Thirty years ago, Harvard Business School’s Professor Shoshana Zuboff said: “Everything that can be automated will be automated” - and that prediction now appears to be coming true.
Indeed, there is now widespread fear that a goodly portion of human jobs will be eradicated by technologies such as robotic process automation (RPA) and artificial intelligence (AI). As management consultancy McKinsey put it: “Forty five percent of the activities individuals are paid to perform can be automated by adapting currently demonstrated technologies.”
Payroll professionals are finding themselves at the forefront of this debate. In fact, a study by Oxford University and management consultancy Deloitte predicted that 97% of existing payroll jobs would automated out by 2025.
But amazingly, there is an upside. As organisations automate in an attempt to cut costs and reduce the chance of manual errors, it means payroll practitioners can spend less time on data entry and other repetitive work.
They are being offered the chance to move from working in an essential admin function to becoming strategic partners of the business by delivering essential insights and value instead. By using automation effectively, professionals can free up their time to operate at a more strategic level.
Why is automation a concern for payroll professionals?
According to our ‘The Workforce View in Europe 2018’ research, almost a third (30%) of workers are worried that their job will be automated out at some point in the future. Interestingly, younger generations are more concerned about this scenario than their older counterparts – 41% of 16-24-year-olds fear their job will disappear at some point in the future compared to just 20% of workers over 55.
This situation begs the question of what organisations are currently doing to allay these fears. Worryingly, some 48% of European employees feel their employers are failing to make the necessary preparations to retrain and upskill them in response to the rise in automation.
What will the payroll professional of the future look like?
While some manual payroll tasks such as calculating tax are currently being automated, there are clearly areas in which human intuition and problem-solving will remain vital such as interpreting regulatory changes or dealing with exceptions. AI and robots cannot liaise with stakeholders, but payroll professionals with an inside knowledge of systems and processes can. Humans will also be required to take charge of monitoring and directing AI systems too.
The biggest plus of automation is that it frees up professionals’ time to focus on more strategic concerns such as business forecasting, establishing employee return on investment and influencing board-level decisions. As RPA technology becomes more widespread, the need for data scientists to analyse the patterns and trends hidden in payroll information will increase. Humans will also play a central role in governance and monitoring terms.
How to prepare yourself for the future
The best way to prepare yourself for the future is to upskill and reskill. Versatility will be key. As data plays an increasingly important role in the function, payroll professionals will need to understand this data inside out. They will require deeper industry knowledge, an ability to solve problems creatively as well as effective data analysis and people skills.
While appropriate training will be crucial, it may also be necessary to recruit from a wider talent pool than has been the case in the past.
Pay matters
New technologies present the payroll team with an exciting opportunity to offer the business more than just a way of paying staff. But as a manager, it is essential you meet the concerns of your workforce and show that automation is not just about cutting costs and replacing people. If you take the time to listen to their fears and develop an appropriate upskilling strategy, there is a real opportunity to make the payroll function more valuable than ever.
David Woodward is vice president of product development for Europe, the Middle East and Africa at ADP. Prior to this role, he worked at a number of international organisations in the human capital management space, most recently as chief product officer at SD Worx UK.
Thirty years ago, Harvard Business School’s Professor Shoshana Zuboff said: “Everything that can be automated will be automated” - and that prediction now appears to be coming true.
Indeed, there is now widespread fear that a goodly portion of human jobs will be eradicated by technologies such as robotic process automation (RPA) and artificial intelligence (AI). As management consultancy McKinsey put it: “Forty five percent of the activities individuals are paid to perform can be automated by adapting currently demonstrated technologies.”
Payroll professionals are finding themselves at the forefront of this debate. In fact, a study by Oxford University and management consultancy Deloitte predicted that 97% of existing payroll jobs would automated out by 2025.
But amazingly, there is an upside. As organisations automate in an attempt to cut costs and reduce the chance of manual errors, it means payroll practitioners can spend less time on data entry and other repetitive work.
They are being offered the chance to move from working in an essential admin function to becoming strategic partners of the business by delivering essential insights and value instead. By using automation effectively, professionals can free up their time to operate at a more strategic level.
Why is automation a concern for payroll professionals?
According to our ‘The Workforce View in Europe 2018’ research, almost a third (30%) of workers are worried that their job will be automated out at some point in the future. Interestingly, younger generations are more concerned about this scenario than their older counterparts – 41% of 16-24-year-olds fear their job will disappear at some point in the future compared to just 20% of workers over 55.
This situation begs the question of what organisations are currently doing to allay these fears. Worryingly, some 48% of European employees feel their employers are failing to make the necessary preparations to retrain and upskill them in response to the rise in automation.
What will the payroll professional of the future look like?
While some manual payroll tasks such as calculating tax are currently being automated, there are clearly areas in which human intuition and problem-solving will remain vital such as interpreting regulatory changes or dealing with exceptions. AI and robots cannot liaise with stakeholders, but payroll professionals with an inside knowledge of systems and processes can. Humans will also be required to take charge of monitoring and directing AI systems too.
The biggest plus of automation is that it frees up professionals’ time to focus on more strategic concerns such as business forecasting, establishing employee return on investment and influencing board-level decisions. As RPA technology becomes more widespread, the need for data scientists to analyse the patterns and trends hidden in payroll information will increase. Humans will also play a central role in governance and monitoring terms.
How to prepare yourself for the future
The best way to prepare yourself for the future is to upskill and reskill. Versatility will be key. As data plays an increasingly important role in the function, payroll professionals will need to understand this data inside out. They will require deeper industry knowledge, an ability to solve problems creatively as well as effective data analysis and people skills.
While appropriate training will be crucial, it may also be necessary to recruit from a wider talent pool than has been the case in the past.
Pay matters
New technologies present the payroll team with an exciting opportunity to offer the business more than just a way of paying staff. But as a manager, it is essential you meet the concerns of your workforce and show that automation is not just about cutting costs and replacing people. If you take the time to listen to their fears and develop an appropriate upskilling strategy, there is a real opportunity to make the payroll function more valuable than ever.
David Woodward is vice president of product development for Europe, the Middle East and Africa at ADP. Prior to this role, he worked at a number of international organisations in the human capital management space, most recently as chief product officer at SD Worx UK.
