Integrating an organization’s payroll and human capital management (HCM) system can certainly be a daunting task, especially when it needs to be done to streamline and strengthen process controls; reduce errors, touchpoints, and manual tasks; and support business growth.

However, those are all great reasons to invest in such an ambitious project.

CloudPay presented the webinar, “5 Steps to Payroll, HCM Integration Success,” which outlined the five critical steps needed for a successful implementation.

Matthew Hillier, Executive Vice President, Products at CloudPay, and Olga Rodriguez, Director, Connectivity Implementation at CloudPay, provided their expertise on a successful integration.

In fact, an internal poll during the webinar revealed that 33% of those surveyed said they were not planning an integration, while 29% said their integration was already live.

What’s Driving Integration?

Why would an organization invest in payroll and HCM integration? There are several reasons, according to Hillier, why integration would be beneficial.

First, investing in integration provides a single source of truth where data only needs to be entered once, which also helps to improve a team’s effectiveness.

Hillier explained that there are several core drivers that are pushing organizations toward this type of integration.

“Teams are looking to reduce manual touchpoints, get rid of errors, and simplify workflows,” he said. “They might be looking to strengthen process controls, especially around the movement of data, delivering it to payroll, which is crucial. Sometimes, this is driven by a desire to extend the value of that HCM investment.”

While HCM and payroll integration can streamline processes, there are several reasons why HR and payroll professionals are reluctant to get started. Often, there is a lack of stakeholder buy-in for the integration, a lack of resources, too many vendors, and it’s simply too complicated.

An internal poll indicated that 47% of attendees were discouraged for every one of those reasons and delaying payroll/HCM integration.

Regardless, the investment and buy-in for organizations with a global reach could be invaluable when leaders understand that payroll/HCM integration processes become much more optimized to maximize global user engagement.

“The learning that is going to be required is not that big, because part of that process is already done by the integration,” Rodriguez said. “You are enhancing the employee experience.”

Outlining the Steps

Once an organization buys into the payroll/HCM integration, leadership launches the first of five steps that—even with other process implementations—begins with planning, followed by discovery, configuration, testing, and deployment:

1. Planning: This begins with leaders reviewing your project scope, which includes the existing landscape and any potential bottlenecks. An explanation of the integration process, what is required, and how this plan aligns with your specific needs is provided to leaders. It’s important that payroll and HR leaders provide a viable timeline they can present. This helps to establish a common vision and partnership mindset, which is needed to collaboratively align resources, responsibilities, and expectations for successful delivery.
2. Discovery: This phase begins as you learn everything about your current payroll system and consider the best possible solution to establish new best practices. This is also where teams begin to better understand and prepare for the global scope. Understanding this step makes the configuration easier and allows for a more tailored integration approach. This is also the time when teams address specific areas where they don’t have the required knowledge and target areas for the testing phase and find answers to those questions.
3. Configuration: Technical transformation begins here as you configure your system and integration technologies to move your data between your HCM and your payroll software. You are also following other key steps here such as preparing your platform interface connectivity with your HCM system, and preparing your systems that manage your data, reporting, calendar tool, and validation framework.
4. Testing: You begin performing controlled and real-world parallel testing to check assumptions, iron-out potential issues, and familiarize teams with the processes. Perhaps you create a list of test scenarios and decide to run them to make sure the integration is working properly.
5. Deployment: It’s almost time. Here, you and your team review data from the various testing phases to make the final decision whether it is time to launch. The process is handed over to internal and payroll management teams. This includes the required documents and the process information. The rollout goes live, along with change management of teams and processes affected by the new workflow. All the onboarding and set up work has led to this!

“This is the homerun,” Hillier said. “This gets easier. This process speeds up and gets more predictable because you build up a rhythm. You build up momentum and that’s a really important piece.”