Modern Payroll: Here’s Why It’s Time To Update Your Payroll System

Industry Trends

13 October, 2022

Modern Payroll: Here’s Why It’s Time To Update Your Payroll System

Piotr Smolen

Piotr Smolen

An outdated payroll system will hurt your business.  

Using spreadsheets, outdated platforms, and other forms of manual payroll processing will cost your company time, money, and employees.

Still, 29% of businesses use a payroll system that is 10 years old or older, according to a recent study by Kronos and the American Payroll Association.

But what exactly is modern payroll? It’s a simple solution that solves multiple payroll challenges in a way that improves employee satisfaction and your bottom line.

Learn more about why you should modernize your payroll processes (and how).

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What is modern payroll?

Modern payroll software is much more than a medium to facilitate salary payments and fulfil the basic functions of HR. It’s an integral part of hiring, managing, and retaining employees in any company.

Furthermore, modern payroll systems are not static, but flexible and compatible with other applications.

Modern payroll software is a holistic system that allows you to: 

  • Generate in-depth reports 
  • Measure trends
  • Give your workers access to their real-time compensation information
  • Understand ​​the performance and cost-effectiveness of your business 
  • Make more profitable strategic business decisions

For example, by getting insightful statistics like the average wages of your employees, you’ll have a better idea about whether you’re paying industry-standard wages to your staff. This is important if you don’t want to see your employees go to competitors who offer better salaries than you do.

So are you using an outdated payroll system? If so, for effective payroll management, you either need to upgrade your current application or consider a new product.

Payroll software that is more than 10 years old is simply not suitable for a modern business. 

Payroll systems of the future

Standalone payroll systems are a thing of the past. We can expect a move toward smarter, more user-friendly, and more comprehensive payroll services.

In today’s business world, HR departments crave all-in-one solutions with integration capabilities: 

  • Data-driven tools that can manage all HR processes throughout the employee lifecycle
  • Platforms that can pass data to their payroll systems and prevent duplicate data entry
  • User-friendly software with employee self-service options like viewing payslips or changing personal information in the system
  • Accessible solutions that include mobile capabilities and on-the-go payroll processing
  • Tools with flexible payment options that allow employees to fully manage their own payments, for example choose when they get paid without disrupting their employer’s processes

As a result:

Payroll software is becoming smarter with the use of Artificial Intelligence (AI) and machine learning.

Using AI in modern payroll services can help:

Thus, the Symmetrical automated payroll solution uses advanced AI-based technology that allows companies to forget about manual processes and spreadsheets.

Watch the video below to better understand the impact of AI on HR.

Finally, the payroll software of the future will need to be more globalized with businesses expanding internationally. It will also need to address the demands of the gig economy (digital platform work).

The main challenges of payroll: why is payroll so complicated today?

Payroll should be simple. So why is it not?

Currently HR and payroll processes are well-suited for unchanging things in a stable world. However, such a world doesn’t exist. In fact, businesses are operating in increasingly volatile environments

From the payroll perspective, it’s not the world of straightforward payroll transfers and calculations anymore. For example, an increasing number of workers earn varying sums of money, depending on the month or even the week. 

Further, many employees want their salaries on demand. Paying your employees once per month is an outdated practice that can negatively impact your employee retention.

Traditional ADP (Automatic Data Processing) systems are effective for companies that operate in stable environments with uncomplicated processes, for example when employees on permanent contracts receive the same salary every month.

To better understand the complexities of today’s payroll, think about: 

  • Freelancers
  • Employees on hourly wages 
  • Frontline employees who earn different amounts at different times
  • Big companies that employ hundreds of thousands of people from around the world
  • Companies that like experimenting with their dynamic payroll models, e.g. by offering bonuses
  • High volume-hiring: the practice of hiring a large number of workers in a given time frame

In the above-mentioned cases, payroll processes are much more complex and volatile, which has many implications for businesses.

Increasing gig economy conversion: A courier delivering food to a business woman outdoors

For instance, in the case of high-volume recruitment needs, it’s difficult to control who’s coming and who’s leaving. This can result in a big mess in your documents and operations: you may, for instance, end up paying the wrong people!

There are further risks. Some individuals can get unauthorized access to your (payroll) data, which can have negative legal implications.

The fast-changing and volatile payroll environments of Symmetrical’s clients

As of today our clients are mainly organizations that employ hundreds or even thousands of people domestically or globally. Their main challenges have to do with operating in fast-changing and volatile environments. 

