Metrics and DashboardsPresented by: Brent R Gow, CPP

Director Global Payroll, Starbucks Coffee Co

Agenda• Why Payroll Metrics are Important• Types of Payroll Metrics• Review Purpose of the Dashboard • Developing an Organizational Scorecard• Using Metrics Tell a Story• Integrating Payroll Metrics Throughout the

Organization

Effective Metrics• Support decision making• Measure performance• Identify trends • Define baselines• Provide a basis for benchmarking• Support Corporate Scorecard

Using Metrics to Build Relationships• Use metrics to support and build upon relationships, but

not to replace them• Strong value in maintaining an ongoing dialogue

between your customer groups and at various levels• Strategic (Executive)• Tactical (Manager)• Operational (Employee)

• Listen carefully to your customers! Understand their needs and their challenges

• Create a win-win together4

Data Based Decision• “You can not manage what you don’t measure”

• “If you can not measure it you can not improve it”

• “You can not defend it if you have not measured it”

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Payroll Metrics

Costs/Volumes•Payroll costs/administrative expenses (%)•Payees processed per FTE in Payroll•Average number of payroll payments per employee•Percentage of employees on direct deposit•Percentage of employees receiving checks•Percentage of employees with both check and direct deposit

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Payroll Metrics

Costs/Volumes•OT hours as a percentage of total hours worked•Paid time off hours/$ as percentage of total paid hours/$•Number of Special Checks (i.e., Off-cycle Payments)•Number/Percentage of manual checks vs. system generated checks

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Payroll Tax Metrics• Number of entities & tax jurisdictions for enterprise• Number of provincial jurisdictions per entity• Employer taxes as a percentage of total wages• Percentage of penalties/interest paid on total taxes• Percentage of penalties/interest paid on total gross wages• Number/percentage of tax abatements• Number/percentage of timely payments/reports• Number/percentage of late payments

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Training Metrics

• Percentage of employees who participate in training• Average number of employee hours spent training• Amount of Training Dollars per employee• Employees with expired certifications and licenses

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HR Metrics• Performance Appraisal

Participation Rate • Compensation

Competiveness Compared to External Market Benchmarks (gap to market)

• Average Performance Appraisal Rating

• Termination Rate

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• Total Number of Hired• Gender Staffing

Breakdown• Internal Hires / External

Hires • Performance Rating

Distribution • Employee Engagement

Level • Average Time to Fill

HR Metrics• Health Plan Enrollment

Rates • Average Workforce

Tenure • Transfers • Internal Hire Rate • Retention Rate • Employee Satisfaction

with Training • Benefits Expense per FTE • External Hire Rate

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• Leadership Gender Breakdown

• Age Staffing Breakdown • Average Workforce Age• Average Employee

Compensation • Type of Hires• Ethnic Background Staffing

Breakdown• Average Merit Increase for

Each Performance Rating

Training MetricsQuality• Percentage of errors by type• Payroll department error• Manager / supervisor error – timely, accurate• Employee error – time reporting not submitted• Number of amended T-4 statements • Number of Amended Tax Returns

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Payroll Process Labor Distribution

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We have all used dashboards…

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DashboardProactive Management Tool•Visual representation Monitoring Business Activity to understand the “health” of a business•Provides info of Key Indicators•Information can be in the form of:

– Warnings– Action Notices– Next Steps– Summaries of Business Conditions

•Dynamic (Drill Down Capability)

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Dashboard Example

Measure ValuesPercentile

Ranking Place Measure Description

Accuracy 99.00% 15th

% Payslips produced without error(only those errors reported to Call Center)(calculated as % of payslip volume in month)Green ≥99% Amber ≥98% Red is <98%

Manual paymentsoutside payroll 1.00% 75th

% of manual payments made outside of payroll(calculated as % of payslip volume in month)Green ≤1% Amber ≤98% Red is >98%

Service Desk(Total calls) 3.72% 15th

% of calls received(calculated as % of payslip volume in month)Green ≤4% Amber ≤8% Red is >8%

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Scorecard• Provides collection of reflective measures

1. Performance of key business processes2. Financial perspectives3. Customer perspectives4. Learning and development perspective

(i.e., Training)

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Sample ScorecardCategories Payroll Scorecard

People Metrics          

    March April Target Notes

  Salaries actuals to plan (Fiscal) ($87,992) Favorable $61,119 Unfavorable    

  Planned vs. Actual FTE's 33:28 33:29   New hire in April

Payroll Metrics

         

