01 December 2020

Jerome Smail, freelance journalist, presents the views of four industry luminaries


Payroll is a high-stakes endeavour, whatever the scenario. But it could be argued that when the function is operating in a client/customer context, those stakes are raised even higher.

To find out the secrets of success in client and customer fulfilment, I spoke to four key players in the industry:

  • Stuart Price, head of payroll products, MHR
  • Paul Thickett, payroll services director, SD Worx
  • Karen Thomson, payroll partner, Armstrong Watson
  • Abigail Vaughan, chief operating officer, Zellis.

How have customer/client needs changed for payroll and human resources (HR) suppliers in the last decade?

Stuart Price: There are greater demands and expectations from the customers’ systems due to evolving legislations and the need for the technology to keep pace. Systems, rather than people, now manage legislation, and complex decisions are able to be made via technology and assist customers through a process. As a result, people in payroll now don’t need to know the ins and outs of the field, when a decade ago this wasn’t the case.

This isn’t to say that the decision making has been completely removed from the person. How successfully a system runs a policy depends on the correct initial input of the user, as it can only do what it’s originally programmed to do. In more fringe areas, such as where councils and government departments need to issue orders for money to be taken from people’s pay, an initial decision, such as the type of deduction required, still needs to be made at the human level before the system can then guide them through the rest of the process.

Paul Thickett: I believe that customers are looking for a digital-focused approach for key teams and employees. People want to be able to access payslips online or on their mobile phones and payroll teams need to be able to work from anywhere, so the demand for cloud technology has grown significantly.

Inputs are more efficient, and the quality of service delivery is more about core HR and payroll and its associated outputs working together and aligning to insights that contribute to effective policy decision making for the whole business.

Karen Thomson: As legislation has increased and more responsibility put onto payroll and HR service providers, I have found clients want less interaction with both areas. Most clients are very happy to provide the minimal amount of information and leave the rest to payroll. I am finding many clients are viewing the payroll service as providing HR support, too. For example, I often have requests to work out holiday entitlement (not the pay side), work out redundancy entitlements, and so on. The landscape is changing significantly in my experience, with HR and payroll becoming ever closer.

Abigail Vaughan: Although payroll and HR has significantly evolved, there are two types of customer needs that have been consistent over the last decade.

The first is the need for the supplier to prove it has deep expertise and proven experience in its fields. The second important need is cost efficiency. Payroll is a major cost centre in most organisations, and so there has always been a need to find new ways to create efficiencies, particularly around the more transactional processes that have traditionally been done manually. Many organisations are therefore looking to suppliers to provide solutions that help them harness process automation and artificial intelligence.

What are the key principles of customer/client fulfilment in payroll and HR?

SP: Along with accuracy, the customer’s system being able to match their expectations is another key factor. Customers are truly fulfilled if the system is able to automate complex processes and remove the day-to-day calculations, which is why it’s so important for the right data to be input from the get-go. The system is only as good as the data fed into it, so the more accurate the data, the more able the system is of supporting the customer throughout.

PT: You must create a partnership and collaborative approach with all key stakeholders (external and internal) in order to get the most of your payroll, especially at the beginning of the relationship when you’re discussing the objectives and details.

There needs to be lots of communication and discussion and the results will reflect that approach. It will be clear if there has been no communication because you’ll experience issues, missed deadlines and overall poor performance, which will be evident in the data that underpins the whole process.

KT: If I answer this as what would be the wish list of many of our clients it would be to provide a full HR service from recruitment to exit, collate all payroll information and act as the payroll department and the HR department in one.

AV: As a supplier, you must understand and address the needs of individual customers and not just say, ‘Here’s my solution, let’s make that fit your problem’. Suppliers need to be flexible enough to consider what is and isn’t important for each customer, and therefore develop a tailored solution which directly solves that customer’s key issues.

Another key principle is having a mindset for continuous improvement, even if customers already believe the service is exceptional.

And, finally, it’s key to deliver value at a strategic level. Beyond just providing software or a service, a truly customer-focused supplier should deliver real data-driven insights that help payroll and HR teams have relevant and impactful discussions at board level.

In what ways can payroll/HR providers go the extra mile to ensure customer/client needs are fulfilled?

SP: Clearly listening and engaging with customers while also including them on your own journey ensures they are at the heart of everything you do. At MHR, we arrange regular panels with customers to gain their feedback on how best to enhance or improve a system, and find this highly beneficial. Customers then feel that they have had an active role to play in such a project, and a positive perception of the company’s brand is maintained.

PT: At SD Worx we have a continuous improvement culture that aligns with our customers’ culture, and we measure this through clear deliverables and KPIs [key performance indicators] – which can be in ‘upcoming legislation’ and ‘key end to end processes’. Above everything, we always try and put ourselves in our customers’ shoes and understand their needs.

