Top 5 Payroll and HR considerations when strategising for growth

World-renowned HR and Payroll Futurist (yes, we have those) Pete Tilakos says that Payroll and HR professionals are on the brink of the "Golden Age" of payroll. According to a recent survey he conducted, cloud technology is the most impactful tool transforming payroll operations today. So if your organisation is still relying on in-house infrastructure for payroll, the Dad of HR and Payroll technology suggests it’s probably time to consider a change.

The shift to modern, cloud-based solutions not only simplifies processes but also empowers payroll managers to use data in ways that were once simply unimaginable. This new era is all about elevating the role of payroll from a simple back-office function to a genuine strategic asset that can drive organisational success.

In this blog, we’ll explore the top five payroll and HR considerations you need to focus on when strategising for growth. From harnessing the power of analytics to transforming payroll into a strategic function, we'll provide you with practical insights and actionable steps to shine within your organisation. Let's dive in and discover how you can make the most of this transformative period and lead your payroll and HR operations into the future.

Harnessing the power of analytics is a lot like pulling on a golden thread. It can propel your organisation to new heights — and we promise you, it’s a whole lot of fun to unravel the magic. Imagine being able to pinpoint exactly where your team’s strengths lie or where there might be gaps that need addressing. This is the reality for companies that leverage advanced payroll and HR analytics.

Uncovering insights through analytics

On the surface, numbers in workforce data might just look like plain statistics. However, every action your employees take generates valuable data. Whether it’s a bustling Sydney tech startup or a tranquil North Otago dairy farm, the everyday operations of your staff are a goldmine of information. By using cloud-based analytics tools, you can transform these data points into actionable insights that drive strategic decisions.

• Daily nuggets of knowledge: Think of a café chain across Queensland facing high turnover rates. By using analytics, management can identify patterns and discover that better scheduling could align with lower turnover, making a significant impact on employee retention.
• Keeping a finger on the pulse: In a competitive Auckland consulting firm, real-time performance tracking can be a game-changer. Analytics lets managers see who’s excelling and who might need support, making sure resources are allocated effectively where they’re needed most.
• Driving decisions with data: For a construction firm in Brisbane facing resource allocation challenges, analytics can help optimise planning, making sure projects are adequately staffed without overshooting budgets.

The shift to leveraging payroll and HR analytics isn't just about staying current though — it’s about gaining a strategic edge through keeping your best staff. According to the Josh Bersin Company, organisations using advanced people and payroll analytics  are:

• 4.3x more likely to create a sense of belonging.
• 4.8x more likely to be seen as a great place to work.
• 7.3x more likely to engage and retain employees.
• 2.6x more likely to exceed financial targets.
• 6.7x more likely to adapt well to change.
• 7.7x more likely to innovate effectively

It’s crystal clear: by turning “mundane data” into a powerful strategic asset, you can make sure your business is widely seen as a great place to work to attract, and keep the best talent available. 

Transforming payroll from a transactional function to a strategic asset is like shifting gears from merely keeping the lights on to actively driving your organisation's growth. It's about recognising the massive untapped potential within your payroll data and using it to make strategic decisions that genuinely boost overall business performance. And that all comes down to changing your perspective — what used to be a business-centred model now needs to be seen (and treated) as a human-centred model. 

The Strategic Edge

Transforming payroll from a transactional function to a strategic role involves several key shifts:

• Legacy vs. modern approaches: Legacy systems often rely on batch operations and manual processes, which are inefficient and error-prone. Modern payroll systems offer real-time insights and automation, boosting operational efficiency.
• Improving visibility and value: By shifting from a cost-centre mentality to a value-add approach, payroll can provide strategic insights that support the entire organisation.
• Transactional to strategic: The end goal is to provide strategic business tools and insight on people that support the entire organisation, rather than just ticking HR and Payroll boxes. 

By transforming payroll into a strategic function, organisations can create a truly adaptive and innovative workplace. This human-centric model isn’t merely performative — it treats staff as fully realised human beings. By empowering your team with data and information that reflect the real world and real people, they are better equipped to lead effectively and drive business success.

New Zealand and Australia can be guilty of leaning on the “if it ain’t broke don’t fix it” mantra, but this is always risky business when dealing with HR and Payroll. The truth is, that those old legacy systems, with their weird and wonderful configurations and manual processes built up over the years, often lead to errors and inefficiencies that can be costly and risky.

