Every Payroll Software provider charges some form of Annual Maintenance fee each year with most (except MYOB) including support in this fee.
The Annual Maintenance fee is charged to cover:
- Legislative Changes (a must for payroll software)
- Bug Fixes (which should be the developers cost)
- Support (except for MYOB)
- Development (adding new features and enhancements)
MYOB has commented that their fees are so high to cover the ‘continuous development’ they carry out with their EXO product range.
So, I thought it would be interesting to see how much ‘continuous development’ is happening with MYOB and the IMS Payroll Partner product.
Now for me, development, does not include ‘legislative changes’ as this is a must if the payroll developers wants to sell their product in New Zealand.
In addition, I did ask the question, ‘If a product has been in the market for a long time then there must come a point when everything has been developed, and the only changes will be legislative ones’. If this is true then you would expect that the IMS product would have minimal development when compared to MYOB as it has been in the market considerably longer.
However, the March 2010 results prove differently.
Both products covered the release of Payroll Giving (legislative) which came into force in January 2010 and apart from other legislative changes, the only ‘development’ I can see from MYOB was the addition of a ‘Contact E-mail field‘.
IMS on the other hand (and this is the more mature product) had 11 (non legislative) changes to their product.
You can view the release notes for March 2010 below.
As a comparison we have also included a copy of Smoothpay’s Release Notes. Smoothpay provides regular, automated, updates to their software throughout the year.
Due to being advised that our annual support fee for the MYOB EXO payroll was going to cost $3,420.00 per annum on top of the nearly $3,000.00 annual license fee I have recently (reluctantly) started looking at alternative payroll software.
As our company has been using this software for over 10 years we require very little in the way of support from MYOB and having to pay this amount of money per annum when we have not seen any real development of the product apart from the legislative changes and rebranding from Comacc in the last few years, it just does not make good business sense. Given the reasonable prices of some of the alternative packages that have more functionality, better annual support/license fees and these companies have openly made a commitment to the development of their product, then in just over a year I will have re-couped my MYOB costs.
I say reluctantly as MYOB is actually a very good package to use however what I have found when looking at other products was how simple some of the alternative functions of these products are, such as having a category in KiwiSaver for staff not eligible – so simple but yet it seems to have totally escaped MYOB’s attention that it may be needed.
All payroll software is going to differ in functionality however not all development needs to be on a grand scale to keep users happy.
What I would like to put to MYOB is where are they getting their ideas about what enhancements they intend to develop? I don’t recall client feedback being sought on what functionality or developments we would like to see included in future releases – perhaps I missed the e-mail?
Have MYOB been secretly working on a development plan that they plan to roll out with great fanfare that they have been keeping secret from their clients?
It does appear that other payroll software providers are paying attention to their clients needs and requirements and these providers will find that one companies misfortune will create an opportunity for them – however if this whole MYOB issue has taught payroll software providers anything it is that if you ever take your eye off the ball you are likely to get smacked in the face.
Sorry Guys.
Having checked the release notes for the non MYOB products I’d say that the other companies are developing more than MYOB simply because they have more scope for development because their products are somewhat behind MYOB.
For example, the first thing I saw in the IMS notes was the change to procedure for end of tax year info. Good God, I haven’t had to worry about such things with MYOB (Comacc back then of course) since I started using their software 16 years ago.
Perhaps their fees are so high for development because it’s really hard work trying to improve on what they have. (That last comment was a bit tongue in cheek … I could suggest a couple of improvements)
Patrick, Robert,
I’d go a bit further and say making regular changes has *nothing* to do with SaaS, agile development, being in the market for X years, size of the customer base etc.
It has to do with whether you actually give a damn or not. Clearly the people posting here do.
IMS don’t promptly add payroll giving because they are installed software, Flexitime don’t improve a feature because they are SaaS.
They do it because they give a damn, as does Ace Payroll.
For the record, we’re constantly adding, improving and, just as importantly, maintaining and removing things from Ace Payroll.
Not that we want a gold medal. It should be a minimum expectation when people are relying on you for easy, accurate payroll.
No offence intended Patrick, I’m sure you guys do a great job for your customers.
I agree that it’s not necessarily delivering using the SaaS model that guarantees timely updates. It’s more the Agile development processes we adopt that make the difference here.
I have to take issue with “Glacial Speed”
IMS have been providing payroll software for over 25 Years.
In that time our customers have never missed having the current legislative changes.
Payroll Giving came into effect as of the 7th of January 2010 – Our customers had this software when they needed it. Other providers including some “Software As A Service Model” providers did not have this available until April 2010 and after.
I guess what I am saying is being a SAAS provider does not guarantee timely updates. Having a payroll provider that is committed to meeting their clients requirements is the key.
The glacial speed at which the big payroll software companies move was one of the main competitive advantages that we identified when we started FlexiTime.
Delivering the product using the software as a service model has huge benefits for us as a software development business, and for our customers. Additional features like payroll giving or mandatory changes for changes to tax rates, etc. are made available to our customers without the need for installing new software.
We are constantly developing improvements in the product and aim to release at least monthly. Using agile development techniques and what’s referred to as the lean start-up methodology help us to stay fresh and implement the features and improvements our customers ask for.
Robert Owen.