Still on SAP on-prem Payroll? Addressing the key myths around moving to the cloud
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As organisations increasingly digitise their operations, payroll, a function once considered immovable and too critical to tamper with, is rapidly emerging as the next frontier for transformation. Yet despite the urgency and potential of cloud-based payroll solutions, many businesses remain hesitant. This is often due to misconceptions rooted in outdated assumptions about cost, complexity, and timing.
EX3’s Lift, Shift & Transform offering challenges these assumptions head-on. Backed by our proprietary toolset and years of implementation experience, we help organisations modernise SAP payroll systems swiftly, securely, and at scale, often completing in hours what once took months.
In this article, we address three of the most persistent myths around cloud payroll migration and explain how EX3 is helping clients unlock value and reduce risk with confidence.
Myth 1: "Moving SAP Payroll to the Cloud Is Too Complex and Expensive"
Complexity and cost have traditionally been the twin barriers to cloud migration. For many, payroll feels like a “do-not-touch” zone, a highly customised, business-critical process that’s working "just fine" on-premise. But this perception no longer holds true.
"In reality, it’s much, much simpler to move from where you are today to the cloud than it has been in the past. Our tools allow clients to do in days — sometimes hours — what used to take full teams months."
— Ned McEvoy, Head of Payroll & BPO, EX3
The Lift, Shift & Transform methodology automates key phases of the migration, including transferring configuration and payroll history from legacy SAP systems to SAP Employee Central Payroll (ECP). This isn't just about system migration, it's full fidelity payroll replication with embedded audit and reconciliation capabilities.
Crucially, it also enables organisations to decommission legacy infrastructure, eliminate compliance risks around data retention, and consolidate fragmented payroll environments. The result? Faster transitions, lower costs, and fewer surprises.
"Within the first few days of a migration, clients can run a payroll and compare the outputs against the old system — and we regularly see 90%+ correlation immediately. That early assurance builds the confidence needed to focus on transformation."
— Dan Greer, Managing Partner, EX3
Myth 2: "Payroll Is Just Payroll — There’s No Value in Transforming It"
Payroll has traditionally been seen as a transactional function. But with today’s cloud capabilities, it becomes a strategic asset, one that enhances employee experience, operational agility, and compliance.
SAP's continued investment in ECP is rapidly expanding what’s possible. Three standout innovations include:
1. AI-Powered Payslip Support (Joule AI)
Employees can now query their payslips via conversational AI, even outside business hours. This reduces payroll queries, boosts transparency, and frees payroll teams to focus on value-added tasks.
“AI handles the 80% of questions that flood in after payday, which used to drain teams on Monday mornings. Now, employees get instant clarity, and payroll gets room to breathe.” – Ned McEvoy, Head of Payroll & BPO, EX3
2. Earned Wage Access
Via SuccessFactors’ App Store, employees can draw down earned wages in real time, offering flexibility without compromising payroll integrity. This is emerging as a differentiator in talent attraction and retention strategies.
3. Payroll Control Centre (PCC)
By surfacing payroll issues from Day 1 of the pay cycle, not just at cut-off, PCC dramatically reduces last-minute errors. Early insight into missing data (e.g. bank details, wage types) allows for proactive resolution, spreading the load across the pay cycle.
Together, these innovations turn payroll into a modern, responsive system aligned with broader HR and business strategies. This evolution is especially important for global enterprises. ECP now offers country-specific localisation for over 50 markets, with tight integration between Employee Central and ECP ensuring accuracy across regions.
And for the so-called “long tail” of smaller payrolls, EX3 offers integrated solutions like Neeyamo, ensuring a consistent experience worldwide, from major markets to niche geographies.
Myth 3: "There’s Plenty of Time — We Can Wait Until 2027"
SAP’s mainstream support for ECC ends in 2027, with end-of-life slated for 2030. On the surface, this seems like a distant concern. But factoring in the timelines for business case development, strategic planning, vendor selection, and implementation, the time to act is now. “2027 might feel far away, but it’s closer than many think,” warns Ned McEvoy. “A considered approach takes time. organisations that start early gain flexibility, reduce risk, and can align payroll transformation with broader business strategy.”
A typical journey involves:
- 8–12 weeks to build a benefits-focused business case
- 8–12 weeks for strategic planning and payroll operating model design
- 3–6 months for vendor selection and procurement
- Project execution, which can be accelerated using EX3’s tools but still requires coordination and testing
Late adopters risk hitting resource bottlenecks, facing escalating support premiums, and missing the opportunity to leverage SAP’s evolving capabilities.
Lift, Shift & Transform: Redefining Payroll Migrations
EX3’s Lift, Shift & Transform offering is designed for speed, precision, and security. Key features include:
- Rapid migration from any SAP version or Enhancement Pack
- Automated configuration and data transfer
- Full reconciliation and audit reporting
- Support for both large-scale and long-tail payrolls
- Seamless integration with SAP SuccessFactors and third-party providers
By enabling full historical data migration — including pay slips and cumulative values — EX3 eliminates the need to maintain legacy systems post-migration, minimising operational overhead and compliance risk.
The shift to cloud payroll also opens new doors for operational efficiency (data capture at source), cost optimisation (from CapEx to OpEx), and strategic agility (future-ready operating models, vendor harmonisation, and global standardisation).
Conclusion
Modernising payroll isn’t just about ticking a compliance box before 2027. It’s about unlocking strategic value, faster processing, enhanced employee experience, improved compliance, and reduced operational costs.
The myths around payroll migration persist, but so do the facts: with the right tools and partners, moving to the cloud is faster, safer, and more beneficial than ever before.
“This is a once-in-a-generation opportunity to reimagine payroll. Those who act now will not only mitigate risk — they’ll lead the way into a more agile, intelligent future.”
— Dan Greer, Managing Partner, EX3
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