Businesses grow. Needs change. It’s the cycle we hope for, but it also adds complexity to strategic planning in multinational companies. It’s why we invest significant time and resources into regularly updating our business strategy.
Global payroll should play an important role in these strategic discussions. For multinational corporations, though, this presents a challenge. Global payroll can be an absolute beast to tackle from a strategic planning point of view.
At best, you might know what markets are doing well and where you plan to grow. But it can be next to impossible to predict how laws and regulations might change, affecting pay and statutory withholdings from one year to the next—or even one month to the next.
The best solution is to give payroll a considerable slice of your strategic planning time. Did you know that 88% of surveyed businesses have a payroll strategy or plans to develop one? Here are six ideas about what you should be mulling over.
1. Where do we stand right now?
The first step in planning is getting real about your current payroll state. Look at what is working and what isn’t. If you can understand why something does or doesn’t work, you can use that to inform decisions about change.
How many countries do you currently operate in?
Do you use a centralized or decentralized payroll process?
Are you outsourcing part or all of your payroll?
Have you paid compliance fines this year or last year?
What is your current level of risk?
2. Is the current strategy scalable?
Growth is always the goal in business—more output, increased cost savings, bigger profits. That means that your current payroll process is only working if it can accommodate growth.
If the idea of expanding to another country makes you think of long hours spent auditing your current system to ‘get it ready’ or you’re wondering where you’re going to find the help to do the extra work—your growth potential is limited and in serious need of a scalable strategy that can grow with your company.
Key considerations for scalability:
Level of automation
Inconsistencies in payroll and HR processes
Payroll staff limitations
3. What does ‘ready’ look like?
Every business does things differently. You can look at industry benchmarks and best practices all day long, but at the end of the day, it comes down to what works for your unique product/market/approach.
Do yourself a favor and put the blueprints away. Decide what your ideal payroll situation looks like in terms of being scaleable. You’ll probably end up taking action somewhere between your analysis of your current state and your definition of ‘ready’.
4. What are our opportunities for improvement?
Even when things look pretty great, complacency is the root of business failure. The only way to stay on top is to take a strategic approach to your business decisions like payroll management.
If what you’re doing is working, make sure you understand why. You should be strategically choosing to stay the course versus settling into what’s comfortable.
Are you missing any of these opportunities?
5. What are our potential barriers to success?
You’ll want to examine both opportunities AND threats to your success. Your strengths and your weaknesses. Your strategic planning sessions can be a great time to hash out the logistics of your roadmap to success.
For example, you may know your current technology leaves some gaps that are currently being filled by manual processes. Finding the right software solution or service provider is an opportunity for improvement that will eliminate manual processes and build scalability. But new tech is expensive. One potential barrier to success is budget constraints that put important improvements on the backburner.
Or, maybe you are working on getting better data to more accurately inform the business’ decision-making. You know that your current processes are riddled with data errors because of manual entries or shortcuts to overcome the fact that your technologies don’t integrate well.
6. Do we have the right support?
As your plan takes shape and you can articulate differences between where you are today and where you want to go, you can begin having side conversations that explore opportunities for new partnerships that will serve your goals.
Strategic planning in multinational companies is a continuous process. You’ll be having these conversations today, tomorrow, and many months into the future. The key is to remain open to new opportunities and new partnerships so that when they come along, you’re ready.
Support comes in many different forms—you just need to figure out what type of help will benefit your strategic payroll plan the most. It could be the helping hand of a global payroll provider that offers a streamlined, centralized process and proactive expertise.
Streamline your global payroll process
Global payroll is a big part of strategic planning for multinational companies. While there is no one-size-fits-all solution, there is an increasing number of options available to help streamline your global payroll process.
Use your strategic planning sessions to figure out a global payroll strategy that will fit your needs. But more importantly, recognize that the process is never finished. Businesses grow and needs change, so your payroll strategy is something that you will continue to revisit often.