With the UK economic slowdown gathering pace, the topic of saving and surviving the downturn is still a prevalent issue for many businesses. Companies are inevitably focusing their efforts on cost-cutting measures, but one significant cost that is often overlooked is staff absence.

Staff absence is a costly business which can spiral out of control if left untouched. Last year alone, UK employers lost around £13.2bn through employee absenteeism, according to the Confederation of British Industry.

The cost of absence is not solely restricted to the absent individual. It has a much wider impact on the organisation through the indirect costs associated with arranging overtime and temporary cover, lost management time, reduced productivity and potential loss of client-customer service relationships.

The huge cost of absence to the economy shows why so many chief executives declare that their people are their most important asset. But, despite this, many companies still don't have the efficient technology in place to accurately monitor their employees, resulting in a lack of data on the direct and indirect costs associated with absenteeism.

Time management systems (TMS) have advanced considerably over the past decade and are now key management tools for companies to manage the growing problem of absenteeism. Centralising and automating a workforce management solution relieves managers from the burden of error-prone manual timekeeping and allows the employer to view absenteeism from a wider perspective.

The software allows organisations to manage, report and analyse even the most complex absences, and provides unprecedented visibility into persistent patterns and trends so that managers can take control over both the direct costs and hidden impacts of absenteeism before they spiral out of control.

By analysing absenteeism data in real-time, employers can identify the problem areas at the earliest opportunity and address them, either by providing additional incentives for employees to show up for work, or by spreading the unpopular shifts among a wider section of the employees.

Effective management of labour scheduling - specifically absences and extended leaves - has a strong impact on employee productivity. The ability of employers to plan ahead for absences, such as holidays and doctors visits, brings benefits not only to the employee taking a leave of absence, but also to those still left on the job. Accurate staffing, coupled with the scheduled support of temporary workers, ensures that workflow and production levels remain consistent when employees are absent for extended periods.

There is no ‘quick win solution' to managing absence, and one size does not fit all. But neither is it impossible to reduce absence nor technically difficult to find the right solutions. Most often what is required is a system of company initiatives, focused primarily on the management handling of absence, linked to a comprehensive workforce management system.

One person absent from work may not create a problem, but several people absent for one or more days can have a significant financial impact to the organisation. To avoid these losses, employers must be proactive in eliminating or reducing this problem.

Of course, staff who are genuinely ill must have time off work, but employers need to address cultural issues within their workplaces. Unscheduled absenteeism is a problem that no organisation can afford to ignore, either from a cost or productivity standpoint. Although not always preventable, absenteeism is something that can be mitigated to a certain degree, and workforce management solutions can definitely help.

The uncertain economy inevitably calls for caution in IT spending but the smarter decision-makers should use it as an opportunity to find new ways to operate more efficiently. With the appropriate solutions in place, businesses can significantly reduce the number of last minute no-shows, improve the work environment for all employees and realise substantial savings through reduced absenteeism and payroll costs.

No one knows the challenges of absence management that face businesses today more than the companies themselves. Labour is often the biggest expenditure for an organisation yet it's often overlooked as a controllable expense. In an increasingly competitive business environment, at a time when organisations are fighting to stay afloat, overlooking absenteeism can be very costly.

Christian Berenger is business development director at Auto Time Solutions. For more information visit www.autotime.co.uk [1]