Across from me sat an auditor preparing to perform the annual audit. Following her checklist she asked for printed registers for the year. It was apparent she had not considered the volume of printed material produced from paying 20,000+ employees biweekly. I explained that I had not printed payroll registers in over twenty years and the majority of payroll professionals today rely upon online access for information. I suggested payroll summaries if that would help but did not want to waste that much paper. I was also concerned about the security of the information left lying around in the audit room at night. Eventually, I was able to help her find a different method of obtaining the information.
I began thinking about how the profession had changed since I first started over 30 years ago and the requirements of a modern payroll professional.
At the start of my career, I reviewed paper timesheets for errors and inconsistencies. I would batch up these timesheets and bring them to the keypunch department where the information was then entered onto 80 column cards. Unfortunately, many people still imagine this sort of scenario when they think about a payroll department. For them, a person working in payroll is someone wearing green eye shades, hunched over a desk and manually adding up data. Nothing could be further from the truth. Not only has Payroll moved to advanced technological solutions, it is often on the leading edge of changes and automation.
The aforementioned timesheets have been replaced by feeds from automated time systems. Often these systems use a card swipe to record in and out time, but they might be using biometrics to clearly identify who is “clocking in”. I have seen these same biometrics used at airports to provide access to secure locations!
Today’s payroll professional has gone from a transactional focus to become more analytical; researching a myriad of data to ensure compliance with policies and regulations. Federal, state and local laws have become more complex as each entity looks to grab their piece of the taxation pie. Changing benefit regulations bring us into a world I could not have envisioned.
Doesn’t it make sense then, we should be focused on hiring highly qualified professionals with skills which transcend the traditional clerical role? The Payroll Clerk has been replaced with titles such as Payroll Analyst, Administrator and Specialist to name a few.
Today’s workforce generally has a college degree and is anxious to put to work the knowledge they have acquired. Even seasoned veterans are seeing that they have had to learn new skills to keep up. Look at the sections of the American Payroll Association’s certification exams. Nowhere do they ask you to input a timesheet or transfer data into a computer. Rather they deal with concepts, knowledge of laws and best practices as well as complex calculations.
Just what are some of the skills required to keep up with the times and what tools do we need as our jobs continue to evolve and present new challenges? Given the complexity of a modern payroll organization and that the majority of information can be processed without much human intervention, the skill most needed is having an analytical mindset. Today’s professional needs to be able to extract, review and understand various information that is drawn from the system.
The basis for any analytical role is data. Metrics. A payroll department cannot function effectively without them. Metrics help measure our performance against others as well as ourselves and can be used to create controls and enforce service level agreements. Payroll departments should know how the results from the most recently run payroll compares against those of the previous payroll. If there is a significant difference, it should be researched to understand why it occurred and if it was justifiable. It is not just a matter of seeing the change but also knowing how to investigate the anomaly and understand the impact. That is part of having an analytical mindset. While analytics have always been required in Payroll, it was usually confined to a handful of people performing an analysis of accounts or a manager looking for trends. Today, every person is accountable for understanding and interpreting the data.
It seems these days, we are called upon to manage a project to one degree or another. It may be a very complex process utilizing software designed for that purposeor it could be as simple as filling out a spreadsheet. Either way, the running of projects is no longer confined to an IT department or a professional project manager. Every person in Payroll, regardless of their level, needs to understand how to run a project.
From a technology perspective the profession has moved from the introduction of large main frame computers to desk top PC’s and laptops connected seamlessly to the intranet, to cloud computing and smartphones. We multitask beyond anything we once thought possible and with the touch of a few keys, have access to the data we need. Formerly, accessing that data would have required the expertise of an IT programmer however nowit is done by writing a simple query. The person writing that query is now a team member sitting in Payroll.
Not long ago, we could not envision the ability to work with virtual teams of people you have never met. Rarely did Payroll interact with individuals from another country. Now, many of them are our colleagues and we need to understand different cultures, laws and regulations. Telecommuting has changed us. These days it is not necessary to be in a brick and mortar building to run and administer a payroll or process a payment. Knowing how to utilize all of the tools available has helped everyone continue to provide piece of mind to employees when we have been beset by natural disasters. It is not enough to have the proper tools at your disposal, as any good craftsman will tell you; a person has to know how to use them.
We never used to consider a knowledge of best practices as a job requirement. Today, Payroll departments require quick and analytical thinking, the ability to break down processes and a significant use of technology to continuously improve. Though the basics of timely and accurate payments have not changed, the ability to meet those requirements now require a learned professional who can adapt and understand the how’s and whys of what is being produced. It is time we started to treat these professionals according to those standards.