Measure The Return On Your #1 Expense - Your ROP (Return On Payroll)

By Patrick Thean

Measure The Return On Your #1 Expense - Your ROP (Return On Payroll)

Do you measure your return on payroll (ROP)?  For most of us who run knowledge-based companies, payroll is the largest expense on our Profit and Loss statement. You are going to write that payroll check every month, whether you like it or not, whether your employees made a difference that month or not. Yes... Every month that payroll cycle comes again and you need to write that payroll check. So do you measure or think about your ROP? Since payroll is your largest monthly expense, shouldn't you measure and improve what you are getting for each payroll check you write? Over the next couple of blog posts, I will be discussing ROP. How do we get our ROP up?

Here are 2 thoughts to get your brain going:

1. Decrease the payroll expense while maintaining the workload and work products being done.

2. Keep your employee base the same, and get more work output from the team, without killing them of course. Stay tuned for specific ideas along these lines to improve your ROP.



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