Technology is changing business software – and payroll is one area that’s evolving quickly. From more connected tools online, to compliance and outsourcing, the payroll landscape is changing. So here’s what you need to know about current trends.
Keeping up with change
If you run a small business, it can be hard to keep on top of running that, let alone the software you use. But it’s vital that you keep up with technology – as the way information is managed has fundamentally changed. For example, mobile devices let you work from anywhere at any time. And connected online software gives you freedom to manage your work in clever and innovative ways.
You might think payroll is unaffected by this, but payroll professionals are always looking at ways to improve payroll tasks. Here are 11 small business trends that are happening now.
1. The move to mobile
One of the biggest trends in technology is the move to mobile devices. Ten years ago your staff would have accessed email and other online information using a desktop computer.
Today they’re probably using a smartphone, tablet or laptop. This is important because presentation must be different for mobile devices:
- the screens are smaller
- the method of navigation is different
- user interaction is more direct, with fingers instead of a mouse
- people using mobile devices tend to have shorter attention spans.
So make sure your employees can handle all their payroll tasks using mobile devices. Keep documentation brief and to the point. Ensure everything is accessible and readable on small-screen devices.
2. Flexible employment terms
As economies around the world become more flexible, employment terms change. Freelancers might not be directly employed by you, but short-term and part-time staff will be. You’ll need software that can handle this.
Your payroll software will also need to handle extra employee benefits and perks as they become more common. For example, health club membership might be tax-deductible, especially if it improves productivity. If you provide that perk to your staff, your payroll software needs to take account of it.
3. Leveraging the freelancer economy
Employees don’t stay with one company as long as they used to. Careers are flexible and changeable, and people move around more often. This freelancer economy doesn’t have to be a problem for your business. It potentially gives you a regular supply of fresh talent.
But it does mean you need good payroll software. You need a system that makes it easy to add new joiners and remove staff who leave. And you need to keep the details of those who have left – for many years. This is required by tax legislation, and will also be vital if you are ever audited.
4. The growing cost of compliance
The amount of information that governments demand from businesses is only going up. That’s especially true of payroll.
Businesses in the UK, for example, now have to inform the tax authorities in real-time whenever they pay their employees. That means filing information online regularly – every month or even more frequently.
Meanwhile, in the US, the Affordable Care Act places additional burdens on employers. In fact it could double the amount of form filling for some businesses.
Doing all this work by hand, using pen and paper would be a nightmare. So online e-filing is easier for businesses and for governments. And it probably won’t be long before paper filing is a thing of the past.
So it makes sense to get the right small business payroll software now – software that will adapt as your business grows. Then you won’t have to worry about the cost of compliance in the future.
5. Small business payroll outsourcing
Some companies outsource their payroll operations. Until recently the main choice has been to outsource to specialist companies. They do payroll, and that’s all they do.
But new software means that accounting firms are able to offer competitive services. So check with your accountant about what they would charge to do the work. The answer might surprise you.
Careers are flexible and changeable, and people move around more often. This doesn’t have to be a problem for your business.
6. Increasing office automation
Computers and robots are nipping at our heels. Office automation is moving at a fast pace. It’s gone from basic data processing to much more complex tasks.
You can’t stop this happening, but you can adapt to it. Take advantage of software that automates your day-to-day payroll tasks. Then you can concentrate on other areas of business that you’re more passionate about.
7. Play smarter
When you have a new job position to fill, how do you decide the salary?
- Do you look at what other companies are offering and pitch your vacancy at the same level?
- Should you work out the value of the role to your business and calculate what you should be paying?
- Or do you combine these methods to find a reasonable average?
Soon there might be a better way. Analysis of large quantities of data is helping businesses find the sweet spot for the salaries they offer.
One day this will help you keep your employees happy and reduce staff turnover – all within your budget.
8. Integration with other systems
Payroll on its own is useful. When it’s built into your accounting software and can connect to banking, HR systems and other tools it’s even more useful.
Quality accounting software has built-in payroll and can connect to other business applications, including HR tools. And the good news is, the level of integration for this type of software is only going to increase.
That’s great for businesses, as it reduces work duplication. It also means you can access everything online from the same place.
9. Streamlined management of expenses
Processing travel and entertainment expenses can be hard work. If you’re like the majority of small business owners, you may still do this manually. That’s not the best use of work time, and there are better alternatives.
Modern small business payroll software will let your staff enter their expenses claims for you to process. Invoices can be scanned and stored electronically too – no need for boxes of paperwork. So everybody saves time.
10. Moving into the cloud
“Using the cloud” just means using the internet for data storage and running software. So cloud-based or online payroll software can be run from any internet-enabled device. That includes smartphones, laptops and tablets.
The big advantage here is freedom. You are free to access your information from wherever you happen to be, day or night. As long as there’s an internet connection you will have secure access to vital business data.
11. Better access to information
New payroll software empowers your staff to look after their own data. They can check their personal information, apply for leave and check records of their past wages.
That’s now, but in the future employees will have even more information. Software will help them understand the implications of the tax they pay. It will also do a better job of explaining pension or superannuation payments.
Payroll information helps your staff feel engaged with the business. And engaged employees are much more productive.
Stay ahead of the curve
Every business is affected by these trends. Some of them relate to business structure, others to software. But all of them are changing the way companies like yours do business – for the better.
Stay agile and aware of these trends and you’ll stay one step ahead of your competitors. The right software will do all the hard work for you, and let you concentrate on running your business.
You can find out more about payroll and how it affects your business, by reading our other payroll guides.