Human Capital Management (HCM) requires complex, multi-faceted decision-making. HR managers need to satisfy both the tangible and intangible needs of their company’s employees. To that end, they can use global payroll data to provide insights and make better decisions.
Immedis provides an analytics platform that streamlines global payroll. Our global payroll management application creates easy-to-read reports that aid HR managers in understanding operational insights. With that considered, our application helps in several ways, including:
And ultimately, our platform helps managers address the two sides of HCM: objective, concrete needs, as well as subjective, felt needs. It is an all-in-one payroll solution.
To understand how analytics can provide better insights, we need to first take a look at the needs and goals of HCM. There are two categories of goals here: objective, tangible goals, and subjective, intangible goals. Neither are necessarily more or less important than the other.
They are the kinds of things you could point to or reference in a court of law.
They are the kinds of things that you and your employees can feel, and therefore make an impact on worker productivity and satisfaction. They include:
Reaching both objective and subjective goals is crucial for any HR manager. They keep the workforce satisfied and on track.
Payment is the ultimate signifier of an employee’s worth as an employee. That’s why it is so important that workers be paid fairly, correctly, and on time. Failure to do so signifies that they are not fully appreciated. This appreciation boils down to both concrete and abstract aspects.
Concrete aspects are questions of survival: Can I get by on this pay? Will I get paid on time, correctly?
Abstract aspects are questions of feeling: Am I paid my worth? Is this remuneration fair?
Obviously, these considerations reflect the objective and subjective goals above. HCM managers need to meet those goals to ensure both the concrete and abstract aspects of monetary compensation. They need to do more than simply pay employees and process payroll. Global payroll providers also need to make sure employees feel good about their payment.
Immedis’ analytics platform provides several types of reports that aid HR managers in analyzing global payroll to make better decisions.
These payroll reports, together, provide a robust suite of tools that HR services can use to perform both the objective and subjective sides of HCM.
Setup Reports and Variance Reports both help mitigate risks in international payroll. They provide organized information about what data is present, and how it is changing. Sudden, unexpected changes may indicate payroll errors.
Mitigating global payroll risks is crucial for both the objective and subjective sides of HCM. Paying the wrong amount, or at the wrong time, sends a bad signal to workers. They may start to have concrete worries about the ability of their employer to provide for their needs. They may also start to have abstract worries, about the fairness and value of their remuneration.
Diversity and Inclusion Reports help you understand how pay varies across gender and other factors. It is crucial that workers feel that they are being paid fairly, and this includes non-discrimination across factors irrelevant to work success.
This primarily affects the subjective side of HCM. Workers who are underpaid due to gender or ethnicity will feel unappreciated and resentful. And the other members of your team, should they become aware of this, may also feel that it is unfair, despite receiving greater compensation.
Change is the only constant in life. Immedis’ Flash Reporting and Movements Dashboard provide the insights you need on how your organization is changing. This lets you respond quickly to new changes and developments, and keep employees happy at the same time.
Our analytics platform can even analyze itself. The Service Management Reports openly assess Immedis’ performance. This lets you gauge how the global payroll solution is helping you and shows where it is making the biggest impact.
Better insights mean better HCM, and better HCM means happier employees and greater productivity. Global payroll services are at the center of HCM, as it is the ultimate signifier of value to employees. Doing payroll correctly, therefore, is crucial for maintaining a positive work environment.
Immedis offers several reports to help you better manage payroll and keep workers satisfied in both concrete and abstract dimensions. They should consistently feel that your company can provide for them by paying them correctly on time. And they should consistently feel that they are being compensated fairly for their labor.
Our reports deliver insights related to risks, diversity and inclusion, trends and movements, and even the analytics platform itself. These insights help guide HCM decision making and lead to better payroll management.
I was sitting having lunch in a café recently when I overheard two people at the next table talking about the fact that their pay had been a day late. For one man, he had to borrow money from family, while the other remarked that at least he was lucky to be able to do that – she knew of someone who was going to be late on their rent payment as a result. According to them, the blame lay at the feet of the bank – there’d been some sort of technical error. But it made me think if companies really understand the impact of these situations where payments are late.
Ernst & Young recently found that 78% of people live paycheck to paycheck. It might seem like no big deal to some if someone has to wait an extra 24 or 48 hours for that payment to come through to their bank account. With that amount of people holding out for pay day, we know the reality is very different, and employees are counting on their money to reach their bank account when they expect it to for multiple reasons. Your employees have direct debits set up for rent, mortgages, or car payments and are dependent on having funds available.
