Our Blogs Our Blogs
Choose your blog! Choose your blog!




White Paper

Investing in Your Future






A look at the fiscal ramifications of not moving to a modern ERP solution.



When it comes to technology, the cost of not evolving with the times has been well documented. Even so, no matter how well you understand the concepts of opportunity cost and return on investment, the constraints of your budget can make it difficult to invest in change.

Unfortunately, upgrading to a modern ERP solution is just not as simple as snapping your fingers. Money talks, especially in the world of municipal government, where every taxpayer dollar you spend is scrutinized. So what are the monetary factors in play here, and why is this investment critical to your fiscal well-being?

We have spoken to enough municipality CFOs to know that the status quo ERP solution you’ve always relied on has done little to nothing over the past five years to prepare you for ACA compliance.


1. The Affordable Care Act

The ACA is no longer just a whisper of things to come or an ominous concept looming on the horizon. It is your new reality. But what does it mean in terms of dollars and cents? Aside from the direct cost of the health coverage itself, the risk of noncompliance is always looming. Penalties as high as $3,000 per employee are in effect for any failure to meet the “affordable, minimum value” guidelines for offering coverage below the 9.5% costincome threshold.

We have spoken to enough municipality CFOs to know that the status quo ERP solution you’ve always relied on has done little to nothing over the past five years to prepare you for ACA compliance. Chances are, you are manually trying to calculate and report on hours worked in order to keep up with any employee who may or may not be eligible for benefits based on multiple look-back options. Not only is this an inefficient use of your staff’s time, it is also a heavy responsibility to take upon yourself given the financial impact of inaccuracy.

As the law continues to change and reporting becomes even more nuanced, it will no longer be feasible for your ERP solution to do little more than spit out numbers and dump the burden of responsibility on your shoulders. There are better options available right now, options that will give you easy visibility to safe harbor status, look-back measurements from 3-12 months, and offer-of-coverage information with safeguards built-in to avoid potential disaster. What is compliance worth to you?
 
The direct costs are obvious – printing expenses, manual data entry, and an inflated time to productivity for new hires are costing you money with every new employee you bring on board.


2. Hiring and Retention

You many not know it yet, but you are missing out on the opportunity to attract and retain high performers. According to a recent study by the Aberdeen Group, 90% of employees make their decision to stay with an organization in the first six months of employment. This same study identifies onboarding as a crucial piece to improving the new hire experience, with automated solutions identified as a key factor in helping organizations “improve retention rates, improve time to productivity, and improve the company brand.”

There are better options available right now. While branding is not something typically associated with the public sector, your new hires’ experience can play a significant role in attracting new talent and retaining top performers. That same report goes on to identify additional pressures that you face with every onboarded employee, including “eliminating extra costs, facilitating the forms process, and improving customer satisfaction,” which brings us back to the age-old themes of efficiency and workplace culture.

The direct costs are obvious – printing expenses, manual data entry, and an inflated time to productivity for new hires are costing you money with every new employee you bring on board. Are you aware that there are solutions that can help you slash days or even weeks off of the hiring process by facilitating transparency and communication between your candidates, your HR staff, and your hiring managers? Did you know that these same solutions will automatically transfer all demographic and experience data to your ERP when an offer letter is accepted?

Think of the time and money you could save by streamlining the hiring process. Imagine being able to collect new hire paperwork and roll out communications through a secure online portal, instead of presenting your wide-eyed new employees with piles of paperwork on their first day.

When you start to consider the indirect cost of an inefficient hiring and onboarding process, the numbers are eye-opening. You are in direct competition with private companies for the best and brightest talent in your area and the new hire process is the first impression for many of these potential high performers. The average cost to replace an employee is about 38% of the departing employee’s wage. Even with a conservative estimate of a $35,000 base salary, you’re looking at a hit of more than $13,000 every time you fill an open position. Anything you can do to convince your employees to stay by removing obstacles from their first weeks on the job will have a direct impact on your bottom line.

Making the switch to a more efficient hiring solution is your first step to becoming a destination, rather than a fall-back for those candidates who fail to make the cut with their first or second choice. Bureaucratic red tape and outdated internal procedures have been the knock against municipal governments for too long; it is time for you to step out from the shadow of negative perception that continues to hurt your recruitment efforts.
 
The decisions you make are too important to be based on unreliable or inaccurate information.


3. The Paper Shuffle

Managing your budget is all about controlling costs and prioritizing initiatives. When logistical challenges get in the way, you end up spending more than you bargained for just to keep the system afloat. If you’re like the majority of your colleagues, your team is probably still completing expense reports and payroll by hand, relying on unreliable spreadsheets to monitor expenses, and slogging through tedious approval processes and outdated forms for even the most basic requests.

The concept of “going paperless” is nothing new. From an ROI standpoint, it’s easy to add up the cost of supplies and come to the conclusion that the money you’ll save is not enough to justify an investment in change. Factor in the amount of time that your staff could save by automating these manual processes, and the numbers start to tell a different story, but even that is a mere pittance in the context of a bigger picture.

The largest opportunity cost in this situation can be found in the difference between “flying blind” and having 24/7 access to the accurate, real-time information you need to make informed decisions about your finances. If you wanted to run a budget forecast right now, how would you do it? Would you need to export data from multiple systems, bring it all together in an Excel spreadsheet, and hope that there are no open requests that might affect the numbers you’re working with?

It shouldn't be this hard. 

The decisions you make are too important to be based on unreliable or inaccurate information. Invest in your future with a solution that will empower you to lead from the front and keep your finger on the pulse of your entire organization, without all the hassle. The cost of change is always easier to quantify than the cost of staying put. You know better than anyone what your current financial issues are and how your staff’s time is being spent. When you factor in the deeper issues of compliance, retention, and informed decision-making, what once seemed like an insurmountable financial obstacle becomes a viable investment in your future.
 

Follow-Up Resource: Municipality Management Suite 

To learn more about Skyward's commitment to moving municipality management forward, check out our Municipality Management Suite, or contact us today. 


 


 
.  .  .  .  .  .  .

SITE MAP     LATEST NEWS     UPCOMING EVENTS     CAREERS     CONTACT US

K-12    |     Municipalities    |     Support  

Our technology is developed and supported in the USA

PRIVACY POLICY    |     © 1999-2016 SKYWARD, INC. ALL RIGHTS RESERVED