Every multinational organization operating in business today is looking to grow and expand, enter into new markets and seek out new revenue growing opportunities in different countries -this is simply the nature of commerce and modern business.
There is really no room for standing still- forward momentum is key to business survival and it is not possible to keep pace with technology advancements unless you are moving in line with them.
But is there such a thing as growing too fast, expanding too quickly and almost becoming too successful for your own good? It is not a case that success comes with a price, it is more of a recognition that business growth and global expansion create several new variables that need to be managed - these variables tend to include a mix of data, technology, people and processes. Things simply get bigger and harder to manage therefore it is unwise to move full steam ahead with significant expansion plans without first carefully considering if your organization, and the business-critical functions such as global payroll and HR, are capable of handling such intense growth.
In this article, we will look at some of the challenges that come when multinational corporations expand globally and find themselves faced with a number of new variables that they perhaps were not fully prepared for.
More growth, more people
There is no expanding an organization's reach without skilled and qualified people -they are needed to make this happen. The natural consequences of this are growing teams spread across different countries and continents who need to be paid. The responsibilities of the global payroll department immediately increase when international expansion happens.
It is relatively common practice to move forward with ambition and not really consider what resources and technology are in place to pay these new employees in the global workforce. This has proven to be a costly oversight for several businesses in the past. The quickest way to lose qualified people is to fail to pay them accurately and on time. Your global payroll department needs to be equipped with the right level of technology to handle an expanded workforce and it needs time and space to source crucial local country partners on the ground in these new countries.
It is always advisable to consult with global payroll managers and payroll teams to find out just how easy it is to set up a payroll service and pay new employees in a new region -there are several complex variables that come into the equation such as tax, local compliance and regulatory disclosure obligations. The key lesson here is a simple one -do the right thing and bring your global payroll team into the loop early on in any conversations about regional expansion.
More growth, more systems
Similar to the people equation referenced above -increased growth and company expansion will likely result in several new IT platforms are technology systems coming into play. It is highly unlikely that these platforms and systems will integrate naturally with any existing software or platforms at the organization, and there needs to be strong consideration around the level of work and project management required to smoothly manage these systems. Management costs could spiral very quickly if these considerations are not fully thought through before expansion plans get the green light.
This is about connectivity and ensuring that any new software purchases or decisions to move on to digital platforms are considered in the wider context of the overall organization ecosystem. Business critical functions usually have a need to share data and have technology that is capable of interacting with each other. New systems brought on board with little thought that end up operating in silos can become obsolete very quickly and tend to become an isolated business expense, that after a period of time could turn out to be an unwise investment.
It is always a good idea therefore, to have a chief technology officer along with several technology leaders involved in the discussions early on as they will likely be able to provide some very valuable insight into the best ways for business-critical functions like global payroll and HR and finance to integrate and align with each other from a technology viewpoint.
In the case of global payroll for example, company expansion means a need for local in country experts and payroll providers to calculate and deliver payroll services. This means a new payroll system or global payroll software becoming part of an already crowded payroll technology ecosystem. Global payroll professionals have no desire to work with another new system that sends them even more nonstandard data on a monthly basis. Instead, they want standardization technology introduced to the wider global payroll process along with automation technology to automate any repeatable and recurring tasks to make their service delivery easier, faster and more efficient.
More growth, more compliance
Global compliance can be a complex and thorny issue across a range of departments at a multinational company. Expansion into new territories and regions means new level of compliance commitments need to be met. It is important to consider if you have the people, technology and insight to meet these commitments as local governments in new countries tend to show little sympathy to organizations who set up very quickly and then fail to meet their compliance reporting obligations. The fines and penalties for noncompliance can be significant together with the reputational damage -international compliance is simply not a matter to be taken lightly.
Human resources departments and global payroll professionals will again face new compliance challenges when a company moves into a new region. Such compliance issues are a headache they could do it without, especially if they do not have local expertise on the ground to help them or find themselves operating with legacy technology or outdated systems. A compliance calendar can be varied and complex and ideally it needs to be digitized, while global payroll professionals need to be equipped with digital tools that help them access all the documentation and procedure notes they need to ensure key compliance deadlines and employment law are met and adhered to.
Again, this is a case of preparation and communication -are the key stakeholders in the room at the start of any discussions around expansion into foreign markets? Are global business leaders considering the ramifications of international compliance- it is easy to be swayed by the market opportunity or the potential for significant revenue growth, but caution, care and due diligence are the best approach when it comes to meeting compliance requirements.
More growth, more Payslip!
Payslip technology is built for scaling and we have a track record of helping multinational companies expand into new regions, especially when it comes to sourcing local providers and setting them up quickly on our platform so that global payroll can be processed in the new country in a fast and efficient manner.
Our platform connects people, process, vendors and technology in a way that helps C-suite teams and business leaders identify & seize growth opportunities. Our intelligent standardization, integration & reporting technology is ideal for meeting the specific global payroll requirements that arise as a result of rapid business expansion.
We help out progressive and high performing digital multinationals who are looking for payroll solutions that can enable their growth, deliver cost efficiencies, and help them leverage country specific subject matter expertise in a structured global way. Our platform provides central management control, our integration solution enables structured and automated data flows across new and disparate systems and our Global Reporter tool provides consolidated global reporting to inform strategic and predictive leadership decisions.
We are the digital technology platform of choice for global payroll processing at progressive companies going through a period of rapid expansion and requiring a technology partner who can be as agile and responsive as they are. Talk to our team today to see how we can help you transform your global payroll in whatever region you wish to enter.