Continuous late payments on something like that due to funds not hitting their account on time can have huge repercussions and even impact their credit score. While it may seem small, others might be waiting on that money to come through to finally get something around the house fixed or pay for that gift they’ve been meaning to pick up for an upcoming birthday. From the big worries to the small ones, it all adds unnecessary stress on employees when situations of late payments arise.
With PwC reporting that 54% of people say financial or money challenges cause them the most stress, the need for a managed payment system that can ensure a payroll that is accurate and on time is all the more evident.
To ensure you’re not missing the mark, there are several payment options available, and one of these is availing of a simplified payment system. With this option, your provider takes on the full responsibility of moving your money to ensure employees, as well as statutory and third party payments, are made. Of course, there are other options out there, so knowing what works for you and your business is critical. In assessing your need for a managed payments solution, take a look at the following areas:
Starting with the obvious, this is vital to ensuring the right amount of money reaches recipients’ bank accounts when they expect it. If there are constant issues in achieving accurate and on time payroll payments, it’s time to look at why this is happening and if you’ve outgrown your current treasury management processes. Employees feel the knock-on effects of this, but they also have a huge impact on the business overall.
From a cost and time perspective, consider the implications of incorrect funds being issued. Underpayments cause the headache of dealing with complaints and time spent re-issuing and rectifying those payments. On the opposite side of the coin, overpayments can be hard to catch, often go unnoticed, and are never recouped.
The more parties and individuals that touch payments and funding activity, the greater the risk. The information available to those in that process is extremely sensitive when you consider the nature of that data which includes things like salary and personal/business bank account details. Take the time to look at the number of internal and external parties that touch that data and how information is shared between all touchpoints.
The risk of data breaches and fraud rises exponentially if any manual effort is required to maintain and share this information. Utilizing a managed payments solution removes this risk as your provider manages the end-to-end process once the payroll is approved.
Businesses are continually looking at ways to optimize operations across the organization. Treasury and payment processing should be no different. There are numerous things to consider that add to the time and manual effort required by your teams to ensure payments are made. To begin, ensuring pay-related information is in the required format for relevant banks is labor-intensive – local bank requirements need to be adhered to, and can vary from country to country, adding to the complexity.
In addition, approval processes should be looked at to consider who’s involved and what the typical turnaround time for authorization is. Once approved, time will need to be spent working through bank file uploads and addressing any potential upload issues. If teams are experiencing payments issues, they’re most likely going to have to spend time dealing with re-issuing payments.
The list goes on. All this equates to time spent on an extensive list of manual activities rather than working on value-add goals and hugely increases the risk of errors, inaccuracies, and late payments. A managed payments system can completely transform and streamline this process for the better.
Less than optimized treasury management processes rely on different systems, multiple parties, different authorization levels, and inconsistent reporting. Add to this the fact that failed or rejected payments are often handled outside of payroll systems; businesses will have no audit trail or visibility of payment and funding-related activity.
As the saying goes, if you can’t measure it, you can’t manage it. This is certainly the case without a centralized payroll solution that tracks payments processing. By working with a provider that manages end-to-end treasury management, companies can gain complete oversight of the process and have audit trails available at the touch of a button.
During the next evaluation of your global payroll and payments processes, take the time to look closely at each of these areas and the effect on both employees and the business.
If you’d like to learn more about how Immedis can support your global treasury requirements, get in touch here.
The disruption of the last couple of years has been a big wake-up call for most organizations. While work practices were changing, the pandemic accelerated the move from the office in massive volumes, putting business systems to the ultimate test. It was a watershed moment, and in some cases, it highlighted the inefficiencies of traditional operating models. Out of the blue, it became imperative for companies to have access to their systems regardless of location. This transition was even more significant for payroll teams as they sought to function as usual despite the seismic shift in workplace operations. Many were not ready for the demands of the new working paradigm, and others realized how outdated or fragmented their solutions were, inevitably raising doubts about their efficiency and security. Many organizations learned how their lack of data standardization and processes causes problems and hampers the company’s ability to make strategic decisions.
As enterprises worked to adapt to the new world order and efficiently introduce digital transformation initiatives, one area highlighted as a source of concern was the reliance on manual transactions. The following issues were identified due to this behavior.
