Things you should consider before implementing Multi-Country Payroll

There is a world of choices available today for those businesses seeking to implement a multi-country payroll system. There are a multitude of factors to consider too. The choice is not that complex if a systematic thought process is applied.

First, since business are not likely start ground up (startups usually allow banks or accountants to handle their payroll with minimalist effort), it would be good to look at what’s good about the current payroll service (in-house or outsourced) and what sort of efficiencies must be derived for the future with new deployments. Efficiencies are usually gained through additional connectivity (as real time and integrated as possible) and optimal process, both of which may require the introduction of new technologies and policy articulation.

New avenues in technology:

Examine new technologies that are available. Latest in the line is Robotic Process Automation (RPA). RPA simplifies querying and seeking answers to questions that employees may have of the system. It can intelligently connect with an employee’s calendar (say in Outlook) and warn them of meetings scheduled on a day that they may be applying for leave (in their HCM system) or nudge a meeting ahead when they are on the road and getting delayed. These functions increase awareness, accuracy etc. RPA can work across all employee engagement functions including time management and greatly increase the automation and accuracy in recording data. The immediate impact of this throughput is, the feeds to payroll (of time data) is timely and accurate, reducing FTE needed in manual intervention.

To Outsource or run Payroll on Cloud:

Make a choice out of outsourcing the function, or, handle it centralized in a public cloud, is another consideration. Organizations that have traditionally been paying payroll incentives that are matched to production output or have complex shifts in manufacturing with varied allowances etc., have a tendency to handle payroll in-house. Those with standard payroll systems may outsource. Ramco has seen all the models in delivery, the highest value being cloud based HR Self Services and Managed Payroll. In this model, configuration of self service, sensitive to a statutory region is easily achieved. Managed Payroll hides the complexity of the data process, handles month on month changes (cost center changes or employee exits), and ensures compliance to statutory norms.

Selecting the right Payroll vendor:

Harnessing new technologies is one way to look at choices in payroll sourcing. The other is obsolescence of existing technologies and expiry of extant contracts. Incumbent vendors (who have been providing services) may have difficulty of keeping with statutory changes in a certain area or may not be able to adapt to new technology options without substantial and on-going integration efforts. Clients should look for vendors who are always focused on automating repetitive tasks and leaving nothing to chance, understand a payroll administrator’s job and simplify it, offer a range of horizontal support in the form of control reports, analytics, workflow and smart alerting.

Vendor’s financial records, product development methodology, strategic intent in the payroll domain, recent business success, product documentation, staff are points to critically examine before making the decision. Vendors are also assessed for their ability to provide compliance in various countries that will avail the service. In the base of managed services, vendor’s ability to provide lodgement services in the countries in question must also be examined. Usually vendors would have local alliance partners for the same. While going in for Managed Services, ideally vendors must have ISAE certifications as well.

If the client were a globally distributed organization, however large or small, they would still have to debate on what would be a good starting point.

Would the starting point be on the basis of an expiring contract, maximum vendor inefficiency, and dramatic changes in statutory – these are all points to consider. In Ramco’s experience, clients often start with the most content, technically obsolescent site. This way the content (especially control reporting), roles, and process are preserved and the model is replicated on the new technology at all sites. Sometimes a choice is made in the most IT deficient but scaling site (dramatic headcount increases).

Holistically speaking technology, product, extant contracts, global locations and their readiness to migrate all factors in the consideration. It’s good to work against articulated goals and develop time lines within which to achieve the same.

Above all, an error-free Payroll with nil escalations is the ask of every business.

You can get more perspective about multicountry payroll in this webinar co-presented by our customer General Electric, Global Payroll Association & Ramco Systems. Click here.

See all topics