SD Worx: Creating the HR & Payroll Foundations for Success
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Executive Leaders Network: Finance, Procurement & HR Transformation Summit - May 2022
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SD Worx: Creating the HR & Payroll Foundations for Success
- 1. May 2022 Creating the HR & Payroll Foundations for Success Delivered by: Stephen Ousley, Head of Portfolio, SD Worx
- 2. 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% <250 employees 250-2999 employees 3000+ employees 297 238 286 309 288 103 210 220 259 305 115 116 2,746 HR decision makers across Europe Every year, we gather insights from almost 3000 HR leaders across Europe to build up a truly informed picture of the drivers for HR and their role as business partners. Primary sector (Agriculture, forestry, fishing, mining and quarrying), 2.2% Secondary sector (Manufacturing), 18.2% Tertiary sector (Services), 49.7% Quarternary sector (Public / Non- profit), 16.2% Unknown; 13.7%
- 3. Business growth and health are in the hands of HR leaders HR is tasked with transforming strategy into success and executing the agenda of the board Employee wellbeing and the war for talent are top of mind… Yet, operational efficiency is the #1 priority.
- 4. Post-pandemic businesses need to be agile but sensitive to a revolution in people power that demands flexibility Without a solid operational and tactical blueprint, employee engagement and strategic success is at risk To turn HR strategy into reality, you must get your foundations right HR must consider both technology and service options
- 5. Gut feel doesn’t fly at a board level We shouldn’t be working this hard just to hit the basics Manual input is the reason I can’t get a full, consistent picture I don’t have the data I need to make informed operational decisions The admin burden takes all the time away from people empowerment You can’t grow if you don’t know Microsoft Excel has exceeded its welcome
- 7. 7 of organisations are looking for a one-stop shop to solve local and international needs 70% 40% Of respondents find it difficult to provide data to business leaders 64% Cannot manage basic reporting, resulting in a fractured viewpoint of the business 7 These inefficiencies create issues in three key areas: Control Compliance Cost Management
- 8. Operational efficiency is now the top priority for HR – organisations want to come back stronger Work-life balance has jumped from 9th to 4th place Payroll was the starting point for operational efficiency (and top priority early-pandemic) What is back on the agenda: 1. Operational efficiency 2. Performance management 3. Recruitment 4. Work-life balance 5. HR service to employees 6. Payroll 7. Wellbeing 8. Learning 9. Wage costs 10. Progress management Empowered insights - takeaway
- 10. This has renewed focus on the strategic, in order to… Recruit Retain Revitalise Reward the right talent. % Occurrence in top 5 priorities 41% Staff welfare and resilience 32% Employee engagement and experience 32% Attract and recruit 30% Sustainable employability 30% Talent development and internal mobility Empowered insights - takeaway
- 12. HR is being proactive in outsourcing the expertise, risk, and compliance associated with running payroll in-house, given the complexity of today’s workforce. Payroll is now in the top 3 most desired outsourcing projects (up from 8th last year) – as businesses realise the complexity and resource drain required with hybrid contracts. 1. HR process automation 2. Socio-legal regulations 3. Payroll 4. Digital transformation 5. Recruitment 6. Wage costs 7. HR analytics 8. Contingent workforce 9. Learning 10. Wellbeing Empowered insights - takeaway
- 13. Empowered insights - takeaway
- 14. 14 1 2 3 4 5 Data collection and access to or integration with data sources Payment of wages to employees and cash movements Data interpretation prior to data entry Administration of attendance and absence Data entry 1 2 3 4 5 Administration of pensions and insurance policies Expertise processes Reporting to management and/or the works council Administration of contracts, on- and off-boarding Monitoring of (social legal) legislation and translation into payroll Highest Lowest
- 15. HR leaders understand the need for insights and automation They want to drive tech adoption and to choose technology that puts their people first. 75% Agree 25% Disagree
- 19. 19 Reward
- 20. 20
- 21. Get the foundations right and you’ll become the people ecosystem architect Draw a visual blueprint of your ecosystem Engage all stakeholders in your SOR based on a value concept of 'Outcomes' Get your vendor/partner involved early in your business analysis stage Utilise specialist services where required in your ecosystem Map user journeys across each touchpoint, as user experience is key to adoption Define analytics requirements as an objective, not just an output
- 22. 22
Editor's Notes
- Our new international research report the Future of Work and People, uncovered the strategic responsibilities of HR. Gathering insights from almost 3000 HR leaders across Europe, we built up a picture of the drivers for HR and their role as business partners.
