SaaS or a Customized Solution: Which is right for your recognition program?

Agenda... Differences between the two approaches (SaaS and Customized) Goals of recognition programs and how your choice impacts each How the technology choice influences decisions How decisions impact TCO Which is right for your business?

President Emeritus Board Member Executive Committee & Trustee Mike Ryan SVP, Marketing & Strategy Madison Performance Group

4 Our Employee Engagement Solutions: Help Retain Talent Increase Employee Engagement Scores Help adoption of Company Values & Brand Vision Increase Customer Satisfaction Improve Sales Productivity Drive Loyalty What clients gain: Proven configurable technology Unparalleled consultative approach Largest total global rewards offering Proactive and motivating communication strategies 38 years of thought leadership

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Why do some companies use SaaS? Many CFOs have mandated its usage based on... Capital cost assumptions and The “mission critical” qualifier CIOs willing to go along... Don’t want to maintain installed solutions Don’t want to supply staff for support HR team wants... Administrative reliability Audit trail

SaaS vs. a Customized Solution: What’s changed? Customized no longer means “installed” solutions only Web based delivery changes financial comparisons Shifts risk to the vendor In today’s economy employee engagement is increasingly critical

Total Cost of Ownership has shifted In 2006 SaaS was more effective; provided cost savings Hosting and support services impacted 50-85% of TCO The “cloud” has shifted delivery Financial rational for mandating SaaS no longer applies Examination shifts from “operational expenses” to“opportunity costs”

Employee Engagement is “mission critical” Engagement impacts revenues and profits Low engagement leads to business decline Engaged employees are more service oriented Engagement ignites revenue growth and sustains margins

SaaS vs. a Customized Solution: Employees Companies should look at the total rate of return on engagement initiatives SaaS supports basic activities with an eye on administration and tracking But isn't the goal to do more with your recognition assets?

SaaS vs. a Customized Application: Employees Allow companies to deepen the employee connection Critical in a talent-driven economy Social networking functionality The ability to recognize coworker groups Personalize communications Spot trends and track impact Which allows you to Increase relevance and frequency?

Managers drive engagement

SaaS vs. a Customized Solution: Frontline Managers Timely and consistent recognition reinforces the corporate mission Helps employee understand their roles and directs their efforts SaaS makes the process of recognition straight forward A structured approach serves some companies; limits others Do limitations result in missed opportunities ?

SaaS vs. a Customized Application: HR Practitioners Forward thinking organizations recognize their employees on some level HR is being asked to align behaviors with business goals Does your program allow you to redirect resources? CEOs want HR to build adaptable workforces Which system allows you to capitalize quickly and consistently? Are “standardized” reports enough for you and your business?

SaaS vs. a Customized Solution: HR Practitioners 15

SaaS vs. a Customized Solution: Executive sponsors

SaaS vs. a Customized Solution: Executive Sponsors Senior executives demand flawless execution They also expect HR to be more strategic in their roles They want programs to do more: innovation, collaboration, brand alignment The c-suite is less inclined to accept systems that limit the firm’s potential

Summary There are fundamental differences and misperceptions When examining which is right for your business look at all factors The cloud and the reliance on engaged employees has changed TCO How does the size and scope of your organization impact processes? How does it impact usability? And how does usability impact strategic range? Which offers you the best opportunity to serve all stakeholders? Which helps you get and keep a seat at the planning table? Know your options and be prepared to make your argument either way

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Questions? Mike Ryan Senior Vice President Madison Performance Group