Successful global payroll projects require careful planning and management

Global payroll implementations can be more successful by following ten “golden rules” for scheduling and managing available resources, a payroll consulting executive said May 12.

The ten rules arose from observations that implementations often failed to meet deadlines and budgets, as well as conversations with global payroll managers about their experiences, said David Longworth, head of global payroll consulting at PwC UK .

“I’m here to tell you that Global Payroll Projects are truly special and different,” Longworth said at the American Payroll Association’s 40th Annual Payroll Conference in Las Vegas.

Global payroll projects require input from IT, HR, finance and vendors, and employees are of course interested in the outcome, Longworth said.

All of the global projects have certain characteristics in common, including working with multiple countries of different sizes, multiple systems to integrate, and some level of outsourcing, even if “it’s just the system,” Longworth said. The company remains accountable for compliance even if suppliers are involved, he said.

Companies need to monitor the quantity and quality of resources on the supplier side, including response times due to location, and ensure continuity if staff can be replaced, Longworth said. Negotiation and compromise are needed on both sides, he said.

When testing or demonstrating a project, or creating a proof of concept, it shouldn’t be separated from the project, Longworth said. “When you complete this successfully, it should fit into the project,” he said.

Companies don’t always document project scope, Longworth said. “I’ve lost count of the times we’ve asked clients for the scope of work or their contract and we just don’t have it, they can’t find it, or maybe it’s just a letter of intent that they signed,” he said.

A letter of intent won’t contain enough detail to be useful to the project, and companies shouldn’t make assumptions about roles and responsibilities, Longworth said.

Resource Constraints

Payroll projects are frequently pushed back in favor of other projects, whether for those that are essential to the business, for other payroll obligations such as year-end, or due to the unavailability of other business stakeholders such as finance, Longworth said.

“It’s an inevitability, it’s a reality that we have to deal with with payroll, I’m afraid,” he said.

Companies need to “plan for the unknown” and think about what other resources they can call upon in such situations, Longworth said.

A lack of alignment between central teams, which are more distant and more dependent on local teams, and local teams, which are less subordinate and less connected to central teams, can be mitigated by involving local teams in projects and process design, Longworth said.

The company can design a global standard process and ask the local team if it would work in their country, Longworth said.

Additionally, some global payroll managers said they tried to continue their day jobs while implementing a project, rather than taking full control of the project, and admitted to either burning out or operating out of suboptimally in their day jobs, Longworth said.

“The best person for the job is you as the payroll person, who understands the requirements and has the connections for the project,” but also the worst person to do this job is you distracted “, said Longworth.

Fundamentals and data

Businesses still need the common project-to-project fundamentals for global payroll projects, including setup, preparation, planning, process design, data migration and testing, documentation, and consideration. lessons learned, Longworth said.

Payroll borrows data from other areas of the business, such as HR, finance and IT, Longworth said. Project participants should not make any assumptions about the data, including its accuracy or consistency, that it is suitable for payroll processing, that it can fit into models, or that it can be sent directly to local systems, he said.

However, 80% of payroll processes are common across countries, Longworth said. “There’s tremendous value to be delivered if you can standardize these common processes,” he said.

When designing processes, Longworth recommended proposing an overall process and then allowing exceptions for status or custom reasons.

Finally, the company should go beyond normal risk analyzes and “make provisions for specific contingencies that you think could be material” for a global payroll project, also drawing lessons learned from each country or group of countries to another, Longworth said.

Louisa R. Loomis