Payroll Gets the Spotlight

payroll-in-the-spotlight-blog
payroll-in-the-spotlight-blog

During an Oracle Fusion preview event I attended a couple of years ago, one of the participants cried over the payroll manager checklist tool.  It’s not the first time I’ve witnessed passion over payroll.  The annual APA congress is filled with “timely & accurate” payroll fanatics.

Yet, once outside of the inner circle, payroll applications are typically dismissed as essential, but non-strategic.  Despite the occasional call-out by Bill Kutik, payroll lacks the sex appeal of the latest talent management trend.

Until now, the visibility to business leaders and strategic HR professionals has been minimal.  Once they ensure the basics are humming, these folks move onto more pressing matters.

Payroll in the Spotlight

payroll-in-the-spotlight-blog
Payroll Gets the Spotlight

This is all changing.  With the sudden growth of analytics adoption and interest (including predictive analytics) and the maturation of integration capability, payroll data is set to be in the spotlight of business decision-making.

Take Chiquita as an example.  Chiquita used actual labor cost data from across the globe, all brought together into their Workday HCMsolution to determine the best production site. Rather than estimating costs for different geographical regions, Chiquita had the actual costs incurred.  They could balance this with transportation and other business data to come up with the right business decision.

Payroll data is hands-down the best people data you have.  It is real, it is objective, and it is potentially eye-opening.  It tells things as they are and it can form the basis of major business decisions.

Readmore: Research Summary: Best Practices – Helping HR Bridge the Business Divide

Missing Ingredients

What’s usually preventing organizations from leveraging payroll data in strategic decision-making?

  • Seamless integration that brings all pay data back together for analysis.  With its announcement on May 24, Workday introduced the first bi-directional payroll connector which not only pushes payroll data out to 3rd party payroll partners SafeGuard World International and Patersons, but also brings the actuals back into a single interface.  A two-way payroll interface is not new.  Oracle Peoplesoft and SAP/ADP customers have had access to import/export capabilities through their respective payroll interface products for some time.  What’s different is that Workday’s solution is managed through its integration cloud platform rather than a one-off file transfer.  The bi-directional flow is intended to be core to the system, rather than an afterthought.
  • Analytics that mix pay data with more qualitative talent data and business data.  The burgeoning analytics domain is doing just this.  eThority and OrcaEyes, for example, are making it much easier to pull data together from a variety of sources, create simple-to-consume analytics, and bring forward predictive models.  What leads the charge for the first step in building these eye-opening business decision analytics?  Official payroll data.

Bottom line: The changing capabilities of integration and analytics is driving payroll data into the spotlight for key business decision-making.  In addition to ensuring a timely and accurate payroll process, HR leaders will seek to leverage the output in driving business results.

Your POV: Do you have a full view of your payroll data?  In what business-oriented analytics do you use your payroll data?  What are your plans for the future?