Global Payroll: The consequences of doing nothing
29th March 2023, Wednesday
It is often the case that large enterprises choose to locate specific business units and services in a single location for efficiency, collaboration and cost management reasons. This location is often referred to as a shared services center-essentially a centralized location for specific business processes which tend to support the wider business as a whole.
An example would be human resources and IT support- these are business critical service units that support the entire business, and it can often make sense from a business perspective to move these two departments into a shared location where they can both leverage business resources such as technology and staffing.
In the past, shared services center often came about from a focus on effective cost savings in business functions but in recent years the primary driver has been about digital technologies and modernization-improving essential business support functions with innovative new technologies and new initiatives to ensure that they are in the best position possible to support the wider organization with digital tools in an ever-changing business environment.
In this article, we are going to look at some of the reasons why, leaders in shared services departments should include global payroll operations in any digitization initiatives that they are considering within their shared services centers.
Some popular functions usually considered for optimization within a shared services location are Finance, HR, IT and Legal. Project managers in charge of setting up a shared services center tend not to consider global payroll in this ecosystem as it can often be the case that there is a lack of understanding around how payroll is very much connected to human resources and finance departments, especially from a data flow perspective.
There is a genuine opportunity for shared services leaders to create valuable connections and efficiencies between 3 business critical service units: human resources, global payroll and finance. Choosing to modernize and digitize just two of them would represent a major missed opportunity. A lot of the shared services methodologies are around redesigning business processes to support a digital first model. This is definitely the correct approach, but it would be an oversight to fail to include global payroll in this initiative, especially if there is a focus on finance and human resources, two departments that greatly benefit from data flows and reporting insights received from payroll.
The case for global payroll inclusion in shared services digitization projects is solid:
Many global organizations today have long-tail countries to manage-these are countries in which a relatively small number of employees are based. These countries tend not to be covered by whatever global payroll services delivery and management model the company chooses to pursue. Global companies are left with a problem-how to solve their long-tail challenge. A shared services center would have the required level of focus and technology resources to develop a management plan that included these countries, helping to mitigate risk around compliance.
Like any digitization project, it is best to include something important right from the start of the project rather than discovering 2 years down the line that you really should have included it on the roadmap much earlier in the process. But, if it has been overlooked- project leads in shared services centers should then look at global payroll companies who currently leverage technology, as they represent the best opportunity for rapid inclusion in the operating model because of their digital first approach, innovative technology and integration functionality.
Project leads looking to create a new shared services center where related business functions can be housed for cloud computing optimization should definitely look to include the global payroll function and ensure that it benefits from innovative technology and digitized processes. Such an approach could prove to be invaluable as it would serve to future proof global payroll delivery and management for decades.
Shared services centers can only prove to be a critical backbone to an organization when they deliver process improvement and measurable efficiency gains. Automation is something that can really deliver this, and the results can be very visible when automation is deployed in departments that previously relied on manual processes for data management workflows.
This is another reason why the global payroll function should be part of shared services digital strategy initiatives. Automation and machine learning digital capabilities can transform global payroll operations by eliminating the current over reliance on manual data entry, excel spreadsheets and e-mail data transfer. This is hugely time-consuming, prone to human error, outdated and a major business risk when it comes to accuracy and data security.
The manual work needs to be replaced by hyper automation and robotic process automation data flows, which seamlessly connect global payroll with the multiple data sources required for payroll delivery and management- 2 of which include related business functions HR and Finance. Therefore, automated data flows would benefit all three departments, resulting in process improvement and measurable efficiency gains (time and cost savings). Automation is a key focus for shared services project managers as it represents a way to put an end to dated manual entry, eliminate unnecessary processes and to create self-serve ways for system users and multiple stakeholders to get what they need quickly.
A shared service center or global business services unit exist so that global organizations can drive digitization and achieve cost-effectiveness, improved efficiency levels, standardized processes, while introducing greater flexibility and agility across a range of business-critical functions.
All of this aligns strongly with Payslip’s reasons for building our global payroll control platform. This purpose-built digital platform for global payroll delivery and management was built from the ground up with digitization, automation, standardization, process improvement and cost effectiveness in mind.
Let’s look at some specifics:
This is a core objective of shared services centers- digitizing processes and workstreams for greater speed, agility and effectiveness.
The Payslip platform digitizes the end-to-end payroll process and leverages next level integration functionality to ensure seamless, accurate and fully automated data flows between global payroll, human resources and finance. Some digitization features include:
All of this serves to digitize a business-critical unit, while also empowering it to evolve into a strategic asset to the overall organization. Legacy processes and outdated technology are replaced by a digital cloud environment that lends itself to agility, speed and flexibility. This is exactly how global payroll departments need to operate in a post-pandemic complex working environment where a new working culture of hybrid and remote work has been established
Shared services will look to automate as many processes as possible in order to save time, boost productivity and reduce company expenses.
Payslip Global Payroll Control Platform automates the end-to-end payroll process: from pre-payroll data inputs from multiple sources right through to post-payroll last mile reporting and analytics. Payslip creates and develops purpose-built automation technology, an advanced form of robotic process automation (RPA) that is constantly active in the background during all stages of payroll delivery. The platform ensures direct automation from source software or external vendors into the Payslip platform for automated input, checking and validation at each stage in the workflow.
Shared services are always interested in standardizing processes to develop a single and unified way of working.
This very much aligns to the Payslip approach of data and process standardization inside the platform- the goal is to ensure a single way of working for payroll professionals across all payroll countries. We bring all of the payroll data from all the relevant sources (HCMs, finance and local payroll providers) into our platform, then we standardize it and categorize it at a global level as part of our global first approach to data.
Once the data is standardized at a global level, the result is a single way of working across countries in terms of data and process. Now you have visibility and control over your multi-country payroll-you can see what is happening in each of the countries, but also zoom out to get the bigger picture global view.
Shared services focus on how related departments can work better together by connecting their systems and software platforms.
This is in full alignment with Payslip’s approach to integrations. Global payroll processing and management cannot exist in isolation-there is an ecosystem that involves local country payroll providers, human resources software as well as finance and benefit systems.
Our integration functionality connects payroll to the wider ecosystem in a seamless way via fully automated bidirectional data flows between all of the relevant systems. The platform integrates with popular HCMs such as Workday, SuccessFactors, SAP and Oracle.
Anywhere there are important data flows that are related to payroll processing, we integrate and automate so these happen automatically. This will free up a huge amount of time in every payroll cycle and allow global payroll professional teams to focus their attention on high priority work.
Payslip can help organizations drive efficiencies in their service delivery, improve payroll accuracy, remove latency in payroll and create total transparency across all payroll countries, offering both an individual country as well as a global view-this is really the only way to manage payroll today.
For more information about our Global Payroll Control Platform contact us today.
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Dallas, TX 75201
29th March 2023, Wednesday