Key considerations when writing a global payroll RFP

July 9, 2020 | David Daly 5 Mins read

Choosing the correct global payroll model for your company has become an extremely important decision. Multinational companies today tend to have a dispersed workforce across multiple locations and high-volume employee numbers. This brings a number of complexities into the global payroll process as payroll professionals have to factor in a variety of different payroll calculation elements, many of which are linked directly to local country nuances and legislation.

Payroll professionals really need a global payroll model that makes their lives easier and not harder. They need reliable local providers who understand what a centrally located payroll team is trying to achieve with both their monthly payroll and the reporting requirements. Innovative technology which helps reduce manual processing and makes it easier to analyze, check and confirm payroll elements is also needed to create efficiency.

When putting together a global payroll request for proposal document, several key questions spring to mind when deciding what is truly important to meet payroll provider needs at a multinational in 2020. Your current global payroll business process will help you define these RFP questions as will any knowledge you have around the plans your company has to scale into new countries.

A good place to start with would be attempting to define your payroll processes as it stands currently in each country and identify key tasks and process owners. This will help you identify early what the current gaps, risks and inefficiencies in your global payroll operations look like. Examine process maps if you have them and start asking yourself what it is you want from your operations in the future.

In this article, we will examine a list of questions that should be a part of any RFP process related to the search for a global payroll solution.

Can we continue to use our current local payroll partners?

When outsourcing your global payroll, you want an idea around the level of control you will have when it comes to selecting who delivers your local country payroll. When it comes to aggregator models, you will usually find that you have no say in the matter as they have their own network to call on. It is always worth placing a question into the RFP to see if there is any flexibility in this area. You may well have developed a relationship with a valuable and competent local provider with whom you would like to continue working with. You may wish to ask in the RFP if this relationship can be maintained and if your prospective outsource provider can accommodate the inclusion of a preferred partner in their network. This will give some insight into both their attitude to outside providers as well as the flexibility of their technology in terms of being able to bring this preferred provider on board and meet your specific needs.

If you don’t currently have relationships with alternative local providers, have you given thought to a global sourcing strategy framework for finding ICPs? You may one day need to find one quickly and you will then have to assess what the impact might be of different SLAs, services, delivery methods, terms, contracts, and costs associated with a new ICP. Payslip can help you make comparisons around service delivery and terms so you can benchmark ICPs and choose one that is aligned to your needs.

Can you provide customized reporting? How long does it take, and how much does it cost?

Consolidated global payroll reporting is now in major demand, both from the centralized global payroll team and also from leadership teams within the organization seeking business intelligence around cost analysis and predictive analytics. These teams are turning to payroll for more insight into what it would cost a business to move into a new country. Only detailed, comprehensive, and readily accessible reporting on a global level can help them make an informed decision. Traditionally, this level of detailed reporting has either been unavailable or difficult to get. Outsourced providers are restricted by the technology available to produce these reports and are often only able to provide basic payroll reporting information. Many aggregators also struggle to get reports delivered quickly.

Modern global payroll departments need more in this area and your request for proposal should be asking about the provider’s ability to produce consolidated reporting as well as how quickly they can do it. Informed decisions require real-time reporting split by country, region, employee, payrun element or any other relevant payroll data filter. Consider your reporting needs and anticipate what reports HR, finance and other business units might ask of you in the future. Create a process map of how reporting is currently compiled and the amount of time it takes- compare this information to any answers you get in the RFP. Look for anything that offers insight into the provider’s ability to offer timely reporting that can help you plan for the future. If you require several different reports it is worth asking if the outsource provider charges per report or can provide an overall cost related to reporting.

Can our payroll people speak directly to your local vendors?

With the aggregator global payroll model, the local vendor relationship is controlled by the aggregator and they act as an intermediary between you and them. They usually communicate with them on your behalf and aim to raise and resolve any issues you have without any direct contact from you. You might find that this is a process that does not suit you- you may wish to speak directly with local vendors to get an understanding of their process, how they operate and if their technology and data workflows are compatible with your own. It is worth asking in the RFP then if you will be permitted to establish a direct contact relationship with them. You may not be willing to go through your outsource provider as an intermediary at all times- in particular when you have some very quick questions that could easily be answered by an experienced payroll person. Try to get a sense of how quickly they can respond to simple or advanced queries and check if there are likely to be any language differences that could make things awkward. It is important to have defined query response SLAs in place for ongoing monitoring. Direct contact with potential vendors also allows both parties to discuss ways in which they can work together better, align processes, and deliver data quicker. If there is a block to this communication or it is not feasible, you need to know about it and factor it into your final decision.

Can I see KPIs and SLAs from your ICPs?

You will always want to get a sense of the experience, general competency and if possible, proven performance levels of any ICP under contract with the provider you wish to work with in the future. KPIs and SLA delivery statistics can provide some useful insight here. If they are willing to provide this data, it may help you form a clearer picture around how they prioritize their workloads, how busy they are in general along with how high their standards are. Experienced payroll providers, who have subject matter experts and local expertise at their disposal should be confident that they can respond to this request for information and be in a position to show you some statistics or other information that validates their track record. What you are trying to do here is get an idea of the quality of delivery and operational standards of the ICP when it comes to: service delivery, meeting compliance, meeting deadlines, errors that cause costly re-runs or late payments, language barriers or time-zone issues and the availability of an assigned account manager. Spend some time considering these and any other common pain points you encounter.

Can we replace an ICP who is not delivering with one we prefer?

The recent COVID-19 challenges have brought into stark focus the issue of payroll provider failure. While this can be down to some very understandable reasons, nonetheless it can create a huge headache for any global payroll team. This team will require some reassurance in this matter and a request for proposal is a good place to raise concerns about specific needs you might have. It is a good opportunity for you to ask questions around an outsource provider’s business continuity procedures and emergency process when it comes to a provider failure. Do they have an established network of ICPs that they can call on in an emergency? Can these be onboarded quickly, so payroll disruption is minimized? Is their workflow process and technology support flexible enough to enable them to on board and ICP of your choosing should the need arise?

Payslip

Payslip is not an outsource provider or an aggregator, we are an automation and integration technology partner for global payroll processing. If the above questions were put to us, the answer would be yes to all of them. Our technology does not involve any rip and replace of preferred payroll providers, we simply integrate with them and you carry on the relationship. Our reporting is global, comprehensive, and consolidated- the customer is always in control and they get to schedule and customize the reporting as they choose. Our technology also gives you the flexibility to swap out any underperforming vendor anytime you want. We can quickly source and on board a new one for you.

 

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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.

Colin Smith

Payroll Manager, LogMeIn

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.

Ana Kelly

International Payroll Manager, Phorest