Outsourcing ROI

Greetings all

I've been asked by management to do an ROI analysis of Payroll Outsourcing versus doing it myself.  I don't even know where to begin!  Most examples that I've found usually involve reducing population in the HR Dept, but that is not our objective.  We simply would like to free me up to do other things since our two person dept is consistently overwhelmed over the past year or so.  How do I go about showing how much of my time (and salary) are allocated to payroll, and if outsourcing is the answer?  Any help or advice would be greatly appreciated.

Thank you!


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  • Good afternoon.

    My first suggestion would be to track and then document how much time daily you spend on the payroll function.  Secondly, I would reach out to ADP or Paycor (two large payroll providers).  They will jump at the chance to prove the ROI of using their service.  They might even have a lot of data gathered already for this specific purpose.  Don't recreate the wheel if you don't have too.  Once you have both sets of data, you can arrange it as needed to present it to your boss.

     ADP Sales Number--800-225-5237

    Paycor Sales Number--800.381.0053

    Good luck. 

  • I think Ceridian's product is better than ADP's and they are certainly lower cost.  Ceridian includes significant HRIS functionality that ADP does not.


    That being said, don't focus only on the amount of money saved.  Make sure you also look at how many hours are freed up to do other productive work.  People value freed hours in many different ways, sometimes at a multiple since the freed hours also count as a reduction in the rate at which headcount will increase if business increases.  If any of the people who had their hand in payroll (e.g., accounting) also did some other productive work that you can put a figure on (e.g., accounts receivable), you can stack that on there, too.  More time spent collecting money is more fun in the boss' eye than more time spent spending it.

  • Thank you both...I was a little hesitant to start with the providers, since I hate pushy sales calls (doesn't everybody?)  But, you're right, that is probably my best and most efficient starting point!
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