When one thinks of the phrase “payroll management system”, the image that is typically conjured is one of incredibly complex data sets, endless spreadsheets, and legions of encoders. This intimidating image can give the impression that payroll management systems are only fit for big, multinational companies with hundreds of employees.
However, the truth is that small to medium enterprises (SMEs) still stand to benefit greatly from payroll systems. After all, keeping track of employee pay, bonuses, tax, MPF contributions, final payment, and the like are a crucial part of any business, no matter the size.
Below are just some of the many ways an efficient payroll management system can benefit SMEs.
It helps a company become more flexible
The COVID-19 pandemic has shown the world just how important flexibility in business really is. Businesses in some sectors such as restaurants and travel had to massively scale down or even shut down entirely. On the other hand, you had businesses providing essential services who had to massively scale up almost overnight. The determining factor for success here was how flexible they could be in responding to drastically changing circumstances.
Businesses must remember that payroll is much more than simply signing a few checks. More than just the world’s changing circumstances, businesses need to realize the situation of every employee is different.
The data kept in payroll management systems can provide crucial insights to where a business is headed or how a situation is affecting day-to-day operations. Having data stored in a central location and easily accessible allows businesses to flexibly respond to situations, based on real-time insights. For example, managers can easily monitor team working hours, leaves, and manage holidays with just a few clicks. They can even be notified if there has been a drastic increase in the number of leave requests and start investigating why. Right then and there, business leaders can allocate time and resources much more efficiently and respond to things as they unfold.
Ensuring compliance becomes a lot easier
Clear and concise employee policies can save businesses a lot of time and money down the line. Having clear policies on paid time off, leaves, and progressive discipline can clear up any confusion and prevent lawsuits. Similarly, adherence to laws on tax contributions ensures seamless business operations later on.
Payroll systems such as Workstem are designed are designed to guarantee compliance and protect entitlements . Not only does it track the details of employee leaves and paid time off, but Workstem also comes with tax returns, detailed payslips, and real time MPF contributions. Thus, enterprises are free to focus on sales, product development and other businesses.
Reduced human error
Even the best accountants are only human, leaving the possibility of a mistake. Whether it’s a misplaced decimal or a wrongly labelled contribution, these mistakes can end up costing businesses a ton of money.
Automated payroll software reduces the need for manual data capture, calculations, reporting, and/or returns. With the click of a button, what would have taken a team hours of work is now resolved in a matter of seconds.
Better data storage on the cloud
Data is among a businesses most key resources. It’s how businesses keep tabs on what their clients are doing, what they prefer, how they interact with their business, and much more. This is what makes data loss so crippling for a business—it costs a business about $141 (USD) for each lost data record.
Payroll software secures data by putting it on the cloud, a solution that also lets users access it from multiple devices at different locations. Never again will a manager have to worry about accidentally deleting employee files or leave records getting corrupted when a work PC catches a virus.
In conclusion, although there is no cheap payroll management software the purchase will definitely pay for itself in the long run. In many ways, the ability of payroll to preempt problems and smoothen transactions with employees will turn payroll from a useful to a full-fledged business partner.
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