Payroll appears to be seamless for many people, especially when they have implemented all the digital and automated solutions in their business. Many business leaders and their teams assume that the tech upgrades will solve all of their challenges. The truth is that the journey does not end here.
Unseen obstacles may still hamper the effectiveness of payroll, causing a disconnect between outcomes and expectations. These hidden inefficiencies can be identified in many ways, ranging from inconsistencies in systems to poor data governance. This can have a negative impact on overall business performance.
It is important to identify these weaknesses in order to optimise workflows, maximise payroll’s potential and reduce costs. How can businesses maximise the value of payroll to drive success throughout the business?
Your payroll may be short.
Our recent research shows that 47 percent of the payroll process is still done manually. Many companies still rely on manual payroll processes despite investments in technology. It not only increases the chance of error, but also results in an average of 345 reruns each year.
In addition, issues like data inconsistency and weak governance can have a negative impact on payroll performance. Payroll teams are often slowed down by errors, inefficiencies and high costs. This prevents them from using payroll to its full potential, which is to drive growth.
How to get the most from your payroll system
The potential of payroll goes far beyond paying employees on time and accurately. Payroll can be a powerful asset for businesses when it is integrated with HR, Finance, and Operations. It provides real-time, data driven insights into workforce trends, performance, and pay equity. These insights can be used across departments to help improve operational decision-making, align payroll insights with wider business goals and enhance both workforce management as well as overall organisational effectiveness.
Our Bridging the Gap Report reveals, despite this, that 89 per cent of the businesses surveyed believe their payroll systems don’t provide the insights they require. This highlights the importance of an integrated system in unlocking payroll’s potential.
Integrated and scalable systems can help businesses better manage their workforce, allocate resources, maintain compliance, and ensure pay equality.
Companies that optimize their systems after initial implementation will be better equipped to use advanced technologies such as AI and automation, which can reduce payroll errors and allow the payroll team to focus on strategic analysis.
Payroll’s full potential provides businesses with the insights they need to make smarter decisions, and innovate. This allows them to remain competitive in an ever-changing business environment.
Payroll: Why it still matters to real people
Payroll challenges are not just a technology issue. In order to fully exploit its potential, it is important to focus on the people, their skills and continuous process improvement.
The true value of payroll is realized when systems and teams with the right skills work together in order to provide insights that lead to better business decisions and outcomes. While 99 percent of respondents agreed that payroll is a human-centric process, 49 percent cited a lack in internal skills as the biggest obstacle to integration. This skills gap may slow down efforts to optimize payroll systems.
It is essential to continue optimising the system by giving people the necessary skills. Payroll teams without the necessary expertise will be unable to fully harness the benefits of digital transformation.
Payroll transformation: A proven method
In order to transform payroll from a business bottleneck into an enabler, businesses must balance people and technology in order to bridge the gap between the idealised vision and the operational reality.
Here are three specific steps that businesses can take.
1. Begin with an honest assessment
Assess the integration of payroll systems, identify manual processes that still exist and create a plan focused on addressing inefficiencies.
2. Smart HR strategies can help you develop your skills
Assess the current team’s capabilities and develop a plan of training to fill any knowledge gaps.
3. Plan your long-term strategy
Payrolling and payroll processing are not one-time events. Create a maintenance program that includes regular quality checks and reviews to ensure accuracy. Include ongoing technology updates to maximize system value. Provide consistent training for your team to ensure they are ready to use new tools and payroll needs as they evolve.
There is no time like the Present
Despite the promise of digital and automated systems, many companies still face hidden obstacles that prevent payroll from reaching its potential. Problems such as manual tasks, inconsistent information, and poor integration of systems can cause bottlenecks to impact the whole business. These obstacles are not impossible to overcome.
Payroll can be transformed from a transactional service to a strategic one by identifying root causes, improving integration of systems, and providing teams with the necessary skills. It’s not a question of if you can transform payroll, but when.
