The Four Trends Concerning Global Payroll Leaders

15 March, 2023

Data security (44%), accuracy of employee pay (36%) and reporting capabilities (32%) are top concerns global payroll leaders are working on
Payroll is influencing strategy at the top level with nearly half (45%) of respondents reporting an increase for relevant data from senior management
The majority (61%) of global businesses had their payroll operation impacted by a cybersecurity breach at least once in the last 24 months

15 MARCH 2023, MELBOURNE, AUSTRALIA - Once seen as a ‘back office’ function, payroll is becoming an increasing focus for business strategy and success. Having been central to coping with dispersed workforces and fluctuating employee working patterns in recent years, leaders are now looking to payroll to influence other business-critical areas.

Research conducted by industry-leading online payroll services and workforce management software provider, Automatic Data Processing (ADP), the report reveals that cybersecurity, scaling operations, legislation and driving strategy are the biggest priorities for payroll senior leaders.

The Potential of Payroll report surveyed over 1,463 business leaders responsible for payroll to identify the factors that will drive global payroll in the next two to three years. Results show that almost half (44%) are planning to improve data security, followed by the accuracy of employee pay (36%) and reporting capabilities (32%).

These concerns mirror those of payroll leaders in Australia, says Kylie Baullo, Managing Director ANZ at ADP. “Our data shows that in Australia and across Asia Pacific, the same organisational issues and opportunities are being identified across the board, and these are the ones organisations want to address in the immediate future. This may put additional pressure on existing cybersecurity, HR and operational skills shortages as the global talent war stretches itself even further.”

Cyber secure payroll

Following high-profile data breaches by global companies such as Twitter and Uber, as well as Australian organisations Medibank and Optus, it’s not surprising that data security topped the list of planned payroll improvements in the next two to three years at 44%.

Protecting payroll is an urgent and present danger for businesses, with 61% of global respondents reporting that their payroll operation had been impacted by a cybersecurity breach at least once in the last 24 months.

“Organisations are aware of the urgency of putting the systems in place to protect their data. Almost all (98%) of the senior payroll leaders we surveyed felt that data security had become more important in the last 12 months. But less than half said that they have a full contingency plan in place across their business locations - this lack of action is a major concern.

“Recent high-profile data breaches have demonstrated how sophisticated these breaches are becoming. That’s why it’s becoming ever-more important to consult experts that specialise in keeping payroll and HR data safe,” she adds.

Futureproof payroll

Despite global skills shortages, a looming recession and other challenges, many businesses are looking to scale up their operations. For most organisations, that means more people, which is why 36% of businesses are planning to increase the accuracy of employee pay reporting. Additionally, 31% plan to increase the timeliness of employee pay.

These efforts will help to address current issues, with more than half of respondents (56%) reporting that they currently don’t have full visibility of payroll performance, accuracy and other data across all their international locations.

“More complex and variable working patterns and schedules have meant that almost half (45%) of respondents experienced an increase in payroll queries from employers. Outsourcing of payroll can increase the accuracy of this data and in turn increase employees’ workplace satisfaction.”

Working with payroll experts will also help businesses address the current skills shortage, with 48% saying they have difficulty finding payroll skills from outside the business. Additionally, 64% have resorted to training non-payroll staff to fill this need.

Payroll that can scale

Global businesses, or those with global ambitions are being hindered by inaccurate and inconsistent payroll practices. Nearly a third (30%) of finance and HR leaders reported that they are not confident that their payroll systems could support their plans for growth, or geographic expansion.

“While it can be tempting to look for the quickest solution when it comes to setting up payroll in new business areas and markets, this can be a false economy. Outsourcing to payroll experts who offer consistent and integrated systems, while also factoring in regional differences, provides businesses with a universal perspective of their payroll,” says Mrs Baullo.

Two in five (40%) payroll leaders reported that each country has different methods of tracking compliance performance, which has led to a focus on planned regulatory compliance (22%) in Australia. Additionally, almost a quarter (23%) of respondents would like to transform their operations to deliver standardised multi-country payroll processes.

Foundations for the future: driving strategy with data

Payroll is influencing strategy at the top level with nearly half (45%) of respondents reporting an increase for relevant data from senior management. These metrics are being used to inform cost management, growth, and diversity, equity and inclusion (DEI) strategies.

Currently, many businesses lack the right tools and big data to inform insights, with only 40% implementing global dashboards and just 29% using real-time analytics. This has contributed to 32% of payroll leaders’ desire to improve reporting capabilities.

Additionally, the opportunity to drive efficiencies and other opportunities across business units is a focus for 25% of respondents, who are looking to increase integration with payroll and other business critical systems.

“Payroll leaders are becoming increasingly integral to not just their roles, but business performance. As a plethora of opportunities and issues present themselves, those that find the tools and expertise to support them will keep pace and exceed their peers,” concludes Mrs Baullo.

For more information on ADP’s payroll and HR software solutions, go to au.adp.com.

-ENDS-

Note to editors

Kylie Baullo, Managing Director ANZ at ADP, is available for interview on request.

About the research

The Potential of Payroll: Global payroll survey consists of interviews with 1,486 senior individuals, in 16 countries, who were heavily involved in, or had in-depth knowledge of, payroll in their organisation. All respondents work in multinational organisations of over 1,000 employees globally and all are departmental managers or above.

The research for ADP was carried out by Opinion Matters. All research conducted adheres to ICC/ESOMAR World Research Guidelines. Opinion Matters is registered with the Information Commissioner’s Office and is fully compliant with the General Data Protection Regulation (GDPR) and the Data Protection Act (2018). All interviews were conducted online in the local language between 10 June and 28 June 2022.

The regional breakdown was as follows:

465 in Asia Pacific (Australia, China, Singapore, India)

303 in Europe (France, Germany, UK)

215 in Latin America (Brazil, Chile)

101 in the Nordics (Denmark, Finland, Norway, Sweden)

302 in North America (USA and Canada)

100 in South Africa

About ADP (NASDAQ: ADP)

Designing better ways to work through cutting-edge products, premium services and exceptional experiences that enable people to reach their full potential. HR, Talent, Time Management, Benefits and Payroll. Informed by data and designed for people. Learn more at ADP.com

ADP, the ADP logo, and Always Designing for People, are trademarks of ADP, Inc. All other marks are the property of their respective owners.

Media Contact: adp@iconagency.com.au