With increasing globalization, companies need to take a whole world view, operating in an ever increasing number of countries they struggle to find suppliers that can service their needs. In some cases, such as in global payroll, it is not just a matter of the capability of existing suppliers. Systems and processes that worked in a small number of countries are often found not to scale globally and a whole new approach is needed. In payroll, SaaS has provided the platform that is enabling a revolution in the way payroll is managed and the strategic contribution it can make. Let’s extrapolate a little about the future of payroll management, and the role of the payroll manager.
It feels that the world is becoming more homogenous, economically, politically and culturally, every year. Indeed, I am grateful for the opportunity to have seen much of the world when it was more diverse and untainted, when it contained very different political systems, religions and traditions, unique lifestyles and regional cuisines and when not everybody seemed to speak English. Of course as a ‘westerner’, I am also pleased to have been able to afford to travel, aided as I have been by the inequality of wealth. Diversity remains, and is being rigorously defended, in many places and areas of life and yet the process that began more than a thousand years ago has steadily gained momentum over the last thirty years and continues apace.
It’s easy to focus on the
information revolution as the cause. There is no doubt that the development of the World Wide Web, social media and ecommerce has played a large part in accelerating globalization, building on the momentum created by imperialism and the previous revolution in communications, radio and television. However, it is not just information that travels freely, money does likewise, and goods are transported readily and rapidly, economies of scale increase the size and dominance of manufacturing multinationals and no country can claim any particular company for itself. Non-financial services, for long a laggard and bucker of these trends, are now quickly following exactly the same route and it seems that the English language has prevailed as the world language.
Globalization promotes economic growth, creates employment, makes companies far more efficient, lowers consumer prices, increases consumption and the global standard of living, gradually overcoming inequalities of wealth. However, globalization has its detractors. Progress and economic growth comes at a price. Good or bad, it seems that the trend is to ever larger, ever more powerful and ever more dominant companies that act and think globally, that employ staff in ever more countries and that draw on an increasingly global supply chain to serve an increasingly international marketplace.
Managing these global organizations efficiently is of prime importance. All functions are called to account, to prove that global economies of scale are realized and, more importantly, that all measures are taken to draw from the functional process the business intelligence that highlights trends, provides insight, enables predictions of the future and better informs decision making, that exposes malpractice, theft and fraud and results in competitive advantage. All functions must operate globally, not just to be efficient but to make a strategic contribution, to help further, not just support, the interests of the enterprise they serve.
Payroll, previously a tactical and hidden function submerged under Finance or HR and only coming to prominence when functionally and locally it failed, is no exception. Automation of the complexities of global payroll management, for long too difficult a nettle to grasp owing to its highly regional and constantly changing nature, has been made possible by the advent of The Cloud and the pioneering development of truly global-capable SaaS applications by
CloudPay. The use of CloudPay to
centralize global payroll management within multinationals provides great efficiencies, and yet these efficiencies, whilst important, are not what is driving a revolution in payroll management. The revolution is being driven by the access that is provided by the new technology to large amounts of data, data previously denied corporate strategists and now demanded by the architects of Big Data initiatives being designed, developed and deployed by every multinational and used to derive information that is, in turn, the fuel of intelligence.
In previous blogs, I have talked about the
strategic importance of payroll and
how Big Data initiatives are driving a change of working practices, a change to the role of payroll managers and to the expectation the leaders of multinationals have of functional heads to provide strategic insight. I argue that payroll cannot remain submerged within HR or Finance but must emerge as a discipline on its own, with its own strategic contribution to make. This contribution is to be derived from its newly discovered ability to draw on vast amounts of data, chronological and geographic, demographic and functional from which can be, and should be, derived a wealth of business information, strategic insight and the trend analysis and predictive analytics that provide real competitive advantage, underwriting the best informed decisions.
The context for the shift in focus, the emphasis on Big Data, Business Intelligence and analysis is that organizations are becoming increasingly geographically dispersed and as their horizons expand, so too does the scale, complexity and strategic importance of payroll.
As economic globalization increases, a new breed of global payroll executive is emerging, willing to embrace the challenge and give voice to a long under-appreciated function. CloudPay is here to help them.
