Last week I started sharing our team’s checklist of items to consider when implementing a new payroll system.  And because there were quite a few items (okay, okay A TON of items) to think about, I thought it would be best on all of our brains to finish sharing the list today. Hopefully the first part of our list didn’t drive you to drink, but if it did we’re hoping you’ve all nursed away your hangovers and are ready for part two!

Getting Down and Dirty

• Make sure the vendor is using an issues log. If not, suggest one be part of the project. Google Docs is a great way to share these logs so both organizations can edit, review, and manage.
• Establish a risk management plan.
• Request the requirements documentation/templates you will need to complete as soon as possible from the vendor. Getting these a little bit in advance will ensure no surprises. Generally speaking, this is the area where a lot of projects get delayed.
• Sign up for the training classes that meet the project schedule early before they get filled up.
• Don’t necessarily look to mirror existing processes and procedures. This is a time to make changes that are needed to make the organization more efficient and streamlined. Make Change Management an active and necessary part of the overall project.
• If you have a lot of duplicate earning codes/deduction codes/job codes or unnecessary codes (for example), use this time to clean up items which are no longer needed.
• Discuss your reporting needs with the vendor.
• Make sure the vendor knows your GL requirements and confirm the GL is part of the test plan.
• Depending on the full solution, various interfaces could be part of the project. If so, identify those interfaces in the beginning of the project and ensure the vendor knows the requirements and specs, etc. Confirm interface development and testing is part of the project plan. Too often we see these as “Phase 2” items and that really adds risk to a satisfying go-live.
• If you have any problems getting data from your current system or concerns about your data quality, let the new vendor know immediately. Make sure to allot time to review the data before it’s provided to the new vendor. Good data is one of the most important tasks within the project. This too is an area where projects can get delayed.
• If you have local taxes, discuss these with the vendor so everyone is comfortable. Some vendors manage these for their clients while others insist the client is accountable for keeping up with local changes.
• If you have individuals who work and live in different states, discuss this with the vendor.
• Ensure the vendor has a period of time designated for functional testing. Ensure a good understanding of what functional testing will include.
• As needed, ask the vendor for help establishing User Acceptance Testing (UAT) criteria and test cases. Most vendors won’t have a full UAT plan, but some vendors will help the client put this together. This is one area that any vendor out there cannot be successful without the employer (or your consultant) picking up a huge share of the workload. Your company is unique – and no vendor can anticipate what needs to be tested from your employee’s point of view.
• Often functional testing is the period where security and access levels are tested. If not, make sure security is tested early in the project. Allot time to test Employee and Manager Self Service.
• Ensure the vendor is allowing for at least two pay periods of parallel testing. We see vendors advocating for this to be scaled back. We always encourage our employers to bake as much quality into their implementation as possible.
• Some vendors will provide a test database. If the vendor is going to charge for the test database, it’s a good investment. Note- you may only need a test database for a year or so.
• Be prepared for a period of dual entry with the old system and the new system. In other words, a lot vendors today load the final employee demographic data well in advance of go-live. This means you will be maintaining two systems (two systems of record) for a short time.
• Make sure you have a go-live plan and in particular, a plan to triage any go-live problems, questions, etc.

Don’t Forget About

• Review the processing schedule with the vendor early so it’s clear to everyone. Also, double check holidays, short work weeks, etc. on the processing schedule. Do you have off-cycle bonus runs?
• Be discerning while making sure your previous vendor is aware you are leaving. Look for any possible service drops, gaps of coverage, etc. If your previous vendor is providing tax filing, ensure the service is turned off (to avoid duplicate 941 and quarterly filings, etc.).
• If the new vendor is providing tax filing services, you will need to provide tax IDs, power of attorneys, rates for SUI, etc. Make sure all of this is completed on time. Failure to provide IDs or SUI rates, for example, will result in penalties, delays, and unnecessary confusion.
• If the total solution includes a time clock import, ensure this is part of the parallel testing process.

This rounds on me!

Lift your glass and shout cheers to improved processes and an integrated payroll system! We truly wish you the best of luck in your implementation. If this is all way too much for you to take in, give us a shout! We have several payroll experts that can help guide you through this process. Don’t forget to follow me on Twitter @HRTechKaiser!