Payroll – Time to change or not?

September 23, 2021
10:10 am

Time to change or not? Or rather to centralise or decentralise Payroll and HR functions is the question!

All businesses from start-up to large enterprises have one thing in common no matter what the core business is; all need to comply with Payroll legislation and some form of Human capital management.

With start-up companies the centralised management of Payroll and HR functions are the most likely option to yield, as it would fall into the lap of the business owner or some close relative of the family. In most cases the topic will end up under some heading on a list of “To Do’s” or “Risks” if it is a successful start-up business.

Therefore any successful start-up should look towards a partner or an extension of the business that can facilitate, manage and guide the business owner on best practices, yet comforting the business owner of not losing control or access to relevant information pertaining the one major cost in their business. Already in these cases a decentralised Payroll and HR function is rearing its head as an alternative in the form of outsourcing. Yes, although it is labelled differently, it is a form of a decentralised Payroll and HR function.

In larger enterprises when economies of scale come to play within a HR and Payroll department, the same discussion point under the mantel of decentralising some HR functions to branches, managers or business unit heads can rear its head. In this scenario the same evidence of outsourcing can be seen, where managers,

administrators or the employees themselves would take up arms to fight the good fight.

Populating the Payroll and HR data source with the relevant information now becomes the responsibility of all stakeholders.

Does it seem possible? Yes, subject to the implementation of fit-for-purpose software, adaptable outsourcing partner and an iron fist when it comes to policies and procedures.

Let’s unpack some of the above:

Implementing “fit-for-purpose” software

When casting your lines for partner, be it as a start-up, or large enterprise it is rare to find a partner that can tick all the boxes:

A Platform available to the business, business units, business partners and most importantly the employee from anywhere, any time.
Application with embedded workflows.
Ability to adapt to different devices.
Integration with 3rd parties.
Simple to use and a direct presentation of required information.
Cost effectiveness, considering architecture and hosting platforms.
Proven track record of implementing decentralised HR and Payroll business process.

Adaptable outsourcing partner that:

Complements business processes, rather than changing it.
Enforces best practice and ensure compliance.
Harnesses efficiencies presented by the application utilised (employee claims, leave requests, performance appraisals etc.)
Does not limit accessibility to information by any stakeholder at any time.
Facilitates workflows initiated within the business from employee to final approval within business partner.
Validates and absorbs information from approved 3rd parties.
Is scalable, and has the ability to hand over decentralised functions back into core business units.

Iron fist to implement policies.

As with any decentralisation of functions, the close monitoring and regulating of accountability vs responsibility must be adhered to. Therefore it is key to any business when embarking on this journey to have proper policies and procedures in place that will hold individuals accountable for their part in the entire process.

Checkpoints:

The Business partner implementing your policies and procedures should have a thorough understanding of business processes and technology utilised.
The ability to monitor and record behaviour aligned with business processes.
Thorough understanding of the software implemented.
Exceptional know-how of technology and alignment of policies to compliment the business processes facilitated by an application.
Access to opinion leaders in industry specifics.

In conclusion, the days of having a centralised installation of an application to process a payroll or managing employee related data is far gone. The era of accessibility to information and contribution to a business process has dawned.Be it a decentralised Payroll and HR function or the outsourcing of administration. Moving closer to initiative data collection and approval frameworks complimented by a collaboration of software platforms and consulting services.

For more information on the above topic, please contact the LabourNet Helpdesk at