Payroll Management Software
4 min read

How Finance teams can convince their Leadership to switch to payroll software

Sabrina Castiglione
March 10, 2023

In the fast-paced business world, every decision has to add value to the organisation. As Finance teams look for ways to optimise their operations, they may consider modern payroll software like Pento.

While some things are clear from the get-go, communicating the value to a Leadership team away from day-to-day operations can be challenging. So, what can Finance teams do to demonstrate the value of switching to a dedicated UK payroll software like Pento?

Leadership teams see payroll as a necessary evil.

Payroll is an essential function of any business, but it is not a value-adding activity. While payroll needs to be accurate to keep employee experience intact, it doesn't enhance the company's competitive advantage.

However, the human resources spent on menial payroll admin tasks take up a significant chunk of productive hours and stop teams from doing deep, value-add work. Finance teams must convince their Leadership that modern payroll software can create opportunities to drive better business outcomes.

Time is money.

Time is a scarce resource, and making the most of it is essential, especially as Leadership usually see time spent on 'General and Administrative' activities as a business overhead rather than a value driver. When you don't have an automated payroll software, there are hidden costs. And Finance teams need to surface them effectively –  be it time spent manually collating data into multiple spreadsheets, liaising with external parties, correcting errors and managing stress – it all adds up.

In addition, there is an opportunity cost for Finance teams when they spend time on payroll. Modern payroll solutions automate the entire process, from data collection to benefit administration, pension and HMRC reporting, and accounting, freeing up valuable time. In our new world, where companies are trying to stay lean and agile and trying to do more with fewer resources, especially headcount, freeing up these regular hours is a low-hanging fruit to increase team productivity. Otherwise, payroll can be demanding, bloating your Finance teams with additional hires as you grow.

Be clear about the ROI – time saved, missed opportunity cost, and scalability.

The return on investment of getting that time back is high, and it is helpful to quantify it when communicating with Leadership. When Finance teams add up the cost of human hours spent on payroll, including accounting for payroll journals, and add on the existing provider base fees and additional fees often charged for reporting and P11Ds, the current payroll setup cost is usually higher than initially thought.

At Pento, we talk to companies where as much as 20% of a company's headcount can be involved in a monthly payroll process, whether as a data-inputter, data checker, approver, or otherwise having an input into the monthly cycle. The hours add up, fast.

In addition to these costs, the potential return on those hours when spent elsewhere is a high missed opportunity cost. Instead of spending time on payroll, Finance teams can focus on identifying high-return opportunities for further investment or efficiencies. Primarily when, identifying minor improvements across a significant revenue or cost base can deliver returns that far outweigh the costs of payroll software like Pento.

Timing is important. Be clear about "Why right now?"

Leadership teams care about the right time to change payroll. Will we need to change our payroll provider again? Is this the best use of time right now?

Be clear about why right now is the best time to change your payroll. Are you experiencing unbearable pain with your current payroll setup? Has the current payroll setup become highly inefficient, affecting employee experience? Is your headcount multiplying, and do you need to optimise your payroll process for scale? Call out why now is the best time to switch to payroll software.

Present the benefits, not just the features.

Modern payroll software like Pento has a lot of benefits. Be careful and contextualise the features in terms of how they benefit your payroll process.

  • Scalability: Both as a product and the range of integrations can ensure Pento helps you manage and scale from a handful of employees to thousands.
  • Deep integrations with HRIS and accounting systems: Pento fits into your existing tech stack, keeping your current processes intact. You can also move other systems without worrying about how they play with Pento; whether moving from CharlieHR to HiBob or from Xero to Netsuite, you get the flexibility to have the right tools at any given time.
  • Innovation that helps you: With a traditional payroll outsourcing provider, you're stuck – no matter what, the process today and 10 years later will look the same. But tools like Pento are constantly innovating and increasingly make payroll easy for you. With a modern payroll provider, you get best-in-class software and expertise and can be ready for your business next year, not just the company you are today.

Talk about the ease of switching your payroll system.

If switching your payroll provider will take additional resources and months on end, Leadership will reject your proposal instantly. Ensure you're helping your company realise the value of changing payroll immediately.

Switching to a modern payroll software like Pento can take as little as ten days. A provider like Pento will do all the legwork, including liaising with your existing provider, and all the data reconciliation, setup, and testing to ensure you can be up and running.

Bring your conviction and data to Leadership = change how payroll runs at your company.

Payroll is a necessary function in any business, but it's a lot of admin, not strategic. And that's how Leadership will see it. But you can turn things around:

  • Bring forth the problems and pain your current payroll process is causing you and your Finance team – inefficiency, lack of control, and employee experience left at the mercy of your payroll provider.
  • Be clear about the ROI – time saved, missed opportunity cost, and scalability.
  • Call out the benefits and how they affect you right now.
  • Demonstrate the ease of switching.

Building a proposal to switch payroll can be difficult, but we all know it's worth it. Take that first step towards optimising your operations, and see how Leadership appreciates you for achieving better business outcomes.

Get more payroll insights like this

• Subscribe to the "People-First Payroll Newsletter" to get the latest legislation and payroll insights sent straight to your inbox.
• Or get a demo to find out how Pento can help streamline and error-proof your payroll.