10 Reasons Why NOW is the Best Time of Year to Change your HR/Payroll Provider
Spring is a great time in the HR/Payroll spaces. It is the period of calm before any storms or other common practices like Performance Reviews, Open Enrollment, or Compensation start. If your organization is considering switching providers, now is the time to begin (or finalize) the process with your new vendor of choice. Below are my top 10 reasons why NOW is the right time to take action.
1. Calendar year cutover.
While there are no hard and fast rules of when an organization should change HR/Payroll providers, most occur at the beginning of a month, quarter or, ideally, the beginning of the new calendar year. Looking for a new vendor now would allow for a go-live for the first of the year. This way, you do not have to worry about migrating your current year balance information over to the new system, and you can start fresh.
2. Benefit Enrollment.
Fall and, by extension, the start of the new calendar year is when most companies hold their open enrollment periods and have their benefits begin. It’s critical to have a vendor who can assist with the new elections and ensure the transmission of those elections is in place before pulling the first set of deductions from payroll. Selecting the new provider now is key so that you and the new provider have time to get everything in place.
3. Analysis of new vendor.
Doing your homework and due diligence is extremely important to ensure you are selecting the best possible provider who will meet your business needs and objectives and allow for growth and restructuring as your organization changes in the future. Gather information from all your various key stakeholders, including your employees and managers. While HR and Payroll administrators are essential, don’t forget about those you serve as your internal clients.
4. Integrated Solution.
You shouldn’t have to work harder to work smarter. HRIS can integrate with most other ERP and 3rd Party Benefit Administrators. Make a list of those legacy systems and ensure that your new HRIS can integrate with all of them. If you have not had an interface created previously for items that you manually key into other systems, now is the time to change that and find ones that do.
5. Year-end didn’t go well.
2020 was hands down a crazy and confusing time for HR and Payroll teams, with all the changes from legislation at the federal, state, and even local levels and across most industries. If your year-end did not go as smoothly as in years past, ask yourself if your solution properly communicated, educated, updated, and supported you with all the changes. If not, maybe it’s time to look at a solution that would help you properly navigate these rapid changes more effectively in the future.
6. SaaS Solution.
Gone are the days of having to host your solution and manually adding your monthly/quarterly/annual updates. Software as a Service (SaaS) is a concept that has been around for several years. Now it’s all about a unique URL and log-in credentials. It’s always best to be on the latest and greatest version of a product. Products with different versions and release schedules for the updates are no longer needing to be the burden of your IT or HRIS teams. Let the software provider handle that for your organization. Why not be on the latest and greatest?
7. End the paper flow.
HRAFs, PAFs, or JCNs – whatever you call your internal employee lifecycle change form, you should not need to rely on paper/email to complete your changes. HRIS’s have built-in workflow flows. When looking for a system, you should ask if it can handle the following types: Employee, Manager, and Administrative. Look for a solution that will offer a variety of actions employees can make for themselves (contact updates, change of direct deposit, change of taxes, open enrollment, life events, etc.). Also, look to give managers and certainly administrators the ability to update employee job information and other vital changes.
Do you have a team working weekly to monitor all the changes within the states/provinces in which you are conducting business? Are they helping your organization stay up to date on changing legislation, tax codes, new forms, and updating the system you are using to process payroll? If not, you need to look to a solution that does all of that and communicates when it sees these changes on the horizon. Having a system that is updating the new hire tax forms and work authorization is also particularly helpful. We, as administrators, do not have the luxury of time to be constantly monitoring for these changes.
9. What can’t the system do?
As you evaluate and review the possible solution, the sales/demo teams will illustrate what the system can do and do well. Make sure you ask what the limitations are and the known issues or obstacles within the system. If something worked in your legacy system, never assume that it will be replicated in your new one. Take the time and energy to evaluate the solution fully and adequately. Don’t just take the salesperson’s word about what the system can do but have them truly show and demonstrate it to you. You need to see the proof.
10. Pain Points/Future State.
You are looking to change HRIS/Payroll solutions because you have hit the point where the current pain points hit an inflection point. Knowing where your organization is coming from and what it wants in the future, you now desire a future state with a solution that can meet your needs. Having key stakeholder meetings with your various end-users is essential to know what is not working and what is needed. Keep these groups a part of the process. They can help with selling and increasing the rate of adaptation of a new solution more successfully.
This list is certainly not complete, but rather it is my top 10 reasons why now is the time of year to change providers and how you should evaluate your organizational needs against what the new provider can do. Talk to people, talk to other partners, talk to current clients. Finally, do not be afraid to ask challenging and probing questions. Make sure that you are truly selecting the best vendor that will meet the needs of your organization.
If you have any questions or need assistance as you perform your due diligence with HR/Payroll systems, please consider me a resource to aid in your search. You can reach me directly at firstname.lastname@example.org.