March 10, 2020HCM Support, HCM System Support, HR Analytics, Managed Payroll, Payroll, Payroll Support, Payroll Technology
Position your Organization to Make Data-Driven Payroll Decisions
The term data-driven can be misleading: not just any data will do. The quality and choice of data and how it gets cross-examined matters. It matters a lot. Below, key payroll professionals from Wise Consulting’s Managed Payroll practice help outline the value of using analytics to make data-driven payroll decisions.
Let’s Start with the Basics: How are HR Data Reports Different from HR Analytics?
Reports organize data and spit it out in facts about how much, how long, how many and so on. Of course, reports are great. Viewed over time, they help us identify patterns, assess the fluctuations of key costs, view performance and attendance outcomes and help us understand what happened. It requires human interpretation and manual data manipulation to take it to the next stage of aligning what the data is telling us about our business—what decisions were made, how they impacted the bottom line and how this may drive the next move in order to reach organizational goals.
The Wise Payroll Team Urges You to Avoid Making These All-Too-Common Mistakes
Here are some of the ways that non-data-driven decisions can happen—have you ever found yourself in situations like these?
- Using cost as the main driver in making decisions
- Rushing into a decision
- Being swayed by a sales pitch that doesn’t understand your business
- Failing to consider procedural workflows and downstream impact
- Disregarding the needs of other departments
- Over-focusing on short-term fixes rather than taking the long view
- Ignoring or misinterpreting compliance and regulation requirements
- Failing to recognize accidental precedent-setting with one-off, quick fixes
- Overlooking culture and employee expectations
Properly interpreted, insights gleaned from analytics technology can help avoid some of these traps by diving deeper into connections between data points, exploring how what happened drove the organization in a particular direction, and what can be done in the future to intentionally drive the organization where it needs to go. Tools like ad-hoc queries and predictive recommendations assist the data analysis process. You can read more about leveraging data insights to position Payroll as a strategic business partner here.
Becoming Truly Data-Driven
Though there are several things, such as the right quality data feeding reports or dashboards, that need to be in place in order to harness the power of data-driven decision making, there is one thing that is non-negotiable. Spot the similarity in these two approaches:
- An HCM system that has analytics capability and at least one person with business intelligence expertise who understands your organization’s workflows and business goals.
- Robust, accurate reports that provide the data your organization most needs access to and at least one person with business intelligence expertise who understands your organization’s workflows and business goals.
Ironically, despite all the automated technology, analytics dashboards, advanced querying, drill down viewing and comparison of data capability, you still need experienced people with specialized expertise to make effective, smart, data-driven decisions.
Data-Driven Payroll Support of Organizational Goals
Once you understand the tools and expertise available to you to properly query and interpret your data analytics-style, your organization needs to make sure they are collecting the right data and asking the right questions to effectively make data-driven decisions about meeting business goals. For payroll, this means performing a detailed evaluation of needs, requirements and regulations that affect your organization and processes. Sometimes, you might also need to consider whether to improve processes or invest in new software. The Wise Payroll Team provides a possible list of considerations:
In what states, regions or countries does your organization do business or have a physical presence? Can your system or processes handle the statutory pay that may be required in certain states?
Historical Patterns & Lessons Learned Archives
Are you setting precedent and tracking issue patterns to explore when necessary or are one-offs and exceptions running the show?
How much is the business willing to accept?
Processes & Procedures
Are your processes current and efficient or are they slowing you down and costing you precious resources or time elsewhere? Are you leveraging your system to the max? Do you have single points of failure that could be high risk?
For example, Sarbanes-Oxley regulations. Does your organization meet compliance?
Are your policies consistent with your culture, business standards and, if an organizational goal is growth, are they scalable? Are they evaluated on a regular basis?
Business Continuity Requirements
Do you have a plan or contract with a partner in place to seamlessly continue payroll in the case of emergency or staff shortage? Are your processes documented and ready to be translated on the fly?
Are other essential department systems integrated well with yours (and workflow of policy and procedures as well)? Failure to ask all the partners involved in the workflows up and downstream can cause costly consequences down the line.
Audit Patterns & Frequency
If you have a lot of audit requirements, internal and external, do you need to consider sourcing a payroll vendor or software that can support them?
Fearing You are Not Making Smart Payroll Decisions? Wise can Help!
If you are on a legacy system and thinking to implement new software, need to set up payroll support for emergency situations, know it would save money and avoid compliance risk by outsourcing your payroll function, or want to add analytics functionality to your HCM system, the experts at Wise Consulting can help you and your business meet these goals. Learn more by contacting a dedicated Wise consultant today.
Information in this Article was Provided By:
Ana Woods-Hill, CPP, Managed Payroll Team Lead
Kris Higdon, CPP, Managed Payroll Team Lead
Jennifer Dunivant, CPP, Senior Client Payroll Specialist
Elisama Gonzalez, Client Payroll Specialist
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