We have an HRMS already - why a separate leave management system?

The cost of absence is often misunderstood, seen as immeasurable, or dismissed as a negligible amount. While most other expenses for an organization, including most benefit programs, have clearly defined costs, employee absence is an area that is often not carefully tracked or even when it is, does not easily reveal its full costs. In a simplistic view, absences are sometimes seen as having no extra costs, since they are largely included in payroll expenses. But most managers know that absences do affect an organization’s customer service, staffing, and attainment of production and other business objectives. Otherwise, there would be no need to try to manage them. 

According to the results of a significant study by Mercer-Marsh the total financial impact of employee absences is very significant. Taking into account both direct and indirect costs the total cost of employee absences can cost up to 35% of base payroll. This includes both direct costs like employee pay and indirect costs, like replacement expenses and net lost productivity. Not included in the 35% are the administrative costs related to managing employee absence.

Impact of Employee absences

Absences have three areas of financial impact:

Direct costs: Benefits or wages paid to employees while absent
Indirect costs: Lost productivity or the replacement worker expenses to “cover” absences and minimize loss of productivity, and
Administrative expenses: whether due to internal staffing and overhead, or to vendor services.

With PlanMyLeave HR Staff can have real time information readily available and can utilize their time for strategic HR activities for the organization. Why have a specialized leave management solution? Many companies already may have a enterprise, legacy or homegrown system in place for managing their resources – but these may not be scalable or give real time information when needed most. Even in companies that use an enterprise level HRMS system – the self service dashboard may not be viable due to costs per user. For leave request and approvals many companies still use a manual system of paper requests along with excel to maintain leave balances of employees. Some others use emails – but there is very less visibility and tracking.

Manual leave management tends to be inaccurate, time consuming, paper and people intensive. Managers occupied with people management and production schedules need a quick, accurate and easy way to manage staff leave. PlanMyLeave offers a solution for this challenge. It offers a self service dashboard where employees can request leave and managers can approve or reject based on resource availability and other factors. More importantly, it empowers employees to have transparency into the leave policies of the company that enhances employee motivation and work ethos.

PlanMyLeave is a web-based application and with an app built for smartphones. The mobile interface for the application can give alerts to managers and enable managers be informed in real time about their resource availability. They can also manage leave requests on the go. Having a real-time workforce data can result in savings in many areas and departments across all industries including : Operations Human Resources Payroll Finances Engineering Maintenance A real time look into resource availability and lets the manager plan on where resources need to be shored up.

Non-quantifiable Business Benefits of Absence Management

• Greater employee satisfaction due to employee self-service tools, real-time access to information, and high-quality, timely, equitable administration.
• Reduced employee turnover resulting from the boost in employee satisfaction.
• Curtailing of unexcused absences – once a system is put in place and is visible for management there is an automatic reduction in absences.
• Increased customer satisfaction stemming from the capacity to meet customer needs consistently with a properly staffed and trained workforce.
• Higher revenue resulting from increased customer satisfaction.
• Improved labor negotiation position derived from more accurate and detailed statistics on the workforce’s scheduled and unscheduled absenteeism rates, tardiness, attendance, and leaves of absence.
• Operational process improvement resulting from visibility into the location and magnitude of excessive indirect labor hours, which often point to unproductive activities or process issues
• Better cost accounting and margin analysis resulting from the availability of detailed data on labor hours and expenses — broken down by product, project, customer, work order, and process.

PlanMyLeave is a user friendly web based online leave management system designed for organizations of all sizes. PlanMyLeave offers fully featured flexible multilocation based settings normally found in enterprise class applications at the fraction of the cost and time it would take to implement one.
Posted by Sumathi Umapathy
Friday, 28 Jun 2013

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