Building a Business Case to Purchase an HRIS, Part 1
Building a Business Case, Part 1
HR departments in mid-tier organizations are models of versatility. Their responsibilities include everything from answering employee questions about health benefits and vacation time and sorting out the process of employee reviews, to high level long term planning and organization of training, employee retention plans, management development and other important issues that fundamentally affect the productivity and success of the organization.
Most organizations of this size would agree that they would greatly benefit from their HR professionals having the opportunity to focus more of their energies on strategic issues, as is the case in larger organizations. It is no secret that the top-performing companies in the S&P 500 are the ones that have the strongest focus on employee development. However, in reality, the majority of their HR department’s time and resources is consistently taken up with day-to-day tactical issues—up to 5 hours of every eight hour day, some studies suggest.
This four part post will focus on the time and cost savings that can be achieved with the adoption of Ascentis HR. Ascentis HR can net these savings by providing the following benefits:
- Productivity gains resulting through the ease of use of Ascentis HR.
- Cost and time savings occur through the elimination of old or incorrect data and dual data entry.
- Additional productivity gains and cost savings result from freeing up HR staff to focus on employee growth and satisfaction.
Eliminating costly errors.
There are two main culprits when it comes to mistakes in insurance carrier bills. Transcription errors in paperwork are certainly a problem, but a surprisingly large number of errors can be accounted for in the continued payment of premiums associated with terminated employees. This is a situation that could easily be resolved by automating the link between the insurance carrier and HR. It is also important that the payroll and HR systems are fully integrated so that the payroll process automatically highlights any changes. If the HR system is simply providing a data output file that then needs to be uploaded into the payroll system, it presents two problems.
First of all, this is yet another task that needs to be performed by an already busy HR person. Secondly, the payroll manager is going to want to print off and review any changes before adding them to the system, rather than uploading a data file full of unknown and potentially inaccurate information.
Below are examples of real customers (company names withheld) who discovered their insurance carriers’ databases to be seriously out-of-date. These error rates were discovered when the organization electronically transmitted their benefits enrollment data from their HRMS to their benefits carriers.
Situation 1: A company with 130 employees had nine employees with incorrect names/addresses listed on the eligibility roster of their health insurance provider. This is a 6.9% error rate.
Consequence: Significant time wasted on communication between the HR department and benefit insurance group to correct inaccurate information.
Consequence: Some employees were without medical benefits while the issue was being figured out and fixed.
Situation #2: An organization with 110 employees discovered three members were not on the register and nine members were on the register that shouldn’t have been. This is a 10.9% error rate.
Consequence: Overpayment to insurance carriers and a large unnecessary benefits expense.
Consequence: Significant time spent on calls between employees, HR, and insurance carrier to fix situation.
Consequence: Three employees assumed they had medical insurance when they did not.
Ascentis HR’s benefits management tools can greatly reduce these errors. Configurable eligibility rules, automated eligibility calculation, data transmissions directly to the carrier, alerts and reporting that provide at-a-glance changes to eligibility and enrollment situations, are just some of the ways Ascentis HR can reduce errors while decreasing staff workload.
Learn more about Ascentis Benefits Management Carrier Connect by viewing our archived February 2011 Webinar, “Sending Enrollment Data Electronically with Carrier Connect”.