A FORRESTER TOTAL ECONOMIC IMPACT STUDY The Total Economic ImpactTM Of UKG Pro Workforce Management Cost Savings And Business Benefits Enabled By UKG Pro Workforce Management OCTOBER 2022
“UKG Pro WFM is a much easier system to use for the end user, and that was very important to us […] creating a simpler process and interface for end users compared to the previous environment.” —HR workforce technology director, Bon Secours Mercy Health
3 Key Findings Key Metrics UKG Pro Workforce Management (UKG Pro WFM) is a cloudbased global workforce management solution that offers organizations a unified and configurable platform, with modules to enable important functions such as timekeeping, scheduling, forecasting, compliance, and AI-driven analytics. ROI 169% BENEFITS PV $34.28 million NPV $21.53 million PAYBACK <6 months $28.3M $5.0M $467.0K $545.3K Time savings for managers Improved workforce optimization Back-office efficiencies Technology consolidation cost savings Benefits (Three-Year)
4 Methodology Interviews FINANCIAL MODEL FRAMEWORK Constructed a financial model representative of the interviews using the TEI methodology and risk-adjusted the financial model based on issues and concerns of the interviewees. COMPOSITE ORGANIZATION Designed a composite organization based on characteristics of the interviewees’ organizations. INTERVIEWS Interviewed four representatives at organizations using UKG Pro WFM to obtain data with respect to costs, benefits, and risks. Role Company Industry Size Region HR workforce technology director Bon Secours Mercy Health Healthcare $10 billion 66,000 employees North America General manager, HR operations Super Retail Group Retail $2.4 billion 15,000 employees Australia Global support applications manager Group Bimbo Food manufacturing $785 million 138,000 employees North America (Mexico) Director of payroll N/A Airline $6.1 billion 22,000 employees North America
5 Total Benefits Time savings for managers Improved workforce optimization Back-office efficiencies Technology consolidation cost savings three-year total benefits PV $34.3 million
UKG Pro WFM improves manager self-service (MSS) capabilities and saves time with tasks such as creating weekly schedules and approving PTO and timecards. Managers simplify processes for creating rosters and managing employee schedules by 208 hours per year, equating to time savings for managers of $28.3 million over three years. In prior environments, interviewees struggled with inefficient and highly manual processes to create weekly schedules, approve timecards, and manage shift changes and paid time off. After investing in UKG Pro WFM, interviewees reported an increase in hours saved per pay period due to efficiencies in timekeeping tasks. Annual savings in timekeeping tasks using UKG Pro WFM 208 hours Annual savings of 208 hours on scheduling and timekeeping tasks for managers. three-year benefit PV $28.3 million
“The control of schedules has been very relevant. We have clarity on what schedules each employee is working on, [and] we can [quickly] visualize it in our indicators.” —Global support applications manager, Grupo Bimbo
Improvement in workforce organization of 3%. three-year benefit PV $5.0 million Annual workforce optimization using UKG Pro WFM 3% UKG Pro WFM improves visibility into scheduling data that grants access to customized trends and realtime data to managers. Teams improve workforce allocation by 3% each year, equating to enhanced workforce optimization of $5 million over three years. In prior environments, interviewees had to collect limited data from disparate on-premise systems to inform scheduling and forecasting decisions, which led to overtime and unfilled shifts. After investing in UKG Pro WFM, interviewees reported an increase in data visibility that powers workforce optimization.
