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Payroll Process Automation: Payroll efficiency in an e-world

Written by John Dijns on . Posted in Exact Online

The world is changing and we all know it. The internet is changing the way we work, live and the way our society works. The implication of being connected 24/7 via our mobile devices has an impact on our mindset and expectations.

People nowadays get annoyed if you don’t reply to their e-mail the same day and wonder if you’re okay when you don’t reply to a text message within the hour.  And it’s not just our friends that we treat this way. We also expect real time response from the companies we interact with and whose services we pay for – like your payroll service provider (PSP). The acceptable margin for error has in the same process been reduced. With the current level of IT integration in our lives we expect agreements to be met in the way we agreed them – not what we almost agreed on.  To increase the challenge, we can also see that a greater transparency in the payroll service market is putting pressure on prices, thus further increasing the need for efficiency. How will we manage? Assuming that a workday still has 8 hours, things must change in order for us to support real time communication with our clients and still improve our efficiency. An answer is Payroll Process Automation.

Let’s consider the payroll routing as a logistic process. This is possible for almost any process where information from point A is transformed and routed to point B. For Payroll this means starting at the entry of variable mutations and ending at the sending of the period documents (like payslips, a payment advice list and the financial entries) to the client of the PSP.

The start of this process should be triggered by the party providing the information, in this case the client. After the client approves his entries (in Exact Online Payroll the client can already preview the payslips) the PSP can go ahead and check the calculation. If happy he can either ask the client for approval or immediately finalize the calculation. Upon finalizing he starts the remaining, completely automated part of the process.

The thought is that all agreements made between the PSP and the client are entered into the application so that, all other things being normal, repeated actions can be automated. The PSP and client should always remain in control but shouldn’t have to spend time on processes that don’t really need their attention. A lot of steps are therefore setup to initiate the next one automatically, improving overall efficiency and reducing the chance of error. The PSP can then spend more time advising his client or reduce the marginal costs per payslip.

In Exact Online Payroll we are working towards delivering this vision. Many steps are already or will soon be available. Currently we are testing steps 6, 7 8 and 9 – the steps that allow delivery of payroll output to be completely automated. We will release them before the end of 2010. Only steps 4 and C remain, allowing the customer to approve the draft output and possibly start the finalizing of the payroll period. These last additions will be available in 2011 and complete the full automation of the payroll process.

We are very excited about this development and love sharing this with you. If you feel you would like to know more about this, don’t hesitate to ask for a demo!

        

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Photo credit: R o s e n d a h l

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John Dijns

John Dijns is Productline Manager at Exact where he is responsible for the development of Dutch Payroll solutions. Currently the Payroll development team is working on enhancing Exact Online Payroll. This is the most recent Payroll product. Exact Online is the first SaaS solution to both offer a Financial and Payroll solution on the same platform.

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