Companies put a lot of effort into finding out the reasoning behind certain business trends and expenses, continuously striving to utilize analytics and past data to make better decisions in the present and future. When payroll data is left out of this picture, it can leave a big piece of the puzzle missing. There are many ways that payroll data can be used to improve business processes and outcomes, but these may not be obvious at a glance.
Pinpointing Causes of Staffing Shortages
Spikes in overtime can indicate a staffing shortage that may eventually lead to bigger problems such as drops in productivity and decreased revenues. While the spikes in overtime may be a small piece of payroll data that indicates an issue, payroll data can also be used to solve the mystery of why there are staffing shortages. By bringing up historical data, it may be possible to determine whether the staffing shortages are seasonal, a result of call-outs, or a result of a larger issue.
By taking payroll data and splicing it into reports with other HR data, it may be possible to determine whether a slow hiring or training process is behind staffing shortages or if there is a problem with retention. By pinpointing the exact reason for staffing shortages, it may be possible to correct the issues for better futures outcomes-such as decreased overtime and increased retention.
Bringing Performance Data and Payroll Data Together
While compensation is not the only driver of employee performance, performance and pay are undeniably linked. Using performance reviews to support pay increases is common practice, but reviewing performance information side-by-side with payroll information can help take compensation decisions to the next level. By optimizing the processes used to determine pay raises, employee satisfaction may be increased and the business may benefit from greater productivity.
In addition to pay raises and base pay, it may help to review how well bonuses work as an incentive. Are there obvious spikes in performance, better customer service reviews, or other improvements that correlate to bonuses that were given? Reviewing this information in one place can help to give you an idea of how well bonuses are working to drive desired outcomes and if they are not working, can help you to justify dropping them from the plan and trying other drivers.
Using Payroll Information for Budgeting
In many organizations, HR budgets are drawn up using data from the previous year in an effort to see how close actual results came to forecasts. This process is not completely useless, but it is flawed when pay raises and other payroll data is not taken into account. Using current payroll data to justify budgetary increases over the previous year can help to prevent going over budget and can bring actual results closer to predictions.
Using payroll data to determine why things are happening within an organization can give a better-rounded view of how the company works and can optimize decision making. By using the HRIS to its full potential and integrating payroll data with other data, you also help to ensure that your company is receiving the best return for the HRIS investment.
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