How Should HR Managers Deal with Occupational Hazards at the Workplace?
What are Occupational Hazards and how they have Manifested in the Industrial Era? By definition, Occupational Hazards are those casualties, injuries, and accidents that involve workers and professionals in the course of their work. As the name implies, these are hazards that are associated with their workplace lives and hence, are sustained in the course […]
Myths about Talent Management
Without doubt talent management is a very useful concept for organizations but unfortunately many of them look upon the former as an overhead rather than a value creating process. This can be attributed to some flaws in the implementation and some myths among HR practitioners regarding the same. In this write up we try to […]
Benefits of Employee Multitasking
Let us go through the benefits of employee multitasking: Employee multitasking is beneficial for organizations as it reduces the cost of hiring new employees and also training them. Hiring is a cumbersome process. Human resource professionals need to be extremely careful while recruiting a new person so that he does not create problems later on. […]
Six Steps for Making a Business Case
Organizations tend to work collectively. Ideas tend to come to individuals within the organization. However, they need to be spread across the organization. Any change only takes place if several people in key positions believe that the idea is good enough. This is where a business case comes in handy. Executives from all departments in […]
Features of Participative Management
Employees have always been bossed around their managers and told what they are supposed to do. They never had the authority to decide things in the company. Gradually, times are changing and employees are encouraged to participate in organization’s decision making process. Management motivates them to come up with ideas and suggestions that can make […]
World over organizations are concerned about the return on investment (ROI) of talent management. Those who are investing money into the same are searching for efficient means to calculate their ROI. This problem is not unique to talent management only; training and development for example suffers from the same drawback to a certain extent.
Fortunately there are software available and in development process for the same. These software’s help you in calculating your returns on investment for talent management. The software’s span the entire talent lifecycle and are built to automate and track the entire activities including the financial inputs and outputs at each stage. The software’s bring together all parts of the talent management system into a single collaborative environment. The environment may be either web based on otherwise, depending upon the vendor.
An alternate way of doing this would be making calculations manually, hectic but worth doing considering the benefits. ROI is the ratio of money gained or lost on money invested into a particular product, process or a project. Typically these calculations are undertaken over a three year period. Here are the steps to be followed.
The very thought of calculating cost for performance management system appears bizarre, especially for organizations that employee a good number of people. But there is a method to it, a poll. Choose a representative number of managers or employees and enquire about the average time they spend on preparing performance appraisals for a given year on one singe employee.
Now multiply each of these averages by the total of employees in your organization and the average salary for these managers and employees. For example if the managers in consideration spend an average of 4 hours on each employee appraisal and the average pay for the managers is $ 30 (let’s say) and your company has 200 employees. Then the total cost would come up as 4 × 200 × 200 i.e. $ 24000.
Similarly now calculate the cost for employees. Assuming if each employee spends 2 hours on the appraisal process for each employee and the average pay per hour is $ 15, than the total cost for appraisals for employees is 2 × 25 × 200 i.e. 10000.
In addition the staff growth per year has also to be accounted. The average time spent by the HR people administering and managing the process also needs to be taken into account. Finally other labor costs like copying, assembling, mailing and printing etc also need to be taken into account. All these costs added make up for the labor costs. Here in our case, if we do not account for the administration and other labor costs the total cost would be $ 34000.
Then the physical costs are accounted. These include the cost of paper, stationary, copier, printer etc. An increase of 2-3 % of these costs should also be taken into consideration. The labor and the physical costs combined make up for the total costs incurred. The costs which become the investment now, divided by the cost of purchase gives us the return on investment.
The return may give different results under different conditions of measurement. Though it is entirely not possible to calculate the return on investment on intangible assets, however an approximation always gives an organization a fair idea of their profitability.
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