"For the company, the automation process can be win-win because it streamlines the payroll management system, avoids the errors due to manual work while imposing on managers the respect of the same rules. "
Sylvie Mochet, Associate Director, Oresys - Article business.lesechos.fr
Centralization of information, reliability, time saving, credibility, security, etc., the benefits of automating variable compensation calculation processes are numerous. The software dedicated to the automation of variable compensation facilitates its daily monitoring and encourages more employee acceptance, for which the calculation of bonuses and associated performance will become clearer. At a time when more and more factors are taking into account the performance and de facto assessment of variable compensation, how can we successfully automate processes without losing in accuracy and credibility?
1) AUTOMATION OF VARIABLE COMPENSATION PROCESSES: BETTER TRANSPARENCY OF THE SYSTEM FOR ALL
« Payroll control is a time-consuming, boring process, even a source of errors. Indeed, according to the annual report of ACOSS, in 2015, two thirds of the employers inspected were the subject of a recovery.»
Dominique Rodier, VP Director R&D France & Italy in ADP - Article focusrh.com
Standardize the management of variable pay to streamline its performance
The automation of incentive compensation is really about dealing with the automation of variable pay processes. It is therefore important to dissociate the automation of variable compensation calculation processes from the rules themselves of variable remuneration, which can be calculated or purely managerial.
Choosing the automation of the calculation and reporting processes allow to propose a better transparency of the variable compensation system, both for managers and collaborators.
Automating variable compensation processes requires collecting all the data but also ensuring their processing and consolidation. In addition to ease the calculation of variable compensation, the use of specialized software also allows for significant savings. As a result, the computational chain is rationalized and the errors linked to the human management of the process are thus very limited. In the same way, the design of accurate and customized reports, according to each department and / or collaborator, leads to more acceptance of the stakeholders, generating less questions on the calculations.
Some recent solutions are able to directly integrate HR data, changes in scope, employee absences, ... Therefore, the fear mentioned by some operational managers to lose the ability to act directly on the incentive compensation of an employee is reduced, the evolution of the tools taking place at the pace of the transformations of the organization.
2) HOW TO SUCCEED FOR AUTOMATING INCENTIVE COMPENSATION PROCESSES?
According to the study "Six Key Trends at the Heart of Digital HR Strategies for Companies", carried out as part of the Human Resources Solutions and E-Learning Expo fairs, over 70% of HR decision-makers believe that process automation is the main challenge to be achieved by 2020!
The computational chain: evaluating the performance cycle as a whole
There are softwares able to automate the computational processes and animation of incentive compensation. The computational chain breaks down into 5 different steps.
1. Data Collection
During this first phase, the objective is to collect all the data coming from the various departments of the company: the commercial department, with particular figures related to the performances (sales, objectives ...), the HR department with the data personal (position, absences ...).
2. Data processing
After the data collection phase, the step of aggregation and consolidation of the data takes place. The goal of this treatment is triple: to carry out checks of coherence and completeness of the collected data then to carry out preliminary calculations (aggregation, consolidation ...) and finally to format the data so that the customer does not have this responsibility.
3. Calculation of performances and bonuses
The dedicated tools make it possible to standardize the computational process regardless of the complexity of the incentive compensation mechanisms and the management rules to be applied. In addition, the development of web solutions has led to major advances in ergonomics and the appropriation of these solutions.
4. Reportings
A dedicated software will be able to automate the production and sharing of detailed reports, whether for the department, HR (payroll files), the financial department (budget synthesis), beneficiaries of compensation plans (details of calculations and associated bonuses) ....
5. Animation and Communication
Regular animation of incentive compensation is central to the motivation of the beneficiaries to implement their action plan and therefore the effectiveness of the schemes.
This needs a web interface, now mobile or tablet, in order to communicate in real time on the progress of the performances and the impact on the expected bonuses.
The software dedicated to variable pay: concrete advantages
There are tools dedicated to setting up and managing incentive compensation processes. These specialized software allow you to recover all the data needed to calculate bonuses but also to effectively manage all the performance objectives of your teams.
In addition, a well-defined software suite will be able to consolidate all types of data, regardless of their format or origins, in order to ensure a fair incentive compensation calculation and to limit human errors.
The use of dedicated software also ensures compliance of data formats. The establishment of variable compensation calculations is thus made more reliable as the HR exceptions are taken into account and the calculation elements are archived. Some companies even see an interest in being able to calculate retroactively on the basis of new calculation assumptions.
Primeum can support you on all these aspects by providing you its dedicated software suite.
