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INTEGRATED ABSENCE MANAGEMENT
The business-school maxim that you can’t manage what you don’t measure is certainly true in the management of employee absence. But there is a corollary – you can’t manage everything. One of the key challenges employers face in effectively managing absence is determining where to focus their limited resources.
So where can employers have the most impact, given that financial and human resources are already constrained? There are two key areas to consider in answering that question: software tools and integrated analytics.
Software Tools
An effective absence management strategy, and the tools that support it, must capture, measure, and illuminate those absences that can be managed. In addition to a more standard approach that addresses scheduled absence, integrated absence management must also address unscheduled absence in a holistic way.
Doing so means extracting disability data, workers’ compensation data, FMLA data, and incidental absence data from their respective silos and managing it in a centralized way. Absence management software tools can assist with that, capturing data about unscheduled absences in real time, just as data for scheduled absence is captured.
And having captured the data in real time, supervisors – who are best situated to deal with absence problems – can use that information to evaluate program performance, to identify trends, and to ensure that policies are being implemented consistently and best practices are being followed, even across a widely distributed organization.
The formula that underlies a truly effective absence management tool is surprisingly simple: provide supervisors with the information they need, when they need it, to make effective decisions regarding their absence programs every day.
Integrated Analytics
To fully understand the true costs of absence, the drivers of those costs, and the impact of absence on productivity, an integrated absence management strategy should include a more deeply analytical component.
Data capture and reporting systems provide a solid foundation for the daily supervisory management of employee absence. But a deeper analytic view offers senior managers the insight they need to make policy changes and program design decisions. Few approaches are more effective at identifying the root causes of absence, the drivers of cost, and the relationships between absence programs than thorough, integrated analysis.
As an example, a Fortune 100 energy company believed it could improve its STD and LTD performance, but managers were unsure about where to target their efforts. Web-based absence reporting indicated that STD utilization was inordinately high, and that was leading to issues in other programs, including LTD.
A deeper study10 of the firm’s experience, including STD, LTD, FML, workers’ compensation, and incidental absence data revealed that, among other things, behavioral health claims were the firm’s third most frequent cause of absence, accounting for more than 12% of disability claims. The impact of behavioral health on disability was somewhat higher than expected, relative to the company’s industry.
The study also indicated that more consistently delivered job accommodation and return to work programs would likely result in significant cost reductions.
Based in part on the insight provided by that analytic perspective, the firm targeted its STD, LTD, and job accommodation programs for enhancement and aggressive management. The results are clear. The firm has realized savings in all three programs, and productivity has improved due to reduced STD utilization. In total, the firm has reduced absence and saved more than $9 million over a three-year period.
This employer is not alone in terms of the interplay between programs that ultimately leads to absence issues. According to one survey, personal illness accounts for only 35% of unscheduled absences, while the other 65% are related to family issues (21%), personal needs (18%), entitlement mentality (14%), and stress (12%).11 Without the ability to consider absence in the broader context of these other issues – including stress and mental health issues – supervisors may never know what is actually driving their absence costs.