Digital innovation has steadily transformed payroll from a back-office processor to the nerve center of most organizations. How? In a word, data. Payroll is an incredibly data-rich function of any organization. And when companies can optimize this data via digital transformation initiatives, this is where the true transformative power lies. Global payroll solutions that incorporate leading technology, including robotic process automation (RPA) and artificial intelligence (AI), to provide payroll teams with the means to gather and put structure on this data is when companies can begin to see the potential and power of the transformation.
Transitioning from manual processes to technology-enabled ones offers the payroll function the following advantages.
Payroll remains at the epicenter for employee financial wellness and, as such, must provide transparent, accurate, and timely results to ensure employee confidence. One of the measures of the efficacy of payroll is how companies deal with exceptions, those payments which are not standard. And in an increasingly complex work environment, the payment of those exceptions could decide the employee’s experience and, in turn, can make or break an organization. Remember, one study showed that 49% of workers would seek new employment after experiencing two problems with their paycheck. And with an increasingly tech-savvy workforce, employee expectations around how and they receive their remuneration will continue to increase. Paying people can be difficult but is central to every company’s success. As companies move into new markets globally, managing the complexities of compliance will be a top priority, and the payroll team will be challenged to scale, navigate volatility or remain agile.
To embark on the digital transformation of your payroll, it is essential for payroll professionals to understand the nature of the process. Payroll professionals will need analytical skills to read and interpret the data to identify trends and workforce patterns. Therefore, the data itself and how accurate and how it is collated becomes critical. Standardization of the payroll process and data is the natural first step.
Once gathered, this data, both historical and real-time, can then produce variability and performance reports revealing trends and creating one single truth for the business.
Digital transformation of the payroll process enables greater accuracy and clarity. It saves time and money and provides greater agility, compliance, and security, all of which add up to placing global payroll at the center of operations.
Please listen to our free on-demand webinar, Global Payroll Transformation: Taking a Practical Approach, for more on this topic.
As it can be in life, so it can be in business: objectives and charters seemingly unrelated or even at odds with each other can be, as the cliché goes, two sides of the same coin. As the non-cliché goes, they can be complementing hemispheres. It’s often the case in the C-suite, as the Accenture-advocated idea of whole-brain leadership shows us. And it’s certainly the case in human capital management, as 3Sixty Insights’ concept of concrete and abstract HCM shows.
What’s more, one kind of data can be comparably valuable to different stakeholders in the C-suite whose concerns might be seen, alternately, as left-brained vs. right-brained. Such is the case. certainly, when it comes to the needs of the chief financial officer and chief human resources officer. In a multinational enterprise, global payroll can be the source of that data — as long as it’s available and manageable, which only the right technology can really make happen.
This is the epiphany that came to mind for me, having had the pleasure of co-presenting a webinar last week with Conrad Wilson, data and analytics lead for Immedis, the Ireland-headquartered provider of technology and support for global payroll. Tiffany Appleby, vice president of global alliances and partnerships at Immedis, was our host and moderator. Our topic really made me think: “Payroll Analytics: How global payroll data provides the CFO and CHRO with insights for better decision-making.”
During the webinar, Conrad shared several examples of easily accessible reporting, available in the Immedis system, that help CFOs and CHROs lead better-informed. For example, one thing the CFO needs is to mitigate risk with payroll. It’s usually an organization’s largest expense by far, after all. Setup and variance reports can help with this. As for the CHRO, one thing he or she needs is tools to monitor and drive diversity, equity, and inclusion — ever more a critical component in workforce planning worldwide. And, in the Immedis system, a CHRO will find diversity and inclusion reports and a movements dashboard, both helpful in this regard.
A prerequisite to all this is that an organization sort out its global payroll in a manageable fashion, of course. This usually means outsourcing global payroll, at least to a degree, and deploying robust technology to handle it. Only then will a global enterprise capture the related data in modern ways that ensure its availability and easy presentation to decision-makers such as the CFO, CHRO, and other C-suite stakeholders.
What are all five things the CFO and the CHRO each need to improve their decision-making, and how can well-aggregated, well-presented global payroll data help? To find out, you’ll have to view the webinar — now available on-demand. You’ll probably want to do so anyway, as Conrad and I covered much ground, discussed many intriguing tangents pertinent to the topic at hand, and addressed several smart questions and observations from the audience. It was a real honor to be a part of this production.
