Is There a Simple-to-Use, Inexpensive Performance Management Software Solution That’s Less Costly to Use Than Spreadsheets or Document Files? Yes!
Prove it to yourself with our free, easy-to-use SnapEval Return on Investment (ROI) Calculator.
While most large organizations have embraced automated Performance Management solutions, most small and midsize organizations continue to use manual Performance Management processes with spreadsheets or text document files, unaware that inexpensive Performance Management Software exists.
SnapEval is focused on helping these organizations to automate their Performance Management process with an ultra-affordable, simple-to-use solution that’s specifically designed for small and midsize organizations. The free 10-user SnapEval account enables HR Professionals to quickly validate that SnapEval meets their Performance Management requirements and objectives. The free SnapEval ROI Calculator (How to use ROI Calculator video) enables HR Professionals to easily prove to themselves that SnapEval is less costly than spreadsheets and document files for Performance Management for their small or midsize organization.
While spreadsheets and text documents are virtually free, the manual processes to use them for Performance Management require significant time for administration by HR Professionals, and substantial time for data collection and document completion by Managers.
Example Performance Management tasks for HR Professionals include:
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- Manually tracking when each employee is due for a Performance Appraisal
- Generating and sending reminder emails to Managers to create Performance Appraisals
- Manually tabulating Performance Appraisal scores
- Obtaining approval signatures for Performance Appraisals
- Manually collecting and storing completed Performance Appraisal documents
Example Performance Management tasks for Managers include:
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- Manually creating and storing employee performance feedback notes
- Collecting feedback from employees’ peers
- Manually incorporating feedback notes and peer feedback into Performance Appraisals
Since HR Professionals and Managers always have more productive activities than they have time to execute, the time spent by HR Professionals and Managers on these mostly administrative manual tasks is a cost to the organization. At a minimum, the cost is the wages paid to them while performing these tasks. In most cases, it’s the much larger opportunity cost of not working on a more important issue or project.
A common method to determine whether the expense of a new product is a good investment is to identify other costs that will be saved or avoided by using the product. If the cost savings or cost avoidance significantly exceeds the expense of the product, the justification is simple. The expense for the product is an ‘investment’ for the organization and the cost savings or avoidance is the ‘return’ on this investment, or ROI.
While we have a free, easy-to-use SnapEval ROI Calculator for you to download and use with your own organization (so you don’t have to do any math), here’s an example that demonstrates how ROI is calculated:
A SnapEval subscription is $2.25/user/month. An organization with 27 employees pays ($2.25/user/month) x (27 users) = $60.75/month for SnapEval. This is the investment.
Because SnapEval automates many of the administrative tasks for HR Professionals and Managers in the Performance Appraisal process, it saves a total of 0.5 hours/month of HR Professionals’ time and a total of 2.125 hours/month of Managers’ time, which they can use for other productive activities. Using the HR Professional’s hourly wage and Managers’ average hourly wage to convert these times saved to costs saved, the total wage cost savings is $104.37/month. This is the return.
The Return on Investment is [(Total Wage Cost Savings/month)/(SnapEval Subscription Cost/month)] x 100% = [($104.37/month)/($60.75/month)] x 100% = 172% ROI
An ROI of 172% means that for every dollar invested in the SnapEval software, the organization saves $1.72 in wage costs for HR Professionals and Managers.
As illustrated in this simple example, it’s less expensive for the organization to invest in an ultra-affordable SnapEval subscription to automate and simplify the Performance Appraisal process for HR Professionals and Managers than it is to use free spreadsheets or text documents and a fully manual process for annual Performance Appraisals.
If the organization was also planning to implement SnapEval’s inexpensive Performance Management Software with on-going feedback and periodic Manager-Employee Check-in meetings, SnapEval’s automated reminders and simplification of capturing and sharing feedback with employees would yield an even higher ROI to the organization.
The free, easy-to-use SnapEval ROI Calculator enables instant ROI calculations for both Performance Appraisal and Continuous Performance Management activities.
In addition to wage cost savings, the effectiveness of the Performance Management solution can also offer additional significant returns to the organization. Some of these include:
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- Reduction in employee turnover
- Reduction in absenteeism
- Increase in employee engagement that results in higher levels of productivity
While these indirect benefits are both real and important, we’ve focused only on direct wage cost savings and not on these additional factors in our ROI calculation for two reasons:
1. It’s extremely difficult to accurately measure a reduction in turnover or absenteeism, or an increase in productivity and be able to directly attribute it to the effectiveness of an Performance Management solution, particularly in small and midsize organizations. For example, a significant change in overall labor market conditions may have a large positive or negative impact on employee turnover, a large increase in influenza may cause a near-term increase in absenteeism, and employee productivity may be dramatically changed if new automation is introduced into the organization. Small employee population sizes make it especially difficult to statistically isolate outside factors that mask the effectiveness of the Performance Management solution.
2. Because the investment in the ultra-affordable SnapEval Performance Management solution is very small, the direct savings in wage costs for HR Professionals and Managers alone are more than enough to demonstrate a large ROI for small and midsize organizations.
The free, easy-to-use SnapEval ROI Calculator is simply an Excel workbook that uses basic information about your organization and its manual Performance Management process to automatically calculate an ROI for using SnapEval in place of spreadsheets or text documents.
To use the SnapEval ROI Calculator, simply substitute your organization’s values for the default numbers in the ‘ROI Inputs’ worksheet and view the results in the ‘SnapEval ROI Calculation’ worksheet. Note that an estimate is fine for the time required to accomplish each task. Even with estimated values, you’ll be able to quickly see how much can be saved by using SnapEval.
If you have any questions or need help with the SnapEval ROI Calculator, please contact us at Support@SnapEval.com.
Copyright © 2023 SnapEval, LLC.
I’m David Yeaple, VP of Business Development and Product Management at SnapEval, LLC. I’d love to get your feedback about this blog, our solutions, or anything else related to employee performance management. You can reach me at dyeaple@SnapEval.com or +1 585-414-5000.