A CIO at a multinational company is a person with many and varied responsibilities, the bulk of which have a strong focus on technology and innovation. Global payroll processing does not spring immediately to mind when one considers the key priorities a CIO might have at a multinational- however, many CIOs will agree that sometimes it is the less obvious things that turn out to be the ones that really matter.
It is somewhat ironic that global payroll may not be an obvious consideration for a CIO, yet It is very obvious that the single largest expense or outflow of cash at any company is almost always payroll related. A vast amount of money leaves a business every month in the form of compensation payments and other benefits to international employees located around the world. Global payroll can be viewed as the link between administration and people, so it therefore supports every operational function in in an organization- something that matters on this level must also be of interest to a CIO.
CIOs today are tasked with applying innovation to business-critical functions, technology stacks and any areas of the business where innovation could be used to reduce cost and overhead. For this reason, the global payroll department should very much be on the radar of any CIO interested in improving technology efficiency while optimizing costs.
In this article, we will examine the role of global payroll at a multinational company today, and showcase the reasons why this crucial business service, which in light of the global pandemic has been deemed business critical, should remain on the radar of the cio and all business leaders at a company.
A broad role
While a CIO is normally focused on managing a company’s day-to-day technology operations, and looking at ways to to provide continuous improvement of these operations, the scope of the role is decidedly broader than that and largely dictated by the culture and objectives of the company.
If the focus is cost reduction, then the CIO will look at optimizing costs across a range of departments that use substantial technology stacks for operation. If the culture is all about innovation and next generation technology, the CIO will then have the support for additional investment in technology that aligns with these objectives.
The role is therefore a broad one and there is often scope to examine a range of different departments within the organization against the context of the overall objectives. Cost saving and innovation are likely to be objectives of all multinational companies today, and there is a huge opportunity to introduce both of these to the global payroll department.
Missed opportunity
The CIO role has the potential to evolve into one of the most influential positions in the C-suite, so a CIO should always prioritize the development of a deep understanding of global payroll processing. This department is one of the largest expenses any company will ever have, but more importantly, failing to look closely at it would represent a missed opportunity.
The reality is global payroll has been somewhat neglected when it comes to technology innovation- this is a great shame as there is huge opportunity for digital transformation and innovation in this department that can lead to operational efficiencies together with significant cost savings. There is an opportunity here for a proactive and progressive CIO to digitally transform this department and support it with the level of investment that many other departments benefit from.
A digitally enabled, agile and progressive multi-country global payroll process is something that can strengthen the core foundations of an organization and remove any risk to the on time and accurate paying of staff across international locations. This department should never be at risk of payroll failure, as employee morale and company reputation are very much connected to the accurate and efficient processing of multi country payroll.
The technology exists to enhance global payroll delivery in an innovative manner. The global pandemic has also highlighted that a lack of technology investment in global payroll puts the delivery of this business-critical service at risk. Now may be the right time for a CIO to move away from missed opportunity and moved towards a very worthwhile digital transformation of a critical function.
Developing global payroll
If it is very clear why global payroll matters to an organization, then it is equally clear why it should matter to a CIO and c-suite executives. Therefore, the business case for an investment in digital technology and a digital transformation to improve this department, pretty much explains itself.
This is about developing global payroll processes and functionality to ensure they are agile and prepared to meet future challenges. One of these future challenges might be to continued remote delivery of global payroll. The global pandemic forced remote delivery upon many multinational companies, it is quite possible that is becomes normal practice as there is currently a significant question mark hanging over the future of office life due to Covid.
Should a CIO make a strategic decision to prioritize global payroll delivery, then this represents a real opportunity to lay the foundations for implementing operational excellence in this department for the remainder of this decade. Investments in digital technologies made now will see the introduction of digital tools that can streamline global payroll processes and improve overall delivery. Things like standardized process and automation could be introduced to the delivery process along with enhanced tools for consolidated reporting. These would bring immediate efficiency gains to the department and opportunities for cost savings could be identified via advanced reporting which could compare labor costs across different countries and entities.
In such a scenario, a CIO could be responsible for the development and advancement of a business- critical department while simultaneously identifying cost optimization opportunities.
Being an innovator
Innovation is often about recognizing opportunity, decision-making and taking action before others do- reputations are often built on getting there first. Should a CIO choose to engage with stakeholders in the human resources or global payroll department or have conversations with the leadership team, it will become clear very quickly that global payroll delivery is on the cusp of shifting from being a back office function to a strategic business partner.
It cannot complete this business strategy shift without digital innovation and investment support in new technologies. A chief information officer who is curious about the potential for this department to progress into a strategic ally, may sense an opportunity for payroll to become a significant resource for business intelligence. There is a huge amount of valuable data contained inside complex workflows and global payroll processes -this data is waiting to be freed and interpreted via smart reporting and analytics.
More and more multinationals are adopting cloud-based Software-as a-Service (SaaS) solutions across their business functions, so why not do the same with global payroll? This technology can introduce greater efficiency to the day to day delivery of global payroll while also enabling the department to deliver crucial data and insight to leadership teams for informed and effective decision-making.
This could be an example of true innovation in action - supplying a business-critical function with the technology platform and digital tools it needs to become a department capable of supporting the strategic goals of the organization.
Global payroll technology
The technology exists to transform the global payroll department into an enabler of business strategy. A good starting point is to move global payroll delivery onto a unified cloud platform - this is a form of technology integration that unifies and integrates the key participants in multi country global payroll delivery : the internal payroll processing system, multiple local country payroll vendors and the various data flows from HCM or HR systems.
The next step would be to introduce standardization and automation. Standardization of data flows and workflow processes ensures global payroll professionals located around the world are operating with standardized data and processes. The automation of repeat tasks saves time and effort and helps introduce some much-needed breathing space into monthly payroll cycles.
Finally, the introduction of innovative digital reporting tools will ensure better visibility and control over the payroll process for managers while also making available detailed and comprehensive global consolidated reporting so that senior leadership figures can see and understand all of the costs associated with their multi-country global payroll.