A seven-point guide for Finance and HR leaders.
How good are your payroll operations?
Even though it’s a large part of company spend, the importance of controlling payroll is often overlooked. The pandemic changed that, showing the potential damage to operations, business resilience and employee morale of relying on out-of-date systems and cumbersome processes. Many survived more by luck than design. As a result, finance and HR leaders are having to change their priorities.
Check below to see which situation best describes your payroll and your ability to thrive in the new working environment.
1: Overspending or saving?
It’s only possible to cut payroll costs when you know exactly how much you’re spending. On average, pay accounts for up to 60% of a Fortune 500 company’s spend. So any changes could have a massive effect. Yet, for most companies only 37% of payroll costs are visible, the rest are hidden.
At the proverbial tip of the iceberg, direct costs are easy to see and calculate. But what is lurking below the surface? The cost of upgrades and connectivity, HR and workforce management, pay disbursement and distribution expenses…scattered as they are between departments, they all add up to a sizeable amount, resulting in a much greater total cost of ownership. You need a payroll solution that gives you a realistic view of your total spend.
2: Losing or attracting talent?
Payroll can affect your ability to attract and retain the best people. The way we work has changed and payroll has to adapt accordingly. In the highly competitive market for top talent, our research shows that an effective and flexible approach to pay has a huge impact on employee satisfaction and in turn productivity, and retention.
3: Stressed or stress-tested?
The pandemic proved the ultimate stress test for pay and few came through it as well as they expected. While many of the fault lines were already there, they were made worse by the sudden changes in the working environment. Among key areas affected:
Payroll accuracy
Companies often think this is better than it is. Pre-COVID-19, 52% of companies believed payroll accuracy was high (i.e. greater than 90%). This was cut by nearly half, to just 27%, once the pandemic struck. Is your payroll accurate enough to deliver the strategic data your company needs?
Strategic direction
The insights that payroll gives into the global workforce can greatly inform commercial and HR strategies. Yet few have the systems to deliver that knowledge. In our research, only just over a quarter (27%) of financial leaders considered payroll data when developing their strategies although a much larger number (87%) thought it important to do so.
4: Reactive or proactive?
More than 61% of organisations reported that they received too many payroll queries. The more systems involved the greater the potential for errors and the more likely payroll staff are to find it unmanageable. As a result, it is often employees themselves who pick up on the mistakes.
In recent research, People at Work 2021: A Global Workforce View, more than 41% of employees say they are always, often or sometimes paid late. Such a very poor employee user experience inevitably leads to increased dissatisfaction.
Multiple systems also make it more difficult to answer the business queries necessary to develop more strategic initiatives. Available data is often inconsistent across geographies and difficult to interpret. As a result, our research, The potential of payroll, shows that the greater the number of systems the more frequently senior management ask for data, sometimes several times a day.
5: Local or global?
Most multinationals (75%) are still running multiple systems, often from several vendors, which inevitably causes problems. Data quality and security are compromised, causing compliance issues that can incur costly fines. Payments are late and services affected through inefficient processes. Do you have a single global view that enables the accurate reporting of payroll information to drive strategic decision-making?
6: Status quo or change?
The pandemic showed that it is no longer possible to simply rely on what was acceptable in the past. To compete in times of rapid change, you need flexible systems that can adapt to different ways of working and the rising tide of regulation.
With a simplified global payroll process, fully integrated with HR and finance systems, you can leave old inefficiencies behind, while reducing complexity and radically optimising costs.
7: Future-fearing or future-ready?
The best way to transform your payroll is through a simple, three-phased approach:
Phase 1: Optimisation
Bring payroll and HR together to improve timeliness, accuracy and efficiency. This can reduce payroll processing effort by up to 75% and automates compliance to avoid potential $1.8M in costly regulatory fees.
Phase 2:
Unify your global payroll to benchmark all your workforce data and provide the detailed insight needed to make smarter decisions.
Phase 3: Agility
Seamlessly deliver pay, with one view of global payroll that makes it easier to adapt to changing business needs and comply with regulation, while greatly improving the employee experience.
Find out how finance and HR leaders can use payroll transformation to help fulfill business ambitions.
Read the ADP eBook — ‘Fear or Confidence’.
Sources
1 Gartner, Top Priorities for Finance Leaders in 2021
2 Gartner, Top 3 Priorities for HR Leaders in 2021
3 Deloitte analysis 2017. Labor spending or overspending?
4 Exposing the hidden costs of payroll and HR administration, PWC, 2012
5 Future of Pay: Exploring the evolution of worker pay and talent management, ADPRI, 2019
6 The Potential of Payroll: Global Payroll Survey, ADP, 2021
7 People at Work 2021: A Global Workforce View, ADPRI, 2021
8 Total Economic Impact™of ADP Global Payroll Study Forrester Consulting, 2020
A seven-point guide for Finance and HR leaders.
