Payroll Transformation – Yes, It's Strategic!

By Mike Ellis, Synchrony Global CCO

In the world of transformational HR where focus has shifted to strategic processes such as performance and goals management, recruiting, and succession, one module is often overlooked as a function that can be transformed...Payroll. 

With the widespread adoption of employee and manager self services, and with HR Business Partners and Specialists now having direct access into a fully integrated HRIS, the function of the payroll manager has drastically changed. In the past, all data entry into the payroll system were typically performed by the payroll team themselves, the source of that data often being manual paper based forms or, in some cases, through a help desk ticketing tool. What is the impact on your payroll solution when dealing with the dynamic environment that self-services and wider enterprise access brings?  

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If the underlying payroll solution isn't robust enough to track these changes and automatically calculate any payments / deductions in the payroll, the payroll team will be scrambling post payroll cut-off date to identify changes and ensure any calculations that are required have occurred. The typical cycle of data entry, running payroll, extracting reports, reconciling, adjusting, repeating until it's all balanced and accurate and then sending off the bank file, reports, payslips etc. can all be put at risk with some erroneous data changes from an unsuspecting employee or manager. If the payroll system is integrated via an interface rather than being a component of the HRIS itself, odds are the data corrections made were just in the payroll system due to the time restraints, resulting in potential errors reoccurring the next time data is interfaced down from the HRIS. 

SyncPay Screens.pngEnter what I think is the next wave of payroll management, the Payroll Control Centre that SAP released a few years ago, and now has made available in Employee Central Payroll, SAP's cloud based payroll solution. This is a game changer.  

Payroll managers now can monitor the impact of self-service data changes on their payroll calculations throughout the payroll period. Any changes required due to missing or incorrect data can be assigned to an administrator to investigate and fix or directly back to the HRBP to correct. Control totals that in the past required Excel wizardry that my CFO would be proud of, are produced real time, in dashboard format, and production of bank files, general ledger postings files etc. are all produced through one simple tool. 

The time and effort saving alone due to the Payroll Control Centre is huge. 

In the past when people used to ask for a payroll demonstration I used to cringe, as it never was a simple process and often scared customers away (let's face it the lovely grey/blue screens of SAP GUI are not going to win first prize in a beauty pageant). Now, I find myself actually volunteering to run a payroll demonstration when our team is asked to run one.

So, what does this all have to do with HR transformation? We've found that often whilst there is executive intent to sponsor a focus on Strategic HR, often the business case is hard to stack up due to the reliance on intangible benefits used during the analysis. When you include Core HR and Payroll in the mix, tangible benefits can easily be realised. With a tool such as Employee Central Payroll, the business case can further be strengthened by allowing the redirection of focus from admin and transactions to the strategic elements of providing HR services to an organisation. In the past, this was typically achieved by adopting shared services, which is still a great option, but no longer the only option. Does this mean that payroll can now be considered strategic in the world of HR transformation? I would say yes. 

What about the costs? Traditionally, payroll solutions were expensive, especially when implementing an SAP based payroll solution. This does not have to be the case. If a pre-configured template is used to accelerate the implementation, and the mind-set of the organisation is to adopt that template rather than trying to adapt that template to the company's existing practices, costs can be minimised. As long as that template comes with pre-packaged processes, a level of pre-configuration that allows implementation to focus on effectively moving company data over, and ultimately it is legally compliant (and supports best practice), an implementation can be comparable to any other Tier 2, best of breed payroll system. 

Ultimately, we've found on a number of occasions, replacing the current payroll solution enables an organisation to realise benefits that can then be redirected into funding the more traditional strategic elements of HR. Is this limited to large organisations? Absolutely not, we've clients ranging from 100 employees upwards on our payroll solutions. SyncPay, now powered by SuccessFactors Employee Central Payroll is now available to any sized organisation, from 50 employees in a country up to 10,000 employees (or more if required), all on the same platform with the same user experience and functionality. 

I started out my SAP and HCM career as a payroll consultant, and whilst I always have considered myself a payroll junkie, the innovation that SAP SuccessFactors brought to talent management and strategic HR almost had me converted over to being a talent junkie. I think there may be some fight left in payroll yet, the Payroll Control Centre and Employee Central Payroll is how payroll should be done. 

Download a whitepaper on Synchrony Global's cloud payroll solution, SyncPay, to learn how your orgnisation can take advantage of a best-in-class cloud solution today.

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