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Why the CIO Needs to Understand Global Payroll

David Quirke
David Quirke
Apr 27, 2021 2 mins

While the CIO’s responsibilities are primarily focused on the organization’s technology and digital transformation needs, it is a mistake to presume that they stop there. As a general rule of good business practice, the CIO should be involved in other aspects of the company, particularly payroll. Apart from being one of the biggest operating expenses of any organization, payroll’s sheer size and critical role as the center of the employee experience means that all business leaders, regardless of function, should have an active if not proactive interest in payroll.

However, even if organizations wanted to keep the CIO away from payroll, they may not have a choice. In a recent Gartner report, they suggest that CIOs will be responsible for changing company culture and, as such, will take up the mantle of the chief HR officer (CHRO). One of the driving forces behind this title transfer is that although company values and mission are historically a remit of HR because organizations are now relying on technology to implement and execute on company culture, the CIO must be involved.

Why the time is ripe for the digital transformation of payroll

We’re all very familiar with the revolution in the workplace over the last few years. Together, technology and innovation swept away most traditional business and work practices and replaced them with a new digital paradigm. However, for various reasons, in most organizations, payroll had been the last holdout, resistant to change and continuing to rely on file sharing, spreadsheets, and manual data entry to conduct and complete payroll. All of that is now changing though, as more and more organizations adopt payroll solutions that leverage artificial intelligence and automation to streamline the payroll process.

One of the drivers of this change was recognizing the value and volume of employee data inherently held by payroll teams. While the CFO’s involvement in payroll is well established, and their list of required information essential for the smooth running of a business, the value of this data for the CIO is waiting to be discovered. Think about how valuable it would be for payroll to have information and guidance about how technology-enabled processes can save time and money, standardize processes, real-time data, and, of course, analytics.

The CIO must also ask themselves, could payroll and HR benefit from an investment in technology to better improve payroll operations and bring about efficiencies that will dramatically impact the business for everyone?

Optimizing payroll data

In Will Data Scientists Become the New Global Payroll Professionals? we looked at the rising need for numerical and statistical skills in both HR and payroll. In many organizations, this lack of these particular skill sets in the HR and payroll department could be offset by a collaboration with the CIO and their team. Again, imagine the insights gained- for everyone in the company- if by leveraging the CIO’s expertise, payroll and HR could now greatly enhance their analytical function to:

  • Improve workforce data, especially beneficial for examining employee costs in the various countries and regions the organization operates in
  • Judge and review HR and payroll software to explore their business value, functionality, and ROI
  • Assess the reporting capabilities of payroll vendors
  • Review current business practices to identify areas for improvement.

Furthermore, while we can agree on the value of payroll data, to fully maximize the benefits, organizations need to deploy a consolidated global payroll solution. One that gives access to reports and workforce analytics to ensure that any opportunity for operational efficiencies is in place. CIOs can play a vital role in arguing why a centralized, single source of global payroll data offers extraordinary potential and opportunity for the company. One report estimates that businesses could add an extra £10.4 million to the UK’s GDP if large companies adopted better collaborative efforts between HR and other business functions.

The endless possibilities that such data-driven insights provide to improve decision-making around operations and global headcounts are not just for HR and payroll, but the CIO too, especially if we see that role transform into a CHRO as mentioned previously. And of course, the CIO can provide additional support and expertise to HR and payroll teams to ensure that employee data, is protected.

Additional reading: IDC Analyst Brief. The Case for GP Consolidation