How managed payroll services can improve your businesses efficiency

How managed payroll services can improve your businesses efficiency

It’s a question that many businesses find themselves facing more and more these days: keep specific tasks in-house or outsource them? The simple fact is that the internet has made it very easy and cost-effective to outsource various time-consuming functions allowing staff to focus on value-add business activities instead.

Payroll is one such task that is extremely important but requires a lot of time without producing any profit. Along with the time saving, there are some other benefits to outsourcing your payroll services with a managed services provider that make outsourcing an attractive choice.

Common misconceptions about outsourcing payroll

First let’s look at the reasons why people are hesitant to outsource their payroll function. As technology advances, we are able to perform old tasks in new ways, but rarely is it met without scepticism.

Some of the common misconceptions about outsourcing your payroll services can include:

  1. Outsourcing is costly
  2. Loss of control
  3. Employee information and data is unprotected
  4. Services cannot be customised
  5. Staff will not be paid on time
  6. The process is automated and not checked for errors

Interestingly, none of these common misconceptions are accurate. Outsourcing can save you money while keeping your data more secure than within your local system. The task is handled by a professional, knowledgeable bookkeeper who has the primary function of payroll services removing the chance of manual error or missed/late payments.

In addition to all of this, payroll services are not a set process and will always be customised to the needs of the business, another cost saving as you only pay for what you use.

Business woman holding a stack of folders for documents in front of her close up. Overworked woman concept. Documents work. Secretary.

Maintaining control

The most common myth about outsourcing is that it creates a loss of control; however, this couldn’t be further from the truth. A good managed services provider acts as an extension of your business, another department who are collaborative, with strong communication and above all, you choose the functions they handle.

Outsourcing should always be flexible and callable with key performance indicators in place to ensure the work is being done to the standard you expect.

Risk management

The needs of a payroll system (including the requirements for any tax regulations) are in depth, but extremely necessary to get right. You and your staff should be experts in your field and may not have time to cover the varying legal needs of payroll to mitigate any risks, especially if you are a small business.

A managed services provider will be well-versed in:

  • Legislation
  • Government regulations
  • Privacy, and security
  • Tax and superannuation

This service provides peace of mind that your compliance with regulatory requirements will be satisfied while ensuring that your data is secure.


There isn’t much room for human error when it comes to payroll, especially considering how much money a mistake could potentially cost you. Managed payroll services provide guaranteed accuracy, as this task is their primary focus. You receive skilled, knowledgeable workers who can ensure the correct tax amounts and no missed overtime pay.

The benefit to this is seen during audit time as your books are always accurate, saving significant headaches later on.


As managed payroll services are scale-able, they can move with the growth (or shrinkage) of your business from a cost perspective. The goal with outsourcing is to turn fixed overhead costs into a variable. The workload determines the cost, as opposed to a fixed salary in your HR department.

Further costs can be saved in:

  • Payroll software and equipment
  • Staff training
  • Office supplies and space
  • IT support


We’ve mentioned this sporadically throughout this article, but the most significant advantage to outsourcing your payroll is time saved.

By either negating the need for a HR department or creating more time for your existing one by not bogging them down with payroll tasks, your business saves significant time which can be used on more critical activities.

If you currently spend money on staff hours for manual data entry, quality checking, training and processing, this is likely something you would love to see whittled down or diverted to more important tasks.

Outsourcing is the optimisation of your workforce to provide a better service to your customers.

Consider managed payroll services

Payroll processing is a great task that with a little strategic management, can improve business operations. As with any task that isn’t a core function, outsourcing will save time and money, so get in touch with a us today to see how our managed services can help grow your business.

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