One Small Business Automates Pain-in-the-Neck Paperwork

Dear Readers: This is the first in an occasional series of articles looking at different tools small businesses are using to help automate their administrative and back-office tasks. These aren't the only tools in their field, but an example of what some small firms are doing to make their daily operations run more smoothly.

Sport and Spine, a company offering chiropractic, physical therapy and rehabilitation services, operates seven offices in the Washington area. It has about 50 employees, including part-timers, but started out with just a handful of workers in a Rockville, Md., office in 1994.

About two years ago, Jay Greenstein, who is the company CEO and founder, formed a strategic planning committee with employees to discuss the future of the firm. "One thing that we came up with out of those meetings was about making better employees," he said. "Everyone wanted greater employee engagement, and we all thought we needed to manage our goals more efficiently and do full performance reviews."

The company had used Excel spreadsheets and goal matrices to monitor employee goals "but we found that to be pretty cumbersome," said Greenstein, who answers to the nickname "Dr. Jay." As the company grew and established additional offices, it would host conference calls to discuss the spreadsheets on a regular basis "but we weren't sure who had the most updated copy" and it became really inefficient.

Greenstein said he searched the Internet for a company that made online human resources tools for small firms and eventually came to SuccessFactors of San Mateo, Calif. The company serves clients with as few as six employees as well as larger corporations with thousands of workers, but about 62 percent of its business is with firms with 300 or fewer employees.

After about six months of consideration and deliberations over the investment on Sport and Spine's "very small business budget, we decided to make an investment and rolled it out to every full-time employee," Greenstein said.

The company began using the Web-based tool last year to complete performance reviews and set employee goals. Greenstein said automating the process reduced his time completing the reviews by about 50 percent. It also meant that performance reviews weren't just conducted and put away in a folder somewhere -- now employees could be interactively measured on their goals and other issues outlined in their evaluations throughout the year.

Greenstein said he previously had to open multiple files for multiple clinics in order to evaluate employee goals and determine if they met milestones, but now: "I can go online and look at an individual's progress or how the whole company is doing overall...which is great because I'm kind of a charts and graphs geek."

SuccessFactors generally signs up clients for two- or three-year contracts and charges for the software on a per user basis, with an average per seat cost of about $150, according to Paul Albright, who oversees the small- and medium-sized market for SuccessFactors and is its chief marketing officer. Some customers pay on a monthly basis.

Albright said he recently conducted a demo in McLean, Va., where the head of a small business was looking into the software because he wanted to spend more time outside of the company and "wanted to make sure that his employees' goals were aligned with his goals and that employees' compensation and pay is aligned to properly incentivizing people."

The head of the company's Northeastern sales office, Ashley Brochstein, ran an online demo of the product for me.

The interface looks like an e-mail account. It would probably take about an hour to learn all of its ins and outs. Employees have varying levels of access to employee data and information, all of which is stored on IBM servers in New Jersey.

It has some interesting features, like when a manager writes a performance evaluation she can choose to conduct a "legal scan" of what she's written about her subordinate. Type in "Wanda is an amazing employee, especially for a young manager" and the tool will let you know that an employee's age probably shouldn't be a factor in their evaluation as a manager.

Managers can rate employees on 51 core competencies, including categories like "Internet savvy." The product also includes an online coaching tool to help managers explain in a review why an employee does or does not meet a particular competency.

Brochstein said that some small firms may erroneously set goals for employees that are neither measurable nor attainable and so the program includes a tool that evaluates whether or not a goal is achievable. It also monitors whether certain managers are consistently doling out perfect scores to all of their team members, which skews the rating curve for the rest of the workers.

While the company has clients in a wide array of sectors, Brochstein said it's particularly popular with small non-profits, manufacturers and the financial industry.

Greenstein said he likes it because his outfit -- like many small businesses -- doesn't even have an official HR department. Many typical HR tasks have been assigned to the company's comptroller, while Greenstein and the chief operating officer manage goals and performance evaluations.

SuccessFactors also makes use of its own product, which Albright said, "helps make better managers and improves employee performance."

By Sharon McLoone |  April 21, 2008; 3:30 PM ET
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this info is totally helpful. i look forward to reading other stories in this series. as a small business owner i'm overwhelmed by administrative duties

Posted by: ronnie | April 21, 2008 6:46 PM

Automation is a good way to save money in any business. The computer is allowing us to do it more efficiently and more easily. Web-based solutions are great for all sorts of routine administrative tasks. In addition, web-based CRMs and CMSs allow information to be easily distributed around the company or business. They are also great for interfacing your business with the internet. A solid investment for businesses with the capital.

Alan Bayer

Posted by: Alan Bayer | April 23, 2008 12:14 AM

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