Where is My Pay? Critical Success Factors of a Payroll System – A System Life Cycle Approach

Abstract

Majority of firms deploy technologies in HR administrative applications. While payroll processing is a routine transactional activity, poor design and implementation of payroll system can cause immense harm to employee and organizational well-being. Based on the case study of a flawed payroll system in a large and complex public sector organization in Australia, we highlight the key success factors using the system life cycle approach underpinned by the agile philosophy. It highlights the critical importance of strategic organizational review, user involvement and ongoing communication with diverse stakeholders during the planning, analysis, design, implementation and review stages of a payroll project. It reinforces the need for the adoption of and adherence to sound project and change management methodologies. We also explore the limitations of shared service center approach.