Japanese Philosophy

Japanese philosophy has been around for centuries and has imprinted itself in society. Some of the most notable aspects is how it’s influenced our ethics, social structure and businesses! There are many incredible books that you can read on the subject, whether it is for you personally or your businesses growth.

The focus of this article is to take the Japanese Philosophy of Kaizen and how it can improve a payroll bureau, the process and the benefits to the clients.

Kaizen

Kai (change)

Zen (good)

Kaizen is a Japanese word that means “continuous improvement”. Kaizen was originally developed to improve the manufacturing process, but can be applied to other areas of business such as payroll processing. The philosophy helps find inefficiencies within businesses and then make changes accordingly so companies become more productive, effective, safe & waste less. Kaizen doesn’t have to be complicated, but it does require an open mind and willingness to try new things.

Muda (無駄)

Waste

The main focus is about reducing waste (Muda). Waste in this sense in not the typical ‘rubbish’ it has a deeper meaning. Primarily there are 7 forms of Muda, but for the purpose of this article we are going to focus on 5 forms of waste.

5 Forms of Waste

Inventory

The folders, the masses of paper cluttering your office. The unorganized folders on your desktop, the tasks that need to be completed and unanswered emails all come under inventory.

Waiting

This is the turn around time of a service, whether it’s email response times, the distance between cut-off date and payday or how long it takes you review information

Motion

The number of times you click your mouse, how long it takes to shift through inventory to find the correct folder, the dual entry process. Motion looks at the movements to get from A to B.

Skills

Skills are a huge element. This looks deeply into the staff-are they in the correct roll? Are their activities beneficial to business, and have they been properly trained?

Processing

When it comes to information processing, you have a journey from A to B. The Processing element looks at the steps that get you there: collecting data and processing through authorisation for instance.

This philosophy is very insightful when looking deep into the inner workings of a business, it highlights small inefficiencies that you may not consider until you evaluate them.

Kaizen was the foundation to form the better-known process of Lean. Kaizen and The Lean Process look into 3 elements that could be preventing a business from improving Muda, Mura and Muri. These 3 words are extremely powerful and act as a guide of how to carry out changes in your business or industry—whether it is large-scale manufacturing facilities or a small business.

As mentioned previously, Muda looks at wastefulness, uselessness, any activity that undermines value-addition in a business. There are 2 types of Muda.

Muda – Type 1

Non-value adding activities that are necessary for the end customer. To put it into the context of payroll – we have laptops, that have password, that need to be changed to keep data safe. Now the customer doesn’t get direct value, however it is necessary process for the safety of client dat

Muda – Type 2

Non-value adding activities that are unnecessary for the end customer. This is where the 5 forms of waste that we outlined comes back into play.

Muda (type 2) is what should be eliminated in order to improve.

Mura and Muri are at opposite ends of the scales. Mura looks at the the cause, Muri looks at the effect.

Mura

The reason for the wastes exists, it looks at imbalance, unevenness and irregularity. In the context of payroll many bureaus receive emails, spreadsheet folders all in different formats that can lead to such waste in the form of waiting, motion, processing among other things..

Muri

Over time Muri can lead to staff illness, absence and mental wellbeing issues. This can come from Mura but also when there is an excessive elimination of Muda. By standardizing work and evenly distributing the process, you’ll be able to avoid these unwanted side effects that could affect your company in a negative way.

The main focus of ‘Lean’ is about adding value for clients, the business and it’s staff.


Using Kaizen to Help Improve the Payroll Process

Time for some Payroll Context (the reason you’re still reading!)

Looking at the history of payroll, it’s clunky and time-consuming. It can be stressful with piles of paper up to our ears, dual processing that takes too long…everything Kaizen would disapprove of! There have been so many technological advancements in society – why is payroll so far behind?

Answer: it isn’t behind! There are so many amazing systems that eliminate many of the non-value adding activities that have been listed. Payroll is often the forgotten cog in many business, but it’s voice should be heard. By understanding your payroll provider and their internal process you may find that they are actually stunting your business growth.

LitE Payroll have taken the approach of reducing non-value adding activities in order to add value for their customers, business and staff whilst reviewing business activities to ensure continuous improvement. Here is the issues they faced and how they over came the issues along with how their clients benefited…

Inventory

The Issue

Paper everywhere, folders around the room, emails clogging up the inbox.

The Solution – Cloud-based Payroll Management Tool

Access to all our reports online through the cloud-based payroll system. Payslips are sent via a portal so there’s no need for paper payslips! This means LitE could become completely paperless- And emails? They still receive them, but anything that has to do with payroll is received by their payroll management tool.

Client Benefits

Increased data and information security, access anywhere, simple contact process and history of all past information.

Waiting

The Issue

Long response times, cut off day was too early which meant later changes couldn’t be processed every time, issues in payrun were not dealt with in a timely manner.

The Solution –  Cloud-based Payroll Management Tool.

Using internal SLAs to prioritize queries, instant messenger between client and payroller, personalised schedules for time management and automation to reduce the gap from cut off to payday.

Client Benefits

Simple communication, quick responses from their payroller, better customer service, full visual of payroll progress, ability to instantly delete incorrect changes submitted, ability to add changes as they come more accurately.

Motion

The Issue

Multiple folders, hard to find changes and conversation history with clients. Dual entry process to get data to payroll engine.

The Solution –  Cloud-based Payroll Management Tool.

All history of changes and conversation is internally stored. Each client has their own portal with allows for easy access to information quickly. Utilisation of cloud-based technology how allowed for automation the process of pushing data through to payroll engine.

Client Benefits

Reduced risk of human error, access and visual of change and conversation history, received higher standard of customer service and quicker responses

Skill

The Issue

Payrollers become more like data entry people than payroll experts, focus was on admin rather that customer service and quality.

The Solution –  Cloud-based Payroll Management Tool.

By being able to capture client changes in a standardised format and utilise automation to push the data directly into the payroll engine they payrollers do not waste time on time-consuming admin tasks instead they are the experts they trained to be, they can focus on quality, queries and accuracy.

Client Benefits

High standard of customer service, accurate payroll, a quality service, confidence in their payroll expert, are able to ask more detailed questions and get expert opinions on the matter.

Processing

The Issue

Unstandardised spreadsheets and emailed with client information. Dual entry that was very time consuming. Huge risk of human error.

The Solution –  Cloud-based Payroll Management Tool.

All changes are captured directly from clients through the platform in a standardised format. Utilising automation to push the data through eliminated the need for dual entry and saves time.

Client Benefits

Simple process to submit changes, can submit changes through a mobile app, real-time visual of the progress of their payroll and changes, accurate payroll and great customer service.


See a trend occurring?

The Cloud-based Payroll Management Tool

The Payroll Management Tool managed to provide a solution to many inefficiencies and transform LitE’s payroll process. They have internally streamlined their processes, maximised security, improved customer service and focused on quality- all of which benefits the customers hugely! The risk is massively reduced due to fewer errors occurring with dual-entry and multiple systems. Clients view progress live as well as communicate directly with their payroll expert, meaning they still remain in control whilst LitE do the hard work.

It’s critical for companies to evaluate their outsourced business functions and learn about the processes that are in place. Doing so will help them find a provider with whom they can work productively going forward.

Ask yourself this…

Could your provider be stunting your businesses growth?

Contact us to see how we do things, the value we can add to your business and help you grow.