Editor’s note: This blog was originally published on the 3Sixty Insights blog, on April 14, 2022.
The Human Capital Management (HCM) market continues to grow with expectations that it will expand by over $12 million by 2025. Several factors contribute to its continued growth – from expanded capabilities to the pandemic accelerating the move to the cloud and global expansion. The HCM has evolved into more than simply a library or storage of employee data to that of a full suite of not only HR but also talent offerings. Today, major HCM platforms such as Oracle, SAP SuccessFactors, UKG and Workday support employees from recruitment to retirement and everything in between.
Good global payroll is a byproduct of business process in the HCM system, as the HCM enables automation of the payroll process. Payroll and HCM can work together to provide –
Integration is the seamless flow of information through an entire business process, regardless of the source of truth, and creates a unified user experience. But for true integration, we need to start thinking bigger beyond just integration of systems to build an integrated business process. One where –
You may be thinking to yourself that your global payroll solution and HCM system are already integrated, so your work here is finished. But the key to a true integration that delivers maximum possible value out of both systems is having not only integrated systems but integrated business processes.
Take a look at the chart below to rate where your organization is on the path to achieving business process integration. For some, it may surprise you that there are so many levels of integration.
If you are starting on the integration journey, then it’s critical that you understand what is needed.
Thomas Otter offers a comprehensive explanation of APIs and their importance in The Role APIs Play in Securing the Safety and Success of your Payroll Integration. In the most basic sense, APIs enable the movement of data between systems. “The API stops the wrong data coming through, and the better your API, the better your data in your HCM.”
Payroll teams work with data such as core records, non-core records like bank details and country-specific information, and payroll inputs.
Most all HCMs offer a certification or validation process. Your HCM provider can point you in the direction of their global payroll partners and if the provider you have chosen to work with has successfully achieved certification. Official certification from your HCM providers means that you are guaranteed a level of quality and that your payroll provider has passed rigorous testing around security, data validation and the overall quality of the integration.
Not surprisingly, the global payroll provider plays a critical role in the success of the integration. If your organization is going to market for a new global payroll solution, there are many areas to consider as you look at who will make a good partner:
The capabilities of HCMs continue to evolve, and so too will the capabilities of integration. In time we will see a drive to self-service functionality, especially around enabling employees greater engagement with the HCM and control of their payroll data, and a more intelligent user interface. By creating a seamless information exchange between HCM and payroll, you can reduce the time and costs associated with managing disparate data and increase the time spent effectively utilizing this information to make informed data-driven decisions
If you are interested in more insights into how your payroll team can prepare for and optimize integration between your payroll solution and your HCM, I recommend watching Realize the Benefits of HCM investment. Dave and Will have managed extensive HCM and payroll integrations and this session infuses their expertise with real-world practical tips and advice.
Human Capital Management (HCM) covers a broad area of important business activity. Payroll Management is an integral component of HCM, because it is necessary for ensuring that employees are compensated fairly and accurately. As companies grow and expand, they have more HCM-related data to manage, and can easily get stuck with slow and inefficient HCM and payroll systems.
Our research suggests that less than 15% of businesses are operating with truly integrated HCM and payroll. This undoubtedly causes substantial risk for their global payroll process, as data is lost, misused, or damaged.
Businesses that complete a tight global payroll integration with HCM, enjoy streamlined management of all their employee information. This helps them pay employees correctly, ensuring compliance, visibility, and cooperation with all other areas of HCM.
Digital payroll processing, in an integrated system, is the only way for companies to meet today’s global payroll challenges.
The HCM market is vast and growing. It is expected to grow by $12.16 billion between 2021 and 2025. The reason for this growth is that HCM applications can help tackle multiple challenges at once.
In 2022, HCM includes many different domains:
Ideally, payroll processing involves gross and net pay calculations, country-specific compliance, employment compliance, financial integration, and retroactive and part-time pay. While the reality often comes up far short of this, only a truly global solution can deliver on this promise.
Success in each of these domains is crucial for modern-day HCM. Payroll affects all of them, and payroll data is relevant to every domain. World-class HCM needs a world-class Global Managed Payroll Solution.
Payroll is at the core of HCM because that is the primary medium of exchange for employees. Employees define the value of their work by how much and when they are paid.
Immedis is a global payroll solution platform that solves the payroll aspects of HCM in six ways:
Integrating global payroll data with HCM is a sound business strategy because it solves the clerical problems associated with non-integrated information.
