‘If it ain’t broke’ is a phrase we seem to hear a lot especially when it comes to global payroll delivery and management. It is reflective of a general attitude that seems to view payroll as a function that simply takes care of itself and does not require any assistance in the form of modern innovation and digital tools.
Or more worryingly, it reflects a view that payroll is not broken and is working just fine so there is really no need to pay any attention to it. We would be of the view that this is a borderline reckless way to look at such a business-critical delivery. Payroll is the ultimate contract between employee and employer and it simply cannot fail- therefore, taking such a casual attitude towards it can have severe consequences. Payroll errors or failure to deliver payroll accurately and on time can cause staff retention issues, result in financial penalties as well as reputational damage. It deserves to be prioritised and served with first citizen technology.
In this article, we are going to challenge the assumption that payroll is working just fine the way it is and list a number of reasons why the ‘if it ain't broke’ mentality is a short-sighted approach that can have damaging consequences.
Turns out, it is broken!
Diligent, conscientious and hard-working global payroll professionals around the world would definitely have the view that in many ways, global payroll delivery and management is broken and requires an urgent fix. Let's take a look at some examples:
Manual data entry- really, in 2024? Sounds pretty broken to us. Is it acceptable that a business-critical service relies on excel spreadsheets, e-mail data transfers and manual data entry when technology has advanced so far that there is an abundance of digital tools available to replace such outdated, error prone and risky processes? Data preparation, especially at the pre payroll stage is manual, tedious and hugely time consuming at many companies - pretty much the very definition of what a broken process looks like!
Scattered Vendors- no real process in place to manage the essential local country payroll providers who calculate and deliver payroll at a local country level. Different vendors scattered across the globe with no way to consolidate the essential data. Siloed processes with no clear view of what is happening with each vendor in each country. Just moving from month to month, hoping that nothing bad happens- sounds a bit broken?
No HCM integrations: there is nothing wrong with duplicating data from payroll software over to HCM systems and vice versa-this is perfectly acceptable in 2024 right? Payroll and HR operating separately from one another in disparate systems with no bi-directional data flows is working just fine? No, it is adding unnecessary complexity to an already complex process, and it means that busy professionals are wasting valuable time manually moving data between systems when automation and integration technology should be doing this for them.
Bad employee experience: It's a digital world and global employees everywhere have an expectation that there should be easy access to their payslips, payroll and tax data anytime they want on their preferred device. But so many companies don't offer an employee self-service portal that can be accessed in the cloud. Meaning there is no opportunity for a unified employee experience where all employees are treated the same. Instead, employees have to send e-mail queries to an overburdened payroll or human resource department and then sit and wait for their payroll data. Doesn't sound right in 2024 now does it?
No Employer control: Different processes across countries makes it difficult to see exactly what is happening with payroll in each region. And you cannot control what you cannot see. Aggregator models mean that global employers surrender control over local country vendors and lose the ability to interact with them. This is the opposite of what they want. They want mission control views of all payrolls, all countries. They want digital dashboards displaying the status of payroll in each individual country. And they want global payroll reporting and metrics that tells them what is happening, how much their payroll is costing the business and how well their local country providers are performing. Without this, they have no control and when you have no control you can't really say that something isn't broken.
No AI technology: AI is going to dominate industry and commerce for the next decade, so why should global payroll once again be left behind? Highly sensitive global payroll data should be leveraging AI and automation technology to move it between systems and process calculations. This would remove a lot of the risk associated with manual data entry, create massive time savings as well as productivity gains. Payroll in 2024 does not operate in the cloud at a lot of global organisations which seems insane when so many other departments within the same company do operate in the cloud e.g. sales & marketing . Does failing to engage with AI driven technology today really sound like something that ain’t broken?
No Global Management Plan: Multicountry payroll delivery and management often runs without any overarching management plan. You could have 15 to 30 countries but no real structure in place to manage them. How can this possibly make sense? How can you control the process, see what is happening, avoid errors, remain compliant across jurisdictions and deliver the next level reporting required today by the C-Suite and leadership teams? Simply put, you can't. An end-to-end global payroll process still requires a central standardized management model in order to manage the service providers, local vendors and technology stacks in place to deliver payroll. A single global management solution that ensures the diversity within each country can be accommodated. A lack of such a plan is one of the core reasons why global payroll is broken at many organisations.
If it ain’t broke thinking means you are only going backwards
So, we have outlined a bunch of reasons why payroll is in fact broken and ignoring it will lead to major problems down the road. The ‘if it ain’t broke’ approach means that nothing will change for the better and you'll be left with consequences like these:
- Ongoing payroll errors, delays and frustrated professionals due to an over reliance on excel spreadsheets and manual processes
- Different processes across countries making payroll nearly impossible to manage on a global level
- No ability to deliver consolidated cost comparison reporting to leadership teams
- Constant struggle to keep up with and meet compliance and regulatory obligations
- Data security and payroll information privacy concerns
- Global payroll operations unfit to support wider business strategy
- No visibility and control due to a lack of a global management plan
- Non-connected ecosystem. HR, Payroll and Finance operating in silos
- No employee access to payslips and payroll data
- Companies sticking with outdated aggregator model due to a lack of investment in technology driven solutions
- Spiralling payroll costs as companies struggle to manage the extended workforce along with hybrid and remote workers
These will all need to be fixed at some point so you might as well start now. Payslip is revolutionising global payroll through world class AI Technology for real world global payroll by providing a global payroll management platform that leverages AI-powered automation to harmonize payroll operations for multinational organizations. It solves everything that is currently broken in global payroll and allows you to manage people, processes, vendors and data in a single location.
There was a time when people could only book flights over the telephone. There was a time when music was played only on stereo cassettes. There was a time when you had to wait a full week or longer for that next episode of your favourite television show. If everybody adopted the ‘ if it ain’t broke’ attitude, these might still be in existence today.
The whole point about adopting a new way of thinking is to improve things so that they work in a faster, smarter and better way. This applies to global payroll too- the technology is out there and there is no excuse. So, it is time to really think about things-how do you want your global payroll delivery to look in 2024?