The Consumerisation of Payroll: How Do We Adapt?
Although change can be intimidating, the consumerisation of payroll – the adoption of consumer expectations and standards within payroll – should be seen as an opportunity to improve the employee experience.
According to Mark Judd, VP, HCM Product Strategy, EMEA at Workday, embracing technologies such as automation and artificial intelligence, payroll professionals can ditch processes, create more enhanced payroll services, and get closer to their employees.
Up to 97% of employers believe that employee expectations of their workplace experiences are changing, according to Aon’s 2019 Benefits and Trends Survey. Workers increasingly expect their employers to deliver seamless, personalised and human services, which mirror those they receive in their personal lives. This has prompted businesses to re-examine all the ways they interact with employees, with arguably the most important interaction being payroll.
For years, companies took a one-size-fits-all approach to the services they delivered to employees. However, staff now expect smarter and more contextual interactions with their employers. Personalised payroll, adapted to the wants and needs of different employees, is a prime example.
An increasingly popular form of personalisation in payroll is on-demand pay. Through on-demand pay schemes, employers can offer staff greater flexibility over when they’re paid and offer the chance to access a percentage of their pay at the end of each day or week, for example. This increases employees’ ability to handle unexpected payments and can help them to better manage their finances. This could be highly valuable to employees, given that over 50 percent of young Britons currently live “hand to mouth”, according to research from Perkbox.
By personalising pay, businesses can recognise each employee’s situation and needs, enhance their experience and improve loyalty across the workforce.
Feedback is key to successfully personalising pay arrangements and wider payroll functions. Not only does it help businesses to improve their services, but it also boosts employee engagement. After all, employees have come to expect their feedback to be heard and incorporated into process updates, in the same way, it would be in their personal lives as consumers.
Regular focus groups and routine employee surveys are great ways to gather feedback, and particularly effective if workers can contribute on their mobile devices. By connecting this feedback with the payroll team and wider HR function, organisations can make sure the voice of the employee is present when operational decisions are made.
Employees often request assistance in understanding their payslips and pay structure. In fact, over a quarter of respondents to the CIPP’s 2019 Future of Payroll survey reported an increase in the volume of payroll enquiries they received. A part of payroll’s function should be to educate the workforce on how payroll works. From promoting the payroll calendar to an understanding of payslips and the inner workings of pay, this will help employees across the workforce to get the most out of this function.
However, to meet staff expectations, for both education and seamless services, there needs to be a shift to digital payroll platforms. For instance, modern payroll technology can allow employees to access information about how they are paid and find answers to commonly asked questions. This, alongside process automation, helps free up payroll professionals so that they can spend time working with people to resolve more complex queries.
Technology has a big role to play in the consumerisation of payroll. Complex, legacy systems that currently take several days to process payments and keep the employee at a distance will be consigned to the past. They will be replaced with simpler, less labour-intensive systems that take a more holistic view of the employee and their needs.
Solutions, such as machine learning, robotic process automation (RPA), blockchain and digital credentialing, will also create new opportunities for employers to increase process efficiencies and improve compliance management, so they can focus more on employee experiences.
Feedback is key to successfully personalising pay arrangements and wider payroll functions. Not only does it help businesses to improve their services, but it also boosts employee engagement.
The consumerisation of payroll
In a competitive job market where it’s difficult to retain talent, businesses should understand how each employee interaction impacts the overall experience and what can be done to improve it. No interaction is more important than the way a company pays its employees. Understanding the needs of each individual and giving them greater flexibility and control over how they’re paid can turn something that was once transactional, into something that feels a bit more personal.