Issue link: http://www.e-digitaleditions.com/i/295251
[ 25 ] APRIL 2014 | www.hrotoday.com Payroll services operations. Despite differences in language, culture, and regulations across the business, the client is presented a snapshot of total payroll. "By consolidating payroll data and normalizing it, it thus becomes more understandable to the people in charge of global payroll for decision-making purposes," Paterson explains. Jon Ziglar, executive vice president and managing director, international, at Ceridian, says the Minneapolis-based global payroll solutions provider has seen a huge increase in demand for single-vendor global payroll services. "While the rest of HCM (human capital management) has been global for years now, payroll—because it is so transactional—was still stuck in the Stone Age," Ziglar explains. "There were so many fields to fill in to maintain regulatory compliance in each market—all those different labor rules and hours tied to contract in each market—that it stymied globalization efforts. Because you couldn't see the payroll data, you couldn't do the analytics." As other parts of HR became global, the demand intensified for payroll to follow suit. "Companies wanted the efficiencies of running payroll on a single platform by a single provider taking care of all the integration issues," says Custers. "The business case for global payroll was never the challenge—it was the complexity involved that was problematical. Companies often struggled and failed to reach the finish line, which is why a trusted third-party advisor is so important in this journey." This complexity is gradually being weaned out of the global payroll process. Assuming a provider can digitize disparate payroll data, collect and aggregate this data in the cloud, and then apply big data algorithms to these aggregations, client demands are being addressed. Weinstein, for instance, says ADP's global payroll business is one of the fastest growing parts of the firm. Even midsize companies are lining up as clients. "We've got many large multinational clients, but are now finding that companies with 50 to 100 employees around the world also have a significant need for our services," he says. He cites the example of a client in New England that is hiring a small number of employees in nearly every country in Europe. "They have no idea where to send the payroll taxes, much less whether to withhold the tax," he says. "Other midsize clients are moving into Canada and Mexico, or spreading their wings overseas, and want to be sure they're compliant. At the same time, they want to know if they're driving performance with the right incentive compensation elements. That's where we come in." Despite its promise, payroll data globalization is progressing slowly for many clients, as well as their service providers. "Change doesn't happen overnight, not when a company says it has 65 separate payroll suppliers and wants to ensure compliance tomorrow," Sullivan says. "While you can make sure their people are getting paid, it takes time to ensure data quality, eliminate payroll fraud, increase controls to comply with data protection laws, and so on. Once that is done, only then can you gain visibility into the data for decision-making purposes." Ziglar agrees the trek from merely paying employees to learning from this data takes time. "The important thing is that companies are beginning to understand that payroll is of critical strategic performance; after all, it's the number one expense they have," he says. "By focusing on this cost and how and where it is spent, you can learn all sorts of great things from it. But, it doesn't truly become strategic until you can get visibility. That wasn't possible a few years ago. It is now." Complexity is slowly being weaned out of the global payroll process. Assuming a provider can digitize disparate payroll data, collect and aggregate this data in the cloud, then apply big data algorithms to these aggregations, client demands are being addressed. Russ Banham can be reached at www.russbanham.com