A common challenge when dealing with global payroll processes is finding the right balance between a process that is truly global while also making room to facilitate local country nuances and payroll related elements. These elements are usually mandatory and needed when it comes to adhering to compliance and regulation on a local country level-therefore it is hugely beneficial if a system or process is in place that can absorb local particulars into an overall global process.
In this article, we will examine how local country nuances are a crucial part of payroll delivery at multinational companies around the world. We will also look at what software or technology stack is available to best accommodate local nuance within a process that is designed for global delivery of payroll.
Local matters
The business landscape is defined by many things today but one of them is rapid and large scale growth and development - this often manifests in the form of organic growth and natural scaling, or alternatively, growth by acquisition- companies purchase other entities or merge with them in an overall partnership.
The result of this activity is an increase in complexity and management responsibility when it comes to the delivery of global payroll - payroll becomes more complex and that bit more difficult to achieve when a company acquires 200 new employees in a new continent. It is all the more difficult if the global payroll team is not equipped with the necessary technology stack or digital software tools to enable a smooth transition and easily absorb these new employees into the overall payroll process.
Local expertise is always going to be needed -it does not matter how competent or experienced your global payroll professionals are, they're unlikely to have the kind of local on the ground knowledge that you can get in a specific country. This local expertise is required to ensure the smooth processing of payroll and account for any particular payroll elements that are specific to that country -these could be issues relating to tax, overtime, bonus or other benefits.
The local expertise is also crucial for local country regional compliance -there are things that simply need to happen in a particular country to ensure compliance and it is often unfair or unreasonable to expect a team of global payroll professionals who are not located in that country to go out and search for the knowledge needed to ensure compliance. It is far more feasible to approach in country experts who can apply that knowledge to the global payroll.
What all of this means, is that a global payroll model needs to be chosen and aligned to a technology stack that can ensure that global payroll is delivered on a global level while also capable of facilitating local country nuance- this is about technology and processes that come with inbuilt flexibility as there can be no local country expertise without flexibility.
Platform capability
So, what does all of this have to do with a platform? Well, global payroll being processed at large multinationals who scale rapidly, needs structure and discipline to avoid problems. The immediate problems would be a lack of visibility and control over the overall payroll process -many countries with many employees tends to result in a lot of moving parts and a powerful, cohesive yet flexible and adaptable platform is needed to keep everything stable.
It is now commonly accepted that no single aggregator delivers equally well across multiple payroll countries-Aggregators use their own network of local country payroll providers and it may be a case that they simply don't have professional relationships established in the specific country you need. Or it may be the case, that as a global employer, you wish to continue a productive relationship you have established with a local payroll vendor and this cannot be accommodated by an aggregator model which supplies vendors from its own network only.
A global payroll technology platform can allow for the efficient processing of payroll on a global level while also enabling local country expertise to be a part of the process. This is usually done by a process of integrations - you operate from one overall platform that provides the visibility you need to control your global payroll - but you also integrate all the major players in the payroll ecosystem so that data inputs feed into this single platform.
HCM inputs, accounting data, payroll services technology and local in country providers of payroll services can securely transport the necessary data from their individual systems into the single platform via integrations. You end up with a streamlined and cohesive ecosystem which results in a single platform view of what is happening in all the countries that you processed global payroll in.
With such a platform, local expertise is accommodated right from the start -the necessary pay elements which are specific to an individual country are imported into the system in a standardized way along with all the other necessary inputs from HCM, accounting and the centralized global payroll team. Global payroll managers then get to see, manage and control all elements of global payroll from a single dashboard.
If they need to drill down into a local country to extract specific information, the digital tools and reporting functionalities in this global platform will allow them to do that -they are therefore empowered by a platform that supplies an easily accessible and transparent audit trail that proves local country nuance is accounted for along with evidence of local country compliance. This is a major addition to the global payroll process and solves a specific pain point around the question of local country compliance when multinationals are expanding rapidly into new regions.
Scalable process
This kind of platform also lays the foundation for a repeatable local country expertise process that can be duplicated quickly in any new countries that a company scales into - for example, in the event that a company acquires a new set of employees in a specific country where the local payroll nuances are already accounted for in the global platform -then adding these new employees, getting them paid accurately and on time, while being immediately compliant is very achievable.
Things like this make it much easier for a scaling project to be green lit at upper management level. Global payroll managers everywhere would love to be in a position to state categorically to C-suite leadership teams, that they have the technology stack, software flexibility and local expertise to enable a smooth payroll transition into a new country. This has the added benefit of transforming the global payroll department from a back-office function into a business enabler and strategic partner. Global payroll stops being a blocker to growth initiatives, instead they become an enabler and actually speed the process up -making the company as a whole more agile and responsive -and strengthening their position to develop new revenue streams and gain footholds in new markets.
Payslip is global and local
Payslip provides automation and integration technology solutions for global payroll management. Our platform delivers central management control to multi-national employers and comes with a standardization playbook that helps you take control of data, people, and vendors in your global payroll eco-system.
Payslip understand the need global employers have to run payroll as a globally managed function in a way that requires a common standard or framework across countries. We also recognise that companies with multiple payroll countries need flexibility to accommodate local country requirements. They may require unique pay elements to be created for them.
The Payslip platform is designed to accommodate local country requirements in a global payroll structure and our Automated Workflow Engine enables the efficient flow of data and information from local sources into the common framework. Employers receive the necessary inputs from local vendors while managing all data within a controlled framework. The platform also has unlimited local country pay element build capacity.
Our technology platform is unique in that it allows global employers to connect with in country payroll vendors and local subject matter experts on a single platform using standardized data. Talk to our team today about how we can help integrate local level solutions into a structured global payroll framework.