In particular, an integrated payroll system can transform your business activities in these ways:
These transformations streamline your payroll process and reduce the risk of errors along the way.
True integration is the seamless flow of information through all business processes, regardless of the source of truth. It creates a unified user experience throughout the system. This means a tight integration of both information systems and employees. In particular, cross-departmental communication is key. Payroll and HR managers need to engage with their technology and finance teams to handle all employee data.
Payroll managers can carry out detailed models of how payroll staff carry out their work. This ensures consistency and reliability, as well as a source of accountability for when things go wrong. Ultimately, integration should support the entire business process outcome.
Many businesses do not know what true integration looks like because businesses lie at different levels of integrational maturity.
In particular, we identify six levels:
Survey reports indicate that less than 15% of businesses have seamless HCM and Payroll integration. In particular, a full 36% do not have any integration at all. This is a threat to data security as well as data integrity.
*Source: Immedis partnered with Global Payroll Association.
There are many ways to integrate your HCM and payroll information, but any good system will contain these three building blocks at a minimum:
Integrating HCM and payroll produces enormous benefits for businesses. It streamlines global processes, reducing errors and maintaining employee satisfaction. While most organizations are not in a state of mature integration, all businesses can reach that level by using intelligent APIs, good data, and certification and verification.
The fastest and most efficient connection between the payroll and HCM is with an integrated global payroll system. Immedis offers a global payroll application that helps systematically manage all the payroll details of global business.
Our system brings businesses to the highest level of integration with regard to HCM and payroll. It is self-operating and self-correcting, allowing users to submit and access data in real time across domains. Unlike outdated systems that rest on manual data entry or rigid data structures, we provide a flexible global payroll system that lets users manage payments to multiple countries with a single, centralized platform.
The past two years have been a wake up call for many businesses. The challenges of the pandemic have shown that older ways of handling payroll and HCM are no longer sufficient to pay employees. Global payroll needs to transition into the 21st century, and businesses need to follow a practical approach in making their transformation.
Global payroll providers have the opportunity to shift from being merely information processors to a larger role of strategic advisors or partners to businesses. To that end, modern data technology can provide valuable insights. The best strategy is to use an integrated platform to carry out every needed feature.
We will discuss the challenges of payroll in the future, and how global payroll services are adapting to meet them:
Our research suggests that most businesses have outdated and inefficient payroll systems. Only 28% of businesses have access to real-time dashboards indicating payroll data. Almost 45% have very low to limited levels of standardization across global payroll processes. And on average, businesses surveyed used 7 different payroll providers. They could reduce that number to 1 by switching to a global payroll provider.
Businesses face challenges and need improvement in several areas:
Despite these challenges, businesses are pivoting towards new options.
Payroll transformation is a top priority amongst buyers, with most requiring assistance in navigating and enabling transformative outcomes. We carried out a survey of business owners to determine where they see their payroll needs currently changing.
Clearly, there is room for improvement across the board. But our research also shows that the vast majority of business owners are aware of this, and are beginning steps to make their own payroll transformation.
We have identified several current market trends shaping the face of global payroll.
Cloud-based platform Adoption allows payroll to be enabled through HR and payroll technology platforms.
Robotic Process Automation (RPA) transforms routine office payroll tasks into automated programs.
Global Payroll Delivery Models integrates global payroll into one delivery system, allowing users to manage different regulatory requirements across countries.
Strategic Business Partnering makes payroll into a COE. In particular, executives can incorporate payroll into expansion plans earlier in strategic corporate discussions.
On-Demand Pay empowers workers by giving them more flexible payment options. Paying employees when they want to be paid promotes company loyalty.
Payroll Automation provides several benefits, including improving compliance, saving time and money, strengthening security, delivering data analytics, and realizing the value of HCM.
Digitization will transform payroll operations from simple processing tools to a strategic COE (Center of Excellence). This will enable greater agility and resilience in navigating volatility, supporting strategic plans, and creating global payroll solutions. Payroll continues to be a critical, core element in improving the employee experience. It must promote trust through timely, accurate, transparent results and guided insights.
Mobile first, if not mobile only, UI /UX expectations will escalate. People already expect to do everything on their phones, and payroll is no exception.
AI/ML will augment practitioners and employees with guided, predictive insights and decision making. This will create consistent payroll outcomes and improve data quality.
