By Frank J. Mendelson
Editor’s Note: Ashok Bildikar, Chairman and Managing Director at Neeyamo, is considered an entrepreneur and an innovator in the business world. He has been instrumental in setting up businesses from the start and nurturing them to a global scale. Bildikar has founded multiple startups over the last 35 years, and now plays a pivotal role in steering Neeyamo’s course of being a market leader in providing global payroll and employer of record (EOR) solutions.
How has the role of the global payroll professional changed?
The role of a payroll professional has shifted from back-end accounting tasks to a more tactical and strategic front-end focus. Technology literacy’s increasing importance and the advanced payroll systems’ emergence has driven this shift. Despite the traditional slow adoption of technology in payroll, recent advancements such as cloud-based payroll systems offer greater flexibility and cost-effectiveness. Payroll professionals must now emphasize technology and data analysis to add value and promote business growth.
What emerging trends in global payroll are demanding your attention and how will they exert impact?
Global payroll is changing rapidly due to emerging trends and the need for agility in a borderless world. Remote work and hiring employees worldwide make payroll more complex, requiring agile payroll solutions that adapt to changing regulations and integrate with HR and finance systems. On-demand payroll and earned wage access (EWA) are becoming increasingly important in providing employees access to their earnings whenever needed. Payroll technology is critical in managing payroll operations efficiently and ensuring compliance with local regulations and tax laws. Organizations should adopt agile payroll solutions powered by advanced technology to support their business strategy. The contemporary landscape of information security and privacy regulations at the country level entails a heightened complexity level, necessitating detailed attention and management.
What are the chronic challenges for companies that have, or are moving into, global expansion?
Organizations planning to expand their global footprint face challenges in integrating different systems and processes and managing payroll operations across multiple countries due to the lack of globally integrated systems and compliance requirements. They can overcome this by using global enterprise-scale systems and exploring strategic alternatives for payroll management. Still, they should consider legacy infrastructure, carefully evaluate their options, and weigh the benefits against the costs. In long-tail countries where a small number of employees are based, there may be a lack of awareness and appetite for change. Organizations must work closely with local partners and stakeholders to build awareness and promote the benefits of new payroll solutions.
What are the communication challenges of a global payroll leader?
A global payroll leader faces communication challenges related to language barriers, cultural differences, and time zone differences. This is before considering the navigation of local regulations and compliance requirements while maintaining consistent and accurate communication with all stakeholders.
What resources do you use to stay current on the latest trends and legislation in payroll?
At Neeyamo, our knowledge organization is the largest component of our talent pool. Our native presence in many countries allows us direct access to local regulatory updates and changes. In addition, we have an extensive network of compliance partners who provide insights into the latest legislation and regulations. We continue to collaborate closely with our customers to understand their needs and ensure we meet their compliance requirements and specific needs. We leverage multiple sources and inputs to ensure we are always aware of the latest developments and can provide effective solutions.
How can a payroll department provide support on a strategic level to corporate finance, human resources (HR), and other departments?
To provide strategic support to corporate finance, HR, and other departments, the payroll department must prioritize employee experience and utilize sophisticated systems that integrate seamlessly with other departments. Since payroll manages many employee queries, the department must possess the necessary capabilities to manage them effectively and efficiently.
Furthermore, the payroll department must comprehensively understand the diverse systems with which it interacts, including those used by finance, HR, and other departments. This is particularly essential when managing complex rules and regulations, as few systems can handle them. Integration and technology are fundamental components of the payroll department's operations, as they must be able to manage the inflow and outflow of data from various sources.
What are the biggest challenges for payroll teams and what is emerging to address these challenges?
Compliance is a critical area where payroll can provide strategic support. The health of the enterprise's compliance directly correlates with payroll compliance. Attention to detail is also vital as being right 99.9% of the time is insufficient. Payroll must leverage technology to eliminate points of failure and ensure that all calculations are accurate.
Additionally, payroll must understand cross-cultural nuances and collaborate effectively across borders to manage global payroll operations. Finally, payroll is a cyclical function, and the ability to manage pressure during peak periods is essential. Technology can help with this by automating specific tasks, thus allowing payroll to focus on strategic initiatives.
What strategic advice would you give to a company moving from a domestic to a global payroll?
Global payroll is not simply multiplying domestic payroll by the number of countries in which the company operates. It requires a different way of thinking and a unique set of skills. Selecting the right vendor is also essential to a successful global payroll transition.
One critical consideration is to avoid the assumption that focusing solely on local solutions is the best way to operate. Instead, companies should strive for a single global payroll solution that offers multiple benefits, including increased visibility, a centralized point of integration, and centralized control over payroll operations.
One of the primary differences is the need to navigate the various tax and regulatory requirements of each country where the company operates. This requires a high level of expertise in local regulations and a willingness to adapt to different payroll practices in each country.
In high-tail countries, economies of scale can be leveraged to reduce costs and streamline operations. In contrast, long-tail countries often require a more decentralized approach, focusing on adapting payroll operations to the specific needs of each country.
What is the difference in responding to urgencies in global payroll versus U.S. domestic payroll?
One of the most critical factors is having a well laid-out calendar and a process to help adhere to a schedule. This can include having a process manager, an integrated payroll calendar, and an integrated compliance engine to ensure that everything happens seamlessly.
Treasure management (the act of managing a company’s daily cash flows and larger-scale decisions when it comes to finances) is another critical factor to consider. Disbursing funds can vary significantly from country to country and, in some instances, may take longer. It may be a smoother process in the United States, but it may take longer in other countries.
Compliance is another area where differences between global and domestic payrolls can arise. Compliance adherence can differ in different countries and certain processes may be more manual. It's crucial to consider penalties arising from noncompliance and ensure that all processes align with the relevant regulations.
What have been your experiences on successfully navigating cultural and other differences on a worldwide stage?
At Neeyamo, we were born global, and our experiences working with multinational corporations (MNCs) have allowed us to navigate cultural and other differences worldwide. Our first project was a Japanese project to be delivered in Japanese, and we have since fine-tuned our approach to operating globally since 2009.
We understand that cultural nuances can significantly impact how we conduct business globally, and we prioritize understanding customer expectations and meeting them promptly. Adherence to schedules and proactive communication ensure that our global operations run smoothly.
To help break down cultural and language barriers, we leverage technology. Our multilingual platforms and multi-currency support ensure that we can meet the needs of a diverse range of customers. As we expand our operations worldwide, we remain committed to bridging the cultural gap and providing exceptional service to our customers globally.
In Part 2 of this Professional Spotlight in an upcoming Global Payroll issue, learn about Bildikar’s insights on emerging technology, leadership, skills, and more.