For example, they deal with a high staff turnover: hundreds of employees may come and go every single week! Additionally, the ever-changing regulations and laws make this environment even more uncertain, especially if companies operate on international markets.

As a result, employers operating in volatile environments should: 

  • Stay agile and flexible 
  • Act quickly (recruit quickly, onboard quickly, and update data and employee records quickly)
  • Keep up with their payroll processes (the person hired today may need their money the day after tomorrow)
  • Be able to adapt their software to any given situation

This is what we’ve learned at Symmetrical: how to keep up with the changing payroll processes of our clients. Our solution turned out to be a time and cost saver for organizations employing large numbers of line workers. It also helped employers attract employees and keep them by giving them access to their already earned salaries.

The bottom line: today companies need modern payroll services that are effective, efficient, and flexible. Here’s why.

Modern payroll software addresses the challenges of manual work

Many HR departments are still using Excel to manage payroll. However, spending hours on crunching numbers and managing spreadsheets is not necessary any longer.

Managing your payroll manually in spreadsheets is genuinely an outdated and inefficient practice. It creates the risk of errors, double entries and delays in payroll processing.

In fact, a lot of Symmetrical’s clients used to struggle with Excel spreadsheets. In most cases, it was a big waste of human and time resources. 

The truth is that it can take dozens of people to fight the spreadsheet battle. Yet, there’s a simple solution. Today AI-powered automation can help you avoid the nightmare of manual work and dealing with spreadsheets.

Modern payroll software can handle flexible salaries

Today, offering flexible salaries seems to be out of reach for many employers. They first need good procedures in place – and this is where many companies get stuck.

At Symmetrical we tried to better understand the source of this problem. It didn’t take us long to see things clearly: payroll processes are completely outdated in many organizations. What’s more, without cutting-edge (and cost-cutting) solutions, we can’t expect big changes here, especially in the case of line workers.

So why is it challenging to offer employees flexible salaries? 

It’s primarily because many employers still insist on using Excel spreadsheets or outdated software that is unsuitable for the current dynamic and complex environment.

The truth is that you need a payroll solution that is capable of meeting the current reality. A flexible and agile solution that is not another cost, but a money-saver that reduces your existing high cost of running payroll.

Modern payroll software addresses the challenges of global hiring

Another payroll challenge has to do with internationalization. Working from home has become a widespread phenomenon in the post-pandemic world. As a result, more and more companies are hiring people from different parts of the world.

Modern HR and payroll services enable global companies to provide the flexibility of working from different locations while allowing their employees to stay efficient in their tasks.

It’s also crucial to mention the extra complexities of paying employees from different countries due to different nationalities, languages, currencies, and regulations.

Companies need to take into account such differences, but they also need a centralized system. Harmonizing HR processes and IT systems is essential, so that there’s one global system for managing employees, employee data, and multiple processes. This keeps manual work to an absolute minimum.

This is also where our clients find our automated payroll solution useful. It’s a set and forget global system that also addresses local needs.

Complex payroll processes in the post-pandemic world require automation

Covid-19 exposed flaws in the traditional payroll process. The pandemic has shown companies that a modern, flexible payroll system is essential to keep operations running smoothly when the unpredictable happens.

Having access to payroll data anytime and anywhere is more important than ever. So is modern HR and payroll software that automates mundane and repetitive tasks.

The truth is that in today’s payroll world, automation is essential. Multiple processes and systems have to be integrated. Relevant employee data (salaries, bonus information, benefits, etc.) should be in one place. Moreover, this system must be both effective and secure.

Using automated payroll software will allow you to store all your paperwork, reports, and tables automatically in the cloud. This way you can access information at any time and in any place while downloading chosen reports at a click. This is extra important in the era of remote work.

Modern payroll services: conclusion

Today most companies can’t afford to use payroll software that worked ten or even five years ago. The times, and the needs of HR departments, have changed.

Companies need modern HR and payroll software to: 

  • Automate processes
  • Avoid human error
  • Ensure HR processes are adaptable when things change
  • Enable more data insights 
  • Make better strategic decisions

Are you still relying on the methods you used five or ten years ago? It’s time to bring your business into the future!

About Symmetrical

Symmetrical is the first payroll solution you won’t hate. We enable fast-paced companies to onboard at scale and run their payroll invisibly. To run your payroll hassle-free, on auto-pilot, contact our experts to learn more!

Sources

Payroll Trends: Future of Payroll in the Coming Years
How Outdated Payroll Systems Are Affecting KPIs, Merges And Acquisitions
The pandemic exposed flaws in the traditional payroll process

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