Demand for alternative payment methods will escalate. Already, a number of digital options exist, and some businesses are even exploring crypto payment methods.
Employer integrated earned wage access for on-demand payroll will become a standard payment option expected of employers. Post-2020, people are used to on-demand transportation, entertainment, and delivery. Payroll will be treated no differently.
Navigating intensifying compliance directives globally will remain a top challenge. Firms of all sizes will increasingly see their footprints pulled into new countries of operation, and the complexity of their legal needs will grow rapidly. International payroll services are necessary for managing international employees and a global workforce.
Payroll operating models will require modern capabilities to scale, remain agile, and navigate future volatility. Manual data entry and manipulation is simply too slow, and takes valuable time away from work. Automation, on the other hand, will enable practitioners to focus on value-added tasks.
Globally consolidated, predictive analytics reporting will be a standard, integral tool for leveraging the rich data sets that payroll holds. They will enable users to discover insights in employee data, identify bottlenecks, and streamline their overall payroll process.
Together, these needs will transform payroll services from simple processing operations into a strategic COE and advisor to the business and to HR.
Modern payroll services require a platform-based approach, incorporating technology, services, and extended integrated capabilities through a single global solution. Because no single feature suffices to modernize payroll, suitable systems will require a platform that can handle dozens of new features. Some of the most relevant features include:
Clearly, this is not a challenge for a single piece of software. Each business will have its own set of needs, which will likely include some subset of the features listed above. That’s why a flexible platform, with a 3rd party API marketplace, is the best option for businesses. Flexible platforms allow businesses to operate the core of their payroll while also choosing which specific applications to integrate to meet their unique needs.
Dozens of features fit together to meet the growing needs of payroll and HCM in the 21st century. The worst way to accomplish this is to try to solve all problems one by one, with separate pieces of software that need to be carefully integrated by hand. Unfortunately, many businesses go this route, only to waste time and money and introduce errors and security risks to their system.
The best way to transform payroll to solve modern problems is to use a single, integrated platform. This approach allows data to be shared across applications, allowing users to manage their tasks with flexibility. Businesses can pick and choose the individual APIs they need and plug them into their system without having to worry about whether or not they will work.
Immedis is a global payroll provider that offers a fully integrated global payroll solution. Through a combination of automation, digitalization, and predictive insights, our platform allows payroll and HR managers to turn payroll into a valuable tool for managing workers and ensuring compliance with domestic and foreign employees alike.
We often say that our biggest competitor is Microsoft Excel.
It is true that much of international payroll comes down to operations on spreadsheets. Some prospective clients ask why they should use Immedis if they can get away with using Excel. To which we answer: why would you want to rely on spreadsheets? Spreadsheet applications like Excel don’t handle compliance issues, manage different rules for different countries, or provide security. Compared to robust global payroll providers, it’s like driving a horse and buggy instead of a car.
Not all companies realize the immense difference that global payroll operations can make, but many are starting to see where they are lacking. We took a survey with GPA (Global Payroll Association) to find out where our services can have the greatest impact. To start, our survey discovered that our fears were not misguided. Over 71% of respondents indicated that they frequently use Excel within payroll processing and data analysis.
Of course, the optimistic take on this is that most of the potential payroll application market is still untapped. Those 71% of businesses could all benefit from using Immedis software.
Let’s take a look at some other key results of the survey.
We asked companies the following question: “What is your current payroll close date for all data inputs and changes?”
Respondents fell into four broad classes:
This suggests that most organizations could do better when it comes to their payroll close time. Few are handling data in real time. Most companies lose time by transferring information back and forth between external service providers. Imagine the nuances and complexity beyond just compensating employees as well. When focusing on other countries throughout the world, there is a very different approach to benefits, tax, withholding and things like bonuses and commission. Excel can track variances, in theory, but it becomes increasingly difficult to verify changes as they happen each month. With 39% of respondents claiming that they are processing payroll 6 days before payroll close, this is the equivalent of cramming for a test in university. Too much margin for error, and completely negates a Payroll specialist’s ability to make strategic decisions versus reactionary decisions.
We wanted to get a sense for how businesses managed their payroll through multiple vendors. One advantage of using an integrated global payroll system is that it combines data and processes into a single platform. It immediately alleviates potential shortcomings or variability within external partners.
Our survey discovered that over 44% of organizations are juggling at least 5 vendors at once, with some managing over 100! We also wanted to find out about the beliefs and attitudes regarding vendors for those we surveyed.
