Digital World Class® Matrix Payroll Software Provider Perspective

On this episode of the “Gen AI Breakthrough” podcast, Andy Warzecha, Tracee Bowles, and Matt Merker discuss the recently released Digital World Class® Matrix Payroll study. They highlight the critical importance of payroll accuracy and the need for in-depth market analysis to understand provider capabilities and client satisfaction. The conversation also touches on the potential for automation and AI innovations to further enhance payroll processes and meet organizational objectives.

Welcome to The Hackett Group’s “Gen AI Breakthrough” podcast, where top experts give actionable artificial intelligence (AI) insights, expert advice and strategies to achieve breakthrough business performance. In this episode, host Andy Warzecha, principal and Advisory practice leader at The Hackett Group, is joined by Tracee Bowles, Global Payroll practice leader, and Matt Merker, senior research director for Human Capital Management Market Intelligence. They discuss the newly released Digital World Class^® Matrix Payroll study, highlighting the critical importance of payroll accuracy and the need for in-depth market analysis. The conversation also touches on the potential for automation and AI innovations to further enhance payroll processes and meet organizational objectives. 

To begin, Matt emphasizes that payroll remains critical to employee experience, compliance and organizational reputation. With AI entering human resources (HR), it’s become increasingly crucial to understand both what providers are offering and how customers are adopting these innovations. 

Then, Tracee explains what makes this study different from others. Instead of only evaluating vendor capabilities, The Hackett Group’s approach combines those assessments with feedback from clients on the value they’ve realized after moving to a vendor. This dual perspective provides buyers with a more complete picture of what to expect from a vendor relationship. Matt adds that their Matrix 2.0 method collected data through vendor requests for information, briefings, The Hackett Group’s internal expertise and interviews with customers worldwide – creating a holistic, balanced view of the payroll software market. 

The findings reveal some strong benefits: 60% satisfaction with cost reduction and 71% satisfaction with workload reduction, which Tracee highlights as a powerful combination for companies modernizing their payroll systems. Matt points out that while about 67% of payroll processes are already automated, there is still room to grow, especially with AI and innovations like continuous calculation. Vendors are differentiating themselves with advanced AI features such as anomaly detection, compliance monitoring, chatbots and global capabilities, with earned wage access gaining traction in the U.S. Providers also play a vital role during implementation, particularly for multi-country payroll setups where compliance risks are high. 

Looking forward, Andy and Tracee discuss how AI will reshape payroll. Though adoption has been slower than in other HR areas, Tracee sees vendors driving progress through AI tools embedded in their platforms. The most immediate benefits will come from anomaly detection, which prevents costly errors and protects employee trust, since repeated payroll mistakes can push employees to leave. Ultimately, she envisions autonomous payroll, where systems can run and audit themselves with minimal human intervention. The study provides valuable guidance both for organizations seeking modernization and vendors refining their global strategies. 

Time stamps: 

0:04 – Introducing today’s episode and guests.  

0:59 – Why payroll software matters now.  

2:33 – Matrix 2.0 and data collection.  

4:38 – Vendor differentiation strategies.  

6:56 – AI’s growing role in payroll.  

10:44 – Final takeaways from the study.