Do you know a commodity when you see one?

The reality is that we are in the aggregation of a commodity, and our friends at ADP and Paychex got that train moving a long time ago. Today, no business in America believes that payroll is anything other than a bushel of corn to the HR Services space.
We have to align our industry with that of our customers. Sure, our customers want payroll to be perfect so that they don’t have to actually talk to their employees about their paycheck. That may have been a differentiator before, but now it is an expectation or requirement.

What do our customers value? If you accept that our customers expect, but don’t value, payroll being right or the carrier invoice getting paid then it must be something else. Things like:

Excellent customer service. So when they do call with a problem that needs to be solved, there is a sharp person on the other end of the phone that actually answers and solves the problem in one event.
Advice on real business matters like how the Heath Care Reform Act will impact my business.
New products and services to complement what they buy from you. They love one-stop shopping.
These are business people building their futures and busy people looking for real help and service with a smile for an attractive price.

Consider the flat screen TV for a moment. Did the price go down or up as customers accepted it as the standard? Can we invent 3-D HR? No!

Like it or not, our customers view our traditional product set no different than winter wheat, and they want it better, faster and cheaper. Why do you think QuickBooks bought a payroll company? People want options.

The path to differentiation is right there in front of you, and your clients are telling you what they want. Eventually someone else will provide it to them.

A BPO partner can allow you to take the same resources you have today and focus them on new products, increased customer service and more consultative interactions with paying customers.

You have to view your own service set in a parallel path with your consumer. If importing time sheets and preparing benefit reconciliation is not valued by your client then you should explore ways to lower the cost of that commoditized transaction and focus on being good at what they want.

Companies like ours can bring added process skills to the table (ISO 9001) to ensure that your quality is the same or better. We can bring hard-dollar cost savings to the table, right where your customers demand it and free up your best to be their best.

Come see us at http://www.cognethro.com and see the collaborative business model that we have built for you. We join both worlds, and the intersection is you.

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Disruptive Technology doesn’t have to be expensive to work!

Our team, like you or yours, worked in very large companies and saw millions thrown around into ERP, Data Mart, CRM and about a dozen other acronyms.

Sure, you can buy Siebel from our friends at Oracle to run your sales and customer service divisions for a whole lot of cash, or you can consider Sugar CRM or ZoHo with a 30-day free trial and pay by the month with no IT department following behind.

Each choice comes with a different list of good and bad, but given the price point, the differences in good vs. bad list are shrinking. You can run your General Ledger on Intacct just as well and at considerably less expense than Lawson, if you can put aside the name brand for a moment.

Disruptive technology doesn’t have to be off the shelf, it can be developed to solve a problem you have in common with your competition but owned by you. You can make your processes disruptive and lower price, increase quality and wield it against your nemesis.

Cognet is a provider that can help you disrupt when you consider the following facts:

Our owners and operators have been in your business and have hands-on knowledge of the problems you are trying to solve.
We have a presence in the largest pool of technology talent in the world.
That means that we can apply our understanding of your problem to develop a custom software or technology solution that makes your service model disruptive. We know there are opportunities today in your processes that don’t have an “off-the-shelf” software solution.

Make yourself a disruptive force in your space today by combining process and tools that you won’t find on Google.

Maybe Santa stuffed some BPO advice in your stocking

One of our goals is to educate and improve the HR Services space as a whole. Sure, there are many prospects we talk to who really aren’t prospects, and we admire and accept it. This isn’t for everyone and if you don’t believe in the BPO Santa then we have respect for that decision.

For those that do believe, we offer you a year-end treat, which is honestly our Green Monday offer most of the year.

We also believe in making it possible to explore what BPO can do for you, so here’s how we do it:

Work with us on documenting a single process. We will mutually agree upon a baseline of units, cost and time invested today.
If the numbers and way we do business appeals to you, then do a trial with us for 90 days, which is how long we usually take to get from start to finish on a process successfully.
We charge you by the hour with no set-up fee, so the financial risk is minimal.
If the elves don’t deliver, then you gained some process expertise, and if you ripped that paper off like a dog on a bone, we are happy to work on anything you want at your pace.

