HR Tech Investment Needs Company Buy-In

March 22, 2002 ( - Many companies that sunk large sums into human resources technology haven't yet seen the move pay off because of inefficiencies in their ongoing programs, according to a study by consultant Watson Wyatt.

In order to realize the cost savings they hoped to attain by moving into technology-based service delivery, Wyatt said companies should adopt three “best eHR practices”:

  • having a documented eHR strategy supported by senior management and key stakeholders
  • requiring a sound business case for eHR investments
  • selecting and integrating a mix of HR systems, applications, and sourcing strategies that best fit the organization.

eHR Strategy Pays Off

Only two out of 10 survey respondents reported having a formal eHR strategy, although six out of 10 required a business case for new investments.

The minority of companies with a documented eHR strategy had 28% better HR cost efficiency than companies without a documented strategy. That translated into lower HR costs as a percentage of company revenue. 

Those companies also had a superior staffing ratio (the number of employees each HR staff member supports) – 8% higher than their counterparts.

In addition, high-performing HR organizations reported a 30% increase in time devoted to direct support of company goals.  They noted a 15% decrease in administrative time spent providing information and conducting transactions for employees and managers.

Overall, the survey found that the Web continues to be the dominant platform for employee HR self service.

New Tool

Using the data from the 2002 eHR Survey, Watson Wyatt built a Web-based tool to identify the eHR practices that the company says should benefit HR performance and boost employee satisfaction levels. The free tool is at:

Watson Wyatt’s 2002 eHR survey was based on responses from 649 companies. 

To read more about the study, go to: