How Employee Relations Technology Can Boost ROI in HR

By Deb Muller, on November 22, 2019

Rome wasn’t built in a day. But perhaps it could have been built in less time, and with less cost, had the issues brewing been visible from the data collected with their employee relations (ER) management software.  

Driven by the #MeToo movement and a growing focus on employee well-being, organizations are taking clear steps to create workplaces where employees feel safe and heard. The Third Annual HR Acuity 2018 Employee Relations Benchmark study found that 41% of enterprise organizations now have required investigation best practices in place, up from 33% in 2017, while 43% expect to increase the number of full-time ER professionals in the next year.

Change is happening, and ER technology is playing a big role. Thirty-eight percent of organizations surveyed already use ER tech, and 44% of those using spreadsheets, document management systems, or not tracking data at all plan to transition to an ER tech solution in the next year. ROI_in_HR-1

Some of the benefits are obvious: When employees feel supported, they’re more empowered to speak up about issues like mental health and workplace harassment, and their voices bring what have traditionally been taboo issues to light. 

But what about from a business perspective? Can the implementation of ER technology save organizations time and money, and help to elevate the function of HR as a strategic business driver? 

To find out -- and help employee relations professionals make better business cases -- HR Acuity commissioned Forrester Consulting to build a Total Economic Impact ® study to measure the impact of the HR Acuity solution. After zeroing in on the financial returns, Forrester found the employee relations management solution generated 520% ROI in three years. 

In this blog, we’ll touch on both the tangible business benefits and the ones that might not be as obvious.

Quantifiable benefits of employee relations technology 

Overall, the Forrester TEI study found that ER technology can reduce risk, improve turnover rates, and improve ER team efficacy, all of which translates into significant cost and resource savings. 

When data is stored in a centralized location, ER professionals spend less time creating manual reports and chasing down information. This frees them up to do the meaningful parts of their job -- analyzing data to understand the underlying cause of issues and coming up with solutions. According to the study, ER teams using the HR Acuity solution saw an increase in efficacy by 20%. Significant time is saved with easy-to-use dashboards, and ER teams are earning a seat at the table with their business stakeholders.

On top of improving workflows within HR, the ER tech boon flows throughout the larger business, stemming from an improved employee experience. Organizations that understand employee problems and can address them create a positive employee experience and see less turnover, and turnover is an expensive problem. Employee Benefits News found that it costs 33% of an employee’s salary to hire a replacement, and that 75% of turnover is preventable. With data-backed insight into the employee experience, companies can make informed decisions and maintain an attractive workplace for employees who’ll want to continue being part of the organization. 

If you haven’t already formed this opinion, now seems like a good time to realize just how powerful data can be for HR. Formal investigation and documentation best practices protect organizations from issues escalating, potential mis-steps in the handling of cases, and “lost” notebooks that could result in millions in litigation expenses. What’s more, data allows ER teams to be proactive when bad behavior patterns are identified, rather than having to react to a major issue when it’s too late. 

The unquantifiable benefits

Becoming the next big headline is every major company’s worst nightmare. Big or small, news travels fast, and no company is safe from the damage of negative public perception. Perhaps the biggest benefit of investing in ER technology is protecting brand reputation. Poor handling of workers’ allegations of discrimination and harassment casts a negative light on any company, resulting in ongoing costs that far outweigh legal and settlement costs.

The impact of happy employees may not be tangible, but it’s certainly felt in organizations who get employee relations right. When people know what to expect and feel confident that their concerns will be heard in a fair and consistent manner, they’re happier in their jobs. Happy employees are engaged employees, and engaged employees are more motivated and more productive. Happy employees are also much more likely to sing their employers’ praises, aiding in recruitment and creating a positive image for the company. 

The benefits of investing in ER tech are paramount to any organization’s success. But it takes money to make money. The costs associated with an ER software solution is usually in the form of an annual fee, while internal labor costs and implementation require time and resources. 

As Forrester found, the ROI far outweighs the up front costs - by 520% in the organizations surveyed.

Still need convincing? To measure the potential economic impact of HR Acuity’s solution on your organization, try our interactive ROI calculator for yourself.

Deb Muller
Deb Muller

Deb Muller is the CEO of HR Acuity, a technology solution that combines documentation, process, and human expertise so organizations can meet the challenge of managing employee relations in the modern world. Be proactive. Manage risk. Create a safer workplace.

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