Countering the Labor Shortage

With software and outsourcing against empty personnel departments

The area of payroll accounting in particular has a recruitment problem. New solutions are needed. Hardly anyone likes to hear it anymore: Shortage of skilled workers and war for talents. And yet no one can get past it, as it describes the reality in companies quite accurately. Creativity is needed to attract the attention of potential candidates: This ranges from unusual job advertisements to more flexibility in job requirements and making lateral entrants fit to targeted and long-term succession planning. These are all important and highly successful levers for beating the empty applicant market.

One occupational group, however, seems "immune" to any efforts: that of payroll accountants. Why is that? Have you ever seen a 24-year-old payroll clerk, for example? It seems that this profession is not attractive to Generations Y and Z, who are flooding into the job market. Yet HR, or "people and culture" as it increasingly calls itself to emphasize its employee-centric focus, is not "out" per se. But if it is, then entry is more likely to be sought in "hip" areas, such as employer branding, where the topic of social media is also playing an increasingly important role. Or as a recruiter or junior personnel officer.

Soft topics, such as personnel development, are also welcome, as they are really close to the people. But payroll accounting? Neither hip nor soft. What's more, in payroll accounting you really have to know something about topics that aren't everyone's cup of tea, such as labor, tax and social security law. The corresponding training is extensive. But in the right environment, this can also be the dream job for people with an affinity for numbers.

But it is not only among young people that payroll accounting is viewed with suspicion. Even seasoned HR professionals rarely switch to payroll later. Recruiters become HR business partners. HR Business Partners become HR Developers. HR developers become culture managers. But payroll managers? Not a thing. Perhaps this is because accountants in companies are often a one-man or one-woman show, and many prefer to work as part of a team. After all, this not only offers opportunities for an exchange of expertise, but also a regulated replacement in the event of illness or vacation. Companies with an attractive working environment and teamwork, where payroll accountants are not lone warriors, can certainly find new recruits, as Christian Pfeifer, co-managing director of the outsourcing provider Empleox, confirms. 

So what can be done if young and old alike are not really enthusiastic about payroll accounting? Either you have to make it more attractive or you have to come up with a Plan B. HR managers and accountants are only human. This means that they, too, would like to be able to do at least part of their work from their home office. And of course they want to use software that is as intuitive as possible. While many payroll staff in mid-sized companies are still using the SAP HCM Payroll system, their colleagues from other HR functions are increasingly turning to the cloud, and often to SAP SuccessFactors. 

Making HR work more attractive

All strategic elements of HR management, i.e. recruiting, onboarding, digital salary round and variable compensation, target agreements, performance and feedback, succession, development or training, are at home here. 

Sooner or later, "core processes" such as payroll or time management will also move natively into the SAP SuccessFactors suite. SAP is already relatively far along in time management: The SAP SuccessFactors Time Management module, which is still quite new, can already do quite a lot. The days when it was only possible to map absences are long gone. At least there is a good interim solution for payroll. The "Employee Central Payroll" module combines the master data management of "Employee Central" with payroll accounting in the cloud based on proven SAP HCM technology.

So things have already changed quite a bit. The fact that payroll accountants have to sit in musty offices full of files to do their work, working with highly technical systems that are hardly intuitive to use, is in any case just a cliché. 

But what really gets HR managers and accountants going is software that covers the entire spectrum of modern HR work with a single interface. Last year, the HR IT service provider Empleox showed what this can look like with its One HXM package.

A complete package for HR

One HXM is an SAP-based solution that makes even technically unavoidable system breaks largely invisible to the end user. In other words, it already offers modern cloud modules with billing as an integrated package and elegantly combines both worlds. This avoids individual, error-prone interfaces and manual rework. In short, it puts an end to the patchwork of different HR systems. 

Behind One HXM is the concept of high standardization. The included systems do not come "naked", as software usually does, but are completely pre-configured and perfectly matched to each other. Complex tariff issues have already been thought through by Empleox experts, and the solution is always up to date with the latest technology and legislation. Stop immediately ready for use for the medium-sized target customers between 300 and 3000 employees. 

One HXM is modular and individually expandable. So you don't HAVE to take everything right away, and companies can start lean and then expand as they wish. True to the motto "Everything can, nothing must", the basis can then be completed according to needs and at the appropriate pace: from core HR processes such as personnel administration, time management and payroll accounting to processes related to talent management and manager or employee self-services. 

"Companies that use a complete suite benefit in many ways: they have only one interface, all HR data from the different personnel processes are interlinked, and disruptive system breaks are a thing of the past," knows André Schulte, Senior Director Consulting at Empleox. 

Plan B is even simpler: outsourcing certain processes, such as payroll accounting including all follow-up activities, to specialized outsourcing providers. In this case, an external HR department relieves employees of administrative HR tasks and frees them up. Instead of focusing on master data management, reporting and evaluations, in-house HR staff can then concentrate entirely on the issues they like to do best anyway. This also means that companies no longer need to maintain certain competencies internally. For example, how payroll accounting works in principle or what new developments there are in the areas of tax, social security and labor law. The service provider takes care of all that.

"In my view, HR outsourcing is worthwhile when companies have personnel bottlenecks or departures and when they want to make routine tasks more efficient," says Nikolai Hartmann, co-managing director of Empleox BPO, a subsidiary of the One HXM provider Empleox. System and service provider changes as well as carve-outs are also constellations in which HR outsourcing makes particular sense. 

If companies are already working with SAP in the area of payroll accounting, it may even be possible for experienced service providers to step in at short notice if the company's own payroll provider fails. "Companies therefore have a minimized risk of failure through outsourcing. Even in the event of major waves of illness, such as during the pandemic, it is ensured that all employees are calculated and paid the appropriate remuneration," says Nikolai Hartmann. 

In other scenarios, where entire divisions or further HR topics are outsourced, the process can take up to a year. However, in case of doubt, this is still shorter and more promising than the alternative: finding an internal specialist.