How global payroll data can contribute to business strategy
The payroll department may have been considered something of a functional, back-office process in the past and one of those things you only pay attention to when something goes wrong. This rather dated view is changing as keen observers are noticing the sheer volume of useful payroll data flowing through payroll teams on a daily basis.
Many are now wondering if this data may have other valuable insight. Business leaders are always looking for new ways to create growth and are always grateful for any new data that can help them make important strategic decisions. They are now asking a range of departments across the business to provide them with data and insight that can help drive growth. Payroll professionals today are being asked to deliver more payroll data driven insight and global payroll data is now being looked upon as something that can contribute to a wider business strategy.
It is now becoming recognised that payroll services have a wider role to play in many company initiatives and business strategy. Payroll data gives intelligent insight into employee costs, tax expenditure and multi-country differences in compensation packages. Comprehensive payroll data reporting, consolidated to a global level, can really add value to a multinational company.
In this article we will examine how this crucial data can play a role in a global business strategy.
Insight leads to informed decisions.
Visibility around costs and where money is being spent will always be of value to a multinational organization. To make important business strategy decisions, supported by data driven facts, leadership teams require a multi country comparative report at pay element level. Such a report is likely to give an indication around how much it would cost to hire other employees, with similar job titles and responsibilities, in new countries or territories. This information would be hugely valuable and help leadership teams to assess the viability, in terms of cost and expense, of scaling into a new country. Essentially, the payroll data could be enough to tell them whether or not it is a worthwhile venture because It is often the best data source for uncovering hidden costs associated with specific country nuances.
Payroll data can provide valuable insight to business leaders when it comes to assessing value in their current expenditure. To learn why money is being spent, you must first learn where it is being spent. Payroll professionals can help supply this information. An efficient payroll system will also have valuable data on any new countries a company is considering expanding into. Payroll professionals everywhere also have access to crucial data and insight around compliance, risk, data security and regulations. This is the kind of insight that can help business leaders define and articulate a growth business strategy for an organization.
This information is not only informative but is a huge help when it comes to forecasting future expenses and assessing whether specific expansion initiatives are in a position to deliver a positive return on investment. Business leaders can learn very quickly where their budget is being spent and how much money the business has to invest in other things. This is particularly important in the modern digital economy where employees are scattered across the world, operating in different time zones and subject to different tax regimes. Comprehensive and coherent global payroll reporting can often be a challenge in these circumstances, but already busy payroll teams are being asked to provide it. It is important that they are supported with the necessary technology tools to supply this crucial data.
Data for choosing location
Business leaders will look to take advantage of any real-time data available that can help them make a decision on where best to locate a large chunk of their labor force. They want to be in the right location at the right time to exploit opportunities in the market and create additional revenue streams. They will require business intelligence and data driven insight to help them make these decisions. Global payroll data can inform them around the true costs of moving into a particular region.
It can also give insight into the available levels of talent in these regions and the costs involved in recruiting and paying employees on a long-term basis. Global payroll can supply important predictive analytics around costs if they have the right technology in place to extract the necessary reporting.
Corporate tax and labor costs are the key drivers when it comes to deciding where to invest and leadership teams will be keen to examine in detail all available information at their disposal connected to these two business drivers.
The value of global payroll data
Accurate, real-time data delivered quickly in easy to understand reports adds major value when it comes to defining a clear business strategy. Solid global payroll data allows you to make cost comparisons on a periodic basis as well as across countries and regions. This is where you can derive the level of key insight you need to come to a conclusion and make a decision.
Global payroll data can also provide both high-level and detailed analysis of trending information that can help identify where problems may lie on a country level. For example, employee turnover or churn at a very large organization may not be very visible as such information tends to get absorbed into other business data. Customizable global payroll reporting can identify movers and leavers on a department, country or regional level.
Global payroll data can also help you identify where business continuity risks may be more prevalent- this may not have been the biggest priority at the start of 2020 but the COVID-19 situation has radically transformed the global employer landscape, and business continuity has now become a major area of focus at multinationals.
Data protection & security, GDPR and other compliance requirements can also be managed effectively through the use and analysis of comprehensive global payroll data.
Technology for strategic edge.
Global payroll data answers basic but crucial questions around who gets paid, how much they get paid and where they get paid. Leaders need to drill down to this level in order to make a decision. It is surprising to learn that a large number of organizations today still find it very difficult to supply this key data to C-suite teams. Many payroll professionals have expressed concerns that the current payroll systems they are using are not advanced enough to meet some of the new reporting requirements being asked of them.
This is often due to legacy software or disparate systems that were not designed to produce comprehensive global level reporting. Non-standard data and processes also mean that data is coming from multiple locations in different formats, making reporting even harder. Standardized data and workflows need to be implemented at a global payroll level as this leads to better cost analysis reporting.
Payroll technology plays a key role in payroll delivery and data reporting. The better the software, the more comprehensive and detailed the reporting, and the more valuable the payroll data becomes. Nobody wants to make decisions based on vague or incomplete data. Investing in the right technology is crucial to producing the kind of data needed for strategic decision making at the highest levels of business.
Reporting needs to provide an overview while also allowing for filtered or customized reporting by sector or region. Advanced reporting tools and functionality means better and more accurate data can be extracted and delivered to key stakeholders. Investing in the right payroll technology can result in the kind of data that can help contribute to long-term business strategy.
Prioritize global payroll data
The way forward is to adopt a new approach to payroll data and invest in modern, cloud-based technology which facilitates the level of reporting required. This means prioritising the payroll department and equipping all payroll professionals with the tools they need to carry out both their daily duties and add value with things like enhanced reporting, reduced processing times, improved compliance, and data security.
Software that automate processes and standardizes data gives payroll professionals more time to work on reporting and analysis, this is the kind of work that results in key data being delivered to leadership teams for strategic decision making.
Payroll technology needs to advance and innovate, or risk being left behind. Current processes and out-dated software mean payroll professionals are not in position to do the kind of work needed by leadership teams. This can change by adopting a new approach. The payroll function is crucial to the employee experience and therefore deserves the same level of innovative, cloud-based technology that other departments across multinationals seem to benefit from. The business case for a strong in-house investment in payroll services technology is justifiable.
Payslip can help transform global payroll at multinationals everywhere with the kind of technology they need to produce global consolidated reporting and data driven insights. The Payslip platform will standardize data and processes to make effective reporting more manageable. The platform will also introduce automation so that repeat manual inputs become automated and payroll professionals have more time to focus on priority tasks like reporting and analysis.
The platform features a global reporting tool allowing payroll professionals to schedule and customize any reporting. This better positions them to respond to ad hoc reporting requests from leadership teams for things like country specific payroll cost analysis. On this platform, you can get a single dashboard overview of who is doing what and where – you can also drill down by employee, country or entity to get specific real-time data on payroll costs.
Automation, along with secure data exchanges in a cloud-based environment also helps with compliance obligations and risk reduction. Payroll teams can access folders and data in a remote environment using the platform, so they are immediately ready if emergency continuity measures are put in place in response to a global event.
Payroll data can play a huge role in global business strategy, but any data is only as good as the tools available to gather and analyse it. Payroll services are often overlooked in terms of strategic value, but it can be a sleeping giant- detailed information and crucial insight are there waiting to be delivered and used. All that is required is a new attitude and investment in a technology platform.
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
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