Article prepared by:

Manish Nangia

Assistant Professor-FMS

National Institute of Fashion Technology, New Delhi

Research Scholar-Singhania University

Pacheri Bari, Jhunjhunu (Rajasthan)

Employee Relationship Management

Employees are the key to transform a sound business strategy into bottom line results, yet few organizations are able to provide their work force with the tools and information they need to bridge the gap. Employee Relationship Management is a cutting edge, critical business process that enables your employees to do their job better. In other words it is a process used to better manage your relationships with your employees, as well as at the working practices and effectiveness of your workforce. The concept of ERM will be even bigger than the concept of Customer Relationship Management which is prevailing these days because for Customer Relationship Management to be effective, companies need to have motivated and committed employees which is possible with the help of ERM.       According to Kronos, ERM is defined as the technology that delievers streamlined administrative functions to your operations, productivity tools to your managers and communication improvements throughout your enterprise. ERM is the latest concept which focuses on “E” i.e. Employee. To benefit employees, an ERM solution must enable them to work smarter which means providing them information on training, career growth and industry information. ERM must also offer benchmarks on how the employee affects the bottom line i.e. How does his contribution help the company. Companies may choose to deploy an Employee Relationship Management application for a number of reasons. It can be a vague sense of unease that something is wrong with their internal operations like poor internal communication with employees or a blinding sign that something is wrong, such as a public crisis of faith over the company’s integrity or competency. Through the integrated internal systems, ERM allows employees to have necessary information at their fingertips to meet Customer’s needs, while at same time working towards Corporate objectives as well as meeting and managing personal goals.

The ideal ERM should do the following:

1. It should enable employees to understand their role in their organization’s strategy and to focus on critical business objectives.

2. It should provide the necessary tools to enhance communication and align employee performance with business objectives.

3. It must address the needs of every member of workforce from executive team to Managers, Frontline Supervisors to Salaried employees and Hourly workers.

4. It should empower Frontline Managers and Supervisors to understand, measure and improve productivity, even if it enables employees to work smarter and perform better. It has been proved beyond doubt that companies with high employee satisfaction have high customer satisfaction as employees are responsible for customer satisfaction and delight. Improving Employee relationship is a business strategy and a cultural issue and technology can help to automate employees daily tasks as well as improve cross-enterprise communication. For this to happen it is very important to

survey employees for these reasons:

  • To capture employees opinions on issues important to their satisfaction like benefits, policies, management etc.
  • To reduce Turnover Rates as well as the Cost of Recruitment, Hiring, Retaining and Retraining employees
  • To get feedback for increasing the effectiveness of management and various ways to raise the morale of employees.

ERM is based on a sustainable, cost effective and integrated environment for the organization’s workforce. Employers interact with their employees through automated and manual base processes on a daily basis. ERM solutions should be designed in such a way so as to:

i) Improve Employee Retention: Employee attrition results in poor customer service. Having inexperienced employees interact with customers is a huge disservice to those customers and now it is the era of service. If customers will not get excellent service they will move to some other service provider and the whole purpose of business will be lost. So ERM should aim at retaining the employees longer in their organization for better customer satisfaction.

(ii) Improve Revenue and Profits: As employees stay with their company longer, their training costs decrease. Employees that are satisfied with their job and who have long term experience provide customers with the best possible service. Customers will than be more inclined to stay loyal to the company, providing greater profits over time which will result in long term profitability. ERM encompass all human resources solutions that cover the entire employee life cycle from Recruitment to Compensation to Workforce Development to Retirement. ERM provides the ability to ensure that your overall goals cascade down to the organization with actionable objectives and measurable results and it also provides a broad overview of company’s human capital and potential. Typically the benefits of  ERM includes:

1. Better HR management and decision making.

2. Optimised work force with empowered employees.

3. Improved information sharing and visibility.

4. Better business alignment.

5. Reduced costs and greater efficiency.

6. Low cost of retaining employees.

7. More time to concentrate on value added activities.