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Industry insights
Aug 2021

Payroll: Cloud based software versus legacy systems

Andy Liu, General Manager of Alchemy Resources Sdn Bhd

Alchemy Resources Sdn Bhd is a HR outsourcing & Recruitment specialist that focuses on the areas of payroll, business processes outsourcing, personal data protection and outbound lead generation. 

A recipient of the Gold Award for “Best Payroll Outsourcing Partner” at the 2020 HR Vendors of the Year Awards organised by Human Resources Online, Alchemy is now one of the top payroll outsourcing companies in Malaysia. 

We speak with General Manager - Andy Liu, on the benefits of cloud based software versus legacy systems, and digitalisation’s place in the Malaysia payroll market.

What are some key aspects that sets Alchemy apart from other competitors? 

We focus on the cost savings for our clients. The reason why a client wants to outsource payroll to us is because they find that this scope of work is repetitive and someone besides their own HR personnel can do it. So in order to convince them to outsource their services to us, we must ensure our services provide cost savings for them. 

The second thing we prioritise is the quality of our service. In order to achieve that we use internal quality management systems things like ISO 9000. 

The third thing is data protection - because we are processing personal data, we want our clients to feel assured of data security when they engage us in our services. 

Last but certainly not least is compliance. We use effective software that is in compliance with local regulations and law. And ensure that the software we use is also constantly updating in response to the various changes in the law in order to ensure compliance. 

Based on your experience, what do you think are some key features people should prioritise when looking for the right payroll software?

As a basic minimum, compliance, data protection and security of data is very important. We also look at the accuracy of calculations produced by a software, the overall user experience and the ability to customise certain summary reports for our reporting to clients. 

Once those basic features are present, then other features like time and attendance are a welcome addition.

Which has more value - a cloud based software or a legacy desktop based system? 

The value proposition of a cloud based software really outweighs the legacy system in terms of having the ability for users to access it anywhere, anytime they want. You don’t have to invest in infrastructure like a server and having a team to constantly back up and upgrade the solution. So a cloud based software, beside the risk of data breaches, really far outweighs the traditional legacy systems. 

Storing data in a server is false security. If your server is stored in a physical location and there is a fire or break in that compromises the server, then what is going to happen to your data? In that sense, that’s why I feel that cloud based solutions will outweigh the benefits of legacy systems. However, at the end of the day if a company has the resources and the practices to continuously upgrade the server, then it’s really up to the view of the company whether they want to run with a legacy desktop based software or cloud based software. 

What are your thoughts on digitalisation within the payroll space and its place in the Malaysia market? 

There are still some clients who are using excel spreadsheets to prepare their payroll, depending on the number of employees and how adaptive they are to technology. I think the trend towards digitalisation is not going to stop, it will continue. The speed of adoption of digitalisation in Malaysia however, will very much depend on government support. I’m not going to draw comparisons between countries, but if the local government provides more grants towards digitalisation because of compliance, as a whole, it would make the whole process very efficient and accountable. On a whole, I think the whole process of digitalisation to make payroll efficient and accountable, that trend will definitely continue. 

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