The key to a successful outsourcing venture is getting your services tailored to the needs of your company. Every company is unique, and a one size fits all approach can be ineffective. Some companies may prefer to keep their payroll processes in house and require an updated software package– others may benefit more by outsourcing the entire transactional HR and Payroll process. Many will land somewhere in between the two, and thus, the demand for flexibility in an outsourcing partner is crucial, especially when it comes to HR and Payroll. The following subsections can guide you in selecting the level of outsourcing most suitable for your business.
Software as a Service (SaaS)
At the bottom of the scale, SaaS involves a comprehensive cloud-based payroll and HCM (Human Capital Management) functionality. This allows a company to streamline their HR, payroll and accounting services in the cloud whilst using in-house supporting staff to handle all aspects of transactional HR and payroll. SaaS is best suited to companies who are looking to upgrade their software and improve their payroll processing efficiency but are keen to maintain all HR and Payroll operations inhouse.
Payroll Processing (BPO Tier 1)
The next level of outsourcing tasks your chosen partner with the implementation of a new software solutions, and the smooth running of payroll, and the distribution of payroll output. This involves the distribution of files, payments, and reporting to authorities, leaving your HR and payroll team responsible for providing HR and Payroll master data, inputting data, and internal reporting. Your employee Helpdesk would also remain in-house. This level of outsourcing is better suited to companies who are seeking to increase efficiency and accuracy in the payroll process and relieve workload, allowing efforts to be focused on the input and maintenance of master data.
Managed Payroll Services and Travel Expenses (BPO Tier 2)
This level outsources all aspects of an end-to-end payroll process and travel expenses (if applicable). This includes input, processing, output, and employee helpdesk. Your team would be responsible for updating and maintaining employee master data, including new hires, terminations, and salary changes. The is best suited to companies looking to upgrade and streamline their payroll solution as well as outsource the entire payroll process but maintain a small team inhouse to upkeep some of the administrative work.
Comprehensive Outsourcing of HR, Payroll and Travel Expenses (BPO Tier 3)
At the most comprehensive level, your chosen partner would both seamlessly integrate a cloud-based payroll solution and manage all end-to-end transactional HR processes including employee master data, payroll, travel and attendance, benefits processes, and employee helpdesk. This can be hugely beneficial for companies seeking to upgrade their payroll process whilst investing more time and money into new HR strategies such as wellbeing initiatives which are now recognised as a critical part of any HR strategy (source – Pearlfinders)
Transactions as a Service (TaaS)
In contrast with SaaS, TaaS outsources all transactional HR & Payroll Processes whilst maintaining your own HR and Payroll Software in house. Responsibilities of your chosen partner would include gross-to-net payroll processing, reporting and analytics, compliance, and pension and benefit processing. This would be well suited to companies seeking to outsource the transactional processes to a more reliable group of experts in their field, relieving the pressures of employing and recruiting HR and payroll staff in house.
So why not get a HR and Payroll Solution tailored to your needs?
The benefits of outsourcing HR and Payroll are abundant. To name a few, outsourcing will almost always be cheaper once the true cost of keeping your payroll in house is calculated (trust us, it is a lot more than you expect). Moreover, reducing the burden on your staff, which has likely increased significantly since the start of the pandemic, could allow your HR department to put its time to better use, driving key initiatives such as employee wellbeing projects or diversity and inclusion strategies. Not to mention outsourcing can give you and your employees a better experience all around by advancing the software and improving the accuracy of the payroll process and ensuring compliance.
So why not leave the payroll to the experts? And allow an outsourcing partner to do what they do best, whilst you focus on what you do best.