Innovative Ways to Speed Up Pay Cycles in Engineering Sector
Published: 13/02/2023
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One of the key roadblocks in business scaling is slow pay cycles. Today, we want to talk to the finance team of the engineering sector about the cause and the solution. We will be exploring innovative ways to address the challenge such as automation. By the end of the article, you may have a good idea of how to speed up pay cycles in your business.
Compensating workers for their time is the core element of any job. While some jobs offer pre-set salaries, most engineering sector positions pay their employees hourly. Different tasks and different time frames may come at different rates. Sometimes, the time isn’t logged correctly. Often the number of hourly workers is greater than the size of the finance team processing the timesheets and payments. All this leads to slower pay cycles and they, in turn, prevent the business from growing.
This may feel like a dead-end to many companies. They desperately need to speed up pay cycles to grow, but they feel like their hands are tied as they don’t make enough revenue to expand the finance team. And to generate it, they naturally need more workers. Which adds more stress to the finance team. In other words, it’s a vicious circle. The good news is that breaking it is easier than it seems.
Slow pay cycles are caused by a variety of factors. Some of the common ones are complicated pay processes, differentiating rates and the huge number of employees. All these can be broken into smaller causes, depending on the level of granularity you prefer.
Ultimately, slow pay cycles are the negative implication that comes from the business being successful. They often occur due to the workload being greater than the team addressing it, preventing companies from hitting new heights.
We are blessed to live in the work of technological advancement. And this is precisely what makes it easy to address the issue of slow pay cycles. With the right innovative tools, you can alleviate a lot of work from your finance team’s shoulders. Knowing which ones to prioritise can also help you immensely.
Reading, understanding and calculating timesheets is a vital part of any pay cycle. Ultimately the very purpose of pay cycles is to compensate workers for their time. Timesheets are a tool required to record said time. The nuance that often triggers delays is the fact timesheets, when calculated manually, can take a long time to proceed. This is especially true if your company offer differentiating rates. Another factor is the mistakes the submitters tend to make. It’s then the duty of the finance team to correct them as well as fill potential gaps. This process can eat up a lot of time, from spotting to chasing the worker to confirm the error. And then there are lesser yet frequent roadblocks like late submissions or timesheets that were tampered with.
The solution to this all is a digitalised time tracking system. First of all, it can be customised to include the rates you offer and allocate them to specific times, days, duties and people. Using timesheet rules, you will ensure the workers can’t add more hours than they are allowed to work that day. What’s more, you will no longer be spending your time calculating each of them. The designated timesheet tool will handle this for you. Not only is this approach exponentially quicker, but it’s also less likely to make errors. There is also an added layer of security for digital sheets that are only accessible to each worker individually via a unique login. This way you can rest assured there will be no malpractice like buddy punching.
To address other issues we’ve listed stemming from timesheets, we would like to expand a little more. Digitalising how you handle time tracking in your company can help speed up pay cycles by introducing automation. As already mentioned, automation is what gets your timesheets calculated for you in accordance with your rates and other requirements. You can then link them with your accounting packages via integrations to have this data easily transferred there. We will expand on integrations a little further in the article. Automation can also cut the chase for late submitters. All you need to do is to set an automated email to go out to the workers with missing timesheets an allocated number of days prior to the deadline.
With automation, you can also streamline the approval process. Instead of spending time either correcting or filling in the gaps, you can simply reject the submitted timesheet. You can add a note explaining such a decision too. The worker will then be notified and it becomes their responsibility to correct the error and resubmit the entry. In addition to that, this process is extremely quick when using the right software. For example, with Timesheet Portal, you will be receiving an email every time a timesheet is submitted. Instead of logging into the system to review it, you can both view and make your verdict straight from your inbox.
As previously discussed, slow pay cycles are the major catalyst in preventing your business from growing. Some argue that employing digital solutions does not carry the same weight as growing your team. However, we have already pointed out how this mindset is not right and actually leads you back to the same issue. Let’s expand on that.
If your pay cycles are putting a strain on your financial team, you might be hesitant to scale further. Whether this means growing the team for the sake of expanding or taking on more projects to grow profits, it may not seem like a good idea. At least not at the current stage. The reality is you will be stuck in this stage and not progress further unless you change something. Your finance team are human and they won’t magically get better and work faster over time. For the situation to improve, the right steps need to be taken.
The beauty of automation software is that it is designed to help you scale. First of all, as already discussed, it takes over some of the tasks your employees would take a while to complete and carry them out quicker. This means you will eventually have more time and resources to take on more work. Secondly, most solutions are originally built with the intention to solicit scaling as they are adjusting to your growing workforce, clientele and demands. For example, while a regular timesheet plan at Timesheet Portal costs £10 per month for 5 users, it doesn’t mean you are limited by it. You can always grow the number of users as you go for a small fee. And if your circumstances change, you can always downgrade to your comfort number until you need the additional wiggle room again.
Another growth-supporting component of automation technology is that you are not limited to one solution at a time. Most SaaS tools can be linked with one another through integrations, which expands their functionality and serves as yet another time-preserving benefit. For example, instead of manually transferring data from one system to another, integrated solutions only require a couple of clicks no matter the amount of data to be shared.
In addition to that, using different solutions that are interconnected you can build customised processes you’d otherwise be unable to achieve. Given every business is different and is therefore pursuing different goals, this is a treasured benefit. Although best practices are not to be dismissed, they are overall pretty generalised. The ability to customise how things are running offers a massive advantage as in you get to tailor your very own journey to success. What’s more, you most certainly don’t have to worry if the competitors get insights on your custom processes. Simply put - they won’t be able to copy them as they are uniquely yours.
Your job is far from over when you successfully onboard a digital timesheet solution. Digitisation and digital transformation are not one-off implementations, but rather ongoing processes of their own. When you commit to developing them continuously, you will be reaching new heights every time. Next, we will explain exactly how it works.
Don’t stop at the few mere process automation suggestions we’ve explored in this article. The reality is that literally every part of your business can be automated to an extent. Some can be fully entrusted to the machines, while others would only rely on it partially. The point is that this approach can be incorporated into any area of the business and make difference. You might be wondering how would automation of, say, marketing impact your pay cycles - and therefore why would you care about it. Now here comes an important concept for you to understand. When you begin automating, you’re turning your business into one well-oiled machine.
While the areas of attention may not be sharing direct touch points, everything in your business should be aligned. Often different departments are suffering from data siloes. When they are connected through automation, they gain the ability to share the data they each capture. As humans, we often make assumptions such that the next person either possesses the same knowledge we do or has no need for it. This mindset prevents progress, alas it is not something we can really control. Automation prevents that from happening, eventually granting everyone the same visibility and data access. And trust when we say it’s a recipe for success.
Pay cycles naturally slow down as the business grows. The main problem caused by it is that it then prevents further expansion and scalability of the company. There is only so much humans can do, and onboarding new workers isn’t always an option, especially for younger organisations that are still trying to establish themselves within a competitive market.
The best way to speed up pay cycles is by innovating the process. There is no better tool for it than digital timesheets. They take a lot of leg work off your finance team by automating the majority of tasks. Such would be calculating the time, quickening the approval process and holding employees accountable for errors. Integrations with other solutions can expand your automation options further. All in all, this approach will not only help you scale but also scale together with you.
Don’t hesitate to start. Give it a try.