COMPLIANCE
Using payroll data to shape wider business strategy and approaches
Maria Mason MCIPPdip, partner at BDO UK LLP, assess the virtues of payroll data, including coverage of how it impacts an employee’s journey, shapes an organisation’s strategy and boosts progress, all in an ever-changing world
F rom pay, benefits, hours worked and the associated costs, to recruitment and retention; the payroll team holds data about an organisation’s most valuable asset – its people. Now, as businesses adapt to emerging risks and reporting requirements, payroll data (which has long gone underused) is able to shape our understanding of, and response to, these challenges in new and innovative ways. There’s no denying that, over the last two decades, we’ve changed the way businesses view payroll. We’ve transitioned from being viewed as a ‘push-button’ process, reporting into human resources (HR) or finance, to an evolved and trusted profession. We’re the custodians of key business data, generators of crucial business insight and influencers of strategic business decision making. Our function has also grown into a complex and rewarding profession, offering a range of career paths and development through industry-specific qualifications and accreditation. At the same time, we’ve invested in tools and technology to help us harness and analyse the data we hold, leveraging it to build critical strategic insight, which drives value for organisations. As a profession, payroll now has a seat at the strategy-setting table: a position
where we can shape growth, deliver new forms of value, influence decision making across a wide range of functions / challenges and synergise / collaborate with finance teams, to support business objectives. "We’re the custodians of key business data, generators of crucial business insight and influencers of Shaping the employee journey As caretakers of an organisation’s people, hours, pay and benefits data, the payroll function has always had the capacity to deliver data-driven insight to inform a business’s people strategy. Now, against an increasingly challenging labour market, payroll can use the data it holds to give organisations an even greater understanding of their employees, and provide the finance function with accurate, real-time reporting about the associated costs. strategic business decision making"
As attracting and retaining talent shapes up to be one of the most imperative business challenges of the decade, payroll teams can leverage pay data to develop salary and benefits benchmarks at a market and geographical level. These insights can be used to analyse people proposition and retention metrics, providing a business with a clearer picture of how its people strategy compares with the market, and ultimately enabling organisations to identify opportunities to recruit a high-quality workforce and retain happy, engaged staff. Continuously building growth and leading strategy The payroll team’s potential to offer data-driven insight and added value reaches beyond the traditional remit of the people and HR function. As one of an organisation’s biggest outlays, pay and hours data has an important role to play in broader financial reporting, performance analysis and strategy setting. Pay data is a vital component for profit margin analysis, and with the introduction of real time information technology, payroll teams have the requisite tools to harness live pay data and evaluate this against sales revenue in real time. By combining payroll data, technology and innovation,
| Professional in Payroll, Pensions and Reward | November 2023 | Issue 95 26
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