Using Lean and Collaborative Processes to Drive Payroll




An operation that expects to pay $15.6 billion in wages in 5 million payments this year through a mix of daily, weekly and biweekly cycles applies a constant-improvement approach to its payroll work.

Since integrating lean-management principles into the payroll operations in 2014, General Electric Corp.’s payroll team developed a mission to “take care of GE employees so GE works,” said Caroline Pettit, CPP, payroll compliance and controllership lead for global payroll operations. The mission and the adoption of lean principles into the payroll work flows propelled her team from working in an atmosphere of siloed work with little interaction and an unhealthy fear of mistakes to an open work environment that rationally accepts imperfections and collaboratively addresses them, she said.

Large payroll responsibilities at GE mean that a payroll of some type is run every day, Pettit said May 16 at the annual American Payroll Association Congress in Orlando, Fla.  Payroll operations at GE report to the human resources department, and the team is responsible for receiving inputs,  such as data from timekeeping and other sources, reviewing the data, making any necessary corrections and creating pay.

When initiating the lean management approach to the payroll function, the first step is to develop a process map, with all the appropriate members of the payroll team as well as those providing the inputs to the systems involved in this activity. The map examined human resources data, data inputs, processing, outputs and coordination with the finance team. The map for payroll included separate identification of automated work, manual work, decision points and areas of concentration, Pettit said.  

The process mapping took two weeks, and the visual map of the current processes was spread across several boards in the room.

The next piece was developing an ideal, future process map, Pettit said. Then came training for leaders and implementing changes to bring the processes away from the current state by elaborating on process improvements and providing timelines for completion.

Training for team leaders included ensuring that roles and development were understood and that trust was built, Pettit said.

People in work environments often are taught to not bring up problems with supervisors unless they already have thought about solutions. Pettit said the payroll team at GE modifies that approach to ensure that  conversations with colleagues apply a “continues and considers” approach, through which  the individuals discuss how to continue what they are doing but also consider a better way or a potential solution. If there is a failure with something or some process, it should be addressed quickly through this process, Pettit said.

Pettit’s  team is more comfortable now addressing “red-stickered issues” that indicate something failed because the discussion centers around “why did this fail and what can we do to fix it?” The payroll team now looks at these issues as opportunities to improve and accepts that the results sometimes are part of the process.

Recommendations for adopting lean-management techniques include starting small, with one item, to see if it can be improved, and move on to others, Pettit said. She also said do not fear the issues. Putting a bandage on the problem often does not address the root cause, she said.

Pettit recommended sitting and speaking with colleagues. She developed a mission-control area that allows team members to interact easier. The office is an open environment and this has been a plus in helping people collaborate more. She also said the use of note boards that track the processes—successes and failures—is helpful for all involved.

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