Payroll Issues in Finance Departments
Miguel Domingos
Knowledge Sharing, Partnership, Craftsmanship, Pioneering Innovation & Know-How.
Payroll management is a major challenge for finance departments. It often represents the largest expense for a company and requires special attention to ensure the financial sustainability of the organization.
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I. The Challenges of Payroll Management
A. Forecasting and Control
?One of the main challenges is accurate payroll forecasting. Unforeseen changes can have a significant impact on financial results. As a result, finance departments need to put in place effective monitoring and control tools.
?B. Fairness and Retention
?Pay equity is another important issue. An inequitable distribution of salaries can lead to problems with staff motivation and retention. Finance departments must therefore work closely with human resources to ensure a fair salary policy.
C. Labour Costs and Competitiveness
?Finally, the cost of labor is a key factor in a company's competitiveness. A payroll that is too high can hurt the company's competitiveness in the market. Finance departments must therefore find a balance between attractive compensation for employees and maintaining the company's competitiveness.
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II. What are the calculations that Management Control puts in place to observe this payroll?
?There are several key calculations related to payroll in management control. Here are some of the most important ones:
1. Difference in headcount: This is the difference between the payroll of year N+1 at constant salary and that of year N.
2. Structural variance: This is the difference between the payroll of year N+1 with a constant structure and that of year N+1 with a constant salary.
3. Seniority gap (or noria effect): This is the difference between the wage bill of year N+1 with constant seniority and that of year N+1 with constant structure.
4. Nominal Rate Spread: This is the difference between the payroll for year N+1 and that of year N+1 at constant seniority.
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In addition, the provisional calculation of the payroll is generally carried out in three stages:
?1. Forecasting the wage bill of the stable workforce,
2. Forecasting the impact of exits (including intra-company movements),
3. Forecasting the impact of inflows (including intra-company movements).
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These calculations allow finance departments to better understand and manage payroll, which is crucial for management control.
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III. The place of the Payroll within a company's financial planning
?Payroll plays a crucial role in a company's financial planning. It is often the largest expense for a company and has a direct impact on the company's profitability.
It is used internally to manage the company and more specifically to know the weight of its workforce on its turnover. It is also used for statistical calculations such as the determination of the "Clap" (Local Knowledge of the Productive Apparatus) information system, for sectoral or regional statistics and for the payment of certain taxes (apprenticeship tax, contribution for vocational training, tax on wages, etc.).
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It is therefore essential for finance departments to accurately forecast the payroll for the coming year and to regularly monitor this forecast during the year. This allows the company to effectively manage costs, optimize profitability, and plan future investments.
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IV. How do you address this with Planning Analytics?
?IBM Planning Analytics is a powerful tool that can help address payroll issues in finance departments. Here's how:
?1. Automate manual tasks: IBM Planning Analytics automates manual tasks, enabling finance managers to respond quickly to new business requirements.
2. Developing Clear Planning Processes: This tool helps develop clear planning processes that align the finance department with strategic goals.
3. Real-Time Visibility: With real-time visibility, IBM Planning Analytics directs financial analytics solutions to resource allocation, stakeholders, cost optimization, and asset utilization metrics.
4. Spend optimization: IBM Planning Analytics helps optimize spend through benchmarking, while identifying and prioritizing financial projects that generate a return on investment.
5. Human Resource Management: IBM Planning Analytics automates and streamlines human resource management processes (employment, payroll, bonuses, headcount, and benefits planning), all on a single platform.
6. AI-Driven Workforce Forecasting: IBM Planning Analytics enables AI-driven workforce plans and forecasts that are accurate based on workforce changes, location, return to work, compensation, retention, attrition rates, and more.
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In short, IBM Planning Analytics offers a complete solution for payroll management, enabling finance departments to make informed and strategic decisions.
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V. How can Cubewise help you?
?Cubewise is a trusted partner for the implementation of IBM Planning Analytics in finance departments. Here's how Cubewise can help implement this solution:
1. Migrating to IBM Planning Analytics: Cubewise helps companies plan and execute the migration of their legacy systems to IBM Planning Analytics.
2. Training & Support: Cubewise offers training and ongoing support to help users get the most out of IBM Planning Analytics.
3. Model Development: Cubewise helps develop budgeting and forecasting models tailored to the specific needs of the business.
4. Creating Dashboards: With IBM Planning Analytics Workspace (PAW), Cubewise helps create visually appealing and intuitive financial dashboards.
5. Workflow Optimization: With Cubewise Arc, developers can benefit from faster workflows and efficient troubleshooting tools.
6. Digital Transformation: Powered by IBM Planning Analytics, Cubewise Supply Focus is a decision-making platform that enables organizations to drive their digital transformation.
7. The guarantee of tailor-made work: Two decades of tailor-made creations for our customers, in France, Europe and most continents...
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In short, Cubewise offers a full range of services to help finance departments implement and optimize the use of IBM Planning Analytics.
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VI. Conclusion
?Payroll management is a delicate exercise that requires a balanced approach. Finance departments are at the heart of this issue and must navigate between the imperatives of cost control, fairness and competitiveness. Ultimately, effective payroll management can contribute to the financial and operational success of the business.
?This complex challenge requires a robust and flexible solution. Cubewise, in partnership with IBM Planning Analytics, offers a comprehensive solution that addresses these challenges. From automating manual tasks to creating intuitive financial dashboards, Cubewise transforms the way you manage your payroll.
?So, if you're looking to optimize your payroll management, improve profitability, and effectively plan for the future, look no further. Cubewise is the trusted partner you need to navigate today's complex financial landscape. Make the right choice, make the Cubewise choice.
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Sustainability Data Strategy | TM1 Fanboy | born 344 ppm
9 个月Great summary of the benefits of #tm1. :-)
Knowledge Orchestrator
9 个月Nice work Miguel. You’re spot on! Well done for making the case so clearly.
Passionate about marketing automation and data | Trying, failing, learning, succeeding, innovating, and pushing forward in the digital marketing space for the last 10 years.
9 个月Your posts are fantastic. The memes you use are perfection.