The FundApps managed service for Shareholding Disclosure isn’t free. We charge a yearly subscription for it which we believe accurately represents the value it brings to an organisation. Larger, more complex clients pay more, smaller clients pay less. It automates hours of manual work per day and de-risks a highly complex and ever-changing area of compliance.
But a common reaction our sales team hears when giving a price indication to a smaller prospect is “But I could hire somebody for that price”, usually followed by one or many exclamation marks!
In light of the “Great Resignation” and record numbers of people leaving jobs, it seemed opportune to weigh up the pros and cons of hiring people vs automating via software.
1. Salary != Cost
It’s a common fallacy to compare software cost with base salary. Take for example a yearly salary of £50k. On top of this base salary the employer will have to pay national insurance, health insurance, pension contributions etc. So you should add about 25% on to salary to work out a loaded cost.
Once you factor in office space, equipment, bonuses etc. one is probably looking at least 50% of salary in addition, e.g. a fully-loaded cost of £75k+.
Job tenure is decreasing, so over a 5 year period you are probably going to hire for the job twice and with recruitment & training yet more cost is involved.
Hiring one person is never enough. Between holidays and sick leave etc. there always needs to be a second person with strong knowledge of the domain to step in during such times.
Finally, an ultra-competitive job market means that salary increases above inflation will be required to retain top talent.
In summary, over a 5 year period one should probably reckon with 2x the annual base salary of a new hire as the fully-loaded cost. A £50k salary quickly turning into £100k cost.
As mentioned in the introduction, record numbers of people are changing jobs and careers. Purely hoping people will join or stay because of a good salary package will no longer attract or retain the best talent. People want flexibility, they want a company that has a stance on issues such as the environment & society (e.g. B-Corps), they want interesting & challenging work. If a job will largely entail copying and pasting data into Excel and sending emails with Excel attachments, it won’t appeal to many and will become less appealing over time.
In the same way that nobody works as a switchboard operator or a bank teller nowadays, as technology becomes more powerful nobody will want to do a job that can be easily automated.
3. Humans make mistakes
At the risk of stating the obvious, humans are fallible - they get tired, they have hangovers, they lose concentration. Summing up the wrong column, or copying a value into the wrong cell could result in an incorrect disclosure being made, or worse still, a required disclosure being missed. The internet is littered with stories of catastrophic errors being manually made in spreadsheets - check out our blog post on Excel not being fit for purpose in compliance.
In an era where we can send robots to Mars and create self-driving cars, there is little sense in making humans do jobs that technology can do better and without mistakes.
In summary, the knee-jerk reaction of “I can hire someone for that” needs to be disassembled:
- People are not as “cheap” as technology when everything is considered
- People will move on, potentially leaving a company with a business continuity risk
- Technology works 24/7, doesn’t require holidays or become ill
People should be doing the high value work and leaving technology to do the heavy lifting - find out how FundApps automates the very complex process of Shareholding Disclosure