All too often as consultants we end up configuring the same process for each customer because the SAP payroll software doesn’t provide it. For example, in the US we setup stock option processing for most every customer. In Brazil it might be Vacation Scheduling, or electronic payslips in Argentina. Every country has some examples of these common processes companies require that are not fully delivered with the software.
But why do we repeat this configuration work for every company? Two reasons, usually: SAP provides incomplete functionality, or SAP provides only parts of the process instead of the whole process. Let’s look at US stock option processing as an example.
For SAP Payroll in the US, we usually implement the stock option process with an inbound interface from a broker for the exercises, and an outbound interface for the grants and employee demographic information. Each broker has their own format and requirements, but the basics are the same; yet we build custom interfaces all the time for this since there is no starting point delivered by SAP. The inbound interface generally comes into infotype 0221 Payroll Adjustments, via some custom wagetypes we build to record the proceeds, taxes and such. We setup a daily process for running this special payroll because Federal tax deposits usually have to be made within a few days of the exercise. On the outbound side we build an interface to send the usual employee demographic and payroll YTD data, but sometimes we also have to find a way to send each employee’s marginal tax rate per tax authority and tax type.
This is built for each company’s implementation – what a waste of resources! Future Payroll would deliver a common process for this scenario so that customers have a 90% solution ready to go. The same can be done for charitable deductions (such as United way), nonqualified savings plans, overpayment processing (NOT what SAP currently offers for overpayments) by country, and more.
As a consultant, this reduces the amount of my effort needed for an implementation. And it’s the right way to go so that we can put resources on efforts that really have some impact for the payroll function. Anything that makes implementation easier is also good for customers, and I’m always in favor of that!