While employee retention and benefits outsourcing continue to be the rage in human resources circles, eHR is also a hot topic.
According to a report on the BenefitNews.com highlighting the research of Forrester (EBN/Forrester Research 2005 Benefits Strategy and Technology Study), nearly one-quarter of companies in a recent survey plan on implementing a benefits portal in the next two years.
Of course the big benefit of HR portals is the big time cost savings on HR administration (i.e. paper pushing). Organizational Diagnostics is a management-consulting firm in California specializing in research in high-tech Silicon Valley companies. Over the past decade, it has conducted research on the effect of employee satisfaction on employee retention.
They conclude that for every two-percent increase in employee satisfaction, there is a one-percent increase in employee retention. Put another way, to the extent that you satisfy your staff with the resources and services they need, you can reduce employee replacement costs.
“Employee self-service has well-proven benefits to business—in particular, better service to employees while cutting down on HR’s workload. And the best way to deliver HR services is through an employee portal that gives workers single sign-on access to all services,” writes Drew Robb in Unifying Your Enterprise.
At IBM, e-HR is saving the company more than $500 million a year – $284 million in e-learning alone. But the benefits are far higher than just mere dollars. Since establishing e-HR, employee satisfaction with human resources has risen from 40% to 90%. The financial impact of such an increase must be immeasurable.
As for the intranet as a whole, IBM has some other very important non-financial metrics of more particular interest to communicators:
- Usage and value: 80% of IBM employees access the intranet daily
- Workforce enablement: 68% view the intranet as crucial to their jobs
- Employee retention: 52% are more satisfied to be an IBM employee because of information obtained on w3
(source: Liam Cleaver, IBM, From Intranet to the On Demand Workplace)
When employees are satisfied, they stay on longer, their productivity rises and training costs fall. The combination of a higher employee job satisfaction rating, along with improved knowledge and experience, leads to better customer service.
Studies show that employees who were highly satisfied with their intranet or corporate portal also had a high level of job satisfaction. Conversely, those who were very dissatisfied with their intranet or corporate portals were much more likely to be dissatisfied with their jobs. Other research has shown that effective internal communications – often the responsibility of HR – is a driver of job satisfaction. Since the portal functions as an online communications tool, it naturally flows that a significant correlation between the effective portal and higher job satisfaction would exist.
Why should this be of note to communicators? Well the intranet is a collaborative business system. In other words, all groups have to partner together to deliver value to the organization and its individual employees. As such, human resources is a natural partner for communications (and often falls under the same department on the organization chart). Communicators should look to HR as allies and partners in achieving mutual goals and outcomes via the intranet. Achieving wins for each will increase the value of both.
