Every business has its own story. Especially those exciting and thrilling moments of the business’s evolution will ever remain in the mind of the entrepreneur and will be cherished as he witnesses the company’s success.
Right from developing the idea of a business,
initiating the efforts to get the practical things done, recruiting employees, getting the work done, creating and retaining customers, gradually witnessing the increasing profits, etc., are all the different stages of the growing business. But most of the time, a crucial aspect is overlooked by many businessmen.
It’s trending that the employees are considered to be the first customers. And retaining the employees is as necessary as retaining the prospective customers of the company. A crucial aspect that plays a significant role in maintaining the employees is the timely salary disbursement. It creates the right business environment that enables trust in the management and helps in employee engagement.
In case if the company ends up dissatisfying the employees, then the consequences indeed wouldn’t favor the business. But then, the concern is, how to make sure that the salary management is functioning smoothly? What’s the best solution? How to make the right choice? Let’s discuss and figure out answers to these questions in this blog.
An Overview Of The Various Tools For Salary Management
Salary management includes all that a company provides the employees in return for the work done by them. Thus, it includes basic pay, bonuses, incentives, company perks, etc.
There are three standard solutions available to plan and enable the functioning of salary management used by the companies. They are:
It is the oldest form of compensation management tool used and is still used by a very few companies. The biggest drawback is that the salary management process is too time-consuming and involves risk factors such as human error, data transparency, and data security.
Human Capital Management (HCM) or ERP
HCM is a human resource management software set of practices that strives to achieve organizational competency goals. This includes an integrated functioning of payroll, personnel and benefits administration, ESS, etc.
Best Of Breed
Best of breed is referred to as the best system for a particular category or niche. The system is limited only to its specialized area. In short, it is a digital tool designed for particularly one element of the procurement process, such as payroll or attendance systems.
The functions, benefits, and features of the tools mentioned above differ in their own ways. Therefore the companies need to discern which suits them the best and employ the same.
Crucial Aspects To Consider While Choosing An Impressive Salary Management Solution
With the growth of technology, many organizations are adapting themselves to automated processing and functions. And the same goes for the salary process or payroll. But then, as mentioned earlier, the primary concern lies in how to make the right choice in the midst of the many options available.
Here is a list of essential factors that can be considered in making the choice of the right salary management solution in alignment with the company’s priorities. Let’s discuss one-by-one.
The salary management solution choice made by the company should ensure that the implementation is simple and easy. Also, see to it that the implementation and adoption of the software do not disturb the other functions of the organization. Instead stimulates easy workflow with the least complications.
Configurable Salary Components And Structures
The method of salary process or the components included varies according to the needs and priorities of the organization and definitely cannot be expected to be the same for all. Therefore, it is quite necessary to make sure that the solution you want to implement enables you to configure and clearly establish your company’s salary structure.
Built-In Statutory Compliances
Complying to the many statutory regulations has always been a challenging task. Hence, the software that the company is willing to implement should have inbuilt compliances to reduce the risk of non-compliance. Also, make sure that the vendor regularly updates the changes in the laws without fail.
- Cloud-Based Solutions
The adaption to a cloud-based solution enables the businesses to be flexible as well as get access to the data and information anywhere and anytime. Added to this, it also ensures the security of data despite the unpredictable and unfortunate disasters that might arise. With the increasing remote working scenario, this feature is becoming mandatory.
Automated Payroll Process
The ability to compute and process the payroll function accurately is the most important criteria. This includes the process right from gathering the related data to depositing the salary amount to the concerned employee’s bank account.
The software that the company is willing to implement should also include the feature wherein the employee can generate the payslips or salary slips without depending on the manager for the same.
The software should aid you in generating multiple reports based on the company’s requirements. For example, a report that shows the summary of the professional tax paid.
When we say tax, it does not mean the tax only of the company, but also those of the employees. The software should let you effortlessly file all the tax declarations directly from the payroll software’s portal itself.
Other important criteria are the ability to be integrated with the other or pre-existing tools in the organization. The payroll software should offer flawless alignment, and the compatibility needs to be checked well before finalizing the product.
Employee Self Service
It is said that an ideal payroll or salary management solution is that which helps the employee be independent and can have access to his information easily. This helps him keep track of his salary, tax, and other necessary information related to the concerned employee.
Applications And Claims
It may happen that the employee has to spend from his own pocket for company use at some point. Instead of handling it with physical bills and vices, it would be better if the software allows him to claim the same through the portal.
Added to this, the portal should also include a feature that allows the employee to put forth different applications such as leave, attendance regularization, etc., for better transparency and smooth workflow.
Essential Characteristics Of A Salary Management Solution
While discerning an impressive solution for payroll or salary management, the following are the basic characteristic features that software should possess for an assured smooth functioning:
- Total Return on Investment
- Risk management
- Comprehensive capabilities
- Vendor consolidation
- System compatibility
It’s quite essential to understand that employees and organizations perceive compensation or salary management differs undoubtedly. While the employees prefer that benefits are the third-highest factor that contributes to job satisfaction and performance, employers prefer the pay that’s based on the workforces’ merit is effective for driving the individual performance.
However, this difference in views has indeed led to dramatic changes and shifts in workforce payment strategies. This is leading to the reinforcement of the need for a well-designed strategy. Therefore, it’s important to analyze all the factors necessary to strategize your salary management and discern the right solution for the same.
Divyang Metaliya is a Business Consultant working with factoHR. Apart from managing and improving business processes, his hobby is to spread his vast area of knowledge to the people out there. He loves to create content that is innovative and engaging for the readers.
Salary Management Solution