The hidden dangers of outdated systems

Sticking with outdated payroll systems can create several problems:

• Inaccurate calculations: These legacy systems often hold inaccuracies from expired entitlements or allowances that are still being paid. One project we did revealed that a company was overpaying $3 million annually due to such errors.
• Manual processes: Many older systems rely heavily on manual data entry and calculations (and probably scattered Post-it Notes), which are not only time-consuming but also increase the risk of human error. 
• Compliance challenges: Keeping up with ever-changing payroll regulations is tough enough. Doing it with an outdated system can lead to non-compliance, which can result in hefty fines and legal issues.
• Limited innovation: Legacy systems limit your ability to adopt modern payroll practices like real-time data processing and AI-driven analytics. This can hinder your ability to stay competitive and innovative.

Why modern systems make a difference

Upgrading to a modern, integrated payroll system can be a game-changer:

• Enhanced accuracy: Modern systems automate payroll calculations, making sure that data is accurate and up-to-date. This significantly reduces the risk of errors, building trust in your payroll processes.
• Simplified compliance: Integrated systems simplify compliance with payroll regulations. They give you transparency and auditability, reducing the risk of non-compliance and associated penalties.
• Increased efficiency: Automation eliminates the need for manual data entry and calculations, freeing up your team to actually focus on more strategic tasks. 
• Real-time insights: With real-time data at your fingertips, you can make better decisions and improve forecasting. This helps you manage your workforce more effectively and respond quickly to changes.
• Support for innovation: Features like on-demand pay and AI analytics enable innovative payroll practices, boosting employee satisfaction and retention.

Put simply, sticking with outdated payroll systems “because it ain’t broke” is a risk that can hold your organisation back. By adopting a modern payroll system, you can mitigate risks, enhance efficiency, and support strategic growth.

Payroll experts often find themselves bogged down with ad hoc reporting requests from managers. Aside from being not much fun, this leaves less time for internal audits, value creation, and actually lifting the profile of payroll. To break free from this cycle and become proactive, you should be looking to genuinely empower managers with relevant payroll and HR data, without relying on manual report generation.

The Burden of Ad Hoc Reporting

Ad hoc reporting requests are a common pain point for payroll experts. These requests:

• Consume Valuable Time: Constantly generating reports on demand means less time for strategic tasks like internal audits and process improvements.
• Interrupt Workflow: Frequent interruptions to create custom reports disrupts the daily workflow and reduces overall productivity.
• Increase Risk of Errors: Manually handling data to create reports can lead to mistakes and inconsistencies.

Becoming Proactive with Data Access

To fix these issues, payroll teams should aim to provide managers with direct access to the data they need. This can be achieved by:

• Educating and Empowering Managers: Train managers to use available tools and understand the data, turning them into self-sufficient users.
• Implementing Secure Data Connections: Make sure that data from payroll systems is securely connected to corporate reporting solutions, avoiding the least secure method of emailing sensitive information.
• Automating Report Generation: Use integrated systems that allow for automated report generation and real-time data access.

By enabling managers to access and interpret payroll data themselves, payroll teams can shift their focus to more strategic activities, adding greater value to the organisation. Oh, and trust us, the managers prefer it this way too — it’s a win-win.

Yes — it’s pretty tempting to go for quick fixes when faced with payroll and HR challenges, but this approach often leads to fragmented systems and inefficiencies. Companies should avoid buying stand-alone, non-integrated solutions to plug immediate gaps. Instead, investing in integrated systems can provide long-term benefits.

The pitfalls of quick fixes

Quick fixes often result in:

• Fragmented systems: Using multiple, unconnected systems leads to data silos and inefficiencies. Teams end up handling data multiple times, increasing the risk of errors and making it difficult to scale.
• Manual data handling: Disconnected systems require manual data transfers and reconciliations, which are time-consuming and error-prone.
• Limited innovation: Stand-alone solutions lack the comprehensive capabilities needed to support modern payroll and HR practices, restricting the ability to innovate and keep up with employee expectations.

The power of integrated solutions

An integrated approach to HR and payroll technology offers several advantages:

• Unified data: Integrated systems consolidate data, providing a single source of truth that enhances accuracy and reliability.
• Efficiency and scalability: Automation reduces manual work, freeing up resources and allowing the organisation to scale efficiently.
• Enhanced security: Centralised systems improve data security and compliance, reducing vulnerabilities associated with manual processes and disparate systems.
• Strategic insights: Integrated solutions provide comprehensive analytics and insights, supporting better decision-making and strategic planning.

Given we’re fast approaching that aforementioned golden age of HR and Payroll, standing still is not an option. By leveraging analytics, transforming payroll into a strategic function, modernising outdated systems, empowering managers with relevant information, and investing in integrated solutions, you can do amazing things for your people, and therefore your entire organisation.

Don’t let outdated practices hold you back. Contact Jemini today for expert advice and assistance in implementing these transformative processes. Let’s move forward together into the golden age of payroll and HR management.