Modernizing Payroll: Adaptability, Compliance, and AI

This IDC Perspective highlights practices for modernizing payroll. Payroll does not happen in a silo, even if it is currently managed within one for several organizations. Integrating payroll as a process within broader HCM is vital as payroll dependencies and requirements often bookend critical workforce data, insights, and decisions. Modernizing payroll relies on tighter and more natively intuitive integrations between systems of pay and systems of management. At the top of the list for modernization, payroll leaders need to examine how AI can be used to mirror employee records and associated pay valuation changes directly and compliantly into the payroll environment, all while maintaining guardrails for rules-based adherence toward accurate and on time pay."Payroll leaders are looking to guarantee pay accuracy and rigid compliance as they always have while embracing AI to help them manage more frequently changing characteristics of employee position-based pay," says Zachary Chertok, senior research manager for HCM Applications and Agents at IDC. "Looking for deterministic guarantees using probabilistic systems links is challenging payroll teams to rethink what they need to own and manage as the train to adaptable operationalization is pulling away from the station without them onboard. Workflow avenues for AI can benefit payroll leaders' abilities to keep up while allowing them to be unyielding for accuracy and compliance."