Data and Process
Standardization has been a key area of focus for improvement in the delivery and processing of global payroll for some time now. Many global payroll professionals have been calling for the introduction of standardization for a long time. There are two important areas where standardization can have a major positive impact on global payroll:
- Standardizing Data: this means aligning data and applying standardized formatting to data feeds that are coming in from various different country vendors in different formats, creating a strong need for time consuming, manual intervention to apply some standardized structure around this crucial payroll data.
- Standardizing Processes: multiple payroll teams spread across a number of countries are working to different processes when it comes to delivering global payroll. Applying a standardized structure to these processes will help create efficiencies and streamline the process for a quicker, more effective and transparent global payroll delivery.
To make the above standardization a reality, a level of technology investment is needed and the best way to do it is to employ some innovative technology that can effectively take non-standardized data and apply standardization and structure to it. This enables global payroll professionals to work with the same data across countries and regions. It also helps when it comes to switching tasks across countries- if the process is standardized, task delivery can be achieved irrespective of what country the global payroll professionals is located in.
Standard reporting
Standardizing data also lends itself to global consolidated reporting- requests for this level of comprehensive reporting have been increasing steadily in the last five years as leadership teams at multinational companies look to make strategic decisions based on important and available business intelligence. Data that arrives in a non-standard format makes it very difficult for global payroll professionals to deliver this kind of reporting. They first need to interact with the data, standardize it and then produce reports. This is as manual, awkward and time-consuming as it sounds and many global payroll professionals feel that this should not be the case at a modern multinational in 2020, particularly when they witness the positive effects that innovative technology is having on other critical business functions. They are asking the very relevant question as to why a similar level of innovation cannot be applied in the global payroll department.
New urgency
While the need for standardized processes and data has been there for quite some time, it is fair to say that the recent pressures on global payroll, due to the global pandemic that is COVID-19, has created a greater sense of urgency around the whole issue of payroll standardization. There is now a greater deal of attention on the inefficiencies that result in global payroll due to a lack of standardization- in some instances, this lack of standardization is even threatening to derail the delivery of global payroll at some multinational companies. The need for standardization has just become that bit more urgent.
Global payroll is now being delivered in a remote environment and this brings with it a set of unprecedented challenges. Standardized data and processes would greatly help to meet these challenges- unfortunately for many global payroll professionals, the lack of standardization is simply adding to the burden and pressure they currently find themselves under.
Now more than ever, payroll professionals need processes that are standard and have a focus on speed, efficiency and streamlining. Instead, many are finding that legacy technology and non- standard processes across multiple different countries are making the delivery of global payroll even harder. In some ways, this current situation might be a good thing - it can dispel once and for all the myth that global payroll does not really need a digital transformation or technology upgrade. It very clearly does, and the introduction of innovative technology to standardize processes, automate workflows, improve visibility and help with the scheduling and creation of comprehensive global level reporting is to be welcomed, if not deemed an absolute necessity.
If not now, when?
Global payroll teams that do not have standardization in their process and data are struggling to keep their heads above water. Many are asking important questions such as when will standardization be introduced? This global pandemic will pass, and a certain level of normality will return to business-critical functions like global payroll- but what happens when the next crisis comes around? Are the lessons being learned from what is happening now? If leadership teams choose not to invest in payroll technology after COVID-19, when will they consider this a worthy investment, and will it be too late then?
A lack of investment could come with damaging consequences, there are reports of local country provider failures as well as enormous difficulty when it comes to accessing the necessary global payroll data and information in a remote environment. It seems there is a lot to be learned when delivering global payroll during a global pandemic from remote locations- one of the key learnings is that a lack of standardization around data and processes is not sustainable in the long term. Investment in innovative technology that provides payroll professionals with the tools they need to do their job has become an essential instead of a luxury.
Many benefits
The practical benefits of standardizing data and processes in global payroll can have an immediate impact and therefore, it should not take something like a global pandemic or major economic disaster to prompt the decision to invest in the level of technology needed to make standardization happen.
There are other factors at play that have created a need for standardization in global payroll long before the current COVID-19 crisis. Global payroll professionals around the world have been requesting standardization for a long time now and have continuously highlighted the imperfections, challenges and time delays that occur when dealing with non-standard data and processes.
Standardize to scale
Multinational companies today want to scale quickly into new countries-to do this, they need to know that their global payroll department is quick, agile and more than capable of putting together a process that can see a relatively large number of employees set up and paid in a short space of time in a new country. Many of the people who make the decision to scale into new countries are unaware of the complexities and difficulties involved in a new country set up -they are even less aware of the massive hurdle that non standardized data and processes throws up in relation to this.
If data and processes were standardized across multiple countries, then setting up additional countries and onboarding anything from 10 to 200 new employees would be much more feasible. This is because a standard process would exist in all countries that could be duplicated in the new country -the new country provider could have immediate access to documents and standard operating procedure guidelines around how to perform payroll.
They would also have immediate support and training available from the central payroll office who could comfortably take new payroll staff through a system that features standardized processes. Should additional support be required in the form of a non-resident payroll professional performing the payroll for the new country remotely or even supporting payroll staff in that country, the fact that the process is standardized would make this much more feasible and, potentially even seamless.
Strategy Partner
A situation like this would enable a global payroll manager to make the kind of bold statements they want to make around being fully confident in their people and technology to help the company scale quickly and easily into new regions and territories. They could attend strategic meetings with leadership team members and participate in these meetings using data driven insight to support their conclusions around global payroll feasibility in a new country. This is the point where global payroll becomes a strategic partner to the business and not solely a business function delivering critical services. The global payroll function would like to be in this position and the reality is now that many modern multinational companies are placing demands on the global payroll department to become this kind of strategic ally.
Act now
It is clear that there are many reasons to introduce standardization into a global payroll process-it can be hugely effective in delivering global payroll remotely during whatever crisis is coming next to the global economy. But, as we have outlined, it is clear that proactive steps to introduce it before a crisis happens puts the global payroll team in a much stronger position to be adaptable agile and efficient. The department can also become a business enabler when it comes to scaling into new territories.
A commitment is needed in terms of time and financial investment, but such a commitment is required for all levels of change in an organization. A cost benefit analysis will prove beyond doubt just how worthwhile an investment this could be- and you will certainly find that payroll professionals will be very grateful for the investment- it is simply the right thing to do both for the global payroll department and the wider company.
Standardize with Payslip
Payslip recognized several years ago the importance of standardization in data and processes. We went out and built innovative technology to help make this happen along with introducing significant automation to improve speed and efficiency of global payroll delivery. Our clients talk to us all the time and tell us how much better things are with a standardized process in place - there is immediate increase in visibility and sense of overall control of the process.
Data arriving in standard formatting makes pay runs easier, helps with anomalies and error spotting and is also useful for country-to-country comparisons along with global payroll cost reporting. Consolidated reporting is much easier when data is standardized; reports can be scheduled, customized and run using real-time data to help inform decision making at the highest level. Switching tasks to people in different countries is much easier and more efficient when both countries operate to a standardized process that is either identical or very similar.
When you integrate with the Payslip platform, you access a cloud-based global payroll platform that standardizes data and process on one centrally managed system. Talk to our team today to learn more about how we help with global payroll standardization.