Optimal operating efficiency is a key goal for most businesses, but this can be quite hard to achieve if each individual department uses a separate system to manage its tasks at hand. Fortunately, the continual development of payroll management systems has led to a variety of integration options, meaning the payroll and Human Resources departments can access employee information using the same interface, rather than separate systems. In theory, this should work well, but how does it actually perform in practice? Let’s take a closer look into the world of payroll integration to find out!
The Problem With Standalone Systems
Before we start looking into payroll integration, let’s do a quick overview of standalone systems and the problems that come along with them. The main issue should be obvious: they’re standalone systems! This means that any data stored within the system is only accessible from that particular system. Although it is possible to transfer employee data over to another system, standalone systems lack any integration features, meaning all data will have to be manually copied (a process that’s prone to errors). Furthermore, not all standalone systems use the same value fields for the same data, so employees tasked with manually importing data may be left to interpret the similarities and fill in the holes.
Bridging the Gap Between HR and Payroll
The main purpose of integrating your systems is to connect your HR and payroll software databases. Often, these two systems contain a lot of the same data, but without any integration efforts, employees who need to obtain information from a separate department will have to either: a.) manually request the information and wait for the results, or b.) access the separate system themselves and manually copy the necessary data, neither of which is particularly efficient on a tight schedule. By integrating your HR database with your choice of cloud-based payroll software, you’re enabling department employees to complete their tasks at a much faster rate, resulting in a higher productivity rate overall.
Enabling Your Workforce
When your business uses integrated systems rather than standalone systems, your payroll and HR staff benefits not only from a reduction in the amount of data that needs to be manually transferred but the ease of access to information as well. This is especially important when it comes time to review employee performance, update employee information, or generate reports for your company since relevant data from both departments can quickly be accessed using the same system. It’s also helpful for maintaining compliance with ACA regulations and other tax requirements as any mandatory changes can be quickly implemented throughout the entire system.
Preventing Manual Errors
One of the biggest ongoing challenges companies that still use standalone systems face is the increased likelihood of errors when manually managing data. This is especially true when data is copied from one system to another, since something as simple as an extra digit can render the duplicate records completely inaccurate. Using an online payroll solution that is also capable of managing your HR department (such as UZIO) can help reduce this risk but employees must still ensure the data is entered correctly the first time to maintain accurate records.
Saving Through Automation
Another issue faced by businesses that use standalone systems is an increase in labor costs. As a company grows and expands, there will inevitably be more data that needs to be processed (and therefore manually integrated between both systems), which takes a lot of time up from the already busy schedules of both departments. If they fall behind, you may end up paying a lot in overtime costs, which can offset any potential net profit increases. Fortunately, data integration will be completely automated once you switch to using a cross-departmental integration platform, keeping employees on schedule and labor costs low.
Is Integration Worth the Effort?
As you can see above, there are many benefits from switching to an integrated system over using standalone HR & payroll software. Although the initial implementation may take a bit of time, your new service provider should be able to walk you through the steps, making the overall integration a relatively painless process. Integrated systems are generally priced competitively, meaning you’ll most likely pay the same (or less!) than you already do for your ineffective, standalone systems. If increased efficiency, reduced errors, and the potential for reduced operating costs all sound like appealing benefits for your business then integrated payroll and HR software might be worth investing in.
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