Payroll might be the one task you want to complete and then set aside forever - or until the next time you have to deal with it. But there's a lot you can learn from your payroll data. And not just about payroll, either, but about your business overall.

Analyzing payroll may not bring about the same thrill as, say, sports analysis, but bear with us. Let's dive into some of the key takeaways you can get from payroll analytics and what they can unveil about your business so you can make sure you're on track, aligned and even excelling when it comes to your business goals.

Sometimes, we might think of payroll as purely transactional. The employer sets a wage or salary; the employee works to earn their wage or salary; the employer takes off payroll deductions as well as withholds and remits taxes from gross earnings during pay run calculations; then, finally, the employee gets paid — the end until next time, right? Not quite.

You're probably no stranger to the fact that there's a lot of reporting that comes with running payroll. Whether you're doing it manually or have a payroll software that automatically compiles some of that data together for you, it's a goldmine of information for your business overall.

Reviewing this data after you’ve run and related to your payroll can give you insights into how payroll fits into the grander scheme of your business's financial health and even people management. Including your payroll data in your full business analysis serves to better inform your business decisions.

In its simplest form, payroll analytics is the act of taking payroll data and really studying and reflecting on it to identify trends that impact not only payroll, but other areas of your business as well.

As much as the financial part of payroll may be obvious, breaking down the individual pieces of the payroll puzzle even beyond the act of running the payroll reveals a lot.

Looking at aspects like employee wages, employee expenses and payroll compliance is a bit clearer because you'll see them in each and every pay run. You see the wages for each employee on the docket, reimbursable employee expenses when they submit those to you and payroll compliance in making sure your payroll taxes are properly handled. (Or when the government gets in touch to let you know there's been an error or something is late.)

But then there are other financials related to payroll that aren't necessarily in your processing, such as cost of hiring, cost of labor, cost of running payroll and cost of accounting.

Let's look at the cost of hiring as an example. Typically, the average cost of hiring is calculated by taking the internal and external costs associated with hiring divided by how many people were hired at that time and then multiplying that by 100. When you know that figure for how much it costs your business to hire on average, you can dive into your payroll analytics to see who's new and then have a sense of how much it cost beyond just their salary to bring this person aboard.

When you look at these costs and any others you notice associated with payroll, you can size it up against your business's revenue, just as you would with any other expense on your profit and loss statement.

Maybe you're doing great and can hire more staff to increase productivity and profits. Or maybe you'll see that you've gone over your payroll budget and need to reconsider where you're spending on payroll so you don't dip into the red because of it.

Either way, looking at payroll analysis through this lens can make a big difference.

So what can analyzing your payroll reports tell you about people management? Believe it or not, quite a bit of what you see from these reports ties into and reveals how your team is operating.

Take attendance, for instance. Your payroll reporting can show you things like paid sick time, paid time off, whether someone was missing from the pay run for unpaid time off and other details like that. With that information in hand, you can see who's coming into work and maybe who needs to be checked on to see why they're absent if it's a frequent occurrence.

Attendance can also speak to productivity, which of course ties back to financials. Essentially, if productivity seems to be down, it could be because of how many people are missing work or maybe even because a lot of people are taking vacation at the same time. That can inform you on staffing and how you may need to adjust to make sure the productivity train keeps chugging along.

Another piece of people management information you can glean from analyzing payroll reports is turnover rate. Are you having to process a lot of final pay cheques and Records of Employment? If you're noticing a higher volume of terminations and increased turnover rate in this reporting, you can investigate further into what's going on with your team to see what you can do about making sure your business is a place people want to work or even build a career.

Like many things in this day and age, how you track your payroll data comes down to two main choices: Are you going to do it yourself (a.k.a, manually) or use software?

Tracking payroll analytics manually could mean the super old-school method of pen and paper (but who wants more paperwork?) or perhaps using a slightly more tech-forward method: spreadsheets. In both cases, it means inputting data from your pay runs into the sheet and then using that data to build out your own reports with the rest of your accounting later.

Not only is that a lot of effort and time spent that could go elsewhere in your business, it's prone to human error. We've all been there where we accidentally input something in one field that was meant to be in another. Or, in the case of pen and paper, we're sitting staring at what we wrote trying to decipher our own handwriting.

An alternative that takes a lot of that work off your plate is payroll software, especially software that integrates with accounting software. For example, Wagepoint can sync with either Xero or QuickBooks Online, meaning your payroll data is entered alongside your accounting data to give you a better idea of what's what with your business.

You can even take it a step further and integrate your accounting software with one that focuses specifically on financial reporting, like Syft Analytics does, to get even more in-depth insights.

Regardless of how you're handling your reporting, be sure that you're not counting your payroll analysis out when you're looking at your business as a whole.

As you can see, payroll analytics aren't just designated to payroll land — and what's been highlighted here is just the tip of the iceberg of how you can consider your payroll data and what you can learn from it. Really assessing the payroll numbers isn't just about seeing the money that leaves your bank account when you pay your employees and payroll taxes, but about getting a bigger scope on your business as a whole.

And, once you know the role payroll plays in your business, you can use what you've learned from analyzing the data to make smart, informed decisions that can take your business to the next level.

As Content Lead at Wagepoint, Laura A. Barton uses her way with words to shape payroll, people management and time tracking into approachable topics for small businesses and those who support them. She drives the content for the Wagepoint blog and social media accounts, with a goal of educating and thought leadership with a side of good humor.