11/10/2018 16:53:23

New Research from Paycor Reveals HR’s Increased Impact on the Bottom Line

CINCINNATI, Oct. 11, 2018 (GLOBE NEWSWIRE) -- Human Capital Management (HCM) company Paycor released “People Management - Perception vs. Reality,” a report that provides data-driven insights from more than 700 CFOs, CEOs and HR Leaders around employee and employment issues small and medium-sized businesses (SMB) face and best practices to overcome these challenges. The report highlights common misperceptions around employee engagement, turnover and compliance in 2019, provides tips and tools that help overcome these challenges to ensure organizations can thrive and, ultimately, describes how this increases HR’s role in and financial impact on the overall business.

Overview of survey findings:

C-Suite Perceptions

The majority of CFOs (61 percent) don’t think HR impacts the bottom line. CFOs say the most important metric is total labor spend, while HR leaders say it’s employee engagement and retention.

To persuade CFOs to invest in employee retention—a focus area that will definitely impact the bottom line—HR needs to tell a different kind of story based in metrics across the entire business. For example, analyzing turnover data across the organization (location, manager, department) to understand what’s working and what isn’t, drilling down into which departments or locations have excessive absenteeism to pinpoint management problems and placing a strong emphasis on the onboarding process to mitigate the 90-day failure rate.

Most SMB organizations (80 percent) say they do not effectively engage their employees, and 72 percent of CEOs agree. Many organizations lack a basic definition of what employee engagement is, what a successful engagement plan looks like and, therefore, also lack ownership and accountability for what is missing.

To get employee engagement the attention it deserves, alignment must come from the top. The best way to do that is with compelling metrics that tie employee engagement to the bottom line. Employee engagement surveys provide valuable information and data to help understand what employees are thinking and feeling, as well as establishing that their input is valued. From there, positive organizational change can be implemented with the feedback received.

Turnover

Forty-three percent of organizations don’t track the costs to recruit, hire and onboard new employees. According to SHRM, the national average cost-to-hire in 2017 was $4,425. An untracked expense of this size can quickly add up, especially for a SMB. 

Determine the true cost of hiring an employee by adding together external and internal recruiting costs, and divide by the number of hires in a given time period. The result is cost per hire.

When it comes to turnover, SMB leadership across the board (CEO, CFO, HR leaders) perceive compensation as the primary driver. However, according to a Gallup poll, employees cite “bad bosses” as the number one reason for quitting, followed by lack of recognition and burnout. In fact, compensation did not appear in the top three reasons employees leave a company.

Some of the most important things HR can do to address the universal problem of poor management include working with business functions to set clear expectations on what the organization values in a leader and how success will be measured, sharing company updates and strategic direction with managers so they can communicate critical updates and show team members how their individual contribution is making an impact and invest in managerial development.

Half of SMBs are not tracking turnover data at all, which means if they have a problem, they may not even know it. Among the half that do track, however, they are just tracking voluntary vs. involuntary turnover, a metric that is only a small piece of the puzzle.

To diagnose the causes of turnover in an organization and work to positively impact the bottom line, many angles must be considered, including measuring turnover rate, grouping turnover rates by segment (pay, length, service), tracking hires and terminations and how they stack up against turnover and analyzing turnover trends to find areas that are improving and declining.

Compliance

Fifty-two percent of SMBs are bogged down with managing the ever-changing compliance landscape. As more state and local laws are being added than ever before, SMBs simply don’t possess the in-house expertise to keep up with the shifting policies. As a result, countless hours are spent lost in a web of compliance practice uncertainty.

The most effective way to manage compliance is to find the right HR partner who can focus on the details. Five ways the organization will benefit from this partnership include recruiting and hiring, employees and litigation, wage violations, proper training and ongoing education and certification tracking.

To access the full survey report and learn more about how to combat these challenges, please visit: https://hrcoe.paycor.com/hrcoe-guides/2019-report-people-management-perception-vs-reality?utm_source=dynamic&utm_medium=press_release&utm_campaign=2019-report-people-management

Paycor is a HR, HCM and payroll provider, focusing on delivering technology plus expertise to small and medium-sized businesses. The platform modernizes practically every aspect of people management, from the way organizations recruit, onboard and develop people to the way they are paid, retained and build a company culture.

Survey Methodology and Participant Demographics

The “2019 Report: People Management - Perception vs. Reality,” conducted by Concentrix, a global leader in customer management, and commissioned by Paycor, was conducted in late 2018. A total of 700 respondents across the United States, who work at small to medium-sized businesses, completed the survey, which consisted of an 11-minute online questionnaire. Participants include CEOs, CFOs and HR directors, and represented a wide range of industry verticals. 

Supporting Quotes:

“When it comes to key business issues of employee engagement, turnover and compliance, this research proves that there is a disconnect between what business leaders perceive is happening and why, and what is actually taking place and how to solve it,” said Stacey Browning, President of Paycor. “However, there is one common thread that is always on the frontlines with the ammunition to provide a solution when these problems rear their ugly heads - the HR department. It’s clear that HR impacts every aspect of the business and, as such, impacts the bottom line - more now than ever before.”

Supporting Resources

Paycor Center of Excellence

  • Paycor Website

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  • About Paycor

    More than 30,000 medium-sized and small businesses trust Paycor to help them manage their most valuable asset—their people. Paycor is known for delivering modern, intuitive recruiting, HR and payroll solutions, but what makes us legendary is our singular focus on helping business leaders, entrepreneurs, and HR professionals make a real difference in their organizations. Paycor’s personalized support and user-friendly, scalable technology streamlines every aspect of people management, giving our clients the peace of mind to focus on what they know best, their business and their mission. To learn how Paycor can help you make a difference, visit https://www.paycor.com.

    About Concentrix

    Concentrix, a wholly-owned subsidiary of SYNNEX Corporation (NYSE: SNX), is a technology-enabled global business services company specializing in customer engagement and improving business performance for some of the world’s best brands. Every day, from more than 40 countries and across 6 continents, our staff delivers next generation customer experience and helps companies better connect with their customers. We create better business outcomes and help differentiate our clients through technology, design, data, process, and people. Concentrix provides services to clients in ten industry verticals: automotive; banking and financial services; insurance; healthcare; technology; consumer electronics; media and communications; retail and e-commerce; travel and transportation. We are Different by Design. Visit www.concentrix.com to learn more.

    FOR MORE INFORMATION

    Katy Bunn

    Kbunn@paycor.com

    (513) 307-6392

    MEDIA CONTACT

    Marta Debski

    paycor@offleashpr.com

    (810) 956-4501

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