Change management in payroll services


24th July, 2019

Working in payroll? Change management is your path to success

Whether you’re a payroll officer working in small business or as part of a larger payroll services firm, staying on top of compliance means being comfortable with, and driving, organisational change.

It’s a proven concept that change is difficult.

It’s especially difficult when that change is driven by compulsory compliance. Nothing is more certain to get people grumbling than having to modify their behaviour ‘for no good reason’.

And as we’ve already witnessed, 2019 has been a year brimming with regulatory changes.

The minimum wage increased (again), the Employment Relations Act was amended, paid parental leave increased, and perhaps the biggest update from a payroll perspective – payday filing – made waves for just about everyone.

Payday filing highlights need for change management

Helping practices cope with payday filing has been a large part of my role over recent months. For many, it has fundamentally changed the way they approach and process payroll for their clients.

The solution has required a review and modification of their existing processes, a switch to a more efficient payroll system, or a combination of both.

But by far the biggest challenge to a practice has been the reluctance to commit to improvement on both the practice’s and clients’ side of the fence.

One of the most common responses when rejecting change is being told that they’ve “always done it that way”.

Changing something can often be misconstrued as saying that the current processes are wrong, but that isn’t necessarily the case. Payroll needs to be reviewed on at least an annual basis as it’s ever-evolving.

READ: How to adjust payroll services pricing to reflect payday filing

Checks need to be in place to make certain payroll practices are current, that they meet compliance needs, and generate revenue for your practice.

While what you currently do may be convenient to you, the resistance to change may wind up putting your clients at risk of costly errors to amend and fines to pay.

Deriving value from payroll also means embracing change

Another common response for not needing to change is saying that there isn’t any profit in payroll services.

This has been proven wrong time and time again by practices who’ve adopted payroll as a service for their clients and remain dedicated to pricing according to the level of expertise they provide.

If you’re a bookkeeper or accountant with payroll as part of your service offering, consider how many of your clients have engaged your services purely to recommend the right payroll software for them without any question as to how to set it up and operate it correctly, or manage it for them.

Fact is, a payroll solution is like any tool – it’s only as capable at achieving the desired goal as the person who uses it. In days gone by, it was this thinking that led to premiums charged for the work of master craftsman versus that of a rank novice.

This is exactly how business advisors should think about every solution they recommend. Not only can you fulfil your clients’ needs by getting them the right tool, you also have the ability to operate it for them better than they can, or train up their in-house talent to do so.

Either way, wherever you’re adding value, you can also generate profit.

Change takes time, but that’s no bad thing

Another popular excuse for resisting changes in payroll (or, in fact, any organisational change) is that there’s simply not enough time to do it justice.

Significant change requires downtime, or additional resources, or the risk of errors and outages. All of this means – for the business owner or manager – a setback from their ultimate goal of getting out in front of the competition.

When the same thinking creeps in at the practice management level, then business advisors risk becoming a part of their clients’ problems, rather than a solution to them.

READ: 5 opportunities in payday filing for payroll management services

When it comes to payroll, practice managers and solo bookkeepers alike need a strong understanding of how to priotise these services within their offering if they’re going to be able to communicate its value to clients.

The fact that these changes can be a real challenge for advisors and their clients alike only further demonstrates the inherent value presented by payroll services.

And, ultimately, this line of thinking should lead you to the conclusion that any solid payroll services strategy would be created with an eye for change management.

If you and your clients are reviewing other systems, pricing and processes on an annual basis, why not take the time to include payroll in this exercise?

In this sense, embracing change in a highly dynamic compliance environment is the very thing that will make sure you maintain your footing, giving added meaning to the age-old French saying: ‘the more things change, the more they stay the same’.