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Micah Fairchild The Top Reasons Every Company Needs Time/Attendance Software

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 By Micah Fairchild

Making Time for Time Management Software

The business of managing employee time and attendance has been around for quite some time. Even so, the natural technological progression that many "core" business processes (like payroll systems) have experienced seems to have passed time and attendance by. Indeed, Aberdeen Group's 2010 report The Future of Core HR found that only roughly half of organizations utilize time and attendance software systems. Perhaps the old adage "if it ain't broke don't fix it" is at play, but for whatever reason the adoption of this software is not keeping pace with similarly positioned HR systems.

Organizations that have not adopted this type of software may be wondering what all the fuss is about, given that keeping track of time seems to be widely-regarded as a fairly easy and straightforward process. Indeed, as Gartner's James Holincheck opines, "Historically, time and attendance software was [simply] focused on the time clock and using that to pay people". However, as these solutions have progressed, the newer software systems have moved light-years beyond simple timekeeping. Today, time and attendance technology is focused on:

  • Automating time and expense approval and rule processes;
  • Providing management and compliance data via report generation (often in real-time); and
  • Matching the staffing supply resources you have with the staffing demand that is needed

As Holincheck says, "Now we are looking at an end-to-end solution with more emphasis on scheduling and leave management in addition to time and attendance". Those human resources solutions in turn provide some of the industry's best returns-on-investments and benefits that go far beyond just simple process automation. Here are the top 3 reasons why your organization needs time and attendance software.

Reason # 1 for Time Management Software: Increased Access to Time/Attendance Data

Time and Attendance software solutions greatly increase the level of accessibility for timekeeping data. Traditional timekeeping systems were driven by HR with little regard to the needs of employees or managers. However, as the importance and adoption rate of Employee Self-Service (ESS) and Manager Self-Service (MSS) increases, more and more organizations are utilizing time/attendance data as a conduit for better management decisions. Indeed, by utilizing these systems, managers can access employee data 24/7; view real-time reports on employees nearing overtime or having other attendance issues; and make edits immediately without having to route through Human Resources. This "real-time" deployment is driven by the fact that newer software solutions do not rely on "batch processing", and as such can give managers the exact information exactly when they need it.

Reason # 2 for Time Management Software: Decreased Labor Spend

Regardless of the industry, personnel expenditures make up an ever-increasing slice of the "cost pie". By automating the processes for time and attendance, employers can help drive down some of these costs. For example, employees that are allowed to clock-in even slightly early (also known as "clock-creep") could wind up costing the employer untold sums of money as those extra minutes accrue. In fact, one healthcare company estimated that the simple act of adding software that controls "clock-creep" netted an additional $250K in savings—annually! Indeed, the healthcare industry in particular, with its 24/7 staffing needs and incredible industry/government oversight, is at significant risk for this type of wasteful over-spending. For any industry or organization with a larger percentage of hourly-wage workers though, this is a solution that allows for accurate prediction, and increased success in labor planning and management—often reducing overall labor expenditures by up to 10%. Gartner's Holincheck sums it up best by illuminating the fact that investment in time/attendance software yields returns--saying, "This money [winds up being] well spent".

Reason #3 for Time Management Software: Increased Confidence in Labor Compliance

Finally, automating timekeeping can help with increasing the confidence in how compliant your organization's labor practices are. Keeping up with employee time and attendance is not something that should be taken lightly, especially given that time/attendance issues are some of the most common (and expensive) types of lawsuits brought against employers. For example, Fair Labor Standards Act (FLSA) violations can result in actual damages, liquidated damages, and attorney's fees, as well as civil and criminal penalties (for willful violations). Further, many states have additional statutes, complex "break" times, "grandfather" policies, union rules, etc. that companies must be in compliance with. While Reason #2 highlighted the importance of the "cost factor" of time/attendance software, it should be noted that far and away the most important aspects of timekeeping automation are the editing, reporting, and standardization capabilities for compliance needs that these systems offer.

Bottom-line for Time and Attendance Software

The advances in processes that this type of HR software brings can reduce errors, improve processing time, ease the burden of manual administration, and provide peace of mind by automatically taking care of all wage and hour rules. Further, many organizations are finding that deploying software solutions such as this wind up being only one stop on the road to more effective labor management and improved customer service. For those organizations interested in looking into the different types of time and attendance solutions available, there are several products to choose from depending on organizational needs, budget, and size. For example, software costs and models can run the gamut between Software-as-a-Service (SaaS) solutions (as little as $10/per employee/per month) to client-server applications (licensed on-premises for $100K+). Further delineation of this type of software is found by either selecting a human resource information system (HRIS) that has time/attendance integrated into the package, or opting for a best-of-breed stand-alone product. Still, regardless of the model and method chosen, due diligence should always be exercised in selecting a software vendor; but know this—if you have hourly workers, time and attendance software clearly delivers benefits and payback. End

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For any industry or organization with a larger percentage of hourly-wage workers though, this is a solution that allows for accurate prediction, and increased success in labor planning and management—often reducing overall labor expenditures by up to 10%."


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