Taking a cue from 4th edition I treat the 5 foot step as a separate and additional action.
The action sequence then looks like this.
Every round each character gets the following action
1 Minor as per Pathfinder rules
1 Standard Action as per Pathfinder rules
1 Movement Action as per Pathfinder rules
1 Five Foot Step
If a character as multiple attack they may combine the standard and movement actions and take however many attack they are entitled too. The five foot step is performed normally.
Also when allowed by the rules a movement and standard action into a run action as per Pathfinder rules. The five step must be added to the move and provokes Attacks of Opportunity as usual.
All other rules remain the same.
Being both sequential and consistent, the alternate method is easy to remember and easier to use in play. It also adds a little bit more tactical mobility to the game, something I find worthwhile.
And while yes it adds a square (five feet) to each rounds movement, this amount is not enough to create an issue with game balance in my opinion.
All in all I am happy with it. However as YMMV feel free to give it a run (pun intended) and let me know what you think.