  Check Processing Efficiencies March April Target Notes

  % Direct Deposit (CN) 97.04% 96.86% 98% lower due to new hires

  # of printed checks (CN) 842 929 N/A  

  # of vouchers (CN) 28,146 28,257 N/A  

  % of electronic vouchers (CN) 100% 100%    

  # of Manual Cheques 2,119 1,468 N/A reduction due to timely payroll transmission

  Manual Cheques as % of total statements 0.64% 0.55% <1%  

  Check Reissue 422 414 <100  

  Tax March April Target Notes

  # of Tax Returns filed N/A 327 N/A Qtly reporting

  # of Tax Deposits N/A 1422 N/A Qtly reporting

  Total $ Amount N/A $209,998,015.18 N/A Qtly reporting

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Department ScorecardGo Green

Electronic Payments _____% -Direct Deposit _____% -Debit Cards _____%

Electronic Statements ______%

Total number of payments _______

Total $$ of payments ________

___% of Total Budget

Customer Feedback

-Highly Satisfied ____% -Moderately Satisfied ____% -Somewhat Satisfied ____%

Payroll Team

____ Years of Experience

Attended ____ Hours of Training

Under Budget

0

10

20

30

40

50

60

DirectDeposit

Exempt

Non-Exempt

Customers are saying…”they are Highly Satisfied”

HighlySatisified

ModeratelySatisified

SomewhatSatisified

0

10

20

30

40

50

60

70

80

90

100

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

Hours of Training

Years of Experience

Pay Cards

Go Green86%

Electronic

68%

78%

15%

7%

Fiscally Responsible

98% of Total Budget

Payroll Team Mitigates Risk and Manages Compliance with..

44 Years of Experience

120 Hours of Training

5,867 Payments

$500,000

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Department Scorecard (with Graphics)

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Training Scorecard

Manager Feedback

Next StepsAccomplishments Complete Inventory of Management Skills Complete Development Plan Attend Chapter Study Group

Knowledge Assessment Completed Attended APA Web Based Training Course

Training Activities Target Status

Take Knowledge Assessment 01/31/11

Attend Chapter Study Group 05/20 –

8/15

Attend Fall Forum 09/2011

Sit for CPP Examination 09/2011

• Recommended Cindy become Certified to continue progress on her career path to a management position.

• After CPP is obtained, additional knowledge and experience is needed in Management that will be offered internally.

Individual Goal:

To become a Certified Payroll Professional (CPP) and then move into a management position.

Background: • 5 years of payroll administration• 5 years of customer service

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

3/15/11 6/28/11 9/20/11 12/15/11Quarterly Review Held:

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BenchmarkingMetric Top Performer Peer Group

2012 2011 2012 2011

Process Cost/Employee

$41 $49 $84 $90

Process Cost/Payment

$1.76 $2.06 $2.75 $3.03

Error Rate .02% .01% .06% .02%

Paperless Payment Distribution Rate

90% 81% 76% 67%

Percent Off-Cycle Payments

1% 1% 2% 3%

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Tips for MetricsKey is to use the “right” metrics

• Name of the Metric• Description of what is measured• How is the metric measured• How often is the measure taken• How are the thresholds calculated• Current range of values considered normal for metric• Best possible value of the metric• Units of measurement

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Data Sources• HR/PR Database• Financial Database• Call Center Database• Project Management Database• Time and Attendance System• Excel Spreadsheets• Paper “Stickies”• Other

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Value Proposition: “Payroll Department Data Correlates to Bottom

Line Success”

Manager

Late Terminations

Ongoing Expense

Company Property

Increased Cost of Expenses

(Phones/ PC’s)

Organization

Decreased Profits

$$Terminations

Metric: Timeliness of Termination Notification Days Late for Notification

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Data Collection ToolPerformance Measure

Operational Definition

Data Source and Location

Sample Size

Who will Collect?

Frequency of Collection

How will Data be Collected?

How will data be used? How will data be displayed

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Data Collection ToolPerformance Measure

Operational Definition

Data Source and Location

Sample Size

Who will Collect?

Frequency of Collection

How will Data be Collected?

Cost Per Paycheck

Total Expenses/

Number of Checks Produced

Budget-Expenses To Date

and Payroll Registers

100% Payroll Manager

Quarterly Manually

Cost Per Employee

Total Expenses/

Number of Active Employees + Terminated Employees

Budget-Expenses To Date

and Payroll Registers

100% Payroll Manager

Quarterly Manually

How will data be used? How will data be displayed

Report for Management Scorecard

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Scorecard Integration• Reflect company strategy

• Foundation on company goals

• Mission, purpose and objective must be defined

• Agreed upon measures

• Tied into individual goals

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Building the Foundation1. Begin with the end in mind

2. Define a clear goal

3. Gain buy in from users

4. Design reporting templates

5. Identify data sources

6. Determine Frequency

7. Estimate overall effort

8. Understand audience needs

9. Align with organizational goals

10. Integrate with recognition: performance or bonus

Thank youPlease complete your

evaluation