In the on-demand PayrollOrg webinar, “Impacting Business Through Global Payroll Technology Innovation,” sponsored by Immedis, experts explained the current trends and challenges in the domestic and global payroll space, and the innovations in the market that are having a positive impact.
Richard Limpkin, Chief Strategy Officer at Immedis, said technology and the operating environment make payroll adverse to change.
“Payroll is that classic thing that is best left alone, in many peoples’ opinions,” Limpkin said. “The danger, with that, is the build up of technical and operational debt. It’s that drive to modernize that’s key.”
Limpkin said that the need to modernize operations creates challenges where there is that need to keep up with the changes in technology and innovation that provide the tools to be more efficient.
It’s something that Limpkin said that payroll teams everywhere are striving to overcome the increasing complexities of staying compliant amid changing law and regulations.
Limpkin adds that the increasing drive to globalization in recent years has forced massive changes in the payroll environment to operate outside of its comfort zone to provide services businesses need to deal with the global challenges.
“Ultimately, payroll is the key enabling force with any organization,” he said.
Despite the challenges, the drive to globalization has opened doors to a much larger talent pool, which would otherwise be difficult to source, Limpkin said.
According to a 2022 Gartner Multi-Country Payroll Report, 65%—approximately two-third—of global organizations will have invested in a strategy to unify payroll on a global scale by 2025.
Many of these automated solutions, according to Limpkin, will be touchless—without manual or human intervention.
“This is a long way from the classic global payroll operating environment of 10 years ago,” he said. There’s a huge amount of innovation required in the space to deliver on that, and this is something we all face daily as our organizations continue to grow.”
Meanwhile, some of the market dynamics that are also driving the need for innovation include the following:
- Streamlining global payroll operations
- Hybrid working
- Niche talent in various geographic locations where it was previously unavailable
- Desire to centralize HR and payroll data
- Consolidation of payroll operations
- The ever-changing regulatory requirements for high-risk countries
- The evolving expectations of payroll
Payroll leaders who were attending the webinar were surveyed on the types of technological trends taking place within their organization. Approximately 44% of those surveyed said their organizations were shifting to cloud-based processes, while 40% said their organization was focusing on cybersecurity and risk management in payroll.
Limpkin said the response of attendees was consistent with the technology innovations taking place in global payroll.
“There’s absolutely an understanding that there’s a need to modernize, but there’s also a need to do that in a safe and secure, and a more structured way,” he said. “I think the key things to really bear in mind are that balance between security and risk.”
Limpkin said deploying to the cloud may sound daunting to most global payroll teams, but it’s resilient if it’s done correctly.
Of course, every organization is different and that means there’s no one-size-fits-all global payroll solution.
This is especially true with the explosion of the hybrid working environment and market innovations like global payroll analytics, earned wage access (EWA), payroll integration and compliance platforms, payroll’s growing reliance on artificial intelligence (AI), and next generation employer of record (EOR).
Many of the most common innovations Limpkin addressed are already being integrated. Nearly 60% of webinar attendees indicated that payroll integration and compliance platforms were being integrated at their organizations while 21% said global payroll analytics processes were being utilized.
“In most jurisdictions we look at payroll as effectively a black box, that there’s a right way to run payroll and everything else is incorrect,” he said. “Payroll is subject to the quality of inputs; the quality of what’s put into the payroll environment. It’s just fundamental that if you put bad things into a process that is so tightly defined and descriptive, you will only get the wrong answer. It’s about the prevention of errors before the process ever begins.”
The webinar will remain on demand through February 2024.