- As the practitioners of company health and growth, HR leaders are executing the agenda of the board 72% of HR leaders interviewed say their organization’s business model has changed in the last 5 years HR is key to company health in order to lay the groundwork for company growth. The nature of work continues to evolve and HR is having to reimagine the workplace to drive engagement and performance for their teams and organisation. As a result, the status of HR has continued to be elevated to an actively strategic position.
- HR services are increasingly being asked to participate in strategic projects, either according to the needs of the project or as a key player in the change process. At the same time: When it comes to payroll, a large proportion of companies have difficulty accessing high-performance tools and organising payroll operations (having the right resources, dealing with peaks in activity and optimising the payroll process). When it comes to the HRIS, there are concerns about reporting, de-materialisation of documents and payslips, a lack of collaborative work tools, etc. What are issues you’re currently facing? Control: Multiple points of contact, managing multiple suppliers Patchwork of processes, policies & wage packages Different languagues, cultures and time-zones Different service levels, systems and processes Compliance Fast changing social laws Risk of non-compliance with legislation & corporate policy Risk of misinterpreted policies Security of payroll data transfer Disparate process prone to inaccuracies and errors Cost Management Manual systems, not leveraging ERP investment Difficulties with integration of existing software Inconsistent payroll reporting & visibility of payroll payments Impact on management time and control Need of cross-border reporting / strategic management informaton ORIGINAL TICKBOXES CARRIED OVER FOR REFERENCE: Risk of errors and non-compliance with legislation Patchwork of different local providers Low local adoption rate of HR and Payroll solutions Manual workload leads to high frustration No time to support and drive business change Lack of consolidated reporting leading to few data-driven decisions Source: qualitative research done by SD Worx in 2020
- Operational efficiency is now the number one priority for HR – organisations want to come back stronger than they were pre-pandemic; driving time and cost efficiencies; with a renewed focus on digital transformation and HR automation Work-life balance has jumped from 9th to 4th place in terms of HR priorities. For medium-sized companies it is priority number 1. Payroll was the starting point for operational efficiency (and top priority in 2020) during the pandemic with seismic shifts to remote working and furlough payments. 11 onwards: HR process automation Digital transformation HR policy Reward Diversity & inclusion Socio-legal regulations HR analytics Employee experience
- People focus – Staff wellbeing, employee experience, and the war for talent are the top three HR challenges this year compared to more operational challenges last year (e.g. HR service and performance management) This is another indicator of eyes and minds lifting back up to the strategic level, and preparing businesses for growth.
- 4 in every 10 HR leaders want their payroll function outsourced, either partly or entirely. Remaining 11-20 Reward HR policy Operational efficiency Diversity & inclusion Employee experience HR service to employees Progress management Performance management Work-life balance
- The majority is positive about technology making things easier in all payroll subprocesses, but most added value can be found in the above subprocesses In Belgium transfers to governmental authorities and third parties and data processing and payroll calculation are in the top 5 (highest) In the Netherlands transfers to governmental authorities and third parties and monitoring of legislation are in the top 5 (highest) In Germany check(s) prior to data processing and payroll calculation and data processing and payroll calculation are in the top 5 In France Preparation, management and distribution of payroll documents is in the top 5 In the UK check(s) prior to data processing and payroll calculation, data processing and payroll calculation and preparation, management and distribution of payroll documents is in the top 5
- HR leaders are now expected to deliver proactive business solutions to the table before problems are flagged At the crossroads of challenge and opportunity, the systems you choose could be the difference between credibility erosion and credibility building But HR’s strategic progress is often blocked by outdated systems and siloed internal communications that must be interrogated
- Draw a plan of your ecosystem – A map of the solutions you have or need. It will help you communicate the vision, show data connectivities, a blueprint for future solutions All user personas from HR - Finance – Ops – Employees to be key stakeholders in the in the SOR based on a value concept of 'Outcomes’ Get your vendor/partner involved early and let them advise in your business analysis stage Utilise specialist services where required and the ecosystem impact should be part of every brief (Talent, Recruitment, Payroll, Compliance, Solution Implementation, BPO etc) Map user journeys across modules or solutions, user experience is key to adoption Maybe flip the priorities – Reporting/Analytics priority position, demand and define analytics requirements as an objective in its own right not just an output from a system