The blind renewal of yearly payroll and accounting licenses is an excellent example of this. I am always alarmed by the number of businesses around the world that have maintained the same system they have been using since time immemorial. Yes, there are logistical reasons for using the same solution year on year, but is that really a justifiable reason to let those systems linger in an increasingly competitive marketplace?
It is easy to absentmindedly renew a product license year after year without considering the impact it is having on your business. Why move to a new payroll or accounting solution when the current one works just fine?
A simple tally of inefficiencies and the cost a decision can have on your business should persuade any forward-thinking business owner otherwise.
Scalability on tap
Before you renew your annual license, consider the scalability—or lack thereof—you are locking yourself into for the next year. How quickly does your current license allow you to add or subtract employees or adjust your feature set – to downscale or allow for several new employees at a moment’s notice?
There is a reason pay-as-you-use and other more agile payment plans are gaining traction. In an increasingly competitive marketplace, no business should be forced to pay for employees they no longer have on their payroll.
Anton van Heerden, Managing Director at DNA HR and Payroll Services and the former MD for Africa and the Middle East at a multinational accounting, payroll and payment solutions provider, recently said: “Businesses should not be forced to commit to a payroll provider for 12 months? What if a business has seasonal workforces or is planning to downsize; why should they be penalised?” I do not think there is any arguing with that, do you?
Wasted expenses are more than just an additional cost to write off; it is money not spent developing new products, enhancing the customer experience or paying, thus incentivising, your employees. So, before you renew your contract with any service provider, ask yourself what the implications for your business for the next year are. That is a long time for unnecessary costs to continue to compound.
There are better solutions out there
If there is any reason to move away from legacy platforms, it is because the alternatives offer serious advantages – in this case, cost, compliance and productivity. Native platforms like PaySpace and Xero provide a vast array of benefits over legacy ones.
In fact, one of the selling points of native Cloud architecture for Anton was its multi-tenant, single instance construction. “Native Cloud solutions are always up to date, meaning virtually zero lag between updates to tax law and when they take effect on the platform,” says Anton. “Security, feature and maintenance updates also take place for all users (and clients) simultaneously, which is not just a time saver, but means you can reduce spent internal IT resources.”
As if that was not enough to encourage businesses to make the move, Cloud platforms do not require installation; instead, they work on any device with an internet connection. That is not just a bonus for employees on the move, enabling access from home, the local coffee shop or even the other side of the world, but dramatically reduces onboarding time, as opposed to legacy systems which make compliance and data security as well as maintenance a nightmare.
Why is that important? Consider that for every hour product development, customer responses or time to market is delayed, money is lost and brand reputation is tarnished. That is just one example, among many, how downtime can quickly spiral out of control.
The smart money is already in the Cloud
Ultimately, it is worth asking: does the cost involved with migrating to a cutting-edge cloud payroll platform outweigh the advantages? We argue not.
We are seeing many businesses speeding up their Cloud journey and setting expiration dates on their on-site solutions. I foresee that those who do not move to Cloud platforms will struggle to compete in the future and that slow adoption will give competitors the opportunity to gain serious market share.
No one is denying the potentially substantial logistical requirements involved in moving from one management or operational solution to another, but consider this: if some of the world’s largest organisations have made the change in spite of the logistics, the advantages must be worthwhile. They have weighed up the benefits; perhaps you should, too?
Business owners and executives should pursue any means of reducing hindrances to growth, like excessive costs and downtime. Businesses must also navigate a plethora of regulatory and financial complexity – problems Cloud platforms solve with relatively little effort.
That is why I believe it is pivotal for businesses to position themselves for the future, which is why the adoption of a future-proof native Cloud platform like Xero or PaySpace is so crucial. It is worth mentioning that a policy of review over renewal will serve you well, not just for accounting and payroll but for virtually all operational tools.
Ask yourself. Do you want to throw time and resources at managing your payroll when that time could be better spent giving your business an advantage over the competition?