Most people have accepted that the traditional role of the CFO is changing, and as we enter a new decade, it is perhaps time to evaluate what the priorities might be for a CFO in 2020 and beyond. CFO’s have many responsibilities, chief among these is a common business priority around cost efficiency. A chief financial officer is required to assess the resources a business has at its disposal and then issue advice and guidance on how best to use those resources. It makes sense that any CFO would therefore be interested in learning about potential resources that may not previously have been obvious assets to a business.
A closer look
The payroll department is one such untapped resource. A key reason for this is the fact that huge volumes of usable business data flow through payroll teams every single day. This payroll data is often considered functional and not particularly interesting. This is a misleading and inaccurate assumption. As payroll is often the number one expenditure for a business, it makes sense to examine in detail if the data related to this expense could be used for other strategic purposes along with financial management.
More Data. More Insight.
Payroll operations can provide comprehensive business data that can help with things like current financial status and budget forecasting. Some forward-thinking CFOs are now looking at payroll data for other business insights. For example, a CFO might want to determine whether expanding into a new territory like the united states is worth it or not from a financial perspective. A payroll team can provide useful statistics around current employee expenditure which will help make a reasonably accurate prediction of what future employee expenditure in a new country would look like. This is very valuable information when companies are looking to scale- they first need to know if they have the capacity to do this and at what pace. Payroll data can be an untapped resource, a wealth of credible and actionable information, accessible with the right tools.
It may be difficult for a finance chief to move away from daily operations and critical business priorities to take a closer look at the payroll department. But what if they chose to do so? They might do this out of genuine interest, or they may be under intense pressure from business leaders to develop new strategic approaches. In either case, CFOs will be on the lookout for ideas and information that can help them drive business growth. Should this growth come from an area of the business that was previously not considered strategically helpful, then all the better as the CFO then appears to be a pioneer of new strategies and an original thinker.
What do payroll need to be able to help a CFO?
Payroll teams everywhere are keen to be able to run the kind of global, consolidated reporting that gives a solid overview of all payroll expenses, with the simple touch of a button. Unfortunately, payroll professionals face many obstacles when it comes to delivering the kind of real-time reporting that can make a genuine difference in decision making. They need assistance in the form of a global payroll solution, employee skill sets and cloud-based technology to help them become more agile and self-sufficient. They also need automation and standardization to be a part of the payroll process. This will free up their time to focus on other deliverables like requests from a CFO. A CFO’s life becomes easier if everything runs smoothly in the payroll department. But, it becomes even easier if payroll can transform into a department that adds genuine business insight. With a new attitude, the right level of investment and careful selection of a technology partner, this is an achievable goal.
Technology that delivers results for a CFO
Any CFO will be a fan of any affordable technology that helps them do their job better. A global payroll technology solution has the added advantage of being able to integrate with HCM and HR systems. This will help provide the CFO with integrated reporting and a clearer understanding of how these departments interact with each other and provide value to the business. This value can be clarified in terms of facts, figures and detailed reporting- this allows the CFO to make decisions based on factual, up to date information. All decisions today are based on data so the more comprehensive, detailed and accurate the data- the better the opportunity the CFO has to create future proof strategies that result in a positive return on investment. This is a scenario in which the CFO could come to view the payroll department as a strategic partner and very useful resource when it comes to justifying business decisions.
Why is payroll untapped?
Many payroll departments are hindered by legacy systems and the lack of standardized data. This greatly hinders their ability to provide consolidated reporting on a multi-country level. Manual processes and several country specific vendors make the gathering, delivery and analyzing of standard data an almost impossible task. All of this is a huge drain on the time of payroll professionals, who find themselves with limited scope to provide additional services. All of this has reinforced the long-held belief that payroll is a back-office function who simply make interbank transfers on a monthly basis. If they were given innovative software and were equipped with the right tools, they could deliver so much more while also streamlining current processes. The lack of a technology overhaul is the principle reason that many payroll departments are failing to realize their full potential. A new approach coupled with proper investment could yield handsome rewards for payroll professionals, CFOs or any department looking for data and insight to help drive growth.
A global payroll technology solution can help transform your payroll department. Payslip’s software solutions help businesses around the world to centrally manage and maintain full control over their global payroll operation. Talk to us today and find out more about how we can help your global payroll operations run in a better and more efficient way.
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