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Accounting Integration with HCM - The Key to a Successful Payroll System

Updated: Aug 7, 2023

It is well known among organizational leaders that labor costs are often the highest expense. This section includes employee salaries, benefits, taxes, and other related payroll details. Surveys indicate that this expense accounts for 70% of the total organizational expenses.

Therefore, involving a payroll service provider in supporting the payroll system from all aspects is crucial. This includes salary analysis and compliance with labor laws. While initially efficient payroll data certification and accessibility may be provided by payroll service companies, current business applications cannot function in silos. Various departments such as HR, finance, marketing, and others rely on specific data types for their work. However, the overlapping and separate collection of data has led to a problem known as Data Silos, which affects work efficiency.

To lead your business towards success, the integration of HR and finance is essential. Quality personnel within an organization are crucial factors for its efficient growth. Therefore, creating effective payroll management policies is vital to facilitate organizational growth and development. This process requires collaboration between the HR and finance departments, as both play important roles in the employee management system. The HR department prioritizes while the finance department handles payment. The collaboration between these two departments yields positive results in HCM (Human Capital Management) or human investment management, which aims to improve the quality and performance of employees. This not only enhances work efficiency but also increases ROI (Return on Investment). Internal work system surveys reveal that interdepartmental collaboration significantly impacts an organization's performance and efficiency, while working in silos affects employees in various ways, including repetitive tasks and unnecessary expenses.

If you are considering transforming your organization's work format into HCM (Human Capital Management) with an integrated employee management system, remember to consider the following factors:

Choose a global payroll service provider

Selecting a payroll system from internationally recognized service providers helps reduce costs and save time in working with various providers that may not offer comprehensive global services or partner with other relevant service providers. Global payroll service providers assist in streamlining salary accounting processes, adjusting salaries to match the diversity of living areas, and complying with ever-changing employment laws. Furthermore, they maintain accurate payroll data on a single platform, which facilitates a deeper understanding of the data and supports better decision-making in business.

Seamlessly connect departments for better outcomes

A global payroll system enables support for department integration within the organization and ensures smooth accounting processes. Therefore, it is essential to check the security features and data accessibility of the payroll system. If possible, evaluate the system's capability to accommodate future business expansion.

Apply global standards that suit the social context

Once you have planned to integrate departments, the key is to collaborate with the payroll service provider to implement the plan effectively. The strong foundation of the organization's work system helps create a central platform for payroll management that is ready for business expansion into diverse global areas with potential social context variations.

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