The South African payroll administration industry has matured. With the offer of more technology, access to skills sets and improved levels of control, decision makers in business have several options available regarding how they want to manage mission-critical business disciplines such as payroll.
With continued economic pressure affecting markets globally, businesses of all sizes – which have very different focus areas – are compelled to find ways to manage systems strategically. This means controlling infrastructure as an asset that helps to keep the business competitive and operational at the lowest possible cost.
“There are pros and cons to each model. The option to outsource, for example, does make sense within specific scenarios. It is a model that is usually based on fixed terms. The responsibility for the infrastructure functioning and it operating successfully lies with the party contracted to provide the outsourcing services. However, this means that management will have to relinquish a degree of control to the outsourced party so that the service provider is able to assure the client of guaranteed uptime and reliable maintenance,” says Teryl Schroenn, CEO of Accsys.
Within a tight economic environment, the debate over whether to outsource or keep core disciplines in house is particularly relevant.
Schroenn agrees with the advice that it is best to balance short-term gains with long-term efficiencies.
“There are several advantages to outsourcing and insourcing. As far as outsourcing is concerned, there is access to specialised skills, cost reduction, support and the option to focus and concentrate on key strengths to increase competitive qualities. This service model will ensure that software is up to date and there is no need to re-train on statutory changes,” she says.
Outsourcing takes to the sky
Additionally, the advent of cloud solutions represents a new dimension to outsourcing: Management has access to information remotely and continues to outsource the operational side of payroll, while keeping HR software management in house.
Decision makers need to evaluate the environment and core requirements of their businesses before adopting a particular service model.
“This process is where consulting with service providers who are able to offer decision support around the best methodology can add real value.” Schroenn adds.
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