Two questions we asked were:
Do you believe there is a single vendor who can handle all of your international payroll needs?
How important is achieving international payroll delivery through a single vendor?
Together, this information suggests that there is a vast segment of the market that is simply poorly informed about their options, or they have been burned in the past from other partners that have over-promised. More than half of businesses might not even know that their global payroll needs can be handled with a single vendor. And a large chunk does not know that delivering international payroll through a single vendor can have a tremendous impact.
Our survey results showed that most organizations lack payroll and HCM integration, or lack HCM systems entirely.
Integrating global payroll with HCM systems is one way in which Global Payroll systems like Immedis provide immense value to businesses. It means easier data sharing and analysis. The fact that most organizations have some form of HCM in place, but very few have seamless integration with Payroll, means that Global Payroll is poised to provide benefits to large swathes of the market.
Global payroll systems provide the greatest speed and ease of access for payroll reports and employee data analytics compared to any other solution. Regretfully, not enough businesses take advantage of this fact.
With most organizations pursuing a sub-optimal path to accessing payroll reports and analytics, this drastically lengthens the time it takes to produce global payroll related reports. This can make it harder to pay payroll taxes and adhere to local tax laws.
With just 16% of respondents receiving reports at optimal speed, that leaves 84% who could potentially benefit from Immedis’ services. The data speaks for itself.
International employees may need to update their payroll related information for a variety of reasons. They may move, change phone numbers, take leave, or request changes to their payment schedule. It follows that modern global payroll processes allow for global employees to self-service their change requests. Payroll data, much like Healthcare information, is also personal and private. It only makes sense for employees to have the ability to change their own information and be in control of things like banking, geographic information, etc.
Yet almost half of organizations surveyed have no way for employees to do this:
Additionally, a modern payroll solution would allow for international employees to request on-demand pay. Modern people, after all, expect on-demand rides, food, and tickets at the push of a button. The weekly, bi-weekly, or monthly payment schedule is largely a vestige of the 20th century. With statistics outlining that nearly half of organizations create additional hurdles for employees, this creates unnecessary friction and a lack of control.
Very few organizations offer on-demand pay:
Not enough businesses have the proper awareness or take advantage of global payroll systems. It can be an intimidating initial conversation for a Payroll Specialist, CFO or CIO to wrap their mind around unifying In-Country Partners around one global Solution. Immedis has made the conscious choice to partner with 5 of the leading HCM Suite’s to fast track onboarding and reduce switching costs. Our research suggests that this is largely due to a lack of information. When businesses think they can get away with Microsoft Excel, they might not bother looking for other solutions. The other unfortunate reality is that the cliché, “If it isn’t broken, don’t fix it” applies when information and awareness is lacking. We are on a mission to help folks understand there is a better, more efficient way.
Global Payroll Setup provides many advantages that not enough businesses enjoy:
Immedis offers a global payroll application that helps systematically manage all of the above details. Our system brings businesses to the highest level of integration with regards to HCM and Payroll. It is self-operating and self-correcting, allowing users to submit and access data in real time across domains.
Recently, Immedis and GPA took a survey of those within the payroll industry. We wanted to get a closer look at how organizations manage their global payroll data. We discussed the significance of these results for the bigger business picture in another article, but here we wanted to take a look at the statistics for a deeper dive into the “why” behind them.
We will examine insights from the following areas:
In every case, we found that most businesses operate with subpar payroll technology. They seem to be unaware of what the cutting edge of global payroll technology even is or looks like. They may not know how to transition to modern payroll. We believe that better messaging and communications can help organizations learn about their options and deliver better payroll to their employees.
Companies doing business in multiple countries face multiple different sets of regulatory requirements. As a result, many companies find themselves using separate vendors for each country. While this may function on some level, it is a poor global payroll data solution compared to using a single global payroll provider for comprehensive payroll data management.
Having a unified global payroll system means that it is far easier to share, analyze, and manage information across all of payroll. It also means that expanding into new countries is far easier—instead of having to get a new vendor for each new country, you can simply use the scaling power of your existing provider to expand.
The number of vendors that some organizations use is really incredible. We discovered that over 44% rely on at least 5 vendors at once, with some managing over 100. What likely happens is that a company doesn’t see the value of global payroll providers at first, and then gets stuck in a loop of adding new vendors.
