Whereas iPayroll is an official IRD intermediary, meaning that they can act as a company’s proxy when dealing with the IRD, Flexitime is a standalone service which means companies will still do the traditional cheque sending to the IRD.

In use Flexitime is simple, pretty and intuitive. I’ve gone on record saying that I’m a bit of a fan of applications built on top of flex, in my experience it just seems to increase the chances of creating an application with a great user experience – I’m not sure why but it’s just my observation.

I’ve attached some screenshots below to show how it works. Robert Owen, founder of Flexitime, sent me an email the other day to say that they now allow file downloads for ASB, ANZ, BNZ, National Bank and Westpac. For payroll files.

Go have a look – Flexitime costs $20/month or up to five users. It’s also fully integrated with Xero, creating another time saving (no more horrible journal entries to reconcile an archaic payroll system with an equally archaic accounting system!)

The pay window – probably the first window you’ll see each week;

Enter the hours for an employee – pretty simple;

The all important payslip;

And a nice, correctly formatted PAYE return for the IRD;

The other day I visited SaaS vendor iPayroll and was pleasantly surprised when I looked up at the entrance to their building. iPayroll decided that their market (payroll services for small/medium businesses) needed to really trust them for their most sensitive of data. iPayroll decided that securing naming rights to a building would give them a level of credibility that would build trust with their customers. It’s a reasonable enough thought and it would seem to work for iPayroll and the market they’re in.

Just up the road in a lovely, but unmarked, building lives the global headquarters of Xero. Xero also deals with SMEs and handles their sensitive financial records. Xero too realised that trust was critical but their approach to gaining this level of trust was to go through an IPO and gain the credibility of being in the public eye. Xero banked on this credibility building trust for their brand. It to is a reasonable enough contention (not to mention other good reasons for IPOing) and it seems to have worked well for Xero thus far.

My point? There’s many ways of doing it, and really it doesn’t matter how you do it, but SaaS businesses have no option but to built a credible story and leverage that credibility to create trust for their customers (and potential customers).

I’ll post about my experiences using iPayroll later on, but for now I want to talk more generally about the cost of customer acquisition for SaaS products. I’ve gone on record in the past saying that SaaS vendors who are trying to subvert a traditional installed application need to ease the conversion pain for their users. I for example have been doing SME payroll for over a decade, through multiple businesses – I understand payroll but even I couldn’t face the conversion pain.

iPayroll I can unreservedly say are doing absolutely everything right in this respect. After agreeing to sign up I was personally contacted by iPayroll’s sales manager to run me through the set up process – there were no automatic emails to contend with – rather a patient and helpful real person to talk to.

As we currently utilise a payroll package, we wanted to migrate our data. Again iPayroll shows best practice with this. Rather than asking me to do a migration and deal with the hassles, iPayroll simply asked for either a printout of the reports from my existing package, or a backup file of it. From there they do all the work required to migrate to their own package. (Well they’ve told me they’ll do all the work all ready for our pay run on Monday morning – I’m assuming (and confident) that it’ll happen).

Other SaaS vendors should learn from iPayroll’s model – my contention is that if SaaS accounting vendors in particular provided a similar level of set-up and migration service – their conversion numbers would be much, much higher.

I’d estimate that it costs iPayroll well north of a months revenue to perform this process alone, this is after the sales and marketing costs involved in customer acquisition – it shows a real commitment to giving customers a good experience migrating to their product.

Elaine from iPayroll tells me that they have an exceptionally high conversion rate and that most prospects they pitch end up converting – I can totally see why this is the case, and why their existing customers become the best salespeople they have.

Let me reiterate – anyone trying to create momentum with a SaaS product in a class that competes with installed applications has to ease the conversion pain if they hope to achieve scale.

There has been a fair amount of chatter around the blogosphere around the role of design vs functionality for software, especially SaaS software – iPayroll has come in for a reasonable amount of criticism for it’s look – in this interview we briefly touch on the design issue but focus primarily on the user-centric/solution-centric discussion.

The video is embedded below, apologies for the sound quality of lack thereof. Feel free to subscribe to Divrsity Blog’s Youtube channel for further updates.

I’m not the only one to say that Nik has posted a well thought-out and helpful list of suggestions to make iPayroll slightly more – well SaaS like in appearance. (Thanks to Daniel for the heads up).

Speaking however to the MD and sales manager was interesting. Their perspective can be summed up pretty much with two main points;

• Most small business users aren’t Web 2.0 evangelists – they really can’t see the difference between a high level 2.0 offering and one that is less so
• It’s all about the solution – iPayroll users report excellent satisfaction with the functionality of their offering – that’s all that matter

While I can appreciate their perspective – coming as I do from a background of user-centric design, I can’t help but feel that some of the suggestions made by Nik in the post above would do nothing to detract from functionality, but everything to add to the allover experience.

What do you think iPayroll?