Some people may have previously viewed payroll as purely a hygiene factor, but the pandemic has proven the power of this often-overlooked service in optimising strategy and building a resilient business. ADP’s 2021 global survey, The potential of payroll, shows how payroll forms the foundation of any efficient organisation and has the potential to drive future growth initiatives.
Successive national lockdowns and resulting office closures have meant payroll professionals have faced their fair share of obstacles. In addition, despite enormous changes in the world around them, many teams were using systems and processes that haven’t changed in years, which made tackling legislative payroll changes and managing payroll remotely more difficult. ADP’s global payroll research revealed that for most HR, finance and payroll leaders (82%), the pandemic proved challenging – especially in the areas of reliability and accessibility of payroll systems, as well as accuracy and timeliness of employee pay.
The last 18 months have also highlighted the inadequacies of many payroll systems – 61% of respondents found they were not able to adapt their payroll to meet the needs of their company during the pandemic, and a third (33%) said they didn’t have a payroll system to support expansion plans. Companies must now decide whether to upgrade their systems or carry on as before – which could widen the gulf between what they want their payroll operation to deliver and what it is currently capable of achieving.
ADP’s research into what companies need going forward highlighted a few key areas. Businesses require access to better reporting analytics to inform strategy and planning, increased reporting speed to provide timely information, tighter data security to improve compliance and a streamlined payroll process to reduce errors, minimise costs and increase employee satisfaction.
Transforming global payroll systems is no small task, but isn’t impossible. To deliver this, organisations need to look at three key areas: optimisation, visibility, and agility. Almost three-quarters of respondents in our survey (74%) were still running multiple systems across multiple geographies, resulting in too many queries for staff to handle, inconsistent data reporting, poor system integrations and an inability to adapt to business changes at speed. Instead, instituting a global payroll strategy that is centralised, fully integrated with HR and finance systems and visible on a unified platform means companies have the agility to analyse data quickly and scale solutions to support company growth.
To be successful in today’s challenging landscape, all parts of your business need to be agile. Customising payment options to remain competitive in the war for talent, supporting flexible working options and securing employee data remotely are all key reasons why payroll needs to adapt.
HR and payroll professionals hold some of the most valuable organisation and employee data, and insight from this must be used to support business decisions. The pandemic has shown that a cross-functional team of finance, payroll and HR – that is able to make a strategic impact quickly and efficiently – is no longer a ‘nice to have’ but a necessity.
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