From the outside it often looks like a seamless, well-oiled machine. Many executives assume that once they’ve digitalized their payroll solutions, the hard work is done and it’s smooth sailing ahead.
The reality, however, is often different. Even after making the move to the cloud and automating payroll, various unseen challenges may lurk beneath the polished exterior. This can create a gap between perceived and actual payroll performance. Consequently, companies may struggle to fully realize their payroll’s full potential.
Strada’s research report, Bridging the Gap – From Good to Great in Payroll, brings together data from our own 2024 Company Payroll Complexity Report (CPCR) and Workday’s Strategic Ascent of Global Payroll (SAGC) to help businesses better identify these challenges and better leverage their payroll’s capabilities.
What’s holding your payroll solutions back?
According to our research, 47% of payroll processes are still handled manually. Despite investments in technology and system integration, many companies continue to rely on manual processes. This not only increases the risk of errors but also leads to an average of 345 time-consuming reruns per year.
Additionally, issues such as data inconsistency, weak governance, and poor integration can negatively impact performances behind-the-scenes. Too often, payroll teams find themselves bogged down by inefficiencies, errors, and increased costs. This prevents them from leveraging payroll´s potential to provide strategic insights that drive business growth.
Unleashing your payroll solutions untapped potential
Payroll’s potential extends far beyond just paying employees accurately and on-time. When integrated with HR, Finance, and Operations, payroll becomes a powerful business asset, providing real-time, data-driven insights into workforce trends, pay equity, and performance.
Yet, our report reveals that 89% of businesses surveyed feel their payroll systems aren´t delivering the insights they need. This underscores the importance of a well-integrated system to unlock payroll´s full potential.
Scalable and well-integrated systems help businesses allocate resources more effectively. They help ensure pay parity, attract and retain top talent, improve overall workforce management, and maintain compliance.
Furthermore, companies that optimize their systems beyond initial implementation are better positioned to leverage advanced technologies like AI and automation to reduce errors and free up payroll teams for strategic analysis.
Fully utilizing payroll’s capabilities provides companies with insights that drive smarter decisions and innovations, enabling them to maintain a competitive edge in a rapidly changing business environment.
The importance of the human touch
Overcoming payroll’s challenges is not a matter of technology alone. To fully harness its potential, a focus on people, skills, and continuous process refinement is essential.
Payroll’s true value is realized when systems and skilled teams work together to deliver the insights that drive better decision-making and business outcomes. However, while 99% of respondents in our report agreed that people are crucial, 49% identified a lack of internal skills as a major obstacle to achieving integration.
Giving people the skills to manage these tools is vital for ongoing optimization. Without the right expertise, payroll teams will struggle to harness the potential of new technology, limiting the full benefits of digital transformation.
Strada’s three-step approach
To turn payroll from a bottleneck into a business enabler, companies must bridge the gap between their idealized view and the operational reality by balancing people and technology.
Here are three targeted steps businesses can take:
Conduct an honest assessment
Evaluate how well payroll systems are integrated, identify where manual processes still exist, and develop a focused plan to address inefficiencies.
Build skills with a targeted HR matrix
Determine the skills needed for the new payroll system, assess current team capabilities, and create a training plan to bridge any knowledge gaps.
Implement a maintenance plan
Payroll processes are not a one-and-done exercise. Develop a maintenance plan that includes regular reviews and quality checks to ensure data accuracy. Incorporate ongoing tech updates to maximize system value and provide consistent training to keep your team skilled and ready to leverage new tools as payroll needs and technology evolve.
Read the full report
Discover how Strada can help you transform payroll into a strategic asset. Download our Bridging the Gap – From Good to Great in Payroll report today for insights and practical steps. For personalized one-to-one support tailored to your unique needs, get in touch with our team.
