Cost/Benefit Analysis Problem
Sanjit needs to make a beneficiary change. He goes to the human resource office to find out how to change his beneficiary. Sanjit speaks with Sally, the HR specialist who gives Sanjit the forms to fill out. Sanjit then completes the forms and returns them to Sally. Sally sends the forms to Santos the benefits specialist. Santos checks that the forms are complete and sends the form via snail mail to SunLife Financial to update Sanjits benefit profile. Note that the form is sent via snail mail because the form is signed by Santos and is considered a legal document.
You watch the process and record the following information:
Sanjit took 10 minutes to complete his task. Sanjit earns $26.00 per hour.
Sally took 5 minutes to complete her task. Sally earns $32.00 per hour.
Santos took 8 minutes to complete his task. Santos earns $28.00 per hour.
The form costs 4 cents, postage is 64 cents and the envelope is 20 cents.
Calculate the costs of the above transaction.
Assume that 30% of employees make a beneficiary change each year. What is the total cost for a small company of 50 employees versus an average sized company of 500 employees versus a large company of 5000 employees?
If you implement an HRIS that has exceptional inscription such that SunLife Financial can accept beneficiary changes via an internet application and all of the steps above can be reduced significantly, by having Sanjit complete the process online, what are the potential savings?