Consider a company that only operates in the United States. If they choose to add locations in Canada, they might elect to simply get a new payroll system for Canada. Not seeing their distant global expansion, they don’t see the point in global payroll processing. And so with every new country they expand to, they get a new vendor, until they have too many to manage.
Evidence for this possibility comes from the fact that most companies don’t know about the possibility of global payroll.
Do you believe there is a single vendor who can handle all of your international payroll needs?
To which 42.4% said yes, and 57.6% said no. This means that more than half of organizations surveyed are simply unaware of the massively cost-saving option of global payroll. Perhaps these organizations are content with their situation and are not searching for alternatives. But many of those surveyed would likely not be content with multiple providers if they knew about global payroll.
We also asked:
How important is achieving international payroll delivery through a single vendor?
To which 46% said very important, 40% said somewhat important, and 14% said not that important. It is likely that many of those for whom single-vendor delivery is important are also in the majority who don’t know about global payroll. Only a minority thinks they would not benefit from having a single vendor, but many of them would probably change their mind if they were better informed.
Despite this, almost half of our respondents have had problems with their payroll providers.
Has your payroll provider(s) ever failed to deliver on their service?
To which 46.8% said yes, and 53.2% said no. Combined with the above results, this is astonishing- most respondents have had problems with their payroll providers, yet don’t know or don’t care about using a single provider. Yet having a single provider would improve accountability and transparency, and reduce the chances of error.
Modern global payroll solutions, like Immedis, allow for rapid, real-time delivery of information. But old-fashioned systems, which can be as basic as an Excel spreadsheet and manual entry, are much slower. They often require days or weeks of work to correct the data, and make inputs and changes. They are also lacking in data security.
We asked survey respondents the following question:
“What is your current payroll close date for all data inputs and changes?”
The results indicated that there is a wide spread in payroll close dates, with 39% saying under 6 days and 11.7% saying more than 15. In this case, it is clear that many organizations would benefit from real-time data and improved data security.
Employee experience is at the heart of payroll operations. Getting paid is, after all, the main reason why people work, even if they do find meaning in the work itself. When it comes to employee experience, there are many things that payroll providers can do to make employees happier.
New trends, such as on-demand payment, give employees greater control over their own payroll. Better communication processes for payroll queries make life easier. And guarantees for remote work and gender pay equality ensure that workers feel they are being treated fairly.
We wanted to know what initiatives, if any, our survey respondents were taking to improve their employee experience. We gave them a list of possible initiatives that they could check off if their payroll teams and data were being used to support them.
Our survey results showed that only a minority, 37.3%, were improving the employee experience at all. As for specific results, a mere 7.4% said they were improving their employee well-being, and 15.7% were promoting diversity and gender equity. In addition, less than 12% were using payroll to facilitate remote work. Given how popular remote work has become in recent years, there is a lot of room for improvement here.
Again, many companies are likely not aware of the options that global payroll brings. If they were, they might be more likely to take these initiatives. But it is particularly surprising that so few are using payroll to promote diversity and gender equity, given that salary parity is a big part of equality.
Only a minority of the payroll managers we surveyed were taking full advantage of the powers of global payroll. Most delivered lackluster employee experiences, had poor payroll close cycles, or were tied up in complicated networks of multiple payroll vendors.
We believe that more businesses would benefit from global payroll if they received more communications and information about it. Companies that have dozens of vendors, for example, might have had just one for years, as soon as they started expanding internationally. This would have led to lower rates of problems with payroll providers and easier management of data.
In any case, the insights from the GPA survey are valuable for our continued operations and decision-making.
Our team has assessed thousands of buying processes - from point solutions to global full-suite rollouts at companies of all sizes and industries. We combined our experience with conversations we had with leaders from some of the top digital transformation firms in the HR Tech space and practitioners that have gone through this process - with failure and success. We found incredible consistency between all of the success stories and even more with the failures. While more than 80% of companies have undertaken digital transformation initiatives in the last five years, only 16% say these have successfully improved performance and equipped them to sustain changes in the long term
We have identified three key steps when buying HR technology: Planning & Building a Business Case, Evaluating & Selecting the Solution, and Implementation & Digital Transformation. All stages are essential to the success of the process regardless of company size, industry, or type of technology being assessed.
Today's blog focuses on Step 1: Planning & Building a Business Case.
Some common areas to think about when looking at the business impact of HR Initiatives: