Cloud computing and IT outsourcing in the payroll companies

Introduction 

With so many companies offering payroll services, it is essential to stand out from the competition. Outsourcing payroll has become a preferred method of business owners for numerous reasons, including compliance, ease of use, and time savings (. If a payroll company doesn’t offer the best in technological advancements, they can fall behind, and the financial implications of losing clients can create numerous issues to the bottom line. It is essential to discover what these financial implications involved, so that a company can keep up with proper technology moving forward. Continually educating the company on needs, understanding risks, and planning for the unexpected, are crucial financial management principles for the payroll company to focus on, moving forward. 

The payroll industry has grown significantly over the past few years because of advanced technology. The companies utilize technology by developing cloud-based platforms to carry out their business activities. They also human capital management as well as outsourcing information technology from in-house payroll to the vendors. There is a lot of competition in the local and international business markets among the payroll companies (Firdhous, et al., 2013). Therefore, many US payroll companies depend on the creativity and knowledge to improve their competitive advantage. Innovation is based on the open interaction of creative sources and application of that knowledge in the business activities. Many companies now rely on both external and internal knowledge sources for Information technology. They have maintained links to different knowledge sources both locally and internationally (Doldán, et al., 2016) 

Companies are searching for external and internal knowledge to contribute to innovative and creative production which increases the market performance. The notion of original sources and understanding of the competitive advantage of the company has led to extensive research on which sources are reliable. However, the topic of whether external or internal sources is still involved and has compelled more discussion among the scholars. Cloud computing is one of the current methods that most companies are using (Chesbrough, 2013). It has many advantages. For instance, it gives a company the company to set up a virtual office for flexibility to connect to the business anywhere all over the world. Using global cloud-based benefits systems streamlines the way multinational companies sell their brand in the worldwide market (Kang, 2014) 

Literature Review 

The articles provide great insight into the importance of cloud technology in the payroll industry. These will be utilized to help focus on the needs of customers. I will also provide some research based on the importance of technology enhancements from other companies, not just the payroll industry, and research which focuses on the importance of increasing research on technological improvements. 

Technology has transformed payroll operations; the payroll personnel department has to expand their knowledge through various sources. Technology is one of the successful knowledge source and innovation on the payroll systems. Many payroll business organizations are using different technological methods to apply modern payroll services and operations. Though many organizations are still slow in adopting new technology like cloud computing in the accounting, finance and payroll systems because of fear of security, cost as well as privacy. However, it is hard for a payroll company to justify the reason as to why they should not invest in technology for better operations and service delivery (Kang, 2014). More payroll organizations in the United States are embracing cloud computing, data analytics, and IT outsourcing for payroll operation. This section provides a review of different articles on how cloud computing and outsourcing technology to have a competitive advantage in the global market (Firdhous et al., 2013). 

Outsourcing IT processes 

Outsourcing technology is one of the common strategies small and big companies are using to survive in the competitive business world. Many researchers highly recommend outsourcing technology because many companies, especially small ones or start-ups face competitive pressure to reduce the cost to improve productivity (Kang, 2014). Many organizations are now outsourcing to get the business going through tough times temporally. The company can have one independent contractor or collaborate with another large outsourcing company based on the needs of the company at that time. Innovation outsourcing has many benefits to the company because it leads to short-term cost savings. Outsourcing reduced the cost in the economies of scale, and it also has different characteristics such as different motives as well as risks (Kang, 2014). 

Outsourcing is done with strategic reasons which produce different impacts to the company. Most firms would go for external sources where they do not have the in-house ability. Therefore, the outsources are used as instruments to get external knowledge that is later integrated into the firm with more advanced knowledge. However, apart from other general outsourcing, the innovation outsourcing leads to leakage of information from one company to the rivalry company. According to a survey study Chesbrough, (2013), there is always lack of control of information from leaking to other competing companies. Moreover, since the provider already has more knowledge compared to the buyer of that knowledge, the buyer may not have control on whom the experience should be or should not be shared too. Leakage of the firm’s information weakens the company’s integrative ability (Joseph & Brown, 2017). 

Cloud Computing 

Cloud computing is a model of operation, web applications, networks, and computing systems to give information technology services. The cloud personnel specializes in giving providing applications and services. They allow the experts to efficiently manage the apps, upgrade and maintain them (Joseph & Brown, 2017). Cloud-based payroll software is suitable for growing business since they can be easily scaled. They promote the growth of the industry since cloud storage reduces paperwork, pace, and associated costs. The user can choose to upgrade or customize the platform based on the needs of the company. Cloud computing gives the business organization many advantages as it becomes a virtual office which is operated anywhere any time. It has the following benefits, reduced. It costs, enhances business continuity, promotes collaboration efficiency, scalability, flexibility in the staff and work processes, accessibility to updated data among others (Chesbrough, 2013). 

Reduced costs of IT 

When a business moves to a cloud computing it reduces the cost of management and maintenance of the Information technology systems. Instead of the company purchasing big and expensive machines, the department can use the resources of the cloud computing service provider. It reduces the cost of new upgrades of the hardware and software which can only be installed on a contract at a lower price. The staff do not need to be paid wages for casual work, and the energy consumption is also reduced as well few or no time delays (Drum, et al., 2013) 

Increases scalability 

The organization can decide to scale up or down the operations as well as storage needs to suit the situation of the organization. It also allows flexibility especially when the needs change. Therefore, install of buying and installing expensive upgrades. The computer cloud service provider can do this for the company at free up time to ensure the continuity of the processes (Firdhous et al., 2013) 

Enhances Collaboration and Efficiency 

Collaboration helps the organization to share information with other big rivalry company and learn new tactics. Currently, the companies are exploring everything in the processes of creativity and production. They are discovering right from manufacturing, distribution through external collaboration with other sources (Joseph & Brown, 2017). The competitive business market has forced most organizations to start moving vertically to horizontally to shift the competition from the single level to the large business firms. The companies now have inter-firm alliances where they share knowledge in creative services. They range from the R & D partnership with joint ventures in collaboration with the manufacturing companies (Riemann, 2015). 

The company collaborates with other companies, suppliers as well as customers. They cooperate in research and development of knowledge transfer. For instance, some work with suppliers who increase knowledge on the quality of the new products. They co-generate new ideas and expertise on the creation of new product designs. Other organizations collaborating with the active partners to solve short-term technical issues whereas other work with the customers to identify the new market opportunities and help them improve their products to fit the taste and preference of the customers (Joseph & Brown, 2017). 

Improves Flexibility Among the Staff 

Clouding usually creates flexibility among the team in their work practices. The employees can access data from home and carry out some process in their houses to catch up with the deadline. The clouding resources are necessary for creative services in a company, and the employees can compare information online and apply in their company (Firdhous, et al., 2013). If that is made seasonally, the staff does not feel undermined but they collaborate with the new sources to create new ideas and improve services. In addition, when things are going slow outsourcing is also necessary to perform the functions through cloud systems. For instance, when in the accounting department there is a shortage during the tax season as well as auditing time. It is necessary to outsource for a fixed period so that things do not become stagnant (Firdhous, et al., 2013) 

Leads to continuity of the processes 

The employee turnover is one of the stressing aspects to the management. Turnover can unpredictable and it can cause insistency to the business. Therefore, clouding helps to give a level of continuity and consistency to the company. Another person can still pick up and continue with the processes. Hence reducing the cost of new recruitment or bringing substandard employees because the company need urgent replacement (Riemann, 2015). In addition, in a case like when a human resource manager may have an extended medical leave for instance and her assistance want to leave for a particular new job for a short while the company will be forced to outsource instead of employing new employees for that short period. External sources will make the company in operation when the manager is not available using the clouded data (Joseph & Brown, 2017). 

Enhances meeting deadlines 

The human resources have continuously grown in the evolving and innovative world of technology. Through adoption of technology their work has been made more comfortable, they do not need to go through handwritten schedules, check for time off or ask the employees in order to know how to make payments. They just log in the system look for the required data about the employee and make necessary payments. The payroll managers have to meet some deadlines like paychecks as well as tax filing. When they fail to deliver early especially the employee salaries it creates a negative impact on the employees as well as performance this complication can drag the business activities behind. The delays can lead to hefty fines imposed so with cloud computing systems things are done faster before deadlines (Joseph & Brown, 2017). 

Analysis 

Continual Education- Helps focus on the importance of the needs of technological advancements, and the needs of customers to help promote more demand from customers, which will in turn result in more sales for a payroll company. Continued education is a motivating factor to the employees. They feel motivated and valued by the company. It also enhances their career opportunities (Joseph & Brown, 2017). Technology improves digital learning where the employees learn part-time as they continue working. Advanced education among the employees keeps them updated with the current skills and knowledge. Continued support for the employees enhances engagement and excellent productivity. The managers enable or influence the workers and direct them on the right time to study. The also bring external sources to provide information and knowledge to the employees (Kang, 2014). 

Understanding risks 

Technology has enabled many business organizations to learn about the dangers and threats from the rival companies. Through online research, companies can view the techniques that other rival companies use to win the trust of its clients (Riemann, 2015). Moreover, through customer relationship management, the company surveys online about the client’s needs. They also give their feedback through a discussion forum. Focusing on what can happen if a tech isn’t being offered that another company offers or presenting a new enhancement to companies that isn’t ready to launch, and the financial implications of an error and losing customers because of it. Technology can manage the risks effectively to enable the business to radically outdo the other companies (Firdhous, et al., 2013). 

Plan for the unexpected 

Keeping up with tech even when it is hard to do, fixing issues that are caused from technology enhancements, competition with a competitor who offers a new tech that a company cannot provide, all relate to a company’s losses and financial issues (Firdhous, et al., 2013). Organizations today invest in technology to measure, develop and retain large number of people, assets and liabilities. The right technology gives the right technical solutions which keeps the company stable and productive. The businesses must own the answer to their problems and use it in the right way. The organizations have their answers in technology which combines global and local resources to prepare, engage as well as enable the business to adopt computer clouding (Riemann, 2015). 

