Studies have found that the total cost of ownership of payroll and other aspects of human resources management can total up to $2,500, per employee, annually. This can take a chunk out of even the deepest bottom line. Optimizing spend in this area is vital to long-term longevity and prosperity— as is ensuring you don’t get waylaid by common misconceptions.
It is not uncommon for business managers to be misled by certain beliefs that they think help preserve profit, but in reality, negatively impact the bottom line.
Let’s look at some of the common myths concerning payroll and HR management.
Myth 1: Keeping Payroll In-House Costs Less in the Long Run
Larger companies may maintain and administer payroll in-house in an effort to save money. In reality, keeping payroll in-house can cost at least 18% more than outsourcing this and other HR functions.
The greatest savings are found when multiple HR functions are outsourced to a single vendor. Companies that outsource to one vendor can potentially achieve nearly 30% in total savings.
Myth 2: We Use the Latest Technology, So We’re Saving $$$
Don’t be too quick to assume that just because your business has implemented the latest payroll technology or software innovations you have automatically cut costs. Flashy technologies alone rarely produce a significant change in the bottom line, and can even increase your costs if you aren’t careful.
The most important thing is to make sure that your business processes and your software align.
Jumping too quickly into the latest and greatest solution, while overlooking the need for seamless interconnection can cause duplication of time, overlap in processes, and ultimately cost more to maintain.
Myth 3: Applying Employee Self-Service Functionalities Will Cost Too Much
Facilitating employee self-service solutions (ESS) via online hubs or systems can significantly reduce time invested in various tasks typically managed by HR teams—and ultimately cut costs at a significant rate.
ESS solutions can help to:
- Eliminate time-consuming manual tasks
- Improve employee morale
- Allow HR teams to focus more on the strategic aspects of their jobs
- Enable employees to complete onboarding information and filing online, apply for benefits during open enrollment, update personal information 24/7 with a few clicks, and more
- Eliminate document redundancy
- Improve accuracy of personnel records
- Securely organize all information in one place
From basic payroll processing and electronic tax filing, to a full portfolio of human capital management services, Sheakley can be your one-stop-shop for everything needed to enhance your business’ human resource management, all while managing costs and maintaining compliance. Contact us today and let us help ensure you are getting the most out of your HR budget.