The complex life of a Payroll Administrator – decisions, decisions, decisions!

As a Payroll Administrator life is full of decisions! How to pay someone, how to set them up, what cost centre are they linked too, should they be liable for this leave, this allowance, this deduction?

Interpreting contracts and legislation is a minefield and our world is an ongoing jumble of choices.

Along with the everyday decisions that get made there are also more complex decisions and projects that affect more than just one employee or team at a time. Particularly decisions relating to policy and contracts, many decisions are in fact out of the hands of the Payroll Administrator.

Sometimes multiple areas of the business are impacted by a decision and there is more than one option to go with. How often have you sat in a meeting and discussed a topic going around in circles, then left without any clear direction or decision being made?

Here at MYOB we have adopted a simple but powerful tool created by Bain & Company to help us work through decisions from the very basic to the very complex.

The RAPID framework helps everyone know where they sit in the decision making process, and who ultimately holds the “D”.

Recommend

The “R” role typically involves 80 percent of the work in a decision. The recommender gathers relevant information and will propose a course of action, sometimes more than one alternative, highlighting the pros and cons of each.

Key Responsibilities:

• Establish criteria and required facts upfront
• Gather inputs
• Synthesise analysis
• Develop the recommendation

READ: 5 key things accounting needs to communicate to the CEO

Agree

Agree roles should be used sparingly but are important in circumstances where there are legal or regulatory issues, revenue or profit impacts etc. Whoever has the “A” agrees that the recommendation is valid.

Key Responsibilities:

• Sign off on key recommendations to ensure consistency with company policies or regulatory compliance
• Work with recommender to achieve mutually satisfactory proposal

Perform

People who perform the roles impacted by the decision will have the ‘P’ role. Best-practice companies typically define P’s and gather input from them early in the process to help identify potential issues with the recommendation.

Key Responsibilities:

• Flag potential implementation issues early and ensure decision is practical
• Execute decision as intended
• Handle follow-on decisions with rigor

Input

Input roles are held by those that can contribute relevant valuable information that will help the recommender make a recommendation, and the decision maker to make the decision.

Key Responsibilities:

• Provide input based on data, experience or position
• Ensure input is clearly heard – bring high quality analytics and logic to bear and use influence appropriately

Decide

Specifying the individual who is responsible for a decision (assigning the ‘D’) is critical for good decision making. The person with the ‘D’ can’t make their decision without the team’s inputs – they need great recommendations, insights and the correct sign-offs. This ultimately will result in fast, high-quality decisions.

READ: The complex life of a Payroll Administrator — managing up

A recent example:

Company ‘A’ currently runs a weekly pay run and a fortnightly pay run. The Payroll Administrator has suggested merging these into one fortnightly run to streamline processing.

The RAPID Framework worked like this:

Sue is the Payroll Manager and will be gathering the information to Recommend the change and how it will be implemented. Sue has decided that their CFO Chris has the “D”.

Sue will need to check in with Lisa the HR Manager to confirm if there are any contractual obligations in their Individual Employment Agreements to continue a weekly run. Lisa will need to Agree to Sue’s recommendation and advise actions if required.

When the decision is made it will be Sue and her Payroll Administrator Bevan who will need to make the changes, so Sue will run through the Recommendation with Bevan and ensure that the plan is practical to Perform the change, and that the processing timelines are realistic.

To make sure that all her bases are covered, Sue will get feedback and Input from the Line Managers to make sure that deadlines for timesheet approvals will work, with the Accounts team who have set reporting timeframes and GL functions to perform and with Lisa in HR to confirm what communication needs to go to the company. All those who Sue asks for Input can raise their concerns or ideas and make suggestions.

Once Sue has gathered all of the information she will call a meeting with Chris and Lisa to relay her Recommendation for change, and outline all of the information that she has gathered by talking to the rest of the team.

Lisa will confirm whether or not she agrees with the change from an HR position.

Chris now has all the information that he needs to make the Decision whether or not to agree to the change.

When approaching a decision, the RAPID framework is a simple method to ensure that the decision maker can make a quick and effective decision.

We find that often, gathering all of the information during the process, can lead to us changing a recommendation before we even get to the decision maker – which means time isn’t wasted discussing outcomes that aren’t realistic.

The process can be formal or casual. It can be quick or detailed. It can be whatever works for your company.

“When the roles involved in decisions are clearly delineated, teams and organizations make the right choices – swiftly and effectively” – Bain & Company, Inc

For more information, or to download the ‘Decide & Deliver’ guide, visit the Bain & Company website.