Everyone loves an unsuspecting goldmine – and if you’re an outsourced payroll service provider, you might just be sitting on one.
Payroll is often considered a cost centre for accountants, bookkeepers and BPOs, given the manual nature of the processes involved – but in its position as a critical support system for a business, it has the potential to be so much more. Namely, a well-managed and profitable operation that can help to grow your business.
The complexities and inefficiencies of payroll aren’t secrets to anyone in the industry, but these challenges were further highlighted during the pandemic, when a lack of remote access to payroll processes put intense pressure on organisations all around the world. While some solutions have entered the market to assist accountants and bookkeepers in this regard, many businesses still process payroll fairly traditionally, resulting in issues surrounding compliance and, unfortunately, errors.
People are the driving force that carry a business forward, and ensuring they are paid correctly, transparently, and effectively can be challenging for accountants – but absolutely necessary to get right. Investing in tools that help to effectively tackle the end-to-end requirements of payroll and people management might just be the area accounting practices and service providers need to look into in order to better support their clients – and their own businesses.
Why is payroll still so complicated?
Traditional manual systems for payroll processing can be summarised as unproductive at best, and for good reason. Many businesses still operate on systems that aren’t fully integrated, leaving the payroll provider to acquire the relevant timesheet data from their clients via email, which is then manually keyed into the payroll system. Not only is this an inefficient way of working, but it also greatly increases the risk for error in payroll from the get go.
On top of this, service providers need to ensure they keep up to date with local legislations while managing unique employment agreements that are growing increasingly complex, with many individual employee agreements having specific overtime rates and leave entitlements that make the process of calculating timesheet data into payroll difficult, time consuming, and prone to error.
Given this unique set of challenges, implementing an automated and integrated payroll system is critical in order to stay competitive.
How an automated payroll solution can give you a competitive edge
Through our work with outsourced service providers, we are seeing an increasing demand for these businesses to provide more advisory services, in addition to the transactional manual work. Given that payroll might be one of the most tedious and time-consuming processes, having an integrated, automated payroll solution can free up time for businesses to focus on more value-adding processes while still fulfilling their payroll service obligations.
Additionally, with the rise of remote working and the subsequent increase of cross-border payment processing, many payroll providers are experiencing the added pressure of adhering to ever-changing, complex legislations. Fully integrated and automated payroll solutions can play a critical role in safeguarding business from compliance issues, further reducing human error and aiding in organisational efficiency.
While these issues might seem trivial to some, the impact of implementing these changes and automating payroll processes in accounting firms and other payroll providers can make a great difference to a business’s bottom line.
With increased productivity through a reduction of manual tasks, these businesses are free to take on more consulting, business development and human-centric tasks, resulting in a more efficient and profitable business.
By Phil Bernie, founder, KeyPay