Most companies have invested in cloud systems because anything can happen to destroy information. Information technology completes control on data and it authorizes who can access it and who cannot access it. There is a password on every data whereby not every manager can access it. It also interfaces with other systems. Cloud-based payroll software is automated machine which improves efficiency and enables the employees to have access to their payroll information online (Drum, et al., 2013). Workforces in most companies have mobile payrolls the employees communicate with their bosses on phone not only with their co-workers but also with the workers in other companies through different cloud platforms. the employees also fill expense reports through their apps they also allow access to the payroll, hours, as well as additional relevant information can be found by the manager through different online portals. Technology helps in driving data where they automate the routine processes and use data obtained through the clouds to drive their decision (Joseph & Brown, 2017). 

Synthesis/Integration 

This is focused on offering better products, better technology, and being a leader in the payroll industry, not with just price offerings, but also with user-friendly and high tech that a business owner can benefit from. If the technology isn’t there or isn’t a primary focus, then the competitors can step in and take business from a payroll company. Technology offerings are significant now in the HCM word (Chesbrough, 2013). The iSolved HCM helps the company to streamline all the payroll processes. This empowers employees due to reduced workload, lack of delays in payment as well as self-service through mobile abilities. They also stay compliance with the government, local and state with single solution (Drum, et al., 2013). 

The managers can manage the data of the employees using the HCM systems. The employees benefit through open enrollment, they also get to know the new promotions and employees, the employees also build a high profile for the company using the performance management systems to reward the best employees. The human resource managers also use tracking systems through advanced technology to monitor and recruit new employees. Therefore, HCM system helps in recruitment, onboarding to performance as well as separation and payroll systems. It also reduces paperwork because it is automated and improves employee engagement (Drum, et al., 2013). 

Conclusion 

It takes more than 2 years for a payroll company to start making money on a client. Payroll company A has a retention rate of 93% because they focus heavily on client experience, which involves enhancing technology and ease of use (Joseph & Brown, 2017). If a competitor enters the market with better technology and a better experience, the payroll company can lose a lot of money because of this. It is vital that a payroll company focuses on everything when maintain and gaining new prospective business. 

The emergence of cloud computing technology has played a significant role in most companies. It has influenced the processes and executions of the business. Today most companies have moved everything to cloud computing apps which are said to be cost-effective, flexible, convenient and time efficient. The human resources can now manage the employees working hours and payroll processes. The human resources track the employee’s attendance, leaves, updates real-time data entry which can be retrieved from the software. The software also backs up information required when the papers cannot be located or in case of a crash in the machine where data is lost Cloud computing backs up information (Chesbrough, 2013). 

The human resources have found working comfortable and convenient as well as flexible because they can work at home in their systems, and ensure that the usual practices are done without them having to travel to the workplace. For instance, if the boss was sick and he wanted to make payment to the employee yet the duration for the leave is not over he can just log in to his machine and retrieve relevant information he needs about the payroll then make payments (Firdhous, et al., 2013). 

Cloud computing is a model of operation, web applications, networks and computing systems to give information technology services. The cloud personnel specialize in giving providing applications and services. They allow the experts efficiently manage the apps, upgrade and maintain them. They also deal with backups, recover as well as dealing with failover functions. The clients of cloud services benefit the reliability and decline of the costs due to the economies of scale as well as other factors of production. Using the cloud computing the payroll companies monitor the needs and the risks and take necessary steps to deal with them. Cloud computing motivates the IT organizations as well as other service providers to increase standardization and processes so hat aloud of computing models can be interpreted efficiently. One of the befits of cloud computing is that it is scalable meaning that it can be upgraded on downgraded to fit the needs at that moment (Drum, et al., 2013). 

References  

Chesbrough H. (2013). Open Innovation: The New Imperative for Creating and Profiting from Technology . Boston: Harvard Business School Press. 

Doldán, T. F. R., Huertas, P. L., Martínez, L. F. J., & Sanchez, C. P. (2016, January 1). Information Systems/Information Technology Outsourcing in Spain. 

Kang, KH., & Kang, J. (2014). Do external knowledge sourcing modes matter for service innovation? Empirical evidence from South Korean service firms. Journal of Product Innovation Management, 31: 176–191. 

Firdhous, M., Hassan, S., & Ghazali, O. (2013). Statistically Enhanced Multi-Dimensional Trust Computing Mechanism for Cloud Computing. International Journal of Mobile Computing and Multimedia Communications, 5, 2, 1-17. 

Drum, D., Becker, D. A., & Fish, M. (2013). Technology Adoption in Troubled Times: A Cloud Computing Case Study. Journal of Cases on Information Technology, 15, 2, 57-71. 

Riemann, U. (2015). Benefits and Challenges for BPM in the Cloud. International Journal of Organizational and Collective Intelligence, 5, 1, 32-61. 

Joseph, R., & Brown, P. (2017). The Cloud Gets Personal: Perspectives on Cloud Computing for Personalized Medicine. International Journal of E-Health and Medical Communications, 8, 2, 1-17.