The Payroll Control Center (PCC) is a fully automated system that leverages SAP’s promise of “run simple”. It represents the next generation of payroll processing automation. With the recent Feature Pack 4 delivery, PCC adds new functions to further simplify and optimize the entire end-to-end payroll process.
The Idea Behind Payroll Control Center
During a payroll cycle, there are certain deadlines that must be met. The employees must receive the payment not later than a specific or the tax declaration statement has to be at the tax authority not later than another specific date. Based on these deadlines, the entire payroll processing window is defined in a kind of “backward termination way”. In almost all cases various iterations have to be done in order to get to a correct result and typically those iterations happen to be over-night batch jobs. So what we see are payroll processes that is heavily influenced by a kind of “batch thinking mentality”. What makes this way of processing really time consuming is the following: The later in the process a problem is found the worse it gets as far as the timeline goes. In this case, one has to go all the way back to start, fix the problem and re-run the whole thing.
The question is, does it have to be that way? Can we find new ways where we can significantly reduce the processing time? Can we move away from “batch thinking” to something like “real time”, “online”, “interactive”, “on demand”. The answer is, “yes we can”.
The basic and simple idea behind this is: Let’s verify the data quality whenever there’s a change to employee data. Such a “change event” can happen through an HR person changing master data or data is being uploaded/imported through some other programs, etc. A so-called “policy” contains all the validation rules that tell us “Data quality for a specific payroll process is good or not”. Whenever employee data is changed, PCC finds out a change has happened and validates the policy for exactly those employees.
For example, to say if an employee’s data is good for payroll, we may check if all the necessary master data information is available, if the master data is consistent (check field values, combinations of field values), etc. We even can go further and look at the payroll result itself (even at an very early stage) and run checks to see if there’s anything wrong or if the result would be as we expect it. And this exactly brings us to the point of real insights into what we can expect from a payroll run in terms of data quality and accuracy even before we produce it. The production payroll is now just a smal time window as compared to the long one in the “old way”.
Since the policy is the one and only document that defines in what cases someone needs to get active, we do have suddenly an exception based process. The PCC will let people know when they have to do something (e.g. fix a problem if master data is missing or if the calculation for a wage type is incorrect due to some strange master data constellations, etc.) and will point them to the right solution. In all other cases, people will not be bothered.
You can now include your expert teams into your payroll process even in very early stages. The teams look after the data quality for their specific area of expertise whenever data changes happen. And they make sure that you have a perfect payroll data quality prior to your productive payroll.
And this exactly brings us to the point where there is real innovation happening:
- We decouple the process of verifying the data quality for payroll (we call this “one-click monitoring”) from the production payroll.
- We allow users real-time insights into what we can expect from a payroll run in terms of data quality and accuracy even before we produce it.
- We allow users to interact with the payroll system rather than sitting and waiting for the results of a batch run.
- There are no longer the lists that people have to scan to find out what’s going on, whether things are good or bad; there are no longer the tons of tools to double-check the system results.
- Through using the idea of policies, all know how about “when is a payroll perfect” is kept inside PCC and so is consistently used by everybody (including automated root cause analysis and error resolutions).
- And, we bring this all together in a new, modern and fresh user experience, which is simple, easy to use and focuses on the absolute necessary things.
With “one click monitoring” you achieve now full transparency of all your end-to-end HR and payroll activities at any time, not just during the critical path of production payroll processing. And finally, your production payroll is just three clicks away.
Payroll Control Center in Action
Let’s have a closer look how PCC works for you during a typical payroll cycle. In the following we will discuss the main elements of PCC (one click monitoring, automated root cause analysis and error resolution, payroll production).
As a “Payroll Process Manager” you are responsible for the overall process, you ensure correctness and timeline (sign that all steps are executed correctly) and you trigger others to resolve issues. With PCC you now have a fast overview of how good you are doing with your entire end-to-end payroll process. This number tells you how many policy deviations and errors your teams still have to work on in order to get to a perfect payroll. This information is retrieved from the system real time. Whenever there’s a key stroke, Payroll Control Center can validate the impact of that key stroke and let you know instantly whether this is a good key stroke or a bad one.
The Payroll Control Center offers you analytics for benchmarking and meaningful process improvements. During the process you can easily check how good and healthy you are doing. Here, you can see for example, your difference in gross salary is caused by a bunch of new hires. So you know, there’s nothing wrong with this, nothing to worry about.
And whenever there’s something wrong with the data of your employees, the problems are automatically and immediately assigned to the responsible individuals. You have full transparency of who is working on what.
Automated Root Cause Analysis and Error Resolution
As a “Payroll Administrator” you are responsible that payroll data quality and payroll calculation for employees is accurate according to defined policies. In case of policy deviations, PCC finds the right “Payroll Administrators” to handle and solve them.
Good validation rules within a policy are designed in such a way that they can give you on the same screen enough context information to solve the problem or even point you to the right solution.
In this example, the validation rule checks whether an employee receives some extra money through a retro calculation. On one screen you can see what this extra money is and which wage types had caused that extra money. In case the extra money is correct here, you can simply mark this error as “resolved”. If the extra money is not correct (e.g. if the amount of one wage type is incorrect or a specific wage type should not be there), you can choose a solution which takes you to the right place in the system to carry out the corresponding change.
If you need more information to come up with the right solution (in case there are more than one), you can click on the error and access more detailed information.
Three-Click Production Payroll
After all errors have been taken care of during the “One-Click Monitoring” phase, you can run your productive payroll. This is now just about execution since your payroll data are already accurate.