Kronos for Healthcare Customers Achieve Average of Nearly $2m ROI
Reducing nursing overtime, agency fees, and undiscovered payroll error
are main contributors to ROI
CHELMSFORD, Mass. and CONCORD, Mass., Nov. 6, 2006 — Kronos® Incorporated (Nasdaq: KRON) and The Gantry Group, LLC today announced the results of an in-depth ROI benchmarking study titled "Workforce Management Solutions for Hospitals". This study examined the key value drivers and quantified areas of cost savings realized through the implementation of Kronos for Healthcare. It found that healthcare organizations achieve a payback in less than one year, an average of more than $850,000 ROI after only the first year of deployment, and $1.9 million accumulated payback after three years of solution deployment. The study identified reducing nursing overtime, agency fees, and undiscovered payroll error as the key areas driving these savings.
Kronos for Healthcare is a complete workforce management solution that provides healthcare organizations with the tools they need to reduce direct labor costs, increase productivity, and improve employee satisfaction while supporting quality patient care with a quality workforce.
"Today, healthcare organizations face a number of workforce management challenges that can easily compromise quality care and their bottom line. Therefore, ROI is top of mind for healthcare executives when making any IT investment decisions," said Dale Troppito, managing partner at Gantry Group. "Kronos' expertise in helping the healthcare industry overcome workforce management challenges is clearly evidenced in this report. The results that Kronos for Healthcare customers experience demonstrate the value that the workforce management solution delivers and validates that investing in workforce management solutions should be a top priority for healthcare organizations."
Reducing staff overtime
The nursing shortage, coupled with the increased focus on patient/nurse ratios, has caused an increase in the use of overtime among existing staff. While many healthcare organizations believe that overtime is the only answer to their staffing problems, the ROI benchmarking study found that a workforce management solution can provide tools for more effective staff management, thus reducing the dependence on overtime. Kronos for Healthcare helps organizations minimize their use of overtime through increased visibility into labor data, as well as improved workforce scheduling and planning.
Reducing agency fees
In addition to relying on overtime to compensate for the nursing shortage and increase in patient care due to an aging population, healthcare organizations have come to rely on agency staff to cover the resource gap. However, just like the use of overtime, relying too heavily on agency staff causes labor costs to soar. Instead, best practice healthcare organizations are relying on workforce management solutions to ensure they are retaining and most efficiently scheduling existing nurses to reduce reliance on agency use.
Reducing undiscovered payroll error
Healthcare organizations also are achieving ROI through the use of Kronos for Healthcare by reducing undiscovered payroll error. While large overpayments to an employee are typically discovered by the healthcare organization, small overpayments are often missed and can easily add up to a significant percentage of payroll costs. A workforce management solution allows organizations to increase timesheet and payroll accuracy by automating the time and attendance process. This eliminates the undiscovered payroll error problem by removing human errors in data entry and reducing overpayment due to inconsistent interpretations and applications of pay rules.
Beyond ROI
The "Workforce Management Solutions for Hospitals" study also identified several intangible benefits that organizations achieve through the implementation of Kronos for Healthcare. These include increased staff, manager, and nurse productivity as well as improved payroll and timesheet accuracy. These benefits are all due to the fact that Kronos for Healthcare provides an integrated suite of applications — including labor analytics, labor productivity management, staff scheduling, talent management, human resources, payroll, absence management, and time and labor — which allows organizations to most effectively manage their workforce.
"It is gratifying to see that our customers, in collaboration with Kronos' team of healthcare experts, have generated the results documented in this study," said Brian Graves, global practice leader for healthcare at Kronos. "We have been the leader in delivering workforce management solutions that provide significant and quantifiable results for nearly three decades. The benefits highlighted in this study further confirm the impact our solutions deliver."
The Gantry Group, LLC
The Gantry Group is a market analysis firm that uses primary market research to study the impact of technologies across a range of industries. Technology impacts evaluated include ROI/TCO, market need and acceptance, sales strategies and competitive landscape. Through Gantry Group's market intelligence, market research, and ROI/TCO benchmarking service suites, more than 170 client companies have identified, positioned and quantified their value within the marketplace. Additional information about Gantry Group can be found at www.gantrygroup.com.
About Kronos Incorporated
Kronos Incorporated empowers organizations around the world to effectively manage their workforce. At Kronos, we are experts who are solely focused on delivering software and services that enable organizations to reduce costs, increase productivity, improve employee satisfaction, and ultimately enhance the level of service they provide. Kronos serves customers in more than 50 countries through its network of offices, subsidiaries, and distributors. Widely recognized as a market and thought leader in managing the workforce, Kronos has unrivaled reach with more than 30 million people using a Kronos solution every day. Learn more about Kronos at www.kronos.com.
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