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What’s the opportunity cost of doing nothing?

by
MeBeBot
on July 11,2021

There is an adage that’s more applicable now more than ever, “If you aren’t growing, you’re dying.” In today’s fast-paced, global business world (with the COVID19 endemic dramatically accelerating hybrid work schemes and digital transformation), no company can afford to do nothing and simply rest on the status quo. If companies are not transforming both their customer experience and their employee experience, they are laggards and will quickly fall behind the leaders.

For HR, IT and Operations teams, all partnering together to support their employees and internal business needs, there will be no returning to 2019 as normal. The future is here and change is occurring in digital nanoseconds.

Let us look at today’s business and workforce reality. The number of job openings in the US is at 9.2 million, nearly matching the number of 9.3 million unemployed. Turnover and wages are accelerating at a rate not seen in the US for over 20 years. Organizations that cannot change to meet the expectations of the workforce will find themselves losing their best talent and struggle to replace them.

One of the high costs of doing nothing is the cost of employee turnover.

The cost of turnover includes recruiting a replacement, time to ramp up the replacement to full productivity, and other costs such as higher overtime or employee burnout of those that are “filling in” during the recruiting process. Many companies may not understand the full costs of turnover. For example, the cost of replacing an engineer is often 50 percent of the annual salary and benefits, as this role may be hard to fill and demand is high for this type of talent. The costs of replacing an hourly worker can range between 16 to 20 percent of the annual salary and benefits. For an executive role, the cost of turnover can be 200 percent, as specialized leadership talent costs are more expensive (with recruiting fees, signing and retention bonuses, stock incentives, etc.) than the costs of ongoing employee onboarding, training and career development.

Another cost of doing nothing is losing ground to your competition by not investing in digital transformation.

In the recent COVID19 era, research from McKinsey shows that companies that implement bold and comprehensive digital strategies outperform their rivals and benefit from higher revenue and EBIT growth…even after including the cost/investments for digitization.

*The costs of doing nothing are significant. So for 2022 planning, what actions should HR leaders take?

Below are five trends (with suggestions) on actions to take to move forward and save money and time.

1. Implement flexible work schedules and hybrid working.

Office workers sent home for their safety in March of 2020 were nervous at first about working from

home, with new technology and routines, but they learned to like the flexibility. Most did not miss the distractions at work and they recognized that their productivity is up about 20 percent. If employers do not offer remote work or hybrid work options, these employees may leave for employers who offer more flexible workplace options. More significantly, perhaps, employers who embrace hybrid working and redesign their offices for more meeting and training spaces (and fewer office workspaces/cubes) can save an average of $10,000 per home-based worker per year. In this trend, employers that strategically plan to embrace remote and hybrid work will actually save money, even after investing in office and technology upgrades.

2. Address workforce anxiety and concerns for safety

The workforce knows that the COVID19 pandemic has become an endemic, with a new dominant strain emerging one after another. Employee anxiety is at an all-time high. Employers need to help employees with stress first by providing them a safe environment, empathetic managers, flexibility at work (as discussed above), and access to wellbeing benefits. Reducing stress in the workplace, absenteeism, and presenteeism (present but distracted and not productive), can save employers thousands of dollars per worker per year.

3. Adapt to the demands of Generation Z

The oldest Generation Z employees are 24 years old. Later in this decade, Gen Z will comprise 40 percent of the global workforce. They are the first generation to be digitally native, are more racially and ethnically diverse than any other US generation, and are on their way to being better educated. If it takes them more than ten minutes to apply for your jobs online, they will probably not finish the application. They expect answers to their work related questions to be as fast and easy as ordering a product from Amazon or finding an instruction video online. If they have to call and wait for an answer from an HR or IT team member or get a help desk ticket number for a service, they will probably leave your company for a more digitally savvy organization. Intelligent assistants like MeBeBot provide digital natives the answers to their most commonly asked questions as easily as placing an order for a pizza.

4. Enable digital transformation of your business processes

There are many advantages of digital transformation: streamlining and improving the efficiencies of your operations, meeting the expectations of Millennials and Generation Z, and gaining an edge over your competition. Digital transformation is not just buying digital technology for improving customer products and services, it is transforming your whole operations, including IT, HR, and operations. It is knowing how to integrate digital technology to enable artificial intelligence and robots to do what they do best, and people do what they do best, in harmony. As McKinsey has pointed out above, organizations that fail to make these transitions will suffer lower revenue and EBIT growth. HR digital technology investments, according to a 2021 study by The Hackett Group, are growing beyond applicant tracking systems and talent management systems to include chatbots to answer employee onboarding and general questions.

5. Invest in upskilling and reskilling the workforce.

As pointed out above, the cost of turnover is more expensive than recruiting and in a long-term labor shortage, such as in the US, is a necessity. Thankfully, remote and hybrid work makes it easier for employees to clear their schedules to take seminars and online courses. Additionally, since before the pandemic even began, there has been an increasing number of available online certification programs that are free of charge, making upskilling more attainable now than ever. Investing in HR digital technology, such as MeBeBot, is an affordable way to improve your companies speed of response and employee experiences for Generation Z and all of your workers.

MeBeBot’s Intelligent Assistant automates answers to your employees’ FAQs, anytime from anywhere. The solution delivers a 90 percent accuracy rate of answers for our customers and thousands of employees across the globe. Better yet, our intelligent assistant installs in under 30 minutes as an app in Teams or Slack. And, with the addition of push messaging and pulse surveys, your employees will receive consistent communications and their satisfaction and needs can be measured, delivered via a chatbot, in the flow of work to drive immediate usages and adoption. Why wait? MeBeBot is affordable, provides an immediate time to value, and our clients with a $250k to $1M return on investment within a year.

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