Cutting out the paperwork

ONE of the biggest woes for human resources (HR) management is, quite possibly, paperwork.

And reducing these manual administrative processes will be key in helping companies increase their efficiency and facilitate a growing trend in remote working.

Consequently, more and more SMEs are looking to tap digital technology to cut down on their paperwork to focus more on enhancing their operations.

This certainly marks a shift in small businesses. Many were hesitant to use digital solutions for their HR and administrative needs only some two years ago. A cost increase and the lack of awareness were among the main reasons for this.

Notably, a full HR software can cost companies anywhere between a few hundred thousand ringgit and a few million ringgit.

But the emergence of more cloud-based software services providers in recent times has brought the cost down for such services. Additionally, many of them offer tailored solutions to meet different needs.

In the wake of greater digitialisation, Kakitangan.com co-founder and chief executive officer Effon Khoo says SMEs are realising that it is more risky for their operations to go without a cloud system in their people operations, pushing them to look at the various digital solutions available in the market.

Kakitangan is an online payroll and HR software-as-a-service platform in Malaysia serving the SME segment. The mobile-friendly platform comprises modules for payroll, employee expense claim, leave, benefits and GPS time attendance.

The company was founded in early 2015.

Khoo notes that reception for its services is certainly gaining more traction in recent times in line with the dramatic shift towards digital business transformation post Covid-19.

“SME companies have many challenges and part of our challenge is to convince them on the benefits of digitising their HR operations in order to be more efficient and effective in managing their critical workforce and talent,” he says.

Its customer base cuts across the entire gamut from tech-based start-ups and new enterprises to larger companies with hundreds of employees. They also come from various industry segments including retail, food and beverage, manufacturing, technology, professional services and education.

Kakitangan’s growth over the years has been admirable. According to Khoo, it has been consistently posting good double-digit growth rates year-over-year since its inception. And while the last two years have been challenging given the impact of the pandemic on many SMEs – its main business segment – Kakitangan still managed to post decent growth.

“The company has been operating at the edge of break even in the last two financial years, making it one of the better managed companies in the online payroll software industry.

“The company is now supporting more than 5,000 companies actively using the Kakitangan.com system,” he adds.

The company’s growth prospects have also attracted investor interest.

It recently secured a Series A investment from OSK Ventures International Bhd in the sum of “a few million ringgit.”

The capital injection will enable Kakitangan to increase its expansion across Malaysia and focus on further developing its cloud-based software.

Prior to this funding round, Kakitangan also secured RM1.55mil in funding through an equity crowdfunding campaign in 2016 participated by 63 investors. This was followed by another mini funding round.

The total issued capital of the company at the moment is RM8.96mil.

Moving forward, Khoo says a combination of good customer experience, fast innovation speed to address the needs of SME customers and the rising trend in adopting online payroll systems will enable the company to continue with its strong growth rates.

To further assist small businesses, Kakitangan has also recently rolled out its new online HR advisory service, HR Sifu. The add-on service is currently available to all new and existing users of Kakitangan at no charge until the end of this year.

The HR Sifu platform is an all-in-one HR advisory service tailored for SMEs covering a wide range of HR aspects including work permit application for expatriates, industrial relations, and payroll technicalities related to the Employees Provident Fund, Social Security Organisation, Employment Insurance System and the Inland Revenue Board of Malaysia.

“New features will be progressively added onto HR Sifu services over time. We are committed and will continue to invest in new services and solutions to support the growth of our SME customers within our core expertise of payroll and HR,” says Khoo.

With SMEs making up the bulk of businesses in Malaysia, Khoo notes that this segment will continue to offer an exciting and large, untapped potential for the company.

“We will remain to be very focused on the Malaysian market for now and to continue to innovate and to support our customers here.

“There is so much more that we can offer Malaysian SMEs as they navigate their own growth journey, and indirectly contribute to Malaysia’s economy and employment market,” he says.