Emerging Trends in Employee Compensation for APAC and Beyond

Data security and accuracy concerns persist for global payroll leaders.

FREMONT, CA:The majority of senior payroll leaders in the APAc region have identified cybersecurity and scaling operations as the top priority. Almost 50 per cent of organisations are planning to enhance their data security, improve the accuracy of employee pay, and strengthen reporting capabilities.

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The potential payroll’s primary concern is the cybersecurity, scaling operation, legislation, and driving strategy. These concerns are standard across the region and organisations are eager to address them soon. However, addressing these issues put further strain on the already existing talent shortage in cybersecurity, HR, and operational skills, especially as the global talent war intensifies. The report has identified four significant trends that are expected to shape the payroll industry over the next coming years.

Cyber Secure Payroll

The concern for data security has increased for leaders, as data breaches continue to occur by global and local companies. However, data security has become more important. Over the next few years, only 44 per cent of payroll leaders have planned to improve data security. Payroll is considered an immediate threat to businesses, with 61 per cent being affected by a cybersecurity breach within the last two years.

Numerous organisations have delayed their plans to standardise and integrate payroll operations globally due to the threat of cyber-attacks. 40 per cent of them identified data security concerns as the biggest obstacle to implementing a global payroll model across their geographies, which is higher than any other factor. Businesses need to address data security concerns before they can pursue other goals.

Futureproof Payroll

Issues such as skill shortages and a potential recession made businesses expand their operations and hire more employees. As a result, 36 per cent of organisations are aiming to enhance the precision of their employee pay reporting, while 31 per cent are seeking to improve the promptness of employee pay.

The initiatives assist to tackle current problems, as more than half of them seldom have complete visibility of payroll performance, accuracy, and other data in all their global locations. The majority of companies have implemented more internal audit checks and employee surveys in the last three years. This raises concerns that payroll errors continue to go unnoticed.

The errors in their payroll system are only detected during a payroll audit. Additionally, 26 per cent stated that they become aware of the issue through employee complaints, and 22 per cent through local authorities. The recruitment of payroll professionals needs improvement, as almost half of them find it challenging to hire payroll talent from outside their organisations. As a result, businesses are focusing on training current nonpayroll staff, upskilling existing payroll employees, or revising their payroll processes to reduce the need for staff.

Payroll That Can Scale

Inconsistent payroll practices have adverse impacts on businesses, such as hindering growth and geographic expansion plans. One-third of HR and finance leaders expressed a lack of confidence in the payroll system’s ability to support growth plans. 40 per cent of payroll leaders have different compliance tracking methods, leading to a focus on planned regulatory compliance. Furthermore, a quarter of respondents expressed interest in transforming their operations to provide standardised multi-county payroll processes.

Foundations for the Future: Driving Strategy With Data

Payroll is increasingly becoming a strategic tool, with 45 per cent of senior management using payroll data to inform important business strategies. However, many organisations lack the necessary tools and data to generate meaningful insights, as only 40 per cent are implementing global dashboards and just 29 per cent are using real-time analytics. As payroll leaders aim to improve reporting capabilities. In addition, 25 per cent are looking to increase integration with other business-critical systems to drive efficiencies and other opportunities across business units.

Data security and accuracy remain key concerns for payroll leaders globally. The threat of cyber-attacks led various organisations to postpone plans for global standardisation and integration of payroll operations. While businesses are looking to grow, while also focusing on improving payroll reporting and increasing the accuracy and timeliness of employee pay.  Recruitment of payroll professionals remains a challenge, with organisations opting to upskill existing staff and review payroll processes, payroll is increasingly influencing strategy at the senior management level, with the use of relevant data to inform cost management, growth, and diversity, equity, and inclusion strategies. Improving reporting capabilities and increasing integration with other business-critical systems are top priorities for payroll leaders.