The Positive ROI of a Turn-Key Intranet
A turn-key, web-based intranet offers a variety of benefits that can positively impact your employees and entire organization. The return on investment can be significant, involving areas such as productivity, training/hiring, software/hardware, technical resources and employment engagement. There are also intangible benefits like lower employee stress and higher customer satisfaction. Best of all, a turn-key intranet can be implemented in as little as one month and start paying off immediately.
Improvement on Productivity
An intranet can help employees save a tremendous amount of time on everything from finding forms and accessing corporate systems to requesting services and reading company news. For instance, a business with 200 employees making an annual salary of $30,000 can recoup a productivity improvement of $125,000 annually. That’s based on a daily productivity improvement of 10 minutes multiplied by 260 working days (with 60 minutes in an hour).
Savings on Training and Future Hiring
An intranet makes it easy for HR departments to manage training and hiring activities more efficiently. Administrators can save a considerable amount of time managing training courses, assessments and reporting online for current and incoming employees. Conserving just 10 minutes a day can save $130,000 a year for 200 employees working 260 days and earning $15 per hour.
Software and Hardware Costs
Building your own intranet can be costly, depending on the software and hardware you choose. For example, using Microsoft SharePoint to implement an on-premise intranet involves expenses relating to licenses, server software, virus protection hardware and infrastructure. The cost of implementation for a small company with fewer than 10 employees could be as low as $10,000, while a larger enterprise could pay up to $200,000. An Osterman Research study entitled “SharePoint Census 2011: State of the Market,” shows that the average cost to manage SharePoint is $46 per user per month. A fully-functional, browser-based intranet can be implemented for a fraction of the cost.
The cost of managing an in-house employee portal is a key issue for many organizations. Take SharePoint, for instance. Another Osterman Research study, “Managing Growth and Driving Down Costs for Microsoft SharePoint,” indicates that approximately 375 users are supported by each full-time-equivalent SharePoint-focused IT administration staff member. The annual salary for an IT staff member who manages SharePoint application development, content administration and other activities is $100,000. With a user-friendly intranet solution, there is generally no need to hire additional IT staff.
An intranet is the ultimate tool for content management, internal communication and collaboration. Research shows there is a significant correlation between internal communication and employee engagement. In fact, communication drives employee engagement, which can be defined as an employee’s involvement with, commitment to and satisfaction with work. Office workers who are more actively engaged are 43 percent more productive, according to global management consulting firm Hay Group.
Moreover, businesses that engage their workforce have higher earnings per share (EPS). Based on a study by international research and consulting firm Gallup, companies with an average of 9.3 engaged employees for every actively disengaged employee in 2010-2011 experienced 147 percent EPS compared to their competition in 2011-2012.
Impact of Employee Engagement on Performance
A clear work-unit-level relationship exists between employee engagement and a company’s performance. Gallup research reveals that there is a well-established connection between employee engagement and nine performance outcomes, such as profitability, productivity, customer ratings, turnover, absenteeism, safety and quality. The study, “How Employee Engagement Drives Growth,” was conducted across 192 organizations in 49 industries, 34 countries and nearly 1.4 million employees.
Gallup found that work units in the top quartile or group in employee engagement outperformed bottom-quartile units by 10 percent on customer ratings, 22 percent in profitability and 21 percent in productivity. Work units in the top position also saw a reduction in:
- turnover (65 percent in low-turnover organizations and 25 percent in high-turnover organizations)
- safety incidents (48 percent)
- patient safety incidents (41 percent)
- quality defects (41 percent)
- absenteeism (37 percent)
- shrinkage/theft (28 percent)
A turn-key, web-based intranet also allows organizations to minimize downtime and conserve IT resources. Consider these results of the “SharePoint Census 2011” study from Osterman Research: More than 80 percent of organizations using SharePoint experienced unplanned downtime multiple times during the past 12 months, with the majority of them experiencing up to five separate outages. It took an average of 30 minutes or less to restore service, reported the study participants, who represented more than 120 IT executives, managers, and staffers at mid-to-large enterprises.
The downtime was mostly attributed to hardware errors or mistakes made by IT team members. Those problems caused average monthly management costs for SharePoint to double to around $90 per user per month. Almost half (43 percent) of the study respondents pointed to "a lack of administrator skills, training, and knowledge” as an inhibitor to efficiently leveraging SharePoint. A well-designed, web-based intranet comes with the reliable service, security and support you need to keep things running smoothly.
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