How Can We Automate Payroll – And Integrate It Cost-Effectively With Intricate HR Expertise?


The payroll industry is adopting ever more advanced automation technology but how and where can it be best deployed to deliver cost savings while keeping customers - HR people and their employees - happy?

Robotic Process Automation (RPA) has already made significant headway across several business processes − many companies are deploying RPA technology on a commercial scale, especially in banking and finance.

The technology is especially adept at processing - and making decisions on - large batches of data quickly and accurately. This not only improves operational efficiency but frees up skilled staff to focus their energy on more creative and rewarding tasks, improving employee engagement and job satisfaction. RPA is already doing the heavy lifting in areas including processing loan applications and insurance claims.

Of course, there is already significant automation in payroll, with very advanced platforms capable of handling hundreds of thousands of complex gross-to-net calculations. However, the industry has been slower to adopt automation technology because decision trees tend to be more complex and, typically, not as well documented as in other industries.

That looks set to change as artificial intelligence (AI) and machine learning (ML) technologies become better at helping companies automate ever more complex processes. We are starting to see the adoption of more sophisticated AI and ML systems capable of handling multi-step payroll processes ¬- even helping to drive their simplification.

But payroll is not just about number crunching. It's about dealing with people - HR personnel, employees, tax authorities and regulators - professionally, sensitively and intelligently. It still needs the human touch. How do multinationals get the most from automation, while handling the diverse, and often nuanced, differences in language, regulation, culture and social norms around the world?

We have seen how the traditional shared service centre model has failed to deliver the efficiencies and cost savings expected from consolidating all payroll functions into large regional centres - the 'non-technology' barriers proved too difficult to surmount without significantly higher headcount than anticipated.

At TMF Group, we've always recognised the importance of having skilled local payroll experts working closely with local employees and tax authorities. Our business is founded on the presence of in-house, in-country experts in over 80 jurisdictions...

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