Payroll Software Consultants: 3 Productivity Best Practices
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By Dave Foxall
Payroll Software Consultants: Setting Them Up for Success
The introduction of a new payroll software solution involves a number of detailed and specialized tasks; including defining requirements, functional analyses and designs, process optimizations, data conversions, project planning, technical analyses and designs, systems testing, project management, and customizations, and internet enablement. And the fact of the matter is that most organizations lack the time and skills (and sometimes both) to handle these tasks effectively in-house.
A survey conducted by Peerless Media Research Group asked, “When your company purchases software, who do you typically use to integrate the software installation?” Of the respondents, 45% use the services of the software supplier and a further 12% engage an independent software consultancy. So, potentially more than half of organizations are using external help with new software; either for one or more of the discrete project elements mentioned above or for the whole selection and implementation process. Put simply, software consultancy is big business. Seizing upon this trend, in a 2011 report (Transforming HR through Technology) the Society for Human Resource Management (SHRM) identified this skill shortage as a critical development need for HR and payroll personnel; noting, “Organizations will need staff members who can work effectively with external vendors and consultants to implement and upgrade software and evaluate implications of new software initiatives”. Indeed, the absence of these skills can actually delay the very ROI that engaging a payroll consultancy is meant to accelerate. We know from the outset that there are certain principles for managing payroll consultants. But what best practices in productivity can help you to leverage the best value from the payroll consultants that your organization has already engaged?
Payroll Software Consultancy Best Practice #1: Cost Limitation
Of the many things that can have a negative impact on productivity, perhaps the most salient is the issue of price haggling. Untold hours can be dedicated to this fruitless exercise if not handled properly, but fortunately one of the easiest ways to mitigate this is through best practice. Namely, understanding the particulars of payroll consultant fees (i.e. what they are, where they come from, etc.) can net significant dividends in terms of productivity by stopping discussion on the topic before it starts. Interestingly though, a recent PricewaterhouseCoopers survey (The Hidden Reality of Payroll & HR Administration Costs) found that consultancy fees were part of the hidden “direct, non-labor costs”; which many organizations fail to take into account when calculating the total cost of ownership (TCO) of a given payroll software application. In its initial stages, the cost of any software project can be subject to all sorts of variables and, depending on the agreed pricing structure, this can make payroll consultants’ fees difficult to forecast—and thus easily subject to debate and time down the line. Add to this the inescapable fact that some firms will underestimate the required consultancy hours in an effort to win the contract (then charging additional fees as more time becomes “necessary”), and potential conflict over consultancy costs become likely. However, much of this turmoil can be avoided by insisting on a fixed cost or fixed scope contract—making the number of hours needed the consultant’s problem, and not yours. This frees up everyone’s time and energy to focus on the project itself.
Payroll Software Consultancy Best Practice #2: A Clear Picture of Success
A simple point perhaps (but one of crucial importance) is to have clearly-defined objectives from the start. Hopefully your organization’s desired outcomes for the payroll software project have already been clearly outlined in terms of deadline, quality, resources, functionality, engagement, etc. Equally though, whatever you expect your payroll consultant to achieve should be similarly defined in measurable terms. Is it user training (and resulting skills), or a successful go-live, or a percentage cost reduction in payroll management within six months? These success measures should be negotiated, agreed-upon, and incorporated in the service contract to avoid misinterpretation and (in the worst case scenario) unnecessary blame-gaming and wasted time.
Payroll Software Consultancy Best Practice #3: Check In Regularly
Meetings, catch-ups, chats, video-calls, instant messaging sessions…regardless of the formality of whatever check-in method you’ve chosen with your payroll software consultant, the important thing is to communicate regularly. This puts you in the loop on progress made and ensures the consultant is up to speed on business and strategic factors that could have an impact on your new payroll software. Furthermore, as the Inc. magazine article (How to Get the Most Out of Consultants) points out, “Communicating often and honestly can only improve your consultant's dedication. By building those relationships and lending a friendly face to your organization's name, you can ensure your consultants will stay committed to bringing you long-term success”. Of course, good rapport and relationships can be major contributors to the payroll software project’s success, but you’re after productivity first and foremost—the fastest way to get this new technology tool into the hands of your workers.
Payroll Software Consultancy – Final Thoughts
While undoubtedly a payroll software consultant brings his or her knowledge, experience, and skills to the table; the true determinant of the value of their contribution can often lie within the client’s control. By taking responsibility for productivity-enhancing and detracting issues such as cost negotiations, criteria for success, and communications maintenance, you have the ability to set your payroll software consultant up for success. In addition though, we’d add one more thing that carries significant weight in terms of getting the most out of a consultant relationship…“Appreciation, appreciation, appreciation – remember consulting is a difficult position for anyone working in a team but not being a part of it can be strenuous. Being expressive of your gratitude for what they are doing will likely be reciprocated with further productivity”.
A recent PricewaterhouseCoopers survey (The Hidden Reality of Payroll & HR Administration Costs) found that consultancy fees were part of the hidden “direct, non-labor costs”; which many organizations fail to take into account when calculating the total cost of ownership (TCO) of a given payroll software application.”