The business impact of technology choices in multi-country payroll

While multinationals often set out looking for a single payroll delivery model, in practice, a host of complexities and idiosyncrasies mean that they usually end up with multiple providers using different delivery models, and based on different technology platforms. This paper assesses the practical realities – and associated costs – of those technology choices.

It argues that:

  • Business managers in payroll, HR and finance are often tempted to leave the complexities of technology to their IT specialists. But technology choices can have significant business implications, both in terms of the speed and cost of implementation, and in the ability of a platform to meet ongoing business needs. Modern technology platforms provide a number of improvements ranging from basic productivity enhancements, such as mouseovers and data lookups to reduce the time to find information, to transformational features such as embedded analytics
  • Moving to a multi-country set-up brings additional technology risks, some of which are unique to the global payroll market, and these need to be factored into the business case for change
  • While cost factors are just one part of the multi-country payroll equation, they inevitably influence technology decisions and often force organizations to take a pragmatic rather than purist approach. For example, where a large payroll population is managed in-house on a multi-function enterprise resource planning (ERP) platform, the cost of shifting may be prohibitively high: likewise, the cost of outsourcing the smallest country populations can compare unfavorably to the status quo
  • A wide range of issues can impede organizations from selecting one single vendor or platform, ranging from the limitations of some vendors’ geographical coverage to the difficulty of scaling platforms up to handle large countries or down to manage the smallest employee populations
  • Some of the technology options now support a hybrid approach to service delivery. For example, the work carried out by enterprise software vendors to break down their products into smaller logical components should in theory allow customers to maintain their existing legacy systems while wrapping in new functionality around the edges
  • Finally, payroll is a “sticky” application that, once implemented, organizations are often reluctant to change. This makes it all the more important to get the technology choices right first time

To read the full report, click here or follow the relevant link on the left (GPRN membership required)

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