Payroll is often one of the biggest cost centers for any company, and one of the most vital functions within the business. The reports that payroll generates can be a valuable insight for business leaders, providing visibility into true payroll spend, either company-wide or broken down by department, region, country, or employee. With an outdated payroll system, putting together payroll reports can be a massive undertaking of time and resources, and are often not completed or utilized to their full potential.
Today’s technology can easily provide analytics that go beyond typical reporting and can be a vital tool to measure company efficiency and performance. Analytics can provide a deeper more meaningful level of not only providing results, but delving into the processes in order to see where improvements could be made.
Below, we discuss four ways that reporting and analytics can provide you meaningful insights:
1. Payroll Spend
Likely to be of greatest interest to your finance department, cost is one of the first insights that companies look to discover. How much does it cost to run your payroll? Without up-to-date technology, it may be difficult to even quantify your payroll spend, especially if you are working in different countries with varying currencies. If your payroll department is consistently putting in overtime because they need to fix errors or re-run reports, it may be time to look at a more cost-efficient and accurate payroll system that can provide this level of insight and can automate your reporting to allow you to analyze your spend from an overall view, or as granular of a view as needed.
2. Error Rates
Rate of errors, as a reporting metric, can be broad, but it provides context to other reporting metrics, such as accuracy and time. You can look at the overall error percentage or the per-payroll number to see if your payroll department is forced to spend a majority of their time fixing issues.
Analytics will provide a deeper level of information such as when and where these errors enter into payroll, often giving insight into the quality of the original data, or perhaps the efficiency of how your data is input into your system. If you consistently see errors in the data input portion of payroll, it may even be necessary to look outside of payroll for factors causing the issue. Conversely, if your error rates are low but your payroll still requires multiple rounds of revisions, you might need to examine your payroll processing or how the calculations are made.
3. Accuracy Rates
Accuracy rates is one of the most important metrics as this is the major goal of any payroll department. You want to be paying the correct people the correct amounts at the correct times. There can be understandable inaccuracies in your payroll, such as a sudden new-hire or someone leaving the company, but if your accuracy rates are consistently poor you might be looking at an error-prone manual data transfer process. It’s important to watch your accuracy over time to ensure that your company isn’t suffering from a more systemic error, or having issues at specific times, such as during holidays or with certain functions such as commissions and bonuses.
When we analyze accuracy, however, it’s important to include the first-time approval rates. How many revisions until payroll is approved? This number will let you know where in your process to look for errors. If payroll is consistently approved the first time around, your data collection and processing is going splendidly, and you should look elsewhere in your pipeline for inefficiencies. This is an excellent example of how analysis pairs with reporting to give you a better insight into your payroll.
4. Timeliness Rates
Along with accuracy, time is one of the most important metrics for payroll. You need to pay your employees correctly and on time. Some companies begin and end their payroll considerations at this basic level, but taking a deeper look at the time that goes into your payroll will provide valuable insight for your company.
Analytics will provide your company with insight into your payroll calendar, allowing you to see into your processes and where your resources are spending their time and can be incentive to upgrade your system. In addition to better reporting and analytics, upgrading your technology to a cloud-based system that can integrate with your HRIS or HCM system can result in shorter payroll calendars as it eliminates manual data input.
Taking Your Payroll to the Next Level
Payroll reports can give you an overall picture as to the health of your payroll process, but if you’re not taking the time to analyze the data, you’re not using your payroll to the full potential. If you can fix even one area of your payroll, all the rest will follow at least in part. Fewer errors with data input saves time for processing, and the accuracy of the payroll allows for easier approvals. Everything adds up.
It’s worth looking at a global payroll solution to increase efficiencies and gain insight into each aspect of your payroll. An up-to-date cloud-based system cuts down on manual data transfers (a point of error), and can automate certain processes (for greater accuracy). This turns into a better use of your money and your time. iiPay’s proprietary technology provides you with all of this, including simple integrations and tools for reporting and analyzing your payroll data.