Innovative Ways to Speed Up Pay Cycles in Engineering Sector
Published: 13/02/2023
Free trial
See for yourself how you can save time and money. Enter your details below for a free 30 day no-obligation trial.
One of the main obstacles to business growth is slow pay cycles. Today, we want to address the finance team within the engineering sector about its causes and potential solutions. We will explore innovative methods to tackle this issue, such as automation. By the end of the article, you should have a clearer understanding of how to speed up payment cycles in your business.
Paying workers for their time is a key part of any job. While some roles offer fixed salaries, most engineering jobs pay employees by the hour. Different tasks and time periods can attract different rates. Sometimes, hours are not recorded accurately. Often, the number of hourly workers exceeds the capacity of the finance team to process timesheets and payments. All these issues lead to slower pay cycles, which then slow down the business’s growth.
Many companies may see this as a dead-end. They urgently need to speed up pay cycles to grow, but they feel constrained because they don’t generate enough revenue to expand their finance team. Naturally, they need more staff to increase revenue, which, in turn, adds stress on the finance team. Essentially, it’s a vicious circle. The good news is that breaking free from it is simpler than it seems.
Slow pay cycles result from various factors. Common ones include complex pay processes, differing rates, and the large number of employees. These can be broken down into smaller causes depending on the level of detail you prefer.
Ultimately, slow payment cycles are a negative consequence of business success. They often happen because the workload exceeds what the team can handle, preventing companies from achieving new levels.
We are lucky to benefit from technological progress. This is precisely why tackling the problem of slow payment cycles becomes easier. By using the right innovative tools, you can ease much of your finance team's workload. Knowing which tools to prioritise can also be very valuable.
Reading, understanding, and calculating timesheets are essential parts of any pay cycle. The primary aim of pay cycles is to compensate workers for their time, and timesheets are key tools for recording this. A common cause of delays is that, when calculated manually, timesheets can take a significant amount of time, especially if your company offers different rates. Another issue is the mistakes submitters often make. It then falls to the finance team to correct these errors and address any gaps. This process can be time-consuming, as it involves identifying errors and contacting workers for clarification. Additionally, less frequent hurdles such as late submissions or tampered timesheets can also occur.
The solution to all this is a digitalised time tracking system. First, it can be customised to include the rates you offer and assign them to specific times, days, duties, and personnel. Using timesheet rules, you will ensure workers cannot add more hours than they are permitted to work each day. What’s more, you will no longer spend your time calculating each of their hours. The designated timesheet tool will manage this for you. Not only is this approach considerably faster, but it also reduces the likelihood of errors. Additionally, there is an extra layer of security for digital sheets, which are only accessible to each worker individually via a unique login. This way, you can be confident there will be no malpractice like buddy punching.
To address other issues we’ve identified from timesheets, we would like to expand a little more. Digitalising the way you handle time tracking in your company can help accelerate pay cycles by introducing automation. As mentioned earlier, automation is what enables your timesheets to be calculated automatically in line with your rates and other requirements. You can then connect them with your accounting software via integrations to transfer the data easily. We will discuss integrations further in the article. Automation can also streamline the process for late submissions. All you need to do is set an automated email to be sent to workers with missing timesheets a few days before the deadline.
Automation also helps you streamline the approval process. Instead of spending time correcting or filling in gaps, you can simply reject the submitted timesheet. You can also add a note explaining your decision. The worker will then be notified, and it becomes their responsibility to correct the error and resubmit the entry. Additionally, this process is very quick when using the right software. For instance, with Timesheet Portal, you'll receive an email every time a timesheet is submitted. Instead of logging into the system to review it, you can view and make your decision straight from your inbox.
As previously discussed, slow pay cycles are the primary obstacle to your business growth. Some argue that digital solutions aren't as effective as expanding your team. However, we have already demonstrated that this way of thinking is flawed and can bring you back to the same issue. Let’s explore that further.
If your pay cycles are straining your finance team, you might hesitate to expand further. Whether this involves growing the team to support expansion or taking on additional projects to boost profits, it may not seem like a good idea. At least not at this stage. The reality is you will remain stuck in this phase and won't progress unless you make a change. Your finance team is human, and they won’t suddenly improve or work faster over time. For things to get better, the right steps need to be taken.
The benefit of automation software is that it is designed to assist your growth. Firstly, as previously mentioned, it takes over some tasks that would require your employees a significant amount of time to complete and does them more quickly. This means you will eventually have more time and resources to manage additional work. Secondly, most solutions are initially built with the aim of supporting scaling as they adapt to your increasing workforce, client base, and demands. For example, while a standard timesheet plan at Timesheet Portal costs £10 per month for five users, it doesn’t mean you're limited to that. You can always add more users for a small fee. And if your circumstances change, you can always downgrade to your preferred number until you need the extra capacity again.
An additional benefit of automation technology that fosters growth is that you are not limited to using only a single solution at a time. Most SaaS tools can be linked through integrations, which enhances their functionality and offers another time-saving benefit. For instance, instead of manually transferring data between systems, integrated solutions require only a few clicks regardless of how much data needs to be shared.
Furthermore, by using various interconnected solutions, you can create customised processes that would otherwise be impossible to achieve. Since each business is unique and has its own goals, this provides a valuable advantage. While best practices shouldn't be dismissed, they are usually quite general. The ability to tailor operations offers a significant benefit, enabling you to customise your own route to success. Additionally, there's no need to worry about competitors gaining insights into your customised processes — they simply won’t be able to copy them, as they are uniquely yours.
Your task isn't finished once you successfully implement a digital timesheet solution. Digitisation and digital transformation are ongoing processes, not one-off projects. By committing to continuous development, you'll reach new heights each time. Next, we'll explain exactly how it works.
Don’t restrict yourself to the limited process automation ideas we’ve discussed in this article. The reality is that almost every aspect of your business can be automated to some extent. Some areas can be fully entrusted to machines, while others only partially rely on them. The main point is that this method can be applied to any part of the business and can make a significant difference. You might wonder how automating, for example, marketing could impact your pay cycles - and why it matters. Here’s an important concept for you to understand: when you begin automating, you’re transforming your business into a well-oiled machine.
While the areas of focus may not have direct touch points, everything in your business should be aligned. Often, different departments suffer from data siloes. When connected through automation, they gain the ability to share the data each captures. As humans, we often assume that the next person either has the same knowledge we do or does not need it. This mindset hinders progress, yet it is not something we can easily control. Automation prevents this from happening, ultimately granting everyone the same visibility and data access. And trust us when we say it’s a recipe for success.
Pay cycles naturally slow down as the business grows. The main problem with this is that it then hampers further growth and scalability of the company. There is only so much humans can do, and onboarding new workers isn’t always practical, especially for younger organisations still trying to establish themselves within a competitive market.
The most effective way to speed up pay cycles is by innovating the process. Nothing beats digital timesheets for this purpose. They lessen much of the workload for your finance team by automating tasks like calculating hours, speeding up approval procedures, and holding employees accountable for errors. Integrations with other solutions can further enhance your automation capabilities. Overall, this method will not only help you scale but also grow alongside you.
Don’t hesitate to start. Give it a try.