Having your VOICE heard: Focusing on the Big Five Global Payroll needs
Having your VOICE heard: Focusing on the Big Five Global Payroll needs
Charlie Knox, Chief Customer & Technology Officer and Stephen Wratten, Director of Product at activpayroll
Foreign direct investment has been booming in recent years, creating huge opportunities for organisations to globalise their footprint. In fact, foreign direct investment reached an impressive $1.3 trillion in 2022; and in the first half of 2023, it rebounded to $727 billion. Whilst expanding a workforce globally is a strategic move that sets a business apart from its competitors or puts it on a fast-tracked growth trajectory, companies will undoubtedly tackle several challenges – particularly regarding payroll.
With employees working across international borders, organisations will need to begin navigating the hurdles related to payroll and mobility. International expansion success hinges on a business’s ability to understand the key principles of global payroll in order to leverage the team’s full potential and drive sustainable growth.
These key areas encompass visibility, outcomes, integration, compliance and experience, which we have labelled the V.O.I.C.E framework. By addressing these five key areas, organisations will unlock impactful outcomes and better navigate the complex landscape to manage and deliver success.
Making Sense of Change and Gaining Visibility
Visibility is at the heart of global expansion as it enables businesses to see how the changes impact their operations, setting the scene for the entire strategy. Firstly, business leaders need a full picture of their payroll data, which gives them the ability to model, predict and prescribe improved results. They will also need visibility of payroll performance to tangibly see the efficiency gains from addressing the complexity of global payroll.
Most businesses will partner with a knowledge partner who will help them navigate this new territory. In this case, businesses can leverage advice on global payroll and tax compliance implications, as well as receive guidance on any of the global payroll platforms being utilised. Organisations will also need to have visibility on the direction their global payroll partner is going to ensure that they are evolving their software and services in a way that supports the business’s long term needs.
Ensuring the Right Outcomes
Along with HR, the payroll team has access to and works with some of the most sensitive information within a business. With that in mind, companies need to address the security of this data to ensure payroll can be delivered securely, as the impact of a data breach can be catastrophic both internally and externally. Seamless execution is also imperative to the payroll function as every pay cycle becomes more complex with the addition of new countries or remote employees.
Once these factors have been taken into account, the power of payroll data can truly be unlocked. With the addition of expertise from a global payroll partner, companies can make the right organisational decisions based on new locations, as well as keep up to date with the latest cost and tax implications worldwide.
Integration at a Grass-Roots Level
Given the complexities of global payroll, having all of their payroll data and visibility for the process in a single integrated platform is critical to enable businesses to achieve their outcomes. There are a large number of Human Capital Management (HCM) and Enterprise Resource Planning (ERP) solutions available in the market, but choosing the right one can be make or break when ensuring HR and finance teams can deliver accurately at pace.
Whilst technology integration is important, businesses also need to consider their people in the delivery of organisational success. This means that the platforms used must be adopted at a cultural level with full alignment at all times. Additionally, in functions where there are blurred lines between HR and payroll teams, such as employee benefits, having access to global payroll tax and compliance experts will help leaders understand the benefits or locational implications to make the right decisions to support their goals.
Reviewing Compliance Pain Points
Legislation is always evolving and it is becoming even more challenging for businesses to stay ahead of changing policies whilst getting to grips with numerous, new legislative regimes. Tax legislation is notoriously complex, and there can be several levels of rules and regulations to follow when expanding across borders.
Compliance issues now go to the very top of organisations, with Chief Compliance Officers responsible for both ensuring compliance is achieved and working with management teams to monitor the importance of payroll growth. Therefore, ensuring businesses stay informed and take the appropriate action when expanding into new markets can have a major impact on their future success.
Utilising Experience to Build Trust
Having confidence and trust in a global payroll partner is crucial to delivering positive outcomes for an organisation looking to expand into new geographical markets. This long-standing and transparent relationship can be built by having a clear sense of responsibilities for each party, particularly when onboarding new countries. By getting this right at the start, businesses will be able to unlock a plethora of benefits.
Global payroll partner companies will also have experts in a variety of support roles, either for the whole organisation and its payroll process, or specific experts in the nuances of international tax complexities. This helps solidify the roadmap of an organisation’s global payroll operation, ensuring that it meets their needs and desired outcomes.
Evaluating Global Payroll Provisions
With untapped opportunities available in the global business ecosystem, making sure that a company’s payroll provision is meeting the needs of the business and its employees has never been more important. Addressing the top global payroll challenges and leveraging insights from payroll and mobility experts will help organisations navigate these growing HR complexities and put the business on track for success. Businesses can do this by focusing on the V.O.I.C.E framework to meet their global payroll needs now and in the future.