Global payroll: Why consolidated reporting is crucial
Multinational companies around the world are scaling into new regions at a faster rate than ever before. When this happens, they need to set up payroll operations quickly so that they are in a position to hire new staff and quickly become operational in a new territory. When this happens across several countries, workforces can expand at a very fast rate and payroll teams suddenly find themselves with several payroll countries to manage at the same time. A lot of moving parts are at play with here with a significant increase in data that needs governance and security. This has resulted in a greater need for business intelligence and operational oversight. Only detailed, comprehensive and consolidated global payroll reporting can deliver this- and innovative, flexible technology is needed to assist with this delivery.
This usually involves running a system generated report so that a centralized payroll manager can get some insight and analysis around the cost of paying staff along with examining other key metrics like KPIs and vendor SLAs. It sounds straightforward and it can be if you only have one country on your books and a relatively straightforward payroll process. The reality of course is very different, multinational companies in 2021 are now global in nature and many have a mandate to scale internationally into new regions and seek out new business opportunities. This has led to a global workforce spread across different nations, time zones, cultures and currencies. This brings with it a number of variables that complicate matters- these include local legislation and regulation, tax nuances, different public holidays and annual leave allocations along with detailed and specific pay elements that can vary with each country. Unsurprisingly, this makes clear reporting a real challenge and the vast majority of payroll operation technology systems were simply not designed to account for this level of detail and complexity. A technology solution is needed as reporting requirements evolve.
Consolidated reporting is rapidly becoming a business expectation -the challenge with this is that sometimes leadership teams are not aware that legacy technology in their payroll departments will not support the rapid production of the kind of comprehensive reporting they need. Business moves fast and there is often a need for real time cost analysis around global payroll expenses. Innovative and flexible technology is needed to support global payroll teams when it comes to new demands around reporting. This technology needs to be able to schedule reporting and also introduce customized elements so that reporting can reflect specific things like country, region, personnel paid and individual pay elements such as bonuses and ad hoc payments.
There is also the wider issue of oversight and visibility around cost. It is not always easy for one report to highlight how much payroll is costing a company in a particular country or region. Data analysis is crucial to strategic decision making so this information needs to be made available to leadership teams as and when they need it. These teams are requesting reports showing detailed figures which outline what global payroll is costing them right now and what it is likely to cost in the future. They need this information to make informed decisions about whether or not to scale operations into a new country- is it affordable right now and will it be affordable in the long term? Do the figures reflect that this will be a justifiable long-term investment or is the data indicating that they should hold off until a better time? Global consolidated reporting is needed to answer these questions.
What are the blockers?
The key blocker is legacy technology and the lack of flexibility to run specific reporting or to deliver high level oversight on global payroll operations. Another factor is the choice of global payroll model employed by multinational companies. If they have chosen an aggregator model, then they are restricted to the reporting capabilities of the vendors within that aggregator’s network. Either way, they find that readily available data giving them a clear view of what is happening with global payroll is not easy to get their hands on. Non-standardized data is another blocker- data arriving from multiple countries at different times in different formats means a lot of time-consuming manual effort is needed to extract reporting.
Global employers are now looking at what options they have available to them to improve this visibility and extract better, more detailed and comprehensive multi-countryreporting. Many are discovering that what they need is a technology partner like Payslip, who can help them with reporting but crucially, allow them to maintain relationships with their preferred providers or aggregators.
How to remove the blockers
Multinationals can either change their global payroll model, switch to a new provider or aggregator or choose instead to work with a third-party technology partner. A partner who can swiftly integrate with their payroll systems, standardize the data and then deliver consolidated global reporting. A technology partner can set up multi-country payrolls with speed and efficiency, allowing teams to auto-schedule reporting, giving them much more control around the content, quality and frequency of their payroll reporting. A huge ‘rip and replace’ project is not needed here- it is more about looking at cloud-based software to assist and augment your current technology so that efficiency and continuity are introduced to make your overall process stronger and faster. Flexible technology can integrate with wider HR systems and HCMs meaning consolidated payroll reporting is connected to the wider IT eco-system of a company. This goes a long way to removing the blockers around legacy tech, limited visibility and inadequate reporting structures.
Ad-hoc reporting during Covid-19
We find ourselves in unprecedented times as the Coronavirus global pandemic has brought enormous business pressure to multinational companies around the world for the past 18 months. Right now, many businesses are still firefighting and in survival mode due to the pandemic. To operate in this mode, leadership teams are requiring data and advanced reporting on an almost daily basis. Payroll teams are being asked for additional data and reporting and many have to inform those requesting that they simply do not have the tools to deliver this reporting. This is causing frustration as well as delays to important strategic decisions. Covid-19 is highlighting the need for powerful, flexible technology that can deliver real-time cost analysis in times of extreme urgency. There is also an urgent need to be able to access multi country consolidated reporting remotely right now as a large number of global payroll teams worldwide are working from home and therefore need technology to support them.
Payslip and Consolidated Reporting
The Payslip platform is designed to deliver consolidated reporting at the touch of a button. One of the core features of the platform is that it standardizes data and automates processes. These features make the delivery of consolidated reporting much faster and easier. The Global Reporter tool provides multinational employers with essential and comprehensive global payroll reporting at the touch of a button, helping them to view , understand and compare payroll costs, trends and variances across all of their payroll countries. The software lets them filter by country, region, employee or pay element for greater visibility and the reports are run in real-time. The tool offers real-time access to consolidated pay and cost data, with analytical insights across entity, country, payroll, or employee level. Payroll, payments and performance reports can be extracted along with general ledger reports. Users can automatically generate reports on a monthly/weekly basis and customize them in a number of ways. The platform can deliver the kind of cost analysis reporting needed to support strategic decision making while also allowing leadership teams to get immediate, high-level visibility over all end to end global payroll operations.
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