TWO DIRECT METHODS TO IMPROVE HR EFFICIENCY TODAY.
Since being coined in 1893 by John R. Commons, Human Resource (HR) has evolved to become a vital part of any thriving business. In a bid to ensure that the company succeeds in its growth and development, the HR department is responsible for its workforce’s productivity and contribution to the company. This means on top of traditional roles like recruitment, training, management of employee benefit programmes, processing payroll, and maintaining overall morale; the HR Department has become a core driver in shaping business success.
Optimising your HR operations is not an easy task. The continually evolving business landscape is pushing the boundaries of HR capabilities; HR as a whole finds itself in a position where they need to spend more time enhancing performance and less time on traditional administrative work such as employee record keeping or payroll processing. There are many strategies HR Departments can undertake to achieve excellence. Perhaps the most impactful would be the contributions brought about by payroll outsourcing or the adoption of an all in one Human Resource Management Software (HRMS).
01 Consider outsourcing to a payroll service provider
Of the many benefits that come with outsourcing payroll, specialised expertise would be the most notable. By outsourcing your payroll, it provides HR with the opportunity to save on time and cost as well as navigate delicate cultural, language, and regulation issues. By engaging a third-party payroll vendor, the HR department can significantly reduce risk and labour.
Payroll outsourcing reduces cost and saves time.
Processing payroll in-house is time-consuming. It is delicate work that requires a high level of attention to detail. The stress on workload only rises as the company grows and headcount increases. It is important to remember that payroll is only a subfunction of the HR department and one which is an administrative back-end function. Unlike other strategic functions of HR that can drive business performance such as management of employee benefits, recruitment, and training. Consider the benefits to the business if your HR teams were wholly focussed on these instead of scrutinising considerable amounts of data to avoid miscalculations and errors. It is important to note that the time your department saves by not burdening itself with this duty is reflected in cost savings. So, by outsourcing payroll processing, which includes anything from calculating payroll taxes and statutory filings to handling payroll enquiries and disbursement, you benefit your organisation financially too!
“Human resource isn’t a thing we do. It’s the thing that runs our business.” - Steve Wynn
The ongoing costs of the payroll software, additional headcount required for processing wages, managing paperwork, and tax liabilities can add-up to a considerable sum. So, in addition to saving time-cost, by choosing to outsource your payroll functions to a payroll vendor, you could be generating concrete savings to your bottom line.
All things considered, the actual extent to which payroll outsourcing will assist in reducing your costs depends on your current level of efficiency in administering payroll in-house and of course, the complexity of your payroll.
Payroll service providers can offer you peace-of-mind when it comes to compliance and data security.
Staying up-to-date with complicated compliance regulations is an ever-present and real risk that HR teams face when running payroll operations in-house. Even with the most experienced employees, lapses may occur when your department gets busy. Payroll vendors minimise this risk through a dedicated team of experts that operate under stringent protocols and multi-level cross-checking – a process that is often skipped when managing in-house to save on time.
Another aspect for worry other than compliance would be security. Considered the security of your HR payroll software and data is In an age when data security and personal data protection are at the forefront of conversations it is critical you have the appropriate measures in place to ensure accountability with these matters. You need to consider where your payroll software and data are stored and is this a secure location with ISO certification? Do you have the latest security updates installed and processes in place? In the event of an unfortunate lapse in security or hardware malfunction, the many hours required to recover your data along with the implication of experiencing an extremely sensitive data breach will deal a severe blow to the HR department and your company.
By contrast, when you outsource your payroll to a top payroll outsourcing company, they will offer highly secure payroll solutions. They do this by storing your data on highly secure cloud-based servers that utilise state-of-the-art encryptions that prevent any unauthorised access. Data-loss worries would also be a thing of the past with backups across multiple server locations. This essentially allows the HR department to eliminate the effort and time cost that comes with constant security monitoring and data protection—in short, peace-of-mind with minimal effort.
Still need a reason to outsource your company payroll? Here’s 6 more!
➤ Read 6 Key Reasons to Outsource Your Company Payroll
02 Consider a well-integrated and interconnected Human Resource Management System (HRMS)
There are many reasons why your HR department would want to consider investing in a fully integrated HRMS solution. All-in-one HRMS solutions typically provide a better user experience for all staff (including HR) and swifter access to a broader array of data. According to research conducted by Software Path, it is not surprising that the most popular reason for HR to integrate an HRMS is to increase overall productivity.
Well-integrated HRMS saves time and eliminates potential human errors.
Automating your HR processes helps you save time. Having to manage every HR function efficiently is hard work. Payroll management and processing in particular can be needlessly resource-draining. However, with a well-integrated HRMS, a company with about 100 staff can complete its payroll processing in a day or less. And while some companies may already be using an HRMS to process payroll, it is important to note that the lack of a well-integrated system that automates calculation and combination of data between various HRMS modules could potentially bring about greater potential for errors leading to areas of inefficiencies.
An ideal HRMS would encompass several key modules and automate a swift data-sync process between them. Examples of modules can be: Leaves, Claims, Time and Attendance, Personnel, and Payroll. Remember to review your HR needs and ensure that your HRMS of choice offers a all the required modules. It is important to note that data from different modules are interdependent.
E.g. payroll processing is dependent on accurate claims data to ensure precise disbursement amount.
By utilising a well-integrated solution, you can ensure that that there are no lapses or variances in the records that may lead to inaccurate accounting.
“One machine can do the work of fifty ordinary men. No machine can do the work of one extraordinary man.” – Elbert Hubbard
By choosing your HRMS wisely, you guarantee peace of mind for your HR department and free-up resources to focus on other functions such as improving processes and securing a strong talent pipeline. In the words of Elbert Hubbard, let your extraordinary people do extraordinary work and leave the machine to do the ordinary work.
HRMS simplifies employee services
One of the critical functions of any HR department is employee servicing. The task of supporting employees with basic services such as clarification and generation of essential documents, amongst other things, can be extremely tedious and time-consuming. This becomes exceptionally prevalent for organisations with a massive number of overheads. Needless to say, this causes a drop in the department’s productivity. Top HRMS applications can offer remote access to employees. Some of which even provide mobile solutions which increase accessibility for the modern employee who is always on-the-go. Having such a function provides quick access to general information and documents as well as facilitates an efficient enquiry process without the need to be connected to a physical intranet.
These are just a couple of ways in which you can significantly increase the efficiency of your HR department and begin moving in the direction of HR excellence. However, outsourcing a vital HR function or adopting an HRMS does not come without its challenges. The department may show signs of resistance for fear of their jobs. Decision-makers must provide clear communications on how these new efforts serve to benefit its people. Furthermore, while there is a chance that jobs and positions could be replaced, new positions will always be created to facilitate outsourcing or integration.
Have we provided you with the answers you’re looking for? If we haven’t, we’d very much like to do so. Contact our resident payroll services expert on increasing HR efficiency here!
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