Tennessee Statewide 2014Tennessee Statewide 2014

AgendaAll about MemphisWhat are metrics?Why measure what we do?Developing metrics/KPI’sStandard metricsPresenting your metrics

Memphis 2012 CensusArea:

324 Square MilesLand: 315.1 Square milesWater: 9.0 square miles

Climate Average August temperature 71 to 90 degrees Highest temperature 108 degrees (7/13/1980) Lowest temperature -13 degrees (12/24/1963) Average rainfall 53.68 inches

Memphis 2012 CensusPopulation:

655,155 15.8% Between ages of 25 to 34 13.3% Between ages of 35 to 44 14.1% Between ages of 45 to 54 10.0% Age 65 or older Median age is 34.0, (national median age

is 36)Median income of $32,285

US Median $51,107Average commute time 24 minutes

(NJ 14.6% more than 90 minutes)

What does this tell us about Memphis?

Climate?

Age?

Income?

What are Metrics?

Figures used to measure activity, results or performance

Metrics support a story

Stories support metrics

Metrics are also known as:

Key Performance Indicators (KPI)Critical Performance Indicators (CPI)Key Performance Measurements (KPM)

Score CardReport CardStatistics

Why Measure What We Do?

What gets measured gets attention

The language of business is dollars and numbers

“Without statistics, yours is just another opinion”.

Why Measure What We Do?

Helps to understand where successes and failures are coming from

Used as an early warning system – allows you to be proactive

Helps in making decisionsNo doubt about what you want done Rewards (batch processing as a supervisor)

Why Measure What We Do?

Sell your ideas and make presentationsCan be used as the basis of Process

Improvement PlansYou can’t improve what you don’t measure

Benchmark either internally or externally

Compare yourself to a standard Set individual and team objectives

How Healthy Is Your Department?

How do you know what to measure?

How do you get started?

What do you do with them?

1. Brainstorm with your team and ask other Payroll or AP Departments what KPI's they are reporting

You don’t want anyone to feel threatened or intimidated

Get buy-in from Department

Developing KPI’s

2. Determine which KPI's are the most basic and the most meaningful to your organization

Developing KPI’s

3. Pick 6 (+/-) to report Select a reasonable number of KPI's to

report. Which ones are appropriate?Determine what upfront work will need

to be completed (report definition, etc.)Determine who will generate the data

Developing KPI’s

4. Avoid analysis paralysis and just start issuing them!

Focus on data collection and not the pretty presentation -- they don’t have to be pretty in the beginning

You don’t have to issue them to ‘everyone’ in the beginning. Start by issuing them within the department

Developing KPI’s

5. Agree on targets for each KPI (don’t let them be de-motivating)

Methods for determining appropriate targets:

Use predetermined goals already set by your organization

Best PracticesReasonable and attainable for your organization

Developing KPI’s

6. Add targets to KPI's and refine format

Make it look prettyShould be easy to analyze

They are not any good if no one looks at themShould not take a long time to reviewConsider your audience (executive

summary?)Include a cover page

Developing KPI’s

Developing KPI’s

7. Get feedback for enhancements

From colleagues, supervisors, team members

What would they like to see?WIIFM (What’s In It For Me?) -- How does it impact their department?

Developing KPI’s

8. Issue KPI’s on a regular basis

Weekly, monthly, quarterly; People should know when they are available

Different for different people

Developing KPI’s9. Update and change as needed

If it doesn’t change; don’t track itWhat was urgent may not be any longer

Rollout of new functionalityIndustry/regulations changes

Things to Consider for KPI's

Add a sentence to describe the significance of the KPI

Show the KPI over time (multi-year trends)Include month-to-date, quarter-to-date and

year-to-dateInclude agreed upon target data and

compare to actualInclude note of explanation when

appropriate

Common Payroll Department MetricsCost per paymentNumber of employees paid per Full

Time Equivalent (FTE)% or number of off-cycle checks

issued% of employees on direct deposit Total Tax Penalties

Common Payroll Department Metrics

System performance Clock end time for payroll confirm Basic statistical information

