CEOs consistently rank workforce issues among their most critical responsibilities. Retention and workforce morale have become direct reflections of CEO effectiveness. In addition, steadily rising benefit costs have captured the attention of every U.S. organization. As a result, major HR investments have become strategic rather than administrative decisions, and are increasingly viewed as sources of competitive advantage (or disadvantage).
Independent research demonstrates that CEO involvement varies according to specific HR investment decisions. CEOs are involved in 90.7% of benefits decisions, 89.6% of insurance purchase decisions, and 75.6% of payroll purchase decisions. Within the HR category, CEOs are most heavily involved in the Final stage of purchase decisions, during which vendors are selected and approved.
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The involvement of the CEO has a positive effect on the purchase of services including HR investments like benefits, payroll and retirement plans. When the CEO is involved in a purchase decision, the likelihood is greatly increased that the organization will forward quickly in the evaluation and adoption process (+92.3%), it will become a priority that others in their organization will give serious consideration to and remove roadblocks in the evaluation process (+91.5%), and ultimately become a reality (+89.4%).
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