Every single person involved in the delivery of global payroll would be willing to acknowledge that 2020 was an extremely challenging year. The global pandemic put a strain on businesses across the globe and a particular squeeze was felt in business-critical departments like global payroll, human resources and finance.
There was a sudden and practically nonnegotiable shift to remote delivery and a new reliance on technology capabilities for global payroll business continuity. Before things settle down into a new working normal, crisis point was reached at a lot of organizations, particularly those who are simply not equipped to pay a geo dispersed international workforce from a remote environment.
Many found that their on-premise legacy technology in place was simply not designed to cope with these new and drastic requirements while other companies found that their technology stacks could withstand the pressure, but the same story could not be said of the technology or business continuity plans in use by sections of their payroll provider vendor network.
In this article, we will take a look at some of the payroll weaknesses that were exposed by the coronavirus pandemic as well as what organizations can do to make sure that they don't continue to be at risk with payroll continuity and remote working in 2021.
Cracks began to appear
Research by EY found 35% of companies do not have a payroll strategy, and only 26% of businesses rate their current payroll provider’s performance as ‘good.
The above discovery by EY was something of a wake-up call for many multinational companies. A lack of global payroll strategy combined with a general dissatisfaction about the performance levels among their provider networks, is a strong indication that something is not quite right with their global payroll service delivery.
It strongly points to a lack of visibility and control around global payroll processes, people and technology and is indicative of a wider need for a global payroll solution that puts global employers and payroll teams back in charge of their technology and provider ecosystem.
A global payroll strategy must be one that puts the employer and payroll professionals in control, and now in 2021, it must be one that has technology and digital platforms as the main drivers of process within global payroll. There needs to be a shift away from legacy systems, limited access to payroll data and non- secure sharing of this data.
All of this needs to be replaced by a digital mindset and technology outlook that recognizes how important digital platform integrations and innovative cloud tools are to the efficient and fast delivery of multi country global payroll.
The cracks have appeared already, businesses have suffered global payroll delivery failure last year, and some have implemented some short-term solutions that only serve to paper over these cracks. Further payroll system problems will inevitably appear unless global payroll departments are given the authority and resources to develop and implement a global payroll strategy that is capable of handling the challenges of COVID-19 while also supporting business growth objectives.
4 key weaknesses that were exposed
The EY research went out to explain how COVID-19 exposed a number of crucial weaknesses when it came to delivering multi-country global payroll. When a major global event happens that has massive economic repercussions, it is understandable that many organizations will be unprepared and feel the consequences. Very few could have anticipated lockdowns, furloughs and federal government-imposed travel restrictions.
Those companies operating with strong digital platforms in a cloud-based environment were naturally more agile and responsive to rapid change. The pandemic has highlighted that this level of technology has now become essential for the effective delivery of global payroll. Digital transformation is no longer a project for the future or a business case that needs to be debated- economic circumstances have turned it into a truly urgent necessity that needs to be addressed immediately.
Exposed weaknesses give multinational companies an opportunity to respond - there is a technology solution that can fix global payroll and futureproof it. But decisive action is required along with buy-in from key stakeholders. Failure to act promptly will see these weaknesses exposed further and exacerbated to the point where global payroll failure becomes a worrying likelihood.
- Lack of global payroll process
- Poor data quality
- Slow response to regulation changes
- Lack of digitization and automation
The above 4 weaknesses all point to a lack of digitization because all four of these points can be addressed and resolved if global employers commit to a digital global payroll solution.
This solution would involve operating from a single platform in a cloud environment- bringing all payroll software and local country vendors onto this platform where they can be managed centrally with visibility and control.
This would enable data standardization to happen so that data formats and processes would be standardized across all of the payroll countries. Digitization would also allow for automation to be introduced to any repeatable and recurring task within global payroll-this would add speed and efficiency to the process while also removing the likelihood of human error.
Digitized processes would allow global payroll managers to apply structure and control to their multi country payroll process. They would immediately become more agile and responsive and payroll managers would be in a far stronger position to pivot and respond to regulation changes -these regulation changes are to be expected in a complex payroll environment so things like digitized compliance calendars can be of a real benefit here.
A global payroll process where a technology platform, one that is designed specifically for the management of global payroll, is one that can be in place for many years and global payroll managers can feel confident that the innovative technology being deployed as part of this process is flexible and adaptable so that when change comes, they can manage it.
It is hard to see how these four key problems could be solved without a digital payroll solution -tackling each of them individually could be very time consuming and expensive -it is far better to cast a wider net and adopt a payroll technology strategy that is designed to tackle and resolve multiple global payroll challenges at once.
Payslip- the pandemic response that global employers need
Payslip is an integration & automation platform specifically created for global payroll management that is designed by workflow and facilitates data standardization. It enables global employers to implement a data 1st and digital first global payroll process that helps them manage their complex multi payroll environment.
Visibility and Control
Global payroll managers benefit from visibility and control that comes with a centrally managed global payroll process while global payroll professionals get to work with a range of digitally innovative tools that helped them deliver multi country payroll in a faster, smarter and more efficient way.
Standardization and automation
Data and processes are standardized across all countries and automation is introduced where possible. This paves the way for multi-country consolidated reporting providing very valuable country cost comparisons. Poor quality data is replaced with standardized data so that global payroll professionals across countries are operating from the same standardized playbook - things quickly become easier to manage and deliver while on boarding new countries becomes much less complicated.
Digital audit trails and compliance calendars allow multinational companies to meet in country compliance requirements and respond swiftly to regulation changes.
Payslip is the comprehensive solution specific to global payroll delivery that solves immediate needs faced by global employers as a result of the coronavirus pandemic. If you feel that your response to the pandemic is not going to result in a sustainable global payroll strategy or delivery model, then talk to our team today who will be happy to give you a platform demonstration and show you how quickly you can begin to transform your multi country global payroll.