Welcome to Part 2 of our RFP process series for Payroll solutions! In our previous blog, we explored the foundational steps that set the stage for a successful RFP. If you haven’t read it yet, we recommend starting there to build a solid understanding of the preparatory phase. In this instalment, we’ll guide you through the critical steps to take during and after the RFP process. Discover how to effectively manage each stage and make well-informed decisions that will lead you to the ideal payroll solution for your organization. Let’s dive in!
During the RFP Process:
It is a process when RFP is commenced. There will be list of tasks as follow that usually will be executed:
- To have participated vendors to sign off a non-disclosure agreement (NDA) before RFP document is shared. Objective: To protect company’s confidential information being shared with unauthorized parties.
- Due to payroll is the downstream process of other stakeholders, it is important to communicate to upstream and downstream stakeholders of the project scope and timeline based on the tasks listed in the project plan. At the same time, to have each stakeholder to nominate their respective team members as panelists to be involved in system demo, evaluation and finalization processes.
- Preparation of RFP documents – It can be divided into four parts:
Part 1 – General terms and conditions to the invited vendors – this could be prepared by the company’s procurement or legal teams to explain the governance structure, processes and timeline of the entire program.
Part 2 – Key assessment areas: General payroll attributes - payroll team to list down information e.g. The number of countries, entities, pay element; category of employees; salary currencies; payroll cut-off date; pay day etc. System specifications, data change log and its format – HRIS or technical team to prepare this part by providing the specifications and sample of data or log.
Part 3 – Payroll system demo scenarios – payroll team to list down the exceptional scenarios of each location and entity for vendor to prepare the data and show the system capability from gross to net.
Part 4 – Project timeline and fee quote – payroll, HRIS and other stakeholders to agree upon to provide expected timeline and priorities (pilot location and its subsequent locations) for vendor to present the proposed implementation methodology, timeline and fee quote.
- Prior to the vendors demonstration session, determine the sharing protocol and channel of the RFP documents is secured and confidential. The same applies when the RFP document is collected.
- Next, procurement and payroll team shall commence to develop RFP scoresheet for vendor evaluation process.
- The PM shall brief all panelists on the scoring process and timeline for submission.
- Preparation of vendor demo will be prepared and conducted by the procurement team. However, if an organization has no procurement team, this will be handled by the PM.
- Once the demo is completed, PM reminds every one of the evaluation process and conduct panelist discussion and score analysis to finalize top three vendors.
- From the above, invite finalists to have face-to-face clarification and meeting to further clarify any pending items, renegotiate of implementation approach, timeline and fee quote with more specific details given by the panelists.
- Through the above up close and personal sessions, panelists shall conclude the finalist.
Post Process:
Once the finalist is identified, the following steps shall be executed by the PM prior to last stage in signing the master service agreement (MSA):
- Perform Due Diligence
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- Apart from checking on the finance background of the vendor, suggest interviewing at least three existing clients of the vendor to check on the product, service and any challenges during implementation and operation; how all these were resolved?
- HRIS or technical team to conduct data security and governance check.
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- PM to interview vendor’s project manager, functional and technical consultants – Objectives: To ensure the right people in the right role. Also, to check any pleasant working relationship between the PM and the functional and technical consultants in other past projects.
- Negotiation
Finally, the most important task is to go through the terms and conditions of the Master Service Agreement (MSA). Thus, negotiation has to be carried out in the following aspects with the right leads in place:
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- Price – shall be led by procurement team – to negotiate the fees, payment mode, currency, payment fraction and so on.
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- Project methodology and timeline – shall lead by payroll and HRIS teams – to discuss how many phases of the project, which is the pilot country, testing methodology, assess right, handover, blackout period, post live support etc.
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- Service level agreements (SLA) – shall lead by payroll and HRIS teams. It must be as detailed as possible to identify SLA for each project phase e.g. 95% accuracy during UAT, 99.95% during parallel run 1 and 100% in parallel run 2. The same is applicable once the project has gone live – accuracy, timeliness and enquiries response time etc. are well kept per the agreed percentage.
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- Meeting frequency for project update – shall lead by PM – to discuss how meeting shall be conducted during and after project gone live.
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- Termination and exit clauses – shall lead by procurement and legal teams – to discuss clauses in case of any infringements happen to either party, how agreement shall be ended etc.
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- Post-live support – shall lead by payroll and HRIS teams – to discuss post-live working and support models to ensure SLAs are well maintained.
- Legal and Data Security Teams’ Review
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- Once the MSA is negotiated, it is important to have legal to review all the terms and conditions of the contract to ensure it is compliant and it is a win-win situation for both vendor and client.
- Data security team to ensure vendor’s system and cloud has the secured features and licenses. Also ensure it is competitive to in-house data system specifications.
- Sign-off MSA
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- Finally, once all terms and conditions in the MSA are accepted by both parties.
- Official sign-off shall be carried out and with proper safe-keeping for future reference or audit purpose.
- Project Kick-off
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- With the sign-off of MSA, both teams can commence the project by inviting all stakeholders to witness the official project kick-off meeting by going through the “firmed up” project plan, roles and responsibilities and milestones for each project phase.
As we wrap up our RFP process series, we hope you’ve gained valuable insights into managing the stages during and after the RFP for a Payroll solution. By implementing these strategies, you'll be well-equipped to navigate the selection process and choose the best payroll system for your needs. To simplify your journey even further, don’t forget to download our exclusive RFP template, designed to streamline and enhance your search for the perfect payroll solution. Thank you for joining us on this series—here’s to a successful RFP process and finding the ideal payroll system for your organization!
