Technology (IT) Impact On Payroll

All business owners/leaders understand their biggest expense in business is Payroll. So, are you concern about your return on investment on payroll?

Financially savvy business owners/CEOs understand the return on investment on human capital – viewing their employees as their most important business asset. 

The fact is, if you experience 15 minutes of unproductive, non-billable time, it translates to a loss of 0.25hours per day in a traditional 40 hours work week. In a week, you’ll have lost 1.25hours. This translates to a total loss of 65 hours, annually.  Screen Shot 2016-12-20 at 3.34.34 PM

Think about how much revenue you would draw if you increased your productivity by 1.25 hours per week. It’s not a hypothetical issue. Reliable research findings reveal that an increase in productivity in such a degree would result in approximately $93, 000 for a business worth $3 million.


Technology is small item on your list of expenses list but has most impact on your Payroll.


Measure: In order to understand your technology impact, first step is to measure.

Do you have ways of measure following?

  1. How many technology related incidents create by staff daily, weekly & monthly?
  2. How many system and/or application related incidents generated?
  3. How many maintenance related incidents generated?

 Calculate Numbers:

  • Ensure accuracy of all incidents and calculate total numbers of incidents.
  • Calculate average resolution time on incidents.
  • Simply calculate Hours: Resolution time x incidents e Average resolution time 3 hours x 50 incidents = 150 Payroll hours

 Impact on Payroll: You don’t need exact numbers to understand impact on payroll, consider hypothetical numbers or averages. For example, If business have 50 employees that translates to over 200k monthly payroll. And approx. spending 20 to 40 hours on above items: consider investment lost out of 200k payroll monthly.

Is it possible to reduce and control this impact? Of course, you need three step process

Measure: Setup your business to get accurate data daily and calculate averages to get starting point

Strategy: Build strategy to setup goals and plans to achieve them to lower and avoid incidents

Process: Deploy ongoing process for testing, analyzing and re-tweaking your technology before it impacts your payroll.

Every process required commitment, discipline and structure to deliver results from your process, build your teams with these values to deliver your process daily.

 Need help? Take action

Partner with Encompass – contact our team

Also review – Impact on Revenue blog

Understanding cost – access cost calculator