We live in an era defined by productivity and efficiency. The more streamlined your business process is, the more successful you will be. This applies to every area of business, from marketing to management, sales to customer service.
It also can have a huge impact on your accounting and your payroll, in particular. If you can simplify your payroll process, it can clean up errors, decrease workloads, and free your employees to focus on other tasks. It can also make managing payroll easy for employers and employees alike.
With that in mind, here are several tips that you can utilize to reduce the complexity and boost the efficiency of your payroll process.
1. Try Using Cutting-Edge Payroll Software
Many automated payroll solutions can feel vast, overwhelming, and far too big for many smaller enterprises. Even if you run a startup, though, there are still versions of payroll software for a small business.
These have become more and more capable and able to handle individual nuances and needs over time. This gives even the smallest business a comprehensive, user-friendly solution that can automate and simplify a variety of different activities. For example, you can use small business payroll software to:
- Keep all of your payroll activities in one app-driven location.
- Access a cloud-based payroll program regardless of if you’re working remotely or in-office.
- Automate the calculation and filing of payroll taxes.
- Give your employees an easy way to access their payment information.
If you opt for a small business platform, you can also assume that the program will be affordable. This can often not only streamline your payroll but reduce the time and cost of running that payroll each cycle.
2. Sync Up Your Payment Cycles
The modern workforce is fragmented in so many ways. Employees work both onsite and from home. There is a smattering of full-time and part-time positions at every company. Freelancers and contractors add an hourly, non-employee factor into the mix.
This smorgasbord of work styles can lead to a headache when it comes to payment cycles. An hourly worker might be paid every week. A salaried employee could get a monthly paycheck. Meanwhile, a part-time employee could get paid bi-weekly.
It’s important to resist the tendency for this to bog down your accounting department. Instead, create a solid payment schedule that syncs up all of your payroll events as closely as possible. Then make sure to update that schedule on a regular basis.
If you’re using a software solution, you may even be able to take this option to the next level. For instance, small business payroll solution Gusto offers a “Cashout” option through their app.
When an employee logs into the payroll application, they can see how much money they’ve earned up to that point in the pay cycle. If they find that they’re strapped for cash, they can opt to cash out their current funds, even if it’s between paydays. The money is then removed from their subsequent paycheck without fees or interest added.
This isn’t just good for employees. It also removes the need to consider and process advances on a paycheck. Instead, employers can leave the activity for the app to address.
3. Outsource Your Accounting Activities
If you find that you don’t even want to go as simple as a comprehensive software solution, you may want to outsource your payroll activities entirely. This has many advantages.
For instance, if you farm out your accounting activity, it can reduce the overhead involved in operating in-house. This saves you both time and money and frees up precious resources to be reallocated elsewhere. It can also lower your liability and shift risk onto another party.
That said, there are also several downsides to outsourcing your accounting. For instance, it opens up security concerns as you’re forced to trust another entity with your company’s valuable information.
In addition, while there are initial savings, there are often hidden costs and fees that can add up over time. Perhaps the biggest downside, though, is that you lose the ability to control your payroll on your terms. You become dependent on another entity that may or may not match your company’s efficacy, integrity, and work ethic.
4. Set Up Direct Deposit and Go Paperless
If you decide that a software solution and outsourcing aren’t for you, you can still simplify things in smaller ways. One of the easiest of these is to set up direct deposit for your employees.
This reduces the amount of work that goes into printing traditional paychecks. Both employer and employee can have more time as money is automatically tallied and deposited from one bank account to another.
If you find that direct deposit helps your situation, you may want to go further by adopting a paperless payroll model. From communication to timesheets, taxes to reports, the more information you can digitize the better. This not only streamlines your payroll process; going paperless also saves company resources and is good for the environment.
5. Keep Your Records Organized and Centralized
Whether you’re using a comprehensive payroll solution, individual paperless tools, or even a third-party service provider, always make sure to stay organized. Organization is a key factor in your company’s payroll efficiency.
Try to keep all of the information associated with your payroll in one, central location. In addition, religiously update your information and standardize your record-keeping. The more predictable your accounting system is, the easier it will be to do payroll.
From payroll solutions to syncing up payment cycles and beyond, there are many ways to simplify your payroll process. Each of the above suggestions tends to focus on different kinds of business models.
So start by considering which kind of payroll process you want to run. Do you want to be hands-off? Intimately involved? Somewhere in between? From there, choose a solution that can help you organize and streamline your payroll activity in the name of greater productivity.