How good are your payroll operations?
Even though it’s a large part of company spend, the importance of controlling payroll is often overlooked. The pandemic changed that, showing the potential damage to operations, business resilience and employee morale of relying on out-of-date systems and cumbersome processes. Many survived more by luck than design. As a result, finance and HR leaders are having to change their priorities.
Check below to see which situation best describes your payroll and your ability to thrive in the new working environment.
1: Overspending or saving?
It’s only possible to cut payroll costs when you know exactly how much you’re spending. On average, pay accounts for up to 60% of a Fortune 500 company’s spend. So any changes could have a massive effect. Yet, for most companies only 37% of payroll costs are visible, the rest are hidden.
At the proverbial tip of the iceberg, direct costs are easy to see and calculate. But what is lurking below the surface? The cost of upgrades and connectivity, HR and workforce management, pay disbursement and distribution expenses…scattered as they are between departments, they all add up to a sizeable amount, resulting in a much greater total cost of ownership. You need a payroll solution that gives you a realistic view of your total spend.
2: Losing or attracting talent?
Payroll can affect your ability to attract and retain the best people. The way we work has changed and payroll has to adapt accordingly. In the highly competitive market for top talent, our research shows that an effective and flexible approach to pay has a huge impact on employee satisfaction and in turn productivity, and retention.
3: Stressed or stress-tested?
The pandemic proved the ultimate stress test for pay and few came through it as well as they expected. While many of the fault lines were already there, they were made worse by the sudden changes in the working environment. Among key areas affected:
Payroll accuracy
Companies often think this is better than it is. Pre-COVID-19, 52% of companies believed payroll accuracy was high (i.e. greater than 90%). This was cut by nearly half, to just 27%, once the pandemic struck. Is your payroll accurate enough to deliver the strategic data your company needs?
Strategic direction
The insights that payroll gives into the global workforce can greatly inform commercial and HR strategies. Yet few have the systems to deliver that knowledge. In our research, only just over a quarter (27%) of financial leaders considered payroll data when developing their strategies although a much larger number (87%) thought it important to do so.
4: Reactive or proactive?
More than 61% of organisations reported that they received too many payroll queries. The more systems involved the greater the potential for errors and the more likely payroll staff are to find it unmanageable. As a result, it is often employees themselves who pick up on the mistakes.
In recent research, People at Work 2021: A Global Workforce View, more than 41% of employees say they are always, often or sometimes paid late. Such a very poor employee user experience inevitably leads to increased dissatisfaction.
Multiple systems also make it more difficult to answer the business queries necessary to develop more strategic initiatives. Available data is often inconsistent across geographies and difficult to interpret. As a result, our research, The potential of payroll, shows that the greater the number of systems the more frequently senior management ask for data, sometimes several times a day.
5: Local or global?
Most multinationals (75%) are still running multiple systems, often from several vendors, which inevitably causes problems. Data quality and security are compromised, causing compliance issues that can incur costly fines. Payments are late and services affected through inefficient processes. Do you have a single global view that enables the accurate reporting of payroll information to drive strategic decision-making?
6: Status quo or change?
The pandemic showed that it is no longer possible to simply rely on what was acceptable in the past. To compete in times of rapid change, you need flexible systems that can adapt to different ways of working and the rising tide of regulation.
With a simplified global payroll process, fully integrated with HR and finance systems, you can leave old inefficiencies behind, while reducing complexity and radically optimising costs.
7: Future-fearing or future-ready?
The best way to transform your payroll is through a simple, three-phased approach:
Phase 1: Optimisation
Bring payroll and HR together to improve timeliness, accuracy and efficiency. This can reduce payroll processing effort by up to 75% and automates compliance to avoid potential $1.8M in costly regulatory fees.
Phase 2:
Unify your global payroll to benchmark all your workforce data and provide the detailed insight needed to make smarter decisions.
Phase 3: Agility
Seamlessly deliver pay, with one view of global payroll that makes it easier to adapt to changing business needs and comply with regulation, while greatly improving the employee experience.
Find out how finance and HR leaders can use payroll transformation to help fulfill business ambitions.
Read the ADP eBook — ‘Fear or Confidence’.
Sources
1 Gartner, Top Priorities for Finance Leaders in 2021
2 Gartner, Top 3 Priorities for HR Leaders in 2021
3 Deloitte analysis 2017. Labor spending or overspending?
4 Exposing the hidden costs of payroll and HR administration, PWC, 2012
5 Future of Pay: Exploring the evolution of worker pay and talent management, ADPRI, 2019
6 The Potential of Payroll: Global Payroll Survey, ADP, 2021
7 People at Work 2021: A Global Workforce View, ADPRI, 2021
8 Total Economic Impact™of ADP Global Payroll Study Forrester Consulting, 2020