HR tool consolidation—that is, transitioning to tools that encompass multiple HR services—is an effective way to control HR spending without sacrificing your commitment to your employees or adding burdens on your HR team. Historically, the HR toolbox has been filled with countless disparate tools, each with its own credentials, user interface, and price tag. This arrangement might get the job done—but it could be costing your organization more than it should.
Working toward HR tool consolidation can save your organization a lot of money—an especially valuable benefit in uncertain economic times—while simultaneously reducing the mental strain on your HR staff and other employees who use the tools in question. Consolidation helps organizations make the most of their benefits budget, so they can continue to take care of employees and attract top talent.
Here’s a look at why consolidating HR tools is so important right now, how to do it, and how to get even more from your benefits budget by offering stipend reimbursements.
Making the most of a tight budget
Organizations in nearly every industry are facing the challenge of controlling spending right now. These circumstances have led to layoffs and budget cuts for many companies but there’s a line in the sand when it comes to cutting compensation and benefits. Doing so could drive your people away and make it even more challenging to attract candidates—a dangerous move in today’s tight labor market.
In fact, due to steep competition for top talent, many employers are looking for cost-effective ways to increase their benefits and perk offerings. Finding smart ways to maximize the return on your benefits budget while expanding your offerings is not only the key to attracting candidates—it could very well be the key to your organization’s survival.
Fortunately, there are many creative ways to stretch a tight benefits budget while protecting compensation and benefits. One of the most effective strategies, which is currently being used by many companies in an effort to stave off layoffs and other cutbacks, is consolidating HR tools. This move helps cut costs and, in many cases, makes it easier for leaders to plan for the future, by avoiding the pitfall of hiring too far ahead of the curve for business needs that have not yet materialized.
How to consolidate HR tools
It’s become commonplace for HR departments to employ a laundry list of tools to facilitate the wide variety of services offered. An HR professional may have one tool for job applications, one for recruitment marketing, one for payroll, one for HR management, and so on. And on top of that, there are many other HR tools that other employees throughout your organization may use: one for time reporting, one for employee engagement, one for benefits administration, one for learning and development, and more.
Because you pay for each tool separately, the expense of HR tools can skyrocket quickly. On the other hand, tools that combine a range of HR services typically cost less than having a separate tool for each function. Maybe (hopefully) your team has already found tools that consolidate some of these functions. Can you go further?
Streamlining your perks offerings with stipends
In addition to consolidating the tools that support your HR functions, consider streamlining your perks to deliver a more personalized experience. Consolidating individual perk vendors saves you money in the same way HR tool consolidation. Chances are, you may not even realize how much you’re spending on multiple perk vendors (but our calculator can help you find out).
Transitioning to a stipend reimbursement program helps employees pay for the things they need in their lives, whether that’s gas for their commute to the office, wellness expenses for stress management and mental health, or stipends to help pay for vacation travel so they can come back to work rested and refreshed.
The ROI of consolidation
As we’ve mentioned throughout this article, there are loads of benefits to consolidating your HR tools and perks vendors. The most immediate advantage is making your budget go further—a desirable result no matter the size of your current budget or the severity of your economic concerns. HR tool consolidation helps organizations get a better value for their spending and, in many cases, the other benefits consolidation offers can have a positive impact on the employee experience as well, especially for your HR team who uses those tools daily.