What You Should Know About the Latest in Payroll Technology
Digital transformation is a term that can make some payroll professionals ill at ease. At the very least, it means learning a new platform. But it can also mean some payroll job responsibilities will be automated — a cause for worry about job security.
The current wave of digital transformation is especially disruptive, and payroll departments across the country are affected — but it’s really nothing a savvy payroll specialist should be suspicious of.
Technology has and will continue to change the way you work, but it will also create new opportunities. Motivated professionals can ride this wave and land themselves a more rewarding — and possibly higher-paying — job than before.
Robert Half’s Benchmarking the Accounting and Finance Function 2018 report offers a definitive overview of the current state of IT within the world of finance. To get ahead in your field, here are four trends in payroll technology you should know about:
1. Adoption of cloud-based ERP — The latest Benchmarking data shows more and more companies are moving to cloud systems. Seventy-five percent of the U.S. finance professionals surveyed say their company has already made the transition or plans to do so in the near future, compared to 72 percent in 2017 and 62 percent the year before that. For payroll teams, this may mean leaving their existing software platform and adopting Enterprise Resource Planning (ERP) systems in the cloud.
Cloud-based systems make it easier to share data, work remotely and stay up to date on the latest tax codes. Companies also like this shift because there’s less equipment to buy and maintain. Going forward, having hands-on experience with Microsoft Dynamics, NetSuite, Oracle, SAP and other ERPs will be a major asset on any payroll resume. Excel is still the top planning and budgeting tool, beating out the likes of Cognos and Hyperion, but our annual benchmarking study shows reliance on Excel is declining slightly — it is used by 63 percent of respondents this year, compared to 69 percent in 2017.
2. A move toward data analytics — Powerful new systems like cloud-based ERP software generate vast amounts of data, which, in turn, can offer an unprecedented level of insight into a company’s operations. This means a shift in many back-office teams — away from purely functional work and toward a more strategic role. Payroll is a treasure trove of financial and HR data, and management will expect staff to make sense of big data by using payroll analytics tools.
3. Increased process automation — Automation has removed much of the rote work from finance and HR teams. A prime example is the self-service benefits portal, which has made it possible for employees to track their own time, update personal information and manage their benefits without ever having to contact another person. Automation has streamlined payroll processing and reconciliation, freeing up staff time for higher-value tasks. It also improves accuracy.
The down sides, according to some of the executives surveyed, are the high cost and learning curve of the automation software. But there’s no doubt that financial automation is the present and future.
4. The rise of artificial intelligence — Yes, artificial intelligence is related to automation, but it’s a lot more than that. As part of digital transformation, AI algorithms detect patterns and shifts in big data and analyze them so humans can make sense of it all. Thanks to self-learning, also called deep learning, AI systems can evaluate their past performance to improve future predictions. If you have a weather app on your phone (and who doesn’t?), you’re benefitting from the powers of AI.
In terms of payroll, AI excels at analyzing all sorts of variables — employee classification, age, withholding amounts, and so forth — and can improve accuracy by detecting nonobvious errors in paystubs. Then there are chatbots, which can handle routine employee queries.
With automation and AI, the payroll department of the future will undoubtedly have fewer clerks and data enterers. At the same time, staff will still be needed to perform more cognitively demanding and creative tasks. Humans excel at handling nonroutine situations. And don’t forget about the human experience that’s at the heart of talent management and payroll. No matter how fancy a company’s AI program is, people will always crave human interaction in the workplace.
The bottom line
The entire finance industry, including payroll, is undergoing a digital transformation. It’s not a matter of if, but when. No one knows exactly what this field will look like in 50 years, but one thing’s for sure today: The answer is to not be suspicious of payroll technology. Instead, use it to your advantage so you can become a smarter, better informed and more valuable payroll professional.
Accountemps, a Robert Half company, is the world’s first and largest specialized staffing firm for temporary accounting, finance and bookkeeping professionals. Accountemps has more than 300 locations worldwide. More resources, including job search services can be found on the Accountemps website.