“It is the transparency that UKG Pro WFM brings us —to be able to see the detail across our rosters and our brand. What UKG Pro WFM has allowed us to do is actually reshape our workforce [and know] how much labor we need in our store.” —General manager of HR operations, Super Retail Group
Back-office productivity gains for payroll and compliance teams. UKG Pro WFM reduces timecard errors and makes it easier to enter and withdraw compliance information from a single reporting system. Payroll teams experience a 30% productivity improvement and compliance analysts experience an 87.5% increase in reporting productivity, equating to gains of $467,000 over three years. In prior environments, interviewees relied on manual systems that resulted in errors and disputes about pay and required compliance teams to spend considerable amount of time fulfilling requests from legal teams or to build quarterly reports. After investing in UKG Pro WFM, interviewees reported an increase in productivity for payroll and compliance teams. Payroll team productivity gain using UKG Pro WFM Compliance analyst productivity gain using UKG Pro WFM 30% 87.5% three-year benefit PV $467,000
“We’re seeing less errors related to just missing or bad data. It has elevated our ability to audit those timecards more broadly. [The] work has changed, where instead of making these manual edits, [the payroll team is] just doing more audits and checks to make sure that everything is accurate because anything that comes from [the] schedule system is essentially approved.” —Director of payroll, airline
UKG Pro WFM allows organizations to manage capacity as needed, displacing the need for legacy applications and licenses that require physical hardware and ongoing professional services cost. Retiring legacy systems and assets equates to cost savings of $545,000 over three years. In prior environments, interviewees relied on outdated internal and on-premise systems. After investing in UKG Pro WFM, interviewees reported a cost savings as a result of decommissioning servers and licenses. Technology consolidation cost savings. Three-year cost savings migrating from legacy solutions $545K three-year benefit PV $545,300
“We’re able to retire our servers and all that type of thing on both sides of the house, and we’re in the process of archiving those systems as a whole, [which] was a big deal. We’ve also sunset multiple scheduling systems that were used in the past and those have gone away, so we’ve seen cost savings through that as well.” —HR workforce technology director, Bon Secours Mercy Health
Unquantified Benefits And Flexibility Additional benefits that interviewees experienced but were not quantified as well as scenarios in which interviewees might later realize additional business opportunities include: Ability to scale and grow with additional modules within UKG Pro WFM. Improved employee satisfaction. Improved forecasting. Improved ability to meet compliance requirements.
“[With UKG Pro WFM] we moved from [the] early 1990s to the 2020s. That was a significant shift for us. [Employees are now] able to see the shifts, accept or decline [shifts, and] see the roster when it’s published. UKG Pro WFM capability through mobile [allows employees to] see what’s going on, see who they are working with, [and] be more connected to their [colleagues] through UKG Pro WFM.” —General manager of HR operations, Super Retail Group
Appendix A: Total Economic Impact Total Economic Impact is a methodology developed by Forrester Research that enhances a company’s technology decision-making processes and assists vendors in communicating the value proposition of their products and services to clients. The TEI methodology helps companies demonstrate, justify, and realize the tangible value of IT initiatives to both senior management and other key business stakeholders. . Total Economic Impact Approach Benefits represent the value delivered to the business by the product. The TEI methodology places equal weight on the measure of benefits and the measure of costs, allowing for a full examination of the effect of the technology on the entire organization. Costs consider all expenses necessary to deliver the proposed value, or benefits, of the product. The cost category within TEI captures incremental costs over the existing environment for ongoing costs associated with the solution. Flexibilityrepresents the strategic value that can be obtained for some future additional investment building on top of the initial investment already made. Having the ability to capture that benefit has a PV that can be estimated. Risks measure the uncertainty of benefit and cost estimates given: 1) the likelihood that estimates will meet original projections and 2) the likelihood that estimates will be tracked over time. TEI risk factors are based on “triangular distribution.” ! Present value (PV) The present or current value of (discounted) cost and benefit estimates given at an interest rate (the discount rate). The PV of costs and benefits feed into the total NPV of cash flows. Net present value (NPV) The present or current value of (discounted) future net cash flows given an interest rate (the discount rate). A positive project NPV normally indicates that the investment should be made, unless other projects have higher NPVs. Return on investment (ROI) A project’s expected return in percentage terms. ROI is calculated by dividing net benefits (benefits less costs) by costs. Discount rate The interest rate used in cash flow analysis to take into account the time value of money. Organizations typically use discount rates between 8% and 16%. The initial investment column contains costs incurred at “time 0” or at the beginning of month 1 that are not discounted. All other cash flows are discounted using the discount rate at the end of the eighteen-month period. PV calculations are calculated for each total cost and benefit estimate. NPV calculations in the summary tables are the sum of the initial investment and the discounted cash flows in each year. Sums and present value calculations of the Total Benefits, Total Costs, and Cash Flow tables may not exactly add up, as some rounding may occur. Payback period The breakeven point for an investment. This is the point in time at which net benefits (benefits minus costs) equal initial investment or cost.
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