Is there a solution for payroll processing KPI worries?

29th February 2016

Ensuring that people have their pay in their bank account on the day that they are due to be paid is the vital payroll processing KPI for any business. Get it wrong and research says that people will become less motivated, less loyal and may end up leaving your business – so if an organisation gets payroll wrong then it has failed. There have been a lot of very good articles recently about benchmarking and KPI management driving progress and change, but is that the answer for hard pressed payroll teams?

Of course internal payroll teams should already be measuring a plethora of procedures and processes linked to their own internal audit and of course for external regulation, and reporting back at the highest level in a business. So the pressure really is on every month for an internal team.

But is there time for KPI measurement and benchmarking, and if the results are aren’t good, have you got the capacity to make the changes needed to improve?

A number of recent articles have suggested measurement is important in the payroll process, and some good research, including some HMRC research in July 2015 gave a view on time, activities and employee involvement. Interestingly, however, in researching the administrative burden the Mori poll for the HMRC concluded that 60% of businesses used an external resource for some of the duties.

Removing the worry

Of course some organisations remove any worry by simply outsourcing the whole payroll process to give them time to receive, understand and act on reports and information, but others want to have more control. The problem with keeping everything in-house is that the onus to analyse management information, make things happen and create necessary change, falls on you. Updating in house software might be the answer, but ultimately teams still have to have the ability to analyse any reports to strategically lead and add to development of the business.

One of the thing I’ve seen more of recently is the request for part managed services. The benefits of having front end software on hand for analysing and reporting in house, whilst removing the grunt of payroll administration externally has become an attractive alternative for companies large and small. And of course because the administration is handled externally the performance indicators are driven by you

And of course a part managed solution releases time for in house teams to spend time with employees who make contact with payroll queries – a core point in my recent blog article  ‘Payroll queries – Who do I talk to?

A Part Managed payroll solution might not be right for everyone but could provide the balance between effective KPI management, time saving and administrative burden.