It’s often undervalued, but payroll has the potential to provide invaluable data for businesses.
Payroll is absolutely key to any business, yet its value is often overlooked. The Covid-19 pandemic shone a harsh, unforgiving light on payroll, magnifying its existing inefficiencies and adding greater complexities.
Exploring payroll from the perspective of HR, finance and payroll leaders, the survey interviewed 1,100 senior payroll decision-makers in 10 countries between 10 December 2020 and 22 January 2021.
Why payroll needs to be streamlined
The survey found that thanks to the ravages of the pandemic, payroll processes and systems are not as effective as they could be. With 82 percent of companies finding the pandemic challenging, chief concerns were having accessible, reliable payroll systems and being able to deliver accurate, timely staff pay.
Business leaders were clear about what they wanted from a global payroll transformation. This includes access to greater reporting and analytics to inform company strategy and planning. Leaders need information delivered quickly in response to reporting requests, and tighter data security to improve compliance.
They also expect streamlined payroll processes to reduce errors, lower costs and increase employee satisfaction.
In the light of these challenges, businesses face a watershed decision: embrace change and digitally transform payroll to bridge the gap, or continue to do nothing and face a gulf between their aspirations and what payroll currently delivers.
The survey highlighted the need for change to build resilience, streamline operations, and reduce risk in case companies ever face another Covid.
What needs to change?
The survey highlighted three areas where businesses can transform their payroll: optimisation, visibility and agility. Yet the vast majority of respondents (74 per cent) are still running multiple payroll systems across multiple geographical areas. As a result, 61 per cent report that their payroll staff are inundated with queries.
Meanwhile, payroll departments are being asked by senior management to provide extra data, as what’s provided can be inconsistent and difficult to interpret.
Only 14 per cent of companies have a global payroll strategy fully integrated with HR and finance systems – delivering less complexity and radically lower costs.
Driving strategic direction
The report also highlighted that running multiple systems with little integration results in a very limited view of payroll. Without clear visibility, 73 per cent of respondents didn’t have the payroll data to inform the strategic direction of the company.
Plus, 51 per cent had limited confidence in their payroll compliance. Meanwhile, those companies with a unified platform had a clear view of global costs, which enabled accurate modelling, forecasting and reporting.
Becoming more agile
The need to adapt at speed has been brutally highlighted by the pandemic. Some 61 per cent of respondents have been unable to adapt payroll to meet the many challenges they faced. Others (33 per cent) said they didn’t have a payroll system to support company expansion plans.
However, those with a unified global payroll platform have the agility to analyse data quickly and scale to support company growth.
An efficient global payroll strategy can meet the challenges highlighted by the pandemic, integrating payroll data with other systems to deliver more efficient reporting and analytics. Only then can payroll really deliver on its potential, providing the data to drive more strategic decisions and embed greater efficiency across the business.
Find out more about ADP’s fast, easy and accurate payroll services here.