By Emanuela Nespoli, Giulia Komi, Matteo Costa, Matteo Lovo, Vittoria Panzeri and Carlotta Zoccoli.toforetto de luca tamajo
Artificial intelligence and machine learning can be important partners in payroll management decisions. Capturing the “perfect salary” is just one way AI might be able to assist in compensation and benefits decisions. Employers shouldn’t miss the opportunity to involve her AI in both payroll determination and compliance with payroll reporting requirements.
AI and Payroll: Possible Connections
Determining the optimal salary is an important issue for companies. Moreover, in the current “great resignation” scenario, lingering cannot be ignored. One of the reasons employees change jobs is to get the expected salary. This leads to losses for the company, both in terms of performance and money. The hiring process, onboarding, training, understaffed teams, and lack of engagement are just a few of the costs involved.
It may be time for companies to consider introducing fair wages through accounting systems. This is an area where artificial intelligence plays a role.AI‘) and machine learning (‘ML‘) can help.
As we will see, AI can take into account many factors, such as inflation and living conditions, and thus can provide significant improvements in efficiency, accuracy, and transparency in assessing fair compensation. It is possible. At this stage, AI-based payroll management is not far off.
Introduction to artificial intelligence and machine learning
In this article, we refer to AI as technology capable of performing tasks commonly associated with sentient beings. In this context, ML is a type of AI system that can learn from problem-specific training data and automatically build models to solve problems.
A class of algorithms that can be used for payroll problems is known as supervised ML. Supervised learning is the process by which humans program computers to link different inputs to desired outputs. After this initial stage, the programmer verifies the correctness of the machine’s automatic selection.
The main goal of this process is to make the output as accurate as possible, allowing machines with ever-increasing amounts of data to produce the output independently without human intervention. With a good model, the optimal salary adapts accordingly when variables (such as cost of living and inflation) change.
Is the Perfect Salary the Best Salary?
Before trying to define the “perfect” salary, assess why employers want to explore new avenues to optimize compensation packages and how AI can be a key partner in that is important.
AI promotes fairness in the compensation management process. In fact, AI considers the employee’s working ability, technical grade, special skills, age, regional standard wage for the role, position in the company, years of service in the company, etc. when evaluating the perfect salary. There is a possibility. . On the other hand, specifically referring to performance-based variable compensation, AI can rely on scoring standard quantitative items such as inflation, work completeness, work completion rate, work quality, and compliance with company standards. There is a nature.
Considering all of this, the perfect salary package isn’t always the best. Conversely, a mathematical approach to payroll management using AI could result in a perfectly balanced compensation package with respect to fixed compensation, variable compensation, retention bonuses and inflation, or other variable adjustments. Such a perfectly balanced salary can result in cost savings for employers while meeting employee expectations.
Advantages of AI in Reward Scenarios
As we’ve seen, AI and ML can be very beneficial to businesses. First, offering and paying the perfect salary can certainly improve efficiency and give companies a competitive advantage, so they may be able to catch up with the market.
AI can also greatly reduce the risk of error and create a reliable starting point for employers’ payroll management decisions. On another level, AI features related to rewards can also help earn the trust of job seekers. This can improve talent attraction and employee retention.
Finally, AI can be a powerful tool to help handle mandatory payroll reporting, compliance, and other organizational demands on a single platform. For example, when it comes to gender pay gaps and equality, reports on company internals could easily be produced by AI, and could suggest how employers can achieve their goals in these areas. .
Conclusion: an opportunity not to be missed
In conclusion, the use of AI in compensation and benefits management is uncharted territory. Clearly, this could change the way companies define compensation packages and incentive programs. Although there are challenges to overcome, the potential benefits are clear.
