May 2022

The Pace Is Here to Stay: Why Global Payroll Has a Seat at the Table

By Frank Smits
SeatAtTable_InsidePrior to the pandemic, globalization was having an impact on the dynamics of payroll. With larger workforces across multiple countries and continents and rapidly changing regulations and compliance laws, ensuring your global payroll operations are airtight is essential for every business. With the advent of COVID-19 and the incredible level of digital transformation that has occurred since 2020, global payroll is in the spotlight more than ever before and business needs are changing. 

As the world spiraled into chaos and national and regional lockdowns came into force, businesses worldwide shifted from the office to remote working environments. The world of work has been irrevocably changed, and so, too, have many of the foundations of business strategy and success. An efficient and seamless payroll function has always been a marker of a successful business, but as we begin to emerge from the pandemic, global payroll deserves a bigger seat at the table. 

Since the start of the COVID-19 pandemic, one of the biggest challenges surrounding global payroll and other foundational business functions has been business continuity, particularly in locations with less established systems and processes in place. As a result, there has been a complete refocus on compliance and keeping payroll safe—no matter the circumstances, businesses must be able to pay their people correctly and on time. Being paid properly is the absolute foundation of an engaged workforce, and organizations have had to reckon with whether their business models are up to standards. How sustainable and adaptable a company’s processes are will dictate which businesses will thrive in the aftermath of the pandemic. 

At ADP, as we have noticed a bigger uptake in global payroll solutions, like compliance, since there is a general refocus on the basics of business. The need for one expert standard provider is clearer than ever before. Businesses need a partner that can take the burden of HR systems off their organizations and, at the same time, reflect different policies across multiple locations, states, or countries. In times of constant change and a rapidly evolving business landscape, organizations must be equipped with HCM ecosystems that are seamlessly integrated and optimised with end-to-end digital automation. 

This gives businesses the agility to react to the needs of their workforce in real time, whether it’s implementing something like a wellness program or a new benefits scheme. In fact, our payroll research found that 61% of respondents were unable to adapt their payroll to meet many of the needs of their company during the pandemic.

Standardized Personalization

Businesses need tools and solutions that are personalized to their needs and the needs of their employees, but a standardized approach ensures systems are fully integrated and employees in every location of your business are having a consistent, high-quality experience. However, different locations will have varying needs reflective of their own context, laws, and working culture, which is why an HCM ecosystem is so important. With one standardized provider, businesses can easily integrate local services, rather than trying to line up multiple third-party providers in one disparate system. 

In addition to exposing outdated or inflexible business policies, the pandemic has highlighted how access to reliable and up-to-date data has become mission critical. Global businesses must be able to account for their employees in an instant and amidst local legislative changes. The pandemic has created new working environments with people working from different states and countries, both in person and remotely, which influence tax regulations, support and benefit programs, or work-from-home policies and payments. Organizations often implement such policies at a fast pace and cannot make smart decisions without the right data at hand. ADP’s payroll research also illuminated that 73% of respondents did not have the payroll data to inform the strategic direction of the company.

The Strategic Impact of Remote Working

The remote working environment has facilitated a more global and disparate workforce, and without employee data that is consistent and truly global in scope, leaders are unable to properly strategize and expand their businesses. Rather than aggregated and inconsistent reporting, one global payroll provider means that data can be benchmarked across regions and used to drive business decisions more accurately. Payroll and HR professionals hold some of the most valuable business data, such as where to place employees and retention and attrition rates. Even at a domestic level, legislation and HR policies can vary state by  state, and a clear view of data in areas such as diversity and inclusion and wellbeing can influence strategy and improve decision making. 

With the labour market tightening, data that is accessible has never been more pertinent. Payroll has a strategic function in the fight to attract and retain talent, especially as the needs and priorities of potential employees shift. It's not just where we work that has changed; it is also how we work and what we value in our working lives. Employees want flexibility, whether it’s in their working setup or the frequency with which they are paid. The ability to access their paychecks and HR functions at their fingertips, and on intuitive platforms, all make a difference to the employee experience and frees up valuable time for payroll professionals to focus on strategy and planning. 

Global payroll is critical to business’ success in its ability to remain agile and adaptable in the face of change and to retain talent. The pandemic exposed that many businesses were too focused on the future when the foundations of their businesses weren’t solid. Those with a robust payroll and HCM function were able to pivot and plan, and the speed at which leaders must now make decisions means that without timely and valuable data, you’ll be left in the lurch. The world is more dynamic than ever before and so, businesses must be too.

Frank Smits, President of ADP Celergo Streamline, joined ADP in 2009 as Implementation Director in the U.K. and, after a short time, transitioned to Service Director, U.K. Since 2012, he’s served as Division Vice President, Senior Vice President—Service Delivery, and Employer Services International (ESI), where he led many highly successful digital transformation and business process improvement initiatives.
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