Payroll forecasting and budgeting is a monthly and yearly affair that required the payroll team to invest significant time and effort into refreshing assumptions and source data. Key inputs such as headcounts, salaries, and projected hirings were essential but tedious to update. The company employed staff worldwide, each on different remuneration packages and subject to varied tax treatments, making the process even more complex.
The forecasting process was so time-consuming that the team could not refresh assumptions monthly. Instead, they resorted to extrapolating numbers at a high level, which led to a higher margin of error between forecast and actual payroll expenses.
Backbone developed a forecasting model with integration that extracts data from historical payroll runs, streamlines the input of projected hirings and key assumptions, and establishes a reliable source of truth for estimation data. The tool generates reports from the processed data for multiple purposes while protecting sensitive payroll information.
With this solution, the team can now forecast payroll expenses more accurately. The automation removed the need for high-level extrapolations, enabling more frequent and detailed updates, significantly reducing the margin of error between forecast and actual payroll costs.
