A new global study from The Workforce Institute at Kronos Incorporated and Coleman Parkes Research found that U.S. businesses waste $88 billion per year on unnecessary administrative work, significantly more than any other country. That equates to an estimated cost of $4,934 per employee, per organization on burdensome tasks that are not directly related to employees’ core job roles.1
The study, "The $88 Billion Question," also found that the Canadian workforce is hindered by complexity, low productivity, and poor-performing technology. The research was conducted by The Workforce Institute at Kronos and Coleman Parkes Research, and included a survey as well as extensive interviews with HR professionals, operations/line of business managers, and employees.
Treating employees as an asset rather than a commodity is essential for true workforce engagement. It's a critical factor in attracting and retaining the best talent possible in a competitive job market. However, manual administrative tasks unrelated to employees' core job roles creates a time-consuming burden can lead to disengagement. Instead, organizations should re-evaluate these processes to empower employees to deliver their best as part of a broader engagement strategy.
- Bridging the engagement gap: Technology can be turned into an advantage, but out-of-date solutions will only add more unnecessary complexity.
- Nearly three-quarters (72 percent) of respondents report that outdated systems/technology are the biggest workforce management challenge.
- Up-to-date workforce management technology would improve employee engagement, according to 75 per cent of all respondents.
- Productivity and employee engagement should go hand-in-hand: Employees see themselves as contributors, not liabilities on a balance street.
- Some organizations may feel as though there is a leadership void, as nearly three out of five respondents (58 percent) believe that the CEO is focused on finances rather than employees.
- Only 34 per cent of HR professionals surveyed rated their people among the top three assets of their organization, despite national discussion about the importance of employee engagement.
- Stuck in the middle: People are torn between meeting customer needs and manager expectations.
- Seventy-three per cent of respondents find it difficult to complete all of their tasks in a typical work day. In fact, 65 per cent of service sector employees, 54 per cent of HR professionals, and 39 per cent of operations/line of business managers say their working life is too complicated.
- Management demands, internal politics, unrealistic workloads, lack of staff availability, and far too many processes create a perfect storm of complexity that detracts from providing high levels of customer service, according to respondents.
- Small changes create big rewards: Reducing just one hour of wasted time per employee adds up to billions of dollars.
- By reducing the burden of admin work by one hour per week, Canadian organizations would save $1,645 per employee, for a total of $29.5 billion annually.
- According to the study, respondents average 3.1 hours per week on administrative tasks unrelated to their core job roles.
- There is a huge demand from employees to reclaim this time, with 54 per cent stating they would do more strategic planning and 62 per cent wanting to put their focus on important tasks, benefiting the growth of the business and the customer's experience.
- Employee motivations are evolving: Monetary rewards are no longer the sole motivator for employees, which is why organizations should focus on communication, collaboration, and culture to keep employees engaged.
- When it comes to reasons to leave their job, compensation is seventh on the list, with respondents stating they are more likely to resign due to lack of focus and direction, no longer feeling valued or understood, and no longer seeing their future in the company.
- Employees who are valued and rewarded will go the extra mile, driving business growth and delivering exceptional customer service.
- Sixty-two per cent admitted that rewards and incentives would likely increase productivity.
- A global economy, a global issue: Canada isn't the only country where organizations are losing tens of billions of dollars per year due to lost productivity. This global study found that lost productivity is costing organizations around the world a combined US$1.6 trillion:
- U.S.: US$687 billion
- China: US$522 billion;
- Germany: US$144.6 billion;
- France: US$79 billion;
- United Kingdom: US$78 billion;
- Australia and New Zealand: US$35 billion;
- Netherlands: US$34 billion;
- Belgium: US$16.5 billion; and
- Mexico: US$2.2 billion.
- Joyce Maroney, director, The Workforce Institute at Kronos
"It's clear that a small thing, such as a single hour wasted, can make a huge difference when multiplied across hundreds or thousands of employees. At the same time, this research shows that the average day is also becoming increasingly complicated for employees, with a large proportion of time being spent managing complexity instead of adding value. This is not how employees want to spend their days. As a society, we've reached an important junction where workforce demographics, working patterns, and employee expectations are changing. Treating people as an asset rather than a commodity is essential to achieving true workforce engagement, which will only further support efforts to attract and retain top talent. Organizations can increase the likelihood of meeting today's challenges through strategic deployment of technology, a clear HR strategy, an appreciation of cultural change, and a focus on employee engagement."
- Ian Parkes, director, Coleman Parkes Research
"Engagement happens from the top down and from the bottom up. Employees need to feel valued to go the extra mile and provide discretionary input, and managers must lead by example to create a culture of communication and collaboration. However, this just isn't possible in many organizations as both employees and managers are faced with increasingly complicated workdays. Technology is essential, but if it is outdated, poorly implemented, or lacks a purpose, it will only add to the complexity. Instead, organizations should focus on technology investments that help everyone focus on, and streamline their core job duties and add value to the company. The burden of unnecessary admin work is costing Canadian organizations a staggering $88 billion per year. Mitigating this brain drain for both employees and managers will help organizations achieve significant savings while at the same time fostering higher levels of employee engagement that further aid efforts to attract and retain the best workforce possible."
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About The Workforce Institute at Kronos
The Workforce Institute provides research and education on critical workplace issues facing organizations around the globe. By bringing together thought leaders, The Workforce Institute is uniquely positioned to empower organizations with the knowledge and information they need to manage their workforce effectively and provide a voice for employees on important workplace issues. A hallmark of The Workforce Institute's research is balancing the needs and desires of diverse employee populations with the needs of organizations. For additional information, visit www.workforceinstitute.org.
About Kronos Incorporated
Kronos is a leading provider of workforce management and human capital management cloud solutions. Kronos industry-centric workforce applications are purpose-built for businesses, healthcare providers, educational institutions, and government agencies of all sizes. Tens of thousands of organizations - including half of the Fortune 1000® – and more than 40 million people in over 100 countries use Kronos every day. Visit www.kronos.ca. Kronos: Workforce Innovation That Works™.
About Coleman Parkes Research
Coleman Parkes Research works interactively with clients to formulate proven strategies to generate market insight based on individual requirements and key hypotheses. From undertaking thought-leadership research for marketing campaigns and analyzing win-loss opportunities to testing product messages and conducting senior executive interview, our in-house team of experts ensures that all clients' research projects are designed and structured to not only gather the right data, but also to generate valuable insights that question the "so what" and drive effective business growth.
The Workforce Institute at Kronos commissioned Coleman Parkes Research to investigate the current level of employee engagement in a cross-section of Canadian companies and the impact engagement can have on business success. In 2016, Coleman Parkes conducted 106 online surveys and detailed interviews with HR professionals (35), Operations/Line of Business managers (36) and employees (35) at companies with more than 600 employees in the Retail (21 per cent), Healthcare (21 per cent), Public Sector (20 per cent), Manufacturing (20 per cent), Service (16 per cent), and Transportation and Logistics (3 per cent) verticals. The sample sizes and eventual data set provide a snapshot of views that we believe is representative of midsize to large Canadian organizations as a whole. A similar approach was used for each country included in the study.
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