Payroll is one of the most critical sources of data in your company, and when analysed properly, it could prove beneficial for your finances. This analysis could provide more accurate predictions in regards to budget management and cash flow during business growth or company changes. Below, we’re taking a closer look at some of the best places to start when analysing payroll data.
With salary figures to hand, you will have the opportunity to analyse metrics such as the return on investment (ROI). Examining your remunerations will also help you evaluate the efficiency of your investment and the impact remunerations have on your overall payroll data.
Turnover will help you gauge and estimate your cost-to-hire ratio for budget purposes. If your company has a high turnover rate, this could spell out a more profound problem within the company, such as morale, corporate culture, and conditions within the office. It might also lead to a loss in productivity and a greater need for training and recruitment.
Analysing this data will help you determine how often your employees are off sick, spot any trends related to their absences, and figure out when they are most likely to take annual leave (e.g., school holidays, Christmas). You definitely wouldn’t want all your employees taking annual leave during the vital last quarter of the year. By doing a thorough analysis, you will get to know when most of your employees are likely to be absent and plan appropriately.
You can decide to weigh overtime against the productivity of your staff if your personnel work longer than is expected of them. If overtime is counterproductive, you can consider hiring more workers who will be working part-time or consider getting additional staff.
Payroll departments and HR might find it difficult to cut costs while trying to improve the efficiency of the organisation at the same time. When you have a cost training metric, you will be in a position to balance the costs involved with getting skilled employees.
All these areas cover a massive amount of data that you will be able to examine. However, having the right technology is vital, as it will give you an excellent platform for future planning and analysis.
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