Integration HCM and payroll

05/09/2016 Leestijd: 3 minuten

In the past integration between HCM and payroll were headaches how to get a fluent process flow between the HCM product and the third party payroll product. Various solutions were provided for the various HCM products, but implementing never provided a 100% real time solution. In one of my projects I encountered a situation with PeopleSoft HCM and Raet Gemal. When the payroll department did the 13th monthly calculation, also retroactive it took about a week to get everything in order, also during the Christmas feasts. In order to upgrade the environment I managed a PeopleSoft upgrade, using PeopleSoft payroll interface for e integration with another payroll product, that does not exist anymore. Within the PeopleSoft payroll interface a lot of customizations were necessary to provide the payroll solution with the necessary local data. It never worked well. After each monthly pay all kinds of retroactive activities were necessary to adjust data failures.

A rescue for this customer was the decision to replace PeopleSoft with SAP ECC 5.0 with integrated payroll. All problems were solved due to the standard integration between SAP HCM and SAP payroll.

However later on encountering other HCM products I again met all the known difficulties that I had met in the past. Even with a Fusion implementation in 2014 where I discovered that Fusion was only able to export flat files to the payroll provider expecting that the provider was able to select the necessary data for performing the payroll process from the flat file.

In the mean time I noticed that because of the integration between SuccesFactors and SAP, SuccesFactors were starting to use SAP payroll in order to provide a cloud solution. But again it was necessary to set up an integration tool, named Boomi. Good news however is that the latest version of SuccesFactors, 1605, provides the optimal integrated solution that does not need an integration tool anymore.

The next picture provides the two situations

Model van integratie van HCM pakketten en third party payroll pakketten.

The advantage of this solution is that the work is done in the cloud with the same features and benefits as SAP’s on premise payroll solution, but with the added security, scale, and flexibility of the SAP SuccesFactors cloud. Another advantage is that integration with HCM processes that need payroll information, like performance management, analytics (SAP BI solution), time and attendance, benefits etc. now have a real time integration. No adjustments are needed.

NGA mentions the next ten advantages for moving to SAP payroll in the cloud:

  1. Focus HR teams on strategic, value-added roles
  2. Risk-free, rapid transition
  3. Flexible, single vendor, cost model
  4. Sophisticated analytics and reporting providing complete workforce visibility
  5. No further IT management costs – CAPEX to OPEX
  6. Guaranteed payroll compliance and data security, across all countries
  7. Maximizing value of innovation-proofed cloud technologies
  8. Full integration and interfacing with on premise and cloud apps
  9. Introduces employee self-service
  10. Responsive modern user experience

Looking at for instance employee self- service you will notice that due to the integration with SAP Jam the self service is completely different from the original self-service because e-learning is now part of all the HR processes.

It is now a question of waiting for solutions of other providers from HCM and payroll solutions. I expect that the 100% solution is only possible if the provider of HCM and payroll is the same.

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