KT: The key is to go the extra mile in customer service, and I believe over the last eight months this is what has happened. The difficulty, however, is a payroll service provider must make a profit, and more resource is going to be needed to really go beyond client expectations.

AV: You must recognise that customer success doesn’t begin and end with the sales process. Suppliers not only have to hold themselves accountable for delivering on the value and benefits they have promised to customers, but they also have to look for ways to preserve and strengthen that relationship in the long-term. This includes, for example, proactively bringing forward ideas for further process optimisation, or how to improve the quality of reporting.

Plus, even if the qualitative feedback from customers is good, suppliers should consider if there are other effective ways of measuring customer fulfilment, such as through metrics like transactional net promoter score, as these often shed light on opportunities for improvement that may otherwise be missed.

How should payroll/HR providers deal with situations where mistakes are made or the customer/client is dissatisfied with the service?

SP: The first step to rectifying this is accepting the responsibility and being honest about where it went wrong. No software is 100% error-free; providers should be transparent about the timeframe for resolving the issue, providing regular updates and looking for alternative solutions to help the customer in the meantime.

PT: Transparency, ownership and clear action plans for immediate recovery are key. I’m a big believer in honesty. If mistakes have been made the right (and only) thing to do is to communicate what’s gone wrong and what you’ll do to resolve it and make sure it doesn’t happen again. This goes back to communication; if you have a good relationship with the customer and can honestly communicate then you can work through any issues together and agree KPIs that are measurable.

KT: In my experience, when you are honest with a client and explain what has happened then most, if not all, will be understanding. Fixing the mistake quickly is a priority, but never hide it!

If a client is dissatisfied, it is important to understand why. It might be they do not understand why information has to be provided in a certain way, or it could be they don’t enjoy the checking or authorisation of the payroll. So often it is about talking and seeing where compromises can be made to ensure a smooth customer relationship.

AV: You need to really listen and get to the root cause of the dissatisfaction. Is it performance, or is it behaviours? In my experience, the latter can make a challenging situation much, much worse.

Once the root cause is understood, the supplier must take rapid action to address it. This could include, for example, providing the team with additional customer service training, making staff changes where the relationship has broken down; or, if the problem is performance related, proposing a rapid service improvement plan to address it in a sustainable way.

It’s important that when required, you pull out all the stops to deliver on what has been promised to the customer.

How much has Covid-19 changed the landscape of customer and client fulfilment for payroll and HR providers?

SP: The industry has had to adapt payroll and HR systems very quickly. As a result of the situation, we are no longer able to truly prepare for any legislation change, going from a few months’ awareness previously to having to change processes almost daily. This has, of course, made work more difficult for providers to ensure the correct legislation is in place at dramatically reduced notice, so it’s been more important than ever that these changes are communicated immediately to customers.PT: I think it has brought to the forefront the calm and composed nature that generally exists within our industry, and I feel our customers have appreciated that even more than usual. As our customers wrestle with the challenges, the quality of the end results have to remain. This is always the case, but even more so during times when pay may be lower than usual for a large proportion of the population.

KT: In my 25-years-plus career I have never seen changes happen so quickly, and clients expect the world. Payroll professionals are used to saying yes and finding solutions, but the furlough schemes tested this to the highest level. There were just some things we couldn’t do, either due to resource and being unable to recruit or not having the right data. One example is knowing when someone worked their hours, as most systems just record paid hours unless linked to a time and attendance system. This caused great confusion to clients who just wanted us to take care of it all. However, despite the extreme pressure put on our industry, I am proud to say we have come through it.

Good luck to all my peers. And don’t forget to join the CIPP Specialist Interest Group so we can learn from and, more importantly, support each other.

AV: We are seeing customers place increasing value on the expertise and solutions of their suppliers to help them navigate the complex government subsidy schemes. At the core of any resilient payroll and HR department is strong, flexible, and reliable technology. As a result, we are seeing customers accelerate the digitisation of their operations, with a particular focus on moving to cloud-based solutions to assist with remote working, implementing more process automation to create efficiencies, and using data analytics to better understand key trends and challenges.

Unsurprisingly, we are also seeing cost reduction go straight to the top of the agenda for customers. So, it’s now more important than ever for suppliers to demonstrate how their solutions and services can help customers optimise the major cost centre that is payroll and HR. Cost effectiveness can be achieved not only by creating process efficiencies, but also by using payroll and HR data strategically to help organisations make smarter and more profitable business decisions.


Featured in the December 2020 - January 2021 issue of Professional in Payroll, Pensions and Reward. Correct at time of publication.