Payroll: A Strategic Approach to Big Data
- by Career Moves HR
- 22 Feb 2019
Today’s leading payroll solutions include automated tools that provide intelligent insights to payroll data. Insights into payroll data offer reports from absence rates, issues within the process can for data chain, and the need for additional staff impact of overtime versus headcount.
The analysis of payroll performance can provide accurate annual forecasts to assist budget management and cashflow amidst times of change and growth. These insights provide valuable analytics that can mine data and generate reports to build a strategic payroll system that is core to effective business management.
A strategic payroll function can:
· Minimise errors, and costs
· Guide Business Decisions
· Inform Future Planning
· Improve Hiring Practices
· Retain Key Staff
Big data within payroll can identify supplemental payroll runs and indicate problems within the collection process. These small, persistent errors build up over time, once patterns and trends are tracked over time, the process can be reviewed for improvement. This can cover revising holiday schedules or adjusting workflow to create a more acute payroll process.
Since payroll on average accounts for 50-70% of a business’ overhead, incremental reductions in the overall cost offers a notable impact on profitability and efficiency.
Guide Business Decisions
The analysis of payroll performance can be used to assess true costs of business decisions through assessing the overarching impact.
Accurate annual forecasts built from payroll big data can assist in budget and cash flow management throughout a businesses longevity. Through the indication of successful business areas, the need to increase workforce to manage performance and retain productivity can lead to conversations on headcount and potential needs for hiring.
These insights enables a business to evaluate options more accurately, and grow with confidence with clear oversights of staff related costs.
Inform Future Planning
Evaluating business growth and profits per sector alongside headcount can effectively inform a company’s future business and hiring strategy. The holistic oversight of operational costs and company requirements delivers clear evaluation of productive and efficient areas and also where challenges currently exist.
For example, payroll data may indicate rising compensation within a business area without the succession of profits, or even the decline of profits. This information can be relayed to senior managers and may lead to increased training within the area or perhaps the implementation of a leaner team.
Improve Hiring Practices
Workforce management strategy benefits form the insights provided from payroll data through informing on whether a business should grow or decrease its workforce.
Determining associated costs between permanent staff members and hiring an extended workforce, can inform respective earnings and value gained. To strategically execute this assessment, cost of insurance and other benefits need to be compared with the cost of training a new contractor before assigning the most effective hire.
A primary need when utilising big data is the consistency and quality of the data collection. To deliver effective analysis for future planning, and a total picture of operational costs and requirement, the workflow process and consistency in collection needs to be run with precision.
Due to the complexity of process, this provides a challenge for organisations that utilise legacy software and a fragmented payroll model. Currently businesses are evolving their payroll functions to include cloud based software that collates information in a singularly accessible system
To manage such collection processes, standardising the Excel spreadsheets delivered to departments is key to report a clear understanding of where challenges within the organisation lie, and enable leaders to effectively evaluate business growth.
Improved management of the payroll function is minimising bottom line costs through engaging with the workforce and evaluating staff requirements and improving practices.
If you'd like to speak to one of our recruitment specialists on payroll opportunities then please call us on 0207 758 4300 or click here to see current available opportunities.