Resolutions. They’re great for holding yourself accountable for your own success and self-discipline at the start of a new New Year. It always stings when you can’t follow through on them.
For business owners, setting some strategic resolutions makes getting the operational headaches and busywork you’ve been putting off a little easier. As a provider of human capital management services, one of the more common New Year’s resolutions we see at Lift HCM is starting services with a new payroll provider.
At the end of the year, anyone in the market for a partner to manage their payroll is likely dealing with their fair share of headaches from their current provider. When the mere thought of migrating your payroll data is daunting, it’s easy to see how making the switch at the start of the year might seem heaping coals onto the fire. Let’s see if these six benefits to switching services at the start of the year can’t sweeten the deal.
Benefit #1: Capitalize on the Spirit of Renewal
With a new year comes an energizing spirit of renewal. This can make it easier to communicate any changes to employees. This is also why it often helps to frontload these tweaks to your HR and payroll processes at the start of the year.
Joel Xu said it best in this article for Waypoint, “by switching at payroll year-end, it’s the one time of year where your year-to-date amounts are zero”. Even if you don’t hit the ground running right on January 1st, there will still be less data to collect. That’s less busywork standing in the way of completed implementation.
Benefit #2: Consolidate Employee Data to a Single Payroll Platform
When you start services early in the year, you don’t need to bother with backwages. This spares you, your new provider, or your accountant from having to hunt down that data. That’s because Implementing services with a new provider at the start of the year keeps the data involved in taxes and compliance reporting in one ecosystem.
A good payroll provider will make it easy for accountants to access that data, but implementing services at the start of the year means they’re the only party that needs to deliver. Accessing your payroll data might be a breeze in one place and a pain in another.
What you ultimately want to avoid is leading your accountants on a goose chase, running back and forth between your current provider and the ghost of payroll past. Even if you’re not starting on January 1st, you still have the advantage of being able to package one or two pay periods worth of data while keeping your accountants focused on a single platform.
Benefit #3. Gain Some Peace of Mind on Cybersecurity
Spreading your payroll data across multiple platforms means relying on multiple parties to securely maintain your records. Consolidating your data by starting services early in the year can give you some peace of mind by reducing the dilution of sensitive intel across multiple security infrastructures. That’s because storing employee records on single software platform under the supervision of a single payroll provider at the start of the year minimizes the number of attack vectors hackers can exploit to gain access.
Benefit #4. Clean Up Your Employee Payroll Databases
Businesses in industries and environments traditionally associated with higher turnover (e.g. food service and factories) don’t have to include previously-terminated employees. This keeps any anomalies or edge cases accrued under your previous payroll provider from pulling visual focus and diverting concentration away from from the new year’s financial records. Your databases will also look a lot cleaner on the payroll platform you’ll use going forward. You won’t need to worry about Those who switch to a new provider at the start of the year can still access payroll data on their previous platform.
Benefit #5: Clearly Communicate Payroll Changes to Employees
Communicating what you’ve got and where you’ve got it gets exponentially harder the more that information is spread across different platforms. Not only does this communication get more complicated for your accountants, it makes disseminating changes to your team a hassle too.
The longer you wait to make the switch, the more diluted your team will be across the different platforms or software ecosystems you’ve. This may well leave you fielding twice as many questions and doing twice as much troubleshooting and answering twice as money more questions on accounting and employee self-service for two different platforms or service ecosystems will be.
You outsourced your payroll to avoid slowing down to assist with this kind of troubleshooting in the first place. Switching providers early in the year can spare you that stress and allow you to focus more of your time on growing your business.
Benefit #6: Breath Easi(er) During a Regulatory Audit to Cooperate With Payroll Audits and Inspections
If you’re considering outsourcing your payroll in the new year, chances are you know that anxious feeling—the simmering panic of hurriedly signing checks and stuffing envelopes as you watch the end of your ever-growing to-do list disappear around the curvature of the Earth.
You do your best to cross your Ts and dot your Is. Now imagine the feds come knocking at your door. J'accuse! Suddenly you have to provide mountains of paperwork to prove you didn’t have your eyes crossed to let a little financial malfeasance slip through the cracks.
Outsourcing your payroll to an independent third-party provider creates a degree of separation between your business and government regulators that could spare you from a brain curdling amount of stress when complying with an audit or inspection. We’ve covered that before. What we haven’t yet discussed is the advantage of strapping into the proverbial kevlar early in the year, as having to rely on two or more providers of the same service to represent you in this context creates a gap in that armor by default.
Are You Ready to Outsource Your Payroll in the New Year?
This should give you some idea of what you stand to gain from switching services at the start of the year. Lift HCM has provided payroll management services to businesses like yours for over 50 years.
When you resolve to make the switch, you’re resolved to liberating yourself from unnecessary constraints pulling you away from growing your business. You owe it to yourself to start the year strong. Our team is here to help you make sure the easiest resolution you’ll ever make doesn’t fall by the wayside. We’ve got the theme from Rocky playing on a loop in the break room.