Remember, Santa has helpers too, and ours are the best in process, accounting and technology you can find in the HR Services space.

Happy Holidays from Cognet!

Please use the link below or visit our web site at http://www.cognethro.com to view a one-minute example of exactly how BPO can save you money, make your more productive, and let you focus on sales and service.

Your Office Can Be Anywhere in the World

A common next question after the BPO chat is, “How the heck do you do it?”

Unlike the restaurant business where it is all about location, the actual location doesn’t matter in BPO; the location can be anywhere in the world.

So, let’s stick with our crazy and simple ways and consider that in the HR Services industry, a desk with a computer, Internet connection, and access to the systems and tools required to do the job are all you need.

They are the location, no matter where in the world that may be. The location could be an existing employee working from home, an executive at the Starbucks in the airport or even someone 10,000 miles away.

In our Benefits Reconciliation example in the article “BPO for HRO Simplified”, the common requirements to do the job are:

Access to carrier billing and enrollment systems.
Access to a HRMS or payroll system.
Access to any paper records or support to find differences.
A cheap scanner with Excel and Google Chrome on top and you are in business from anywhere in the world.

Think of your BPO as very remote workers.

The key is being realistic about the skill and number of workers at your disposal. Can you find a line of process experts with both accounting and benefit skills in sufficient numbers to get the job done? Will the carriers cut you some slack or take your money?

Where location does matter is where you find a large number of highly educated and skilled workers who have a computer in front of them.

Even better, now you are doing business with a vendor with known economics that lets you get what you pay for, and not worry about overtime or the challenges of employment. You have a contract with agreed upon base line measurements, cost, turnaround time and error rates.

BPOs are experts at finding the right location to hire, train and offer you the best workers for the job, without any of the headache.

They’ve got the location covered. You get to solve your customer’s real problems and help them with the new ones. Not a bad gig.

Simplifying BPO for HRO

Like most things in life and business, we seem to make them much more complex than they are, but the true skill is finding an easy way to explain it to someone.

Everything in a business, specifically for a Human Resource Services company, is a process. We may not have all our processes documented or completely understand each process, but there are people (a.k.a. Process Performers) across departments and all other kinds of space and time who can work together to create an output.

The best way to understand most things, at least for us reformed Finance people, is by using a great example that crosses both Operations and Accounting like the dreaded Benefit Reconciliation.

So, here is how it goes and what BPO can do for you.

Today, your process has five steps:

Get carrier bills and run payroll reports.
Build a recon, probably in Excel, and find differences.
Research those differences and identify adjustments.
Adjust the bills and update the payroll deductions.
Pay the bill on time, correctly, and with adjustments included.
The trick is that these steps can be categorized in two categories:

High value-add with client or employee contact.
Low value-add or transactional and repeatable.
When you do business with an excellent BPO, you own the process. You and the BPO sit down to mutually agree on which of the two categories those five steps belong in. There should be no emotion in the use of high and low, just a realistic understanding of how your client sees them.

So, if we are honest with our collective selves we decide the following:

Gathering invoices, running reports, building Excel models, finding an easy adjustment like a terminated employee, providing adjustments, and changing deductions are seen by your client as a transactional part of your job. Kind of like getting a C on a math exam. These are low value-add.

Talking to your customer about a tricky situation where an employee may have made a bad choice or how you just got them $5,000 back from Aetna is what we would call high value-add.

Without getting fancy and using terms like “swim lane”, we have basically figured out what tasks your BPO should do for you (low) and the ones you should focus your best people on (high). You take the high road, your BPO takes the low road, and all of the sudden you found a way to get to your destination faster and cheaper.

What do you get by doing this? Well, typically we find that you get three things :

Cost savings of about 60 percent on the Benefit Reconciliation process.
Productivity gain of about 20 percent as transactional tasks are at the BPO.
A greater focus on sales and service, not spreadsheets.

This is true of any process, just in different units and flow charts, but the same structure. Learn more at cognethro.com. When you are ready, we will put numbers to this bad boy and set the expectations of what you can expect to the penny and minute.