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Improving Payroll Productivity - Doing More with Less

2/26/19 7:00 AM

Many organizations are faced with a “do more with less” mandate, which extends to their staffing. Tight budgets are getting even tighter, and staffing and resources are being impacted, which can affect the retention of administrative personnel. The expectation is that admin teams can still produce the same quality (or better) and the same volume of work with fewer resources. Under these circumstances, payroll is being pushed toward streamlined processes, fewer manual processes, and less data entry — changes that are necessary to accomplish routine activities and crucial if payroll is to contribute to the company’s goals and objectives.

Finding efficiencies in those mandatory payroll processes is the key to uncovering pockets of time that can be repurposed. On average, the weekly payroll cycle takes 1.9 days to process, and the more common biweekly payroll cycle takes 4.6 days.7 In addition to the routine payroll process, most companies will process an off-cycle payment for a variety of reasons, which can add 1.4 days to the payroll week.8 Automating and outsourcing payroll processes can streamline tasks and alleviate staff to focus on more important initiatives.

The responsibility of the admin professional doesn’t end when the payroll checks are cut.

Research and metrics of payroll operations found that:

  • Roughly 1.5 admin staffers are responsible for 1000 employees9
  • On average, for every 100 employees, there are 79 inquiries annually10
  • The average resolution time for a payroll inquiry is 24 to 48 hours11
  • The most common inquiry is related to pay slip questions, at 25%, followed closely by missing pay, at 22%12

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Based on this data, the admin team has little or no time to spare. The challenge becomes how to find time for the extra demands being made of payroll. As business leaders tackle the issue of uncovering more time for the administrative department, they should consider these operational issues:

  • Are there still manual processes that could be automated?
  • Do processes have unnecessary steps due to system limitations?
  • Is data entered in multiple places?
  • Are older systems slowing down the processing time?

According to a CedarCrestone report on the practices of top-performing organizations, more than 80 percent of top performers’ staff have access to self-service administrative applications, such as basic data changes, payroll, and benefits.13 By providing employees with self-service and mobile capabilities for basic tasks that would normally involve an admin professional (e.g., tax changes, direct deposit forms, and address changes), there is less paper and manual data entry for the admin professional. This can significantly reduce the amount of time administrators spend on daily routine tasks, thus freeing up time to focus on projects and other initiatives that help drive business goals.

Outsourcing and streamlining processes help admin professionals do their jobs by reducing manual effort and increasing productivity. For every payroll cycle processed, standard checklists are used, many times on slips of paper or Excel spreadsheets. When these hard-copy pieces of paper or spreadsheets are used, they can be lost and are hard to use when multiple users all need access to process the pay. Using a single-platform solution, admin professionals can utilize native process flows and configurable checklists with audit reporting capability directly in the software. Simplifying day-to-day processing can also help increase job satisfaction and reduce administrative employee turnover and associated costs.

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Sources:

7 Virginia McMorrow, at 19.
8 Ibid.
9 Bloomberg BNA, Payroll Department Benchmarks and Analysis 2015-2016 (2015), at 51.
10 Ibid at 209.
11 Ibid at 188.
12 Virginia McMorrow, at 39.
13 CedarCrestone, The Seven Practices of Top Performing Organizations, Highlights and Recommendations Taken from Cedar-Crestone 2012-2013 HR Systems Survey White Paper (2012), at 7.

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