Deloitte Shared Services, GBS & BPO Conference

Breakout 8: Delivering a globally compliant payroll solutionDaryl Knight, & Jennifer Hall, Deloitte

14-15 September 2016

Lisbon, Portugal

#DeloitteSharedServices

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Agenda

Global Payroll

• What is global payroll

• Global vs Regional

• Global payroll trends

• Global payroll vendors

• Payroll service delivery models

Why Global Payroll

• Key areas

• Global payroll transformations

Challenges of a global payroll service

Global payroll structure

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Global Payroll

44

Global initiative to

consolidatepayroll providers and implement

standardprocesses, tools and

data/reporting solutions.

Global Payroll

What is global payroll?

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Global Payroll

What is global payroll?

It depends on…Enhanced compliance

Accuracy of Payroll processing

Better control of financial resources

Easier to manage operationally

Improved access to Payroll data

Streamlined global Payroll team and Operations

What can it achieve?Does it actually exist?

Who you ask – buyers or service providers

The definition being used –whether a single global platform and vendor is expected

Does it mean payroll is outsourced to one vendor or moved to one payroll system globally?

Possibly, but more likely it

means…

• A global governance structure

• Vendors consolidated or managed regionally

• In-house or outsourced solution

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Global Payroll

Global vs Regional

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Global Payroll

Global payroll trends

22%

60%

47%

31%

0% 10% 20% 30% 40% 50% 60% 70%

NA

LA

EMEA

APAC

Organisations outsourcing all payroll

processing by global region

10%

5%

10%

5%

15%

25%

20%

10%

Organisations Outsourcing all Payroll

Processing by IndustryConsumer and

Industrial Products

Energy and Resources

Financial Services

Government and

Public Sector

Life Sciences and

Healthcare

Manufacturing

Retail

Tech, Media &

Telecoms

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Global Payroll

It is important that clients do not settle for a vendor that they know, but explore all of the options to find a “best fit” vendor for their needs.

Global payroll vendors

Global Payroll Processor

Locally Processed Payroll

Payroll Aggregator

• One single in-house or outsourced solution under a single contract

• Own payroll technology

• Consolidated reporting

Examples: ADP GlobalView, NGA Human Resources

• Small local providers specific to a country

• Customer manages performance and compliance

Examples: Paychex (U.S.), Liberata (U.K.), Tilimatic (Finland), Symphony House (Malaysia, India, Japan)

• Network of providers managed under single contract (Gross-to-Net performed at local level)

• Data aggregation

• Consolidated reporting

Examples: Safeguard World International, CloudPay, Celergo, ADP Streamline

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Global Payroll

Payroll service delivery models

Aggregator

• Vendor aggregates the data and provides summary information

• Levels of service depends on the client requirements

In-House• Few solution options• Outsourcing or decentralized model may be

still required

Hosted

• Few solution options• Outsourcing may still be required for certain

countries• In-house talent still required

Outsourced• Minimal in-house payroll talent required• Vendor management is critical

In-House

System Hardware

System Software

In-House

Payroll Process

In-House

Single Vendor Single VendorIn-House /

Vendor

Single Vendor Single Vendor Single Vendor

Multiple Providers

Multiple Providers

Multiple Providers

Payroll Process

Flexibility

High

Medium

Low

Low

Vendor Manage-

ment

Low

Medium

High

High

Cloud-based global payroll models are limited at this time; however, it is expected that greater capabilities will emerge as the market continues to grow.

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Why Global Payroll?

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Why Global Payroll

Key areas

ComplianceEffective control and processing which enable compliance at the local and business unit level

Payroll SystemSustainable, scalable, repeatable, request based services & processes which spans the Global Enterprise

FlexibilityAbility to effectively realign payroll processing as the business expands and changes

Global Payroll

Payroll SystemCompliance

Automation

Flexibility

AutomationPayroll processes, servicing and technology that is integrated between business units, suppliers and countries

Global Payroll is the management of financial and employee data across regions

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Why Global Payroll?

Global payroll transformation – project considerations

Build consensus on the need to improve the global Payroll Operations service delivery model

Develop a clear vision and a go forward plan to explain the initiative to executives

Develop a business case and budget request to secure initial project funding

Develop a charter and team structure to startup the initiative

Solicit and solidify support for the initiative by socializing the business case and plan

Key Considerations

• Align decision makers and interested parties on the need for change and the path forward

• Defining a high level vision and the supporting guiding principles and constraints to guide the business case, and support the business strategy

• Establish a team and governance structure that enables cross-business, and cross-functional integration and collaboration

• Identify the key influencers and defining the Executive Sponsorship to help the project build and retain momentum

• Develop a budget request that reflects the reality of the constraints and principles while working to achieve the vision

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Why Global Payroll

Global payroll transformation - common considerations and objectives

What is the

current state?

• Global footprint and cost

• Controls and risks

• Data sources

• Input processes

• Payroll outputs

• Systems and support

• Vendors and contracts

• Business continuity

• Accountability

What are my

business objectives?

• Employee experience

• Cost containment

• Reduce redundancy

• Standardization

• Tighter controls

• Minimize risk

• Scalability (acquisition)

• System of record

• Operational back-up

What are my alternatives?

• High-impact countries

• Low-impact countries

• Change readiness

• Legislative complexity

• Language

• Viable partners

• Efficiency gains

• People impacts

• Costs

Which models

are applicable

for our business?

• Define global and regional standardization

• Identify retained legacy platforms

• Solution road map and associated costs

• Business benefits

Evaluate current state: Clarify objectives: Evaluate alternatives: Evaluate business case:

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What are the challenges of a global payroll service?

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Challenges of Global Payroll

Vendor selection

Local complexity

OwnershipLanguage

issues

Cost containment

Key challenges

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Global Payroll Structure

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Global Payroll Structure

Example structure

Example of a global payroll structure where a payroll aggregator is used:

Head

of

Global Payroll

Regional Payroll Managers

Global Payroll Processing Hub

Local Payroll Owners

Global Governance

Strategy, Policy,

Standards & Rules and

Costs

Global Vendor Management

Regional Governance

Implement Policy,

Standards & Rules

Regional Vendor

Management

Submit Payroll

Changes to vendor

Complete Initial

Reconciliation

Implement consistent Processes

Day to Day Payroll

Operations & Payroll

Approval

Control & Compliance

Local Vendor Management

Payroll Approval

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Questions?

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