Issue link: https://www.e-digitaleditions.com/i/295251
[ 23 ] APRIL 2014 | www.hrotoday.com Payroll Not only are key payroll trends like globalization, the cloud, and data analytics gaining traction in 2014, they're all converging in unique ways to bolster the strategic importance of the payroll spend in diverse organizations. Many payroll providers are mining the unique data produced by their clients' payroll runs to glean valuable insights into the effectiveness of these organizations' incentive compensation plans, regional employee productivity, nearshoring and offshoring programs, and even talent management initiatives. This insight fosters better strategic decisions on where to best deploy company resources—labor chief among them. In the case of global payroll services provider ADP, the rich data sets within payroll have guided the firm's lauded development of the ADP National Employment Reports. Data scientists at ADP apply algorithms to transactional payroll information aggregated across the client base to make predictions on where the United States economy is headed. "We initially started cutting this data regionally, and now are looking at employment by small businesses, franchises, and even nationally," says Don Weinstein, ADP senior vice president of product management at its Roseland, New Jersey headquarters. The firm's most recent national snapshot indicates that private-sector employment increased by 139,000 from January to February, on a seasonally adjusted basis. More Than You'd Think Obviously, in the right hands, payroll data can be abundantly instructive—a veritable gold mine of information. Panning for this gold in the past was elusive, given the paperbound nature of payroll and the multitude of labor laws across geographies. But once this transactional data was digitized, it opened up a world of possibilities. These newfound capabilities are apparent especially for large, global organizations. "Payroll providers can tap into By comparing overall payroll costs to sales, profits, and other metrics in a particular region or across different job positions, companies can yield ways to generate more revenue per employee—like increasing incentive pay where it will provide the biggest bang for the buck.