Total payrollTaxes paidDeduction information

Late paperwork and its impact

Metrics As ControlsTrend Analysis

Gross Wages between periodsChecks in Excess of $X.XXTotal Taxes PaidNumber of employees with no checkHours worked in excess of….Account balancesOther Key Amounts

Common AP Department Metrics

Cost per paymentFull-time ratio to paymentsTotal invoices processedElectronic vs. Paper invoicesTotal annual payments madePercent of electronic payments

Metrics to Enforce SLA’s

Number of Phone calls takenAbandoned callsTime Spent on callProcessing time Accuracy of responseNumber of contacts before resolutionSpeed of response

CALL CENTER

Look for InspirationAPA Benchmarking Study Business MagazinesInformal Benchmarking Business BooksPast Performance

How to present KPI's

Bar graph Pie chart Score card Plotted points on a graph Straight stats

Poster or Post-it

Just knowing a metric can improve it. You will be more aware of what makes the number fluctuate.

When you review the metric regularly, you will start to make better decisions to influence it.

95% DIRECT DEPOSIT

Payroll Cost per PaycheckJuly 2014

Target $1.00

Disbursement by LocationJuly 2014

Target Actual Score% Of Off-Cycle Checks 0.5% 0.1% Green

% Of Direct Deposit 100% 96.4% Red

Late Personnel Actions 2% 1.8% Green

% Of Under Payments < 1% 0.5% Green

% Of Over Payments < 1% 0.9% Yellow

Direct Deposit July 2014100%

75.30%

80.70%

84.60%

87.90%

93.40%

95.80%96.40%

70%

90%

Jan Feb Mar April May Jun July

Target

Actual %

80%

# of Payments Issued

# of Active Employees

Monthly Frequency of Payment

# of EE's Paid per FTE

# of Paymts Paid per FTE

Location 1 Weekly 11,343 3,085 4Location 1 Salaried 7,161 3,906 2

Pensioner 7,607 7,623 1

Bonus 5,225 1Location 2 Weekly 11,303 2,737 4Location 2 Salaried 2,854 1,275 2

Total 45,493 18,626 1,552 3,791

Target 1,500

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Ratio of Employees to Payroll FTE (June 2013 – June 2014)

Total New Vouchers By Month

37

Month 2011

2012

2013

2014

January 16,568

37,054

41,822

45,888

February 14,416

33,784

46,022

45,188

March 33,979

40,476

42,624

46,392

April 26,227

38,978

70,888

45,833

May 36,244

39,091

45,026

42,399

June 36,018

38,490

44,638

50,245

July 38,319

41,548

46,500

August 40,784

44,088

47,427

September

29,667

30,108

39,888

October 31,207

39,648

47,957

November

38,453

28,114

42,772

December 37,573

31,440

41,901

Total 378,545

442,261

557,465

137,468

Includes FICA payments -- 25,000 vouchers

METRIC YOUR COMPAN

Y

PEER BEST IN CLASS

FTE/Ratio

920/1 880/1 1200/1

Off Cycle Checks

2% 4% 1%

Cost Per Paycheck

$2.30 $3.40 $1.70

Direct Deposit

94% 86% 93%

Include an Index!. Section 1 -Ratio of Employees to Payroll FTE (slide 3). Section 2 - Payroll Overtime (slide 4). Section 3 - Self Service/Manual Changes (slides 5-9). Section 4 - Direct Deposit (slides 10-11). Section 5 - Breakdown of Checks Processed (slides 12-13). Section 6 - Salary Changes and Retro (slides 14-16). Section 7 - Overpayment (slides 17-20). Section 8 - Taxes (slides 21-22). Section 9 - Vacation Payouts (slide 23). Section 10 - Additional Pay Sheet Loads (slides 24-26). Section 11 - Garnishments (slide 27). Section 12 - Forms (slide 28). Section 13 - Front Range (slides 29-31)

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What story are you telling?

Contact Info……

Dennis Danilewicz, CPP

Dennis.danilewicz@gmail.com