When you're evaluating payroll systems, "one vendor for HR and payroll" sounds appealingly simple. One contract. One login. One vendor to manage. Fewer integration headaches.
We understand the attraction.
But here's what we've learned from 40+ years in Australian and New Zealand payroll: that simplicity is often an illusion. Most "combined" HR and payroll systems aren't truly unified – they're separate products, often from acquisitions, bolted together and sold as one. The integration work still happens. The compromises are just hidden.
There's another way. A best-of-breed approach lets you choose the best HR system for your people strategy and the best payroll system for your compliance complexity – then connect them seamlessly through modern integration. It's not the fragmented, high-maintenance approach it used to be. And for many organisations, it delivers better results.
All-in-one suites vs best-of-breed: what's the real difference?
When evaluating HR and payroll software, you're essentially choosing between two approaches.
Unified (all-in-one) systems
Offer an end-to-end suite covering HR, payroll, time tracking, talent management, and more – all under one roof with a common interface and database. The appeal is obvious: everything in one place.
The catch? These suites tend to stretch across many functions but often lack depth in each area. Vendors typically build a strong core product – say, payroll – and then bolt on other modules to fill gaps. Those extra modules are often just "good enough" rather than excellent. They tick the box, but there's a difference between doing something and doing it well.
Best-of-breed stacks
Take a different approach. You select the best system for each function – a dedicated HRIS for HR, a specialist payroll platform for payroll – and connect them through integration. Each system has a clear core competency and richer features in its domain.
The result: A custom tech stack that delivers the benefits of an all-in-one system without the usual limitations.
The case for best-of-breed
No compromise on functionality
One of the strongest arguments for best-of-breed is that you don't have to settle for mediocre capabilities.
A specialist payroll provider pours all their development into payroll accuracy, compliance, and complex pay rules. A specialist HR provider innovates on people analytics, talent workflows, and engagement features. Neither is diluted by having to build the other.
This matters especially for Australian and New Zealand payroll, where award interpretation, annualised salary compliance, leave accrual complexity, and STP2/payday filing requirements demand deep expertise. A vendor stretched across HR, payroll, learning, recruitment, and performance management simply can't invest the same depth in getting AU/NZ compliance right.
Solutions tailored to your needs
Every organisation is different – in size, industry, workforce makeup, and HR priorities. All-in-one suites take a one-size-fits-all approach, which may not align with what you need.
With best-of-breed, you have the freedom to pick solutions that fit your unique requirements. A healthcare company might need an HR platform with strong scheduling and credential management. A professional services firm might prioritise advanced performance management and utilisation tracking. With best-of-breed, you can adopt whatever HR software excels in those areas – paired with a payroll system that handles the complexity of your pay structures and AU/NZ compliance.
"As your business grows, so do your HR needs. Best-of-breed platforms allow you to add new functionality without overhauling your entire system."
Freedom from vendor lock-in
Working with separate vendors for HR and payroll can actually reduce your risk in the long run.
If you put all your eggs in one vendor's basket and that single system fails to meet a new need – or the vendor's service deteriorates – you're stuck. Replacing a one-stop HR/payroll system means uprooting your entire HR tech platform.
With best-of-breed, each piece is modular. If one solution stops fitting your business, you can replace just that piece and leave the rest intact. You could swap out an underperforming HR onboarding tool without disturbing payroll at all.
Faster innovation
HR technology moves fast – think about the surge of new tools for employee engagement, AI-driven recruiting, and people analytics in recent years. A best-of-breed strategy helps you take advantage of new innovations because specialist vendors tend to be nimbler.
Their business depends on being the best at their one thing, so they iterate rapidly. Best-of-breed software prides itself on retaining the title "best" – constantly staying up to date on customer feedback and market trends, rolling out new features and improvements faster than bundled suites can manage.
Another consideration: HR needs tend to evolve, while payroll needs remain relatively stable. If you separate the two, you can upgrade or innovate on the HR side without disrupting payroll. Your payroll system can remain the rock-solid backbone for compensation while your HR systems flex and grow.
But what about integration?
The classic concern about using multiple systems is integration complexity – double data entry, inconsistencies, and a clunky user experience.
This is where modern technology has changed the equation.
Today, APIs, pre-built connectors, and middleware make connecting HR and payroll systems far easier and more reliable than in the past. Data flows can be automated in real time: when HR enters a new hire or updates an employee's details, the payroll system is instantly updated too. No manual import/export. No maintaining two versions of the truth.
What good integration looks like:
- Real-time sync
Employee data flows automatically between platforms. New hires, role changes, terminations all sync without manual re-entry.
- Single sign-on
Users access both systems with one login, giving the convenience of a unified portal.
- Clear data governance
HR owns people data, payroll owns pay data. No conflicts, no duplicates.
- Documented and supported
Integration partnerships are formal, tested, and supported by both vendors. You're not on your own.
At Affinity, our platform is built API-first. We connect seamlessly with leading HR systems – including ELMO, HiBob, PageUp, SuccessFactors, and Workday – through real-time integrations that reduce manual work and ensure data consistency.
See how Affinity integrates with your HR stack →The reality of "unified" vendors
Here's something worth knowing: many vendors that advertise "unified HR and payroll" solutions arrived there by expanding beyond their original specialty.
Often, a company that excelled at payroll will acquire or bolt on an HR module – or vice versa. That means behind the scenes, the HR and payroll pieces were developed by different teams, possibly on different architectures. It's a unified system in name, but not necessarily a harmonious, from-scratch creation.
The two parts may not evolve at the same pace or integrate as smoothly as promised, because they weren't originally designed as one.
By consciously choosing distinct solutions, you're acknowledging that HR and payroll require different strengths. Your HR provider can focus on talent management, employee experience, and people analytics. Your payroll provider can concentrate on flawless calculations, legislative updates, and processing efficiency. Each is optimised for its domain. And through integration, they still work hand-in-hand.
What this means for your stack
If you're evaluating payroll systems – or reconsidering your current HR/payroll setup – here's a practical framework:
Consider best-of-breed if:
- •You have complex AU/NZ payroll requirements (awards, EBAs, Holidays Act, multi-entity)
- •Your HR strategy is likely to evolve faster than your payroll needs
- •You want to avoid vendor lock-in for either function
- •You're already happy with your HRIS and just need better payroll
- •You value depth over breadth in your core systems
Consider an all-in-one if:
- •Your payroll is genuinely simple (single award, single entity, minimal compliance complexity)
- •You're a small team that values having fewer vendors to manage above all else
- •Integration capability is limited in your organisation
For most mid-to-large Australian and New Zealand organisations running complex payroll, best-of-breed delivers better outcomes – specialist expertise in both domains, connected seamlessly.
Best of both worlds
Choosing not to buy HR and payroll from the same vendor is no longer a risky move – it's often the smart move.
A best-of-breed strategy lets you leverage best-in-class capabilities in each area rather than compromising with a one-size-fits-all suite. Thanks to modern integration – real-time APIs, single sign-on, documented partnerships – multiple systems can function as smoothly as an integrated suite, sharing data and providing a cohesive user experience.
The advantages are significant: deeper functionality, adaptability to your needs, faster innovation, and the flexibility to change course if necessary. All without sacrificing integration or efficiency.
You don't have to trade off a great HR system for an average payroll module, or vice versa, when you can have top-tier in each.
Affinity is built for exactly this approach
We focus on what we do best – payroll for Australia and New Zealand – and integrate seamlessly with leading HR platforms. You get specialist payroll expertise, AU/NZ compliance depth, and a connected experience that feels like one system.