FEATURE TOPIC
time data. It’s essential the payroll department understands and has regular communications regarding the strategic objectives and goals of the organisation. How should payroll managers go about presenting the data, and to whom? IH: It’s important to find the correct audiences and, wherever possible, agree the data outputs of the payroll function, who the audience is and standardise to the extent that data is being regularly updated. The different audiences may be all the way from boards and executives who need to understand pay gap analysis and action plans, through to people and performance committees who need to understand the take-up of benefits and what could improve this. Where possible, the use of dashboards should be used to create an interactive approach for end users to see real-time tracking of metrics and trends, also ensuring there’s an informed commentary to explain change. We must remember that, as professionals, we have a responsibility to ensure compliance and provide assurance. Data monitoring around performance metrics such as errors, advances and control accounts may mean good practice can be supported through the provision of data monitoring. MM: Naturally, the key to success is understanding your stakeholders and what they need. Data analytics is a great way to demonstrate patterns and changes, particularly for pay and benefits. This kind of reporting is valuable, and is almost always well received, but it’s important to ensure your analysis is tailored to the objectives of the business. Payroll is pivotal to all organisations, and payroll professionals have the benefit of liaising with most areas of the business, particularly finance and HR. It’s important that payroll teams work alongside their finance and HR colleagues to build strong data reporting processes and analysis which supports the needs of the business. In addition to this, as operational leads foster stronger connections with payroll, this will ensure the day-to-day workings by staff are given the correct level of focus. CW: The data needs to be simple and easy to understand. Reports should be summarised as a one-pager which gives the message, with a drill-down option for
further information if required. It’s essential the data fits the audience requirements. “Payroll can certainly provide a very important set of data, but this can be even more powerful when overlaid with information from other parts of the organisation” We often look at payroll data from a financial perspective, but should we be overlaying other information with this to produce a more informed data picture? IH: Payroll can certainly provide a very important set of data, but this can be even more powerful when overlaid with information from other parts of the organisation. For example, areas where there may be higher than average sickness absence might correlate with the volume of casework or turnover from HR or expenditure on temporary labour in finance. One way to achieve being able to cross- reference data is to ensure the hierarchy and unique identifiers used in the payroll system are compatible with those used in other systems. Then, if the data is migrated from all systems to a master data platform, the option to find associated data is possible through a post, employee or hierarchy identifier. To achieve sufficient credibility to influence an organisation, it’s important we offer a collaborative presentation of data as a more powerful set, rather than the payroll data in isolation. MM: There’s no doubt that, due to staff costs being one of highest spends for any business, payroll is always a key financial focus. However, organisations are increasingly looking at how they manage their workforce, and therefore require live data on staff costs as they happen. The ability for line managers to have access to live pay and hours data, for instance, allows for closer management of teams and direct resource, enabling agile decision making and enhanced client value. Payroll departments must play a key role in the capturing and reporting of the relevant data to ensure they’re
firmly positioned to demonstrate the key role they perform in driving the business forward. CW: Dashboards will help visualise the data. Gone are the days when numerous pages of financial data were produced. When making strategic decisions, there needs to be an easy-to-understand summary of the data being presented, especially for non-finance managers. How can payroll managers assess which data will be useful in the organisation’s strategy? IH: There are many strategic objectives which can be monitored using payroll data. The main one will always be financial sustainability and the cost of the workforce which supports budgeting, cash flow and the ability to invest. Employee turnover and the associated costs to support retention to reduce turnover are significant, along with the costs of ending employment, such as termination costs. The employee experience can be monitored through the take-up of benefits, and well-being can be measured through the take-up of healthcare. Or, topically, as we go through the current economic challenge, trends around the use of savings vehicles like pensions and individual savings accounts (ISAs) can be monitored. Forecasting future costs through trends can also support high-level strategy and monitoring absence costs versus investment in well-being or overtime trends, and proposals to reduce this through working patterns are all feasible angles to apply when producing impactful data and commentary. MM: To understand what’s useful, payroll departments must speak the language of the organisation they’re in and, more importantly, understand the organisation’s strategy. This isn’t done in isolation, but in collaboration with the C-suite and other teams. With this information, payroll managers can determine the importance of the data they hold and decide how they can report on this to help build growth, create value and drive the business forward. CW: Payroll managers need to understand what the organisation needs. Reports need to be produced in line with the needs of the wider business, but then reviewed on a regular basis to ensure they’re fit for purpose. n
| Professional in Payroll, Pensions and Reward | November 2023 | Issue 95 42
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