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Project Management Hrm 520

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According to Kavanagh, Thite, & Johnson (2012), a cost benefit analysis (CBA) is a comparison of the projected costs and benefits associated with a human resource information system (HRIS) investment. There are guidelines to effectively conducting a CBA and if they are followed properly the information obtained to determine its effectiveness will be accurate. The purpose of the CBA is to improve organizational performance and not to purchase hardware or software. The CBA teams should start with an open mind and not with the mindset of fixing a problem. The focus should be on functionality and not the actual products. The benefits should always be examined first before the cost is discussed. The CBA team should also have a working knowledge of the organization’s policies, procedures, and how the company makes to decision to accurately determine the best decision. Develop the most feasible estimate without being idealistic or conventional. The analysis should be separate from the questions of how best to justify a final decision. Payroll can be a demanding and time-consuming task and many businesses have opt to transfer these services to an external payroll service provider to manage and save the company time, cost, and avoid penalties. A CBA should be conducted to determine rather or not a company should replace its internal payroll system with a payroll outsourcing service. Direct Indirect

Revenue Enhancements • Outsourcing payroll services
• Better managed payroll and human resource (HR) functions
• Compensates for the lack of skilled workers • Access new technology to automate payroll and HR functions
• Increased levels of service

Cost Reductions • Reduced cost for payroll management by 15-20% (depending on organizational efficiency level)
• Reduced administrative burden • Higher employee satisfaction
• Reduced turnover rate (employees are less

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