systematicHR

Guest Author:  Stephen B. Jeong, Ph.D.

Those of you in smaller organizations who have worked in HR/OD for even just a few years are sure to be familiar with organizational surveys. You then also know – depending on the size and complexity of the organization – how costly this effort can be when you hire a vendor to carry this out.  To help control your cost in conducting your employee survey, let me try to separate out the “essentials” from the “non-essentials” or those that can be done at a lower cost.

In just about any survey effort, there are five major steps:  (a) survey questionnaire planning & design, (b) data collection, (c) data analysis, (d) data interpretation, and (e) reporting/results presentation.  Again, if you’re working with a vendor, you’ll need to take into account a sixth, project management fees.  The following table illustrates the average cost proportion breakdown by major phase or step:  (table repeated below due to possible add placement)

Survey step                    Cost proportion (%)     Is the cost justified?

Questionnaire design            15%                                    Yes
Data collection               20%                           No
Data analysis                 15%                            No
Data interpretation         15%                            No
Reporting/presentation         20%                                    Yes
Project management              15%                                    Yes
Total                                      100%

As you can see, vendors typically charge a significant amount for data collection, analysis, and interpretation (typically over 50% of the total cost).  Regarding data collection, technology has come a long way in just the past 5 years such that in many cases, any one of a dozen online survey tool will do the trick; they are secure, flexible, and, most importantly, cost just a fraction of what a vendor will typically charge.

When working with a vendor, one should always request that the obtained data be sent to you in a MS Excel file (for up to 62,000 employees) or a DAT file.  Once received, data can be organized and analyzed by an in-house analysts or statistician using popular statistical packages (e.g., SAS, SPSS).  If an analyst is not available, you can often negotiate the cost of advanced analyses primarily because analytical techniques – e.g., regression, factor analysis, cluster analysis – necessary for most organizational surveys are relatively straight-forward, requiring little actual time.

Finally, accuracy and validity of the interpreted data depend more on the validity of the questionnaire design than on a consultant’s experience or analytical skills.  You know more about your organization than any outside consultant can ever know.  Hence, if possible, use an in-house analyst or statistician.  If not, negotiate with the vendor to around 5% of the total project cost.  Profit margin for data interpretation is high; meaning there’s usually quite a bit of room for negotiations.

Table Repeat:

Survey step                    Cost proportion (%)     Is the cost justified?

Questionnaire design            15%                                     Yes
Data collection                   20%                                   No
Data analysis                        15%                                    No
Data interpretation         15%                                    No
Reporting/presentation      20%                                    Yes
Project management            15%                                     Yes
Total                                            100%

Stephen B. Jeong, is currently the Managing Director of Waypoint People Solutions – www.waypointps.com, a human capital consulting firm that focuses on high precision employee diagnostic surveys using cutting-edge measurement technology and methodologies. He holds Ph.D. in Industrial-Organizational psychology from the Ohio State University and has been advising private, public, and government organizations since 2000.  He can be reached at stephen.jeong@waypointps.com.