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Payroll softwareHR practicePay & benefitsHR TechnologyPre-employment screening

Free Guide: Implementing Payroll Software – Keeping Costs Down

by Personnel Today 9 Jul 2010
by Personnel Today 9 Jul 2010


No matter how much you’re spending on a payroll software solution, nobody likes to think they are paying more than they need to. We provide four steps to avoiding an overspend.

Most organisations could reduce what they spend on software by as much as 20% without changing suppliers, says Andy Kyte, a research fellow with technology research organisation Gartner Group.

“We’re spending more than ever on technology, but we’re not paying attention to where that money goes,” he says.

1. Only pay for what you need

The first step in reducing the cost of payroll software implementation is to pay for only minimum functionality.

“Have a list of what you need the payroll package to do, and don’t be dazzled in demonstrations,” advises Brian Bennyworth, group HR director at housing association LHA-ASRA.

“I worked in a department once that spent a fortune on a huge PeopleSoft application, and we never used 90% of the features.”

2. Work out what you already have

When looking for any payroll software solution, conduct a thorough audit of what’s already owned. It may be that another department has software licenses that are not being used, for example. Or you might find that the new payroll package will make an existing application redundant, in which case you can save money by not renewing those licenses.

3. Try your existing supplier

Buying payroll software from an existing supplier may generate substantial savings in some cases, adds David Bradshaw, a principal analyst with technology research organisation IDC.

“If it means one less service level agreement, one less set of due diligence and one less relationship to manage, it might be worth looking at paying slightly more for software to get that saving,” he says.

4. Embrace the new

Kyte advises creating policies that will prevent what Gartner terms ‘software hugging’ – users keeping systems that are familiar when there are newer alternatives available.

“Every application and platform you have to pay for, support and maintain costs money,” he says. “So make clear which application is to be used for which process, and don’t pay for anything else.”



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Smart Buyer from Personnel Today is a FREE resource to help you make an informed decision about your next HR purchase. Buyers guides from Smart Buyer contain critical information to help you research your options, plan your purchase and get the most out of your supplier.


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    Personnel Today

    Personnel Today articles are written by an expert team of award-winning journalists who have been covering HR and L&D for many years. Some of our content is attributed to "Personnel Today" for a number of reasons, including: when numerous authors are associated with writing or editing a piece; or when the author is unknown (particularly for older articles).

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