CFO and organizational growth efficiency
Growth efficiency is becoming an increasing priority at the office at the CFO at multinational companies around the world. All companies want to grow but a lot of them tend to make ambitious plans and move immediately into the place of taking action, without fully thinking through and considering the best ways to move forward efficiently.
Efficiently is the keyword here- growth can happen at any organization if they throw enough money at it- but short-term spending only solves challenges in the short term and the things that were overlooked in the rush to secure market share, tend to surface as disruptive problems in the very near future.
In this article, we will focus on growth, efficiency and how today’s cfos need to be strategists who can help prepare their organizations to grow in a manner that is optimized and focused on long term stability and success.
While there is a general acceptance that a certain amount of decisiveness and speed is required if a company is to carve out new opportunities in new countries and territories, the landscape is also filled with cautionary tales from companies who moved too quickly without putting in place the proper foundations for success.
Growing smart is really about assessing where you are right now and putting a detailed and structured plan in place to meet company growth objectives. CFOs, the finance function and other members of the C-Suite are having conversations about the right strategic approach for scale up activity across business units for overall organizational growth. Their decision-making in the early stages of growth can have a major impact on any future bottom-line profitability, financial planning and business performance.
Growth efficiency is about avoiding many of the complexities that come with an attitude of “ let’s get straight into that country and we’ll worry about the rest later”. This is the opposite of growing smart, this is impulsive and shortsighted. Short-term thinking is a risk management issue. There needs to be a plan in place for what to do once you establish business in this new country-and crucially, there needs to be a technology stack capable of supporting further growth, so that the organization can solidify their position in this new country instead of being vulnerable to their competitors because they have simply moved too fast at the outset. The role of the cfo is to help business leaders and the entire organization develop a plan for sustainable growth strategies that will result in revenue growth.
Establish your scaleup currency for business growth
The CFO will want to be involved in establishing the specific scale up currency-this might be a specific product or a brand, but at most organizations it is their global workforce. If you establish that people or talent is your scale up currency then the next step is to prioritize them and how they were dealt with on your journey of growth.
If people are the critical component of growth at your organization, then one of the early priorities must be to ensure that you have the right people in the right places at the organization to help deliver this growth and that these people are looked after so that they see their futures at your organization.
One of the key things to optimize at an operational level if you are planning to scale into new countries is your global payroll function-if you cannot effectively pay all the new employees that you want to hire in the new region, then you cannot hire or retain them. You will get stuck very quickly and find yourself with a choke point or growth efficiency gap-essentially an obstacle to your growth, an inhibitor to your plans and a drag on your resources.
It makes sense to prioritize global payroll operational processes and supporting technology to ensure that you have an organizational structure and operating model that puts you in a position to hit the ground running in any new country or territory and then quickly solidify your global payroll operations for ongoing and continuous smooth operational efficiency. In this sense, global payroll is simply…..
Foundational for executing a growth agenda
When the CFO decides that global payroll operations are actually foundational for executing leadership team growth agendas, they can immediately turn their attention to the ways in which they can support global payroll operations.
One of the best ways to do this is to ensure the global payroll operations are delivered by a global payroll control platform that is deployed in a secure cloud environment. this platform needs to automate workflows and standardized processes across all of the countries-it also needs to ensure these processes can be repeated and duplicated dedicated very quickly when the organization wishes to move into another country-this is really important for companies who wish to scale into several countries with speed and agility.
They also need to ensure that this platform comes with very comprehensive multi country global payroll reporting capabilities. Any CFO involved in executing a growth agenda knows that data and reporting is their friend. They need to analyze the progress of the move into a new country on practically a daily basis, and the more detailed and comprehensive the reporting, the more informed and up to date they are.
A CFO will also be seeking reassurances around data security, information protection and local & global payroll compliance. There is no room for complacency around compliance (the financial penalties are becoming more punishing with each passing year), and everybody knows by now that payroll data compliance complexity very quickly become a choke point and blocker to growth progress.
Any CFO who prioritizes this key technology functionality for their global payroll operations will find themselves in a much stronger position to hit the ground running and achieve growth efficiency.
CFOs must handle the complexities
The complexities of scaling up can become a choke point for growth efficiency and it is therefore important that CFOs and finance leaders everywhere familiarize themselves with these complexities so that they can develop a plan to handle them. A few of the key payroll complexities in play right now and on the horizon in the very near future (along with the impact of a new hybrid work policy) include
The CFO must work with digital transformation officers, project managers and global payroll managers to develop a technology driven solution that is capable of handling these complexities while also facilitating consistent and rapid growth. Crucially, it must also help them remain compliant across any new continent or jurisdiction they enter into.
One thing is abundantly clear-the old legacy aggregator service models featuring spreadsheets, manual processes and email data transfers is certainly no longer fit for purpose or sufficient to handle this level of complexity in a compliant manner. In fact, you are pretty much guaranteed to hit a choke point if you persist with this dated approach. Instead, a cloud-based technology platform with industry standard data security features is the way forward
Chief financial officers who can get a handle on the complexities of scaling up while establishing their scale of currency will find themselves with a much clearer vision on the strategic planning that will help achieve growth efficiency at their organization. They will inevitably come to the conclusion that they need the right technology infrastructure and control platform in place to ensure their global payroll function and operating model is ready to support any growth objectives. Making global payroll central and foundational to executing any growth agenda is a massive step in the right direction towards growth efficiency.
For information on the Payslip Platform contact us today.
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Using Payslip, we can manage all our payrolls across nine in-country vendors on one platform. When the global Covid-19 pandemic arose, it was not an issue from a payroll perspective, and critically getting everyone paid. The Payslip platform enabled continuity for our international payroll service including the fast and seamless implementation of the Payslip Employment Self Service during this time.
Payroll Manager, LogMeIn
Payslip as a technology platform has added a missing piece in our payroll set-up. As an international company with offices in 16 countries, it’s important to us that every employee at GetYourGuide has the same great experience when accessing their pay data.
At the same time, we work well with smaller local payroll providers, supporting us with direct local expertise in their countries. We were able to combine those two elements by placing the Payslip platform in the middle, to simplify reporting and communication with local providers, and to have one simple employee-facing solution across all locations.
Head of HR, GetYourGuide
With business and employee growth rates of above 50%, we rely on our vendors to deliver on time, every time. Payslip’s workflow automation, enables Phorest to manage our payroll provider process – data driven, real time and transparent. Payslip saves us time so we can focus on our business growth.
International Payroll Manager, Phorest
Payslip positions your team for success, and allows you to onboard hundreds of people when you need them very quickly and efficiently, in the same way for each country. The uniformed approach empowered our payroll teams to keep pace with our business.
Payslip also made our payroll process entirely transparent, which is invaluable to our payroll teams as we continue to grow and scale at such a rapid pace.
HR Systems Lead, Wave