The COVID-19 pandemic has been a classic “black swan” event: hard-to-predict and uniquely destructive, leaving the global business community in the financial and strategic shock.
For organisations that hadn’t moved their back-office operations to the cloud prior to the pandemic, their “old normal” business processes had risks built in, and payroll was perhaps one of the greatest risks.
Payroll staff have had to pull together to keep legacy payroll systems operational, with payroll teams forced to step in on-site when remote management tools failed.
Some businesses had to circumvent their on-premise systems and panic-run payroll directly through their banks, reconciling discrepancies at a later date.
To some extent, COVID-19 was an early warning for many organisations of their outdated systems and processes.
Payroll Is Often Overlooked Yet Critical
Many transformation projects, such as taking payroll to the cloud, are often considered as “nice to have” and get overlooked in better times. That is odd when you consider how powerful pay is, which on average accounts for 50% - 60% of a Fortune 500 company’s business spend according to Deloitte’s analysis.
What’s also often overlooked is that payroll actually provides the data needed to deliver smart Finance and HR decision-making, directly impacting vital talent acquisition and retention. Deloitte’s recent paper notes that “organisations… need open, accurate payroll data to run and analyse current operating models, run scenarios and also know exactly what is going on, to look at how you allocate work, where, at what cost and with how many resources.” So, here’s the simple question for you to answer - how can you analyse current operating cost efficiency without accurate payroll data to build your models?
In the wake of COVID-19 upheaval, many finance leaders’ focus is now around risk mitigation, business resilience and operational optimization. It’s clear that the approach to pay needs to change – and fast.
3 Phases of Payroll Transformation
When you are ready to kick start your payroll transformation, take a phased approach to payroll transformation will help you to target your key challenges and see values faster. You may focus on changes that drive savings and efficiency first, before progressing to strategic transformations which will pay-off in the long-term.
Payroll is a process and you need a trusted partner to help you design and deliver the one that’s right for you. With a proven 70-year track record and 1,000,000 customers worldwide, ADP knows how to work with you to do what’s right for your specific business.
Download our newly launched e-book “Take a new look at pay” to get a fresh perspective on pay and learn how you can actually reduce cost managing your largest balance sheet item– payroll spend.
