The impact
of undefined ownership

The impact of undefined ownership

A significant barrier to unlocking payroll’s full potential is an absence of effective governance. Without clear ownership structure and defined roles, payroll processes and systems can become complicated and underused. Lack of focus on the functionality required and how to integrate existing technology or new cloud capabilities with the current processes can lead to inefficiencies and missed opportunities.

Additionally, departments are often in the dark about how their payroll technology can support individual teams’ requirements. Just a few examples include HR benefiting from integrated APIs, customized reports for Finance, integrated systems for Operations, cost-efficiencies for Payroll, and for IT teams – the ability to reconcile data across multiple systems and compliance with global regulations.

This highlights a clear need for better communication and an improved all-round understanding of payroll processes.

Data shows that roles and responsibilities around who owns payroll are often unclear. A little over half (57%) of organizations surveyed by CPCR had a global payroll strategy in place, and only a touch over a quarter had a locally managed regional strategy.

Part of this involves knowing exactly where the payroll processes are working – and, just as vitally – where they’re not. Whether it’s caused by a lack of proper technology, integration, or responsibilities, only 50% of organizations have metrics in place to measure performance, and 36% don’t measure it at all, meaning they’re missing out on valuable insights and opportunities to make improvements.

While it's not necessary for one department to take sole ownership, having a clear payroll strategy is crucial. This should be supported by a governance framework that defines who’s responsible, outlines the required functionality, and ensures existing processes are well integrated for effective decision-making.

What best describes your payroll model?

^Source:^{Strada’s 2024 Company Payroll Complexity Report (CPCR)}