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Advantages of SAP HR/Payroll

Saving time and money, and improving information for decision-making and planning.

Greater automation, ensuring greater accuracy and time savings. SAP is built to
automatically apply policies and rules to employees’ data. In HRMS, this sort of information
would be entered as required, keyed in by an employee. This will invariably result in a certain
amount of inaccuracy, either through interpretation or simple error. In fact, as SAP HR/Payroll
was created, various instances were found of employees in HRMS who were receiving benefits
they were not entitled to, or who had been eligible for shift premiums but had not received them.
As well, the reduced data entry will allow time for more value-adding activities.

Improved reporting capability. Reports are tools managers can use to analyze their operations
and find opportunities for improvement. For example, attendance reports, or workload reports.
HRMS provided a limited number of standard reports in a format which could not be
manipulated for more precise analysis. Reports would be ordered, and would typically take two
days to arrive. SAP provides users direct access to thousands of standard reports, plus the ability
to easily create custom reports. Reports can be exported into Excel for further manipulation or
filtering and then uploaded back to SAP.

Improved position control. Information related to positions includes cost centre, “report to” and
classification, for instance. SAP provides more position-related information than HRMS, and the
information is presented in a much more user-friendly form yourself.

Automated compensation adjustment. Prior to the introduction of SAP, compensation

adjustments were calculated manually outside HRMS and then keyed in.

Improved employee history data. This is essential planning information for various scenarios,
for instance re-organization, or succession planning. SAP presents this information in a much
more organized, user-friendly way.

Better management of CUPE time data. CUPE employees’ time is tracked for payroll
purposes, and is tracked against work centres. This has required entry of the same data into two
different systems, but with SAP it will be entered once and then shared by the HR module and
the Plant Maintenance module. In addition to eliminating duplicate effort, this integration also
allows exact planning in situations where we have had to estimate.

Better budgeting. Similarly to the CUPE time entry situation, budgeting will improve with
exact planning information replacing estimates, as information on position requirements will be
shared between HR and FI modules of SAP (more accurate FTE counts).

Accurate retroactive payment. Today, any payment which was earned in the past can only be
added to the total of the pay in which it is processed, which can sometimes result in a higher rate
of deduction. In SAP, payments earned in the past show up as a separate item on the pay in
which it is processed, and are linked to the period in which they were earned.

Management of leave quotas. HRMS did not provide much ability to manage leave quotas. A
common result of this was overspent quotas. For instance, if an employee went over his or her
vacation allotment, this might not be noticed for some time (or ever). Once noticed, an
arrangement would have to be made with the employee (if the individual was still an employee),
and this arrangement would then have to be managed. SAP automates the management of leave


Business Benefits

SAP ERP Human Capital Management (SAP ERP HCM) provides you with the most
comprehensive global HCM solution available today. With SAP ERP HCM, you gain the
following business benefits:

• Consistently achieve corporate objectives

o Align your workforce with organizational objectives.
o Find the best people and leverage their talent in the right job at the
right time.
o Ensure that every employee understands and acts upon appropriate
business objectives and can monitor their progress toward corporate
• Retain your talent
o Provide your employees clearly defined career and development plans
and personalized learning opportunities.
o Link employee performance to compensation programs, such as
variable pay plans and long-term incentives.
• Proactively identify and fill talent gaps
o Identify, develop, and track high-potential employees.
o Ensure that future leaders can be effectively promoted from within –
and that successors are identified for key positions.
• Lower costs of compliance and employee administration
o Reduce the cost and effort of complying with local regulations through
unrivaled features and functions, support structures, and expertise.
o Reduce HR costs by automating operational employee-related
• Improve decision making and manage human capital more
o Give your executives, HR professionals, and line managers reporting
and analysis options that provide real-time insight into your workforce.
o Identify trends at an early stage and make well-informed decisions, so
you can manage your human capital more effectively, predict human-
capital investment demands, and track workforce costs and the return
on investment for HR projects.
• Reduce risk
o Adapt your processes quickly to changing business needs with a
flexible, scalable solution.
o Leverage local SAP help centers as well as the customer community of
several thousand organizations who are using the SAP® ERP Human
Capital Management solution.
• Implement value-added activities
o Streamline all HCM processes.
o Free employees to concentrate on value-generating activities, rather
than on routine tasks.
• Turn HR into a strategic business advisor
o Align HR activities with organizational objectives
o Focus on leadership succession, workforce planning, and organizational
o Make HR services transparent
o Lower HR costs and deliver better HR services – anywhere and anytime