Growing companies generate exponentially more data as they mature. Datasets like revenue sources, customer behavior, and market research are critical and receive a lot of attention. However, payroll data is arguably just as useful, since it speaks to a company’s most significant investment: its people.
Businesses can rely on any number of electronic solutions to solve payroll management issues these days, but software isn’t a silver bullet. For instance, payroll software providers for the UK are designed to process information in a manner optimized specifically to help companies meet the British government’s demanding PAYE filing requirements.
But these software products work by syncing with other HR and finance data systems, which means that they cannot help a company with disorganized data storage policies and workflows. Resilient payroll data handling processes are critical for high-growth companies. Here are a few key ways to simplify this challenge.
Prioritize Integration Ability in Software Choices
A growing company will likely have several functions accessing the same datasets, making integration and analysis abilities critical. For example, a fast-growing company will likely use a budget or financial planning platform that draws data from HR and accounting platforms to project growth.
Payroll data is a critical input in such analysis and must be readily available for use. A good payroll solutions provider must integrate with a range of systems. In addition, these solutions must connect to ERP software, a critical need for organizations once they reach higher levels of maturity.
HR integrations are a critical functionality, since a company’s payroll structure can change significantly depending on workforce changes. Paying an employee who no longer works with the company is the least of a fast-growing company’s risks. Filing payroll tax information and other regulatory data can go wrong if a payroll solution doesn’t pull data accurately from an HR platform.
Companies must consider whether they prefer a standalone payroll solution or one that comes bundled with an HR system. The latter typically cater to enterprises and might lack some payroll-specific functionality. Whatever a company chooses, it’s important to evaluate a platform’s ability to integrate seamlessly with other solutions used in the business.
Create Data Governance Standards
Data governance is typically associated with IT and technical data storage. However, modern organizations must view governance as a company-wide effort, since many of their processes are digital. Payroll is no different.
Including payroll within company-wide data governance efforts is a great first step. Data privacy and access control play big roles here, especially given how sensitive payroll details are, but hygiene is likewise critical.
For example, when entering new employee information, HR employees must follow a standard format, entering names in all caps or sentence case. They must review employee data periodically and update old employee records to prevent payroll errors. Organizations must invest in training before widely adopting a new payroll system since a new system is only as good as the data it is fed.
Begin by defining which fields serve as payroll inputs during employee onboarding. For instance, should companies store a new employee’s first and last names together in a single field or break them out? What email format policies will the company follow, and where will this information be stored?
The latter is an example of metadata, also referred to as “data about data.” Metadata brings context to a company’s database, helping people understand what is stored in each field and what that data will be used for.
Rethink Processes Before Automating
Many companies make the huge mistake of automating existing processes before taking the time to redesign them. Several payroll processes are holdovers from earlier eras when technology was severely limited. Automating these processes only magnifies inefficiency and lends a veneer of electronification, instead of bringing about true change.
Before evaluating a new payroll solution, companies must audit their existing processes and identify weak points in them. Some weaknesses might be hidden behind symptoms. For instance, constant payroll mistakes might not be caused by manual data entry. Instead, poor data storage might be the culprit.
In such situations, redesigning storage is the way to go, before automating data entry via cross-platform syncs. If storage is poor, an electronic solution won’t reduce the number of errors. By prioritizing digital transformation like this, instead of racing to automate everything, companies can unlock huge growth levers and simplify their payroll management.
Also, rethinking payroll processes ensures a company will realize significant ROI from its investment in payroll platforms.
Back Up Data and Patch Systems
Data backups and patches are typically managed by cybersecurity teams. However, given modern companies’ digital-first operations, every department must own its data and practice good data-handling workflows. Patches and backups are critical to ensuring payroll data is up-to-date and secure.
Typically, SaaS-based payroll platforms automatically update their software to ensure top-notch security. However, companies often work with payroll bureau service providers, which expands the potential attack surface. For example, a leak of employee data and financial information opens a company up to lawsuits and regulatory actions that can be challenging to recover from.
Companies must task their cybersecurity teams with monitoring payroll platform and data sharing activity to ensure all user behavior is within norms. Given its position as a critical company data source, security teams must continuously validate a platform’s access points and security posture.
HR and payroll department employees must watch out for malicious tactics like phishing and monitor their online behavior to prevent hackers from compromising their systems. Well-established security tactics like MFA and regular password changes are essential to safeguarding payroll data.
A Critical Growth Cog
Payroll data isn’t the first place people look when examining key growth datasets. However, it feeds directly into a company’s headcount planning and expansion plans. Securing these datasets, establishing good data governance, educating employees, and examining integration ability within platforms are critical to growing companies building resilient payroll data handling processes.
