Balancing service, price, and risk in the Charity sector
Charities and not-for-profit organisations, perhaps more than any other type of business, look to payroll outsourcing as a way of lowering risk. With over 170 payroll-related pieces of legislation, compliance is becoming more and more onerous.
But how do you make a choice about which outsourced provider to use?
In my experience, the risk-averse choice often leads organisations to choose the bigger players and market leaders. In the charity sector, many have decided to use the largest providers on the basis that it is difficult to make the wrong choice if they are a 'household' name.
I would like to challenge that thinking.
The Goldilocks Zone is a term more commonly used in space exploration to describe a habitable zone around a star where it is not too hot and not too cold for liquid water to exist on the surface of surrounding planets. This analogy may seem like it has nothing to do with payroll but bear with me.
A decision about what supplier to use also has a 'sweet spot'. A set of circumstances that make for a fit that is 'just right'. When deciding on a payroll provider, the size of the organisation is important.
Biggest isn't always best.
In these most challenging of times, when charity incomes are falling, many are looking across all of their commercial arrangements to ensure that they are getting the right service and value for money. These huge payroll companies provide an excellent service for many, but they are not for everyone.
In my discussions with charities, some of their concerns include;
- Whether the payroll is being processed offshore
- A lack of a personal relationship with the payroll processors
- Early and rigid payroll cut-off times
- Inflexibility and the inability to adapt to change quickly
- Expensive fees and additional charges for seemingly everything
- The feeling that they are a small fish in a big pond rather than in a partnership relationship with their provider
At the other end of the spectrum, small may mean better personal service, but what about compliance? Does a small provider have the necessary depth and breadth of expertise?
As a charity your Trustees have responsibilities to ensure you are compliant, acting in the charity's best interest, applying responsible resource management, and acting with care and skill. You need to do your Due Diligence and make sure that any vendor, let alone one as critical as a payroll provider, is an appropriate choice.
You also need to ensure that vendors have the resources, capability, and technical expertise to deliver not only a day-to-day solution but to be able to continue delivering that service when the unexpected, unusual, or complex lands. If the global pandemic has taught us anything, it is that the unthinkable can happen!
This is typically something a small, managed payroll service provider will not be able to deliver. They will not have the resources to put in place all of the necessary assurance, expertise and safeguards to deliver.
Just RIGHT – welcome to the Goldilocks zone
Here mid-tier payroll providers, like Dataplan, can really fit the bill.
They provide a balance of cost-effective solutions, personal service, expertise, and all of the resources necessary to meet the needs of today's charity sector but without the inflexibility and bureaucracy often associated with the very large providers.
Truly delivering best value and service while minimizing risk.
What does 'Just Right' look like?
At Dataplan we have deliberately positioned ourselves in the niche where we are big enough to count but small enough to care.
We have a long-term vision rather than short-term profit goals driven by shareholders. Our view is that getting it right for our customers leads to long term success for our business.
And, in that 'just right' goldilocks zone we have all of the necessary resources, skills, expertise to deliver top-notch service and deliver exceptional value for money.
- Culture and values that is embedded throughout the organisation
- Quality people and experience, and their continued professional development
- Experience working with charities and not-for-profit organisations
- All people, processing and systems in the UK
- A stringent Quality Assurance Framework with ISO27001 accreditation and ISAE3402 audits
- Payroll, tax, pension and HR specialists
- Named contacts consistently handling your payroll
- Technology developed by our in-house team and designed to integrate and wrap around your systems
- A committed CSR strategy
- Financial stability of a business that has traded for over 50 years
I would be happy to have a no-obligation discussion with any charity who is looking to outsource for the first time or is unhappy with the service they are receiving from through current provider. You can contact me at firstname.lastname@example.org
From payroll outsourcing and pension service management to ePayslips and gender pay gap reporting; we have a solution for you and your business.