Elimination of time theft
In the US, The American Payroll Association estimated that time theft - in the form of clocking in for colleagues, tardiness, extended breaks, early departures and employees taking their time to get started after clocking in - costs organisations between 1.5 and 5% of their gross payroll. Implementing technologies such as simple biometric readers to prevent time theft can save significant amounts simply by ensuring that organisations pay employees accurately.
Reduced time-off leakage
Another common issue is employees taking more paid leave than they are allotted. Organisations that track paid time off (PTO) manually may be particularly vulnerable to this type of payroll leakage. Self-service tools for tracking time used can help, while also enabling more efficient communication processes around time-off requests and approvals.
Automate time and attendance processes enable a more strategic approach to scheduling and a significant drop in unplanned overtime. According to Aberdeen Group, automation drives overtime costs down by an average of 19% and unplanned or unbudgeted overtime costs down by 7%. The right functionality can drive a more intentional, strategic approach to overtime right away. For instance, some features can enable managers to call for reinforcements at the touch of a button based on the most valued criteria. They can extend overtime to employees who haven’t reached optimum hours yet or to the least expensive, but most qualified, members of the workforce.
Faster, more accurate retroactive calculations
Ensuring accuracy around complicated calculations like retroactive pay is another way to ensure ROI. The process of correcting payroll errors is, in itself, complex and error-prone. Automating retroactive pay calculations eliminates errors and allows pay corrections to be distributed more quickly and efficiently, resulting in greater accuracy and transparency - along with improved employee satisfaction.
These ROI drivers represent areas where automation will help organisations increase profits, minimise costs, mitigate financial risks and/or reduce attrition. While these savings are not generally included in ROI projections, the impact on the bottom line can be sizeable.
Automating time and attendance shortens the time lag between employees signing in and getting to work. Transitioning from a manual, or partially manual, system to an automated workforce management solution also provides more time for managers and HR to spend on more strategic issues.
Elimination of manual processes
Susceptibility to errors isn’t the only problem with manual processes. In many cases, the data must be rekeyed in multiple systems leading to duplication of effort and lost time. Automation also reduces the need for those entering the data to make judgment calls or round numbers up or down - inconsistencies known to further inflate payroll costs.
Streamlined administrative responsibilities
Automated workforce management tools can be configured to alert managers and payroll staff to anomalies; eliminating the need to sort through all of the data each week or each pay period. Although dozens of pre-configured exceptions based on common concerns and best practices exist, the very definition of what is an anomaly is something that individual organisations can tailor.
Providing transparency around complex pay calculations like overtime and shift premiums allows employees to see for themselves how those calculations were determined. This reduces employee questions while simultaneously boosting morale. Similarly, employee self-service tools allow workers to access their own time-off balances from any web-enabled device.
Greater consistency in payroll processes
An automated approach ensures that policies are enforced uniformly. Not only does this result in lower payroll costs but it also stops employees from playing the system and the perception of preferential treatment due to the inconsistent application of payroll processes from department to department or, even worse, from employee to employee. Preconfigured solutions, based on leading best practices, can take into account the consistencies that will result in the greatest and fastest ROI.