How do I choose the right payroll management software?
A quick Internet search showed over 130 different payroll management software products available from the basic program designed for small businesses, to highly complex systems for large enterprise-level operations. And while every publisher claims to have the "best" offering, the quality and ease of use runs the gamut from dead simple to programs resembling NASA Mission Control.
There are three main categories to consider when choosing the right software solution for your payroll management needs.
- Features and functions
- Cloud-based or installed
- Pricing and support
Since every business is different and at a different stage of business growth, it is impossible to recommend any specific program. However, there are definitely guidelines that can help you make an informed and strategic buying decision.
What should I look for?
While this list is certainly not exhaustive, it does represent the most typical functions that a robust software package would offer. Features you should consider when assessing payroll management software are:
- 401(k) Tracking
- Accounting Integration
- Attendance Tracking
- Benefits Management
- Customizable Time Entry
- Deductions Templates
- Direct Deposit
- Check Printing
- Payroll Tax Management
- Vacation / Leave Tracking
- Tax Form Printing
- W-2 Preparation
- Wage Garnishment
- Year-to-Date Tracking
While you may not need or use all of these functions today, as your business grows your payroll management needs will grow, as well. Consequently, having a dynamic and fully supported program is essential. And if your business employs agricultural workers or has employees overseas, then you may need something specific to those requirements.
So take your time and create your own well thought out list of needed features and capabilities.
Web-based or Installed?
There are a few things to think about when it comes to deciding between cloud computing software versus having the program on your own servers. First, not all payroll management software products are available as cloud, or web, based programs. Secondly, security is still and always will be an issue with cloud-based software. And, third, is the ease of installation and the computing requirements of the program.
The business world as a whole is moving towards the cloud, but there is still a strong argument for keeping vital and especially sensitive programs close at hand, so to speak.
How much is too much?
If you are a very small (less than 5 employees) business, or even a larger "small" business of 10 to 20 employees, you can probably manage with a product priced at less than $1,000. However, it is possible to spend as much as $10,000 or more on very comprehensive and robust business management solutions, which leads to a related consideration: At what point is it smarter to outsource?
In addition, there is the question of support. Most lower-end products, while possibly providing sufficient features and tools to effectively manage your payroll process, do not typically offer much in the way of 24/7 live support. On the other hand, you should definitely expect this from a higher-end program as well as training and pro-active updates, etc.
Do your homework and research extensively. Take the time to make a comprehensive listing of your company's current and projected payroll management needs. Know what you want, what you can afford, and what your in-house resources are. Because it isn't a question of whether or not you need a payroll management solution - it's just a question of which one?