Global Payroll Maturity Prizes Digitalization, Integration

Employers can assess their readiness for a global payroll operation by looking at three areas of optimization, visibility, and agility, a payroll executive said May 9.

Karen Myers, vice president of global product leaders at ADP, referred to “global payroll maturity” as a scale of five levels of operational efficiency in each of the three areas. In her assessment, each area had five levels of maturity: reactive, emerging, controlled, advanced, and leading.

Myers also referred to statistics from the Potential of Payroll in 2024 global payroll survey from ADP. She spoke at the 42nd Payroll Congress in Nashville.

Outside of the survey, Myers said that 51% of employers with “little or no payroll integration” were not confident about an audit coming out “positively.”

Accordingly, the objective of optimization is to make payroll “streamlined, low cost, and predictable,” Myers said, and benchmarks of maturity in that area included documenting processes and then digitizing, standardizing, and eventually automating them. Citing the survey, Myers said that 23% of respondents wanted to streamline processes “across geographies.”

The area of visibility focused on access to and reporting of global payroll data, Myers said. According to the survey, only 44% of respondents had “full visibility of all payrolls across all locations.” Minorities of respondents also had standardized operations or tools such as dashboards or benchmarking.

Benchmarks of maturity in visibility include standardized data and reporting metrics, the ability to find and apply global insights to the employer’s workforce, and in the best case advanced benchmarking and forecasting with “complete visibility over spend,” Myers said.

The area of agility focused on adapting to regulations and business conditions, Myers said, adding that she thought the Covid-19 pandemic helped employers to learn to be flexible and adapt.

The survey found that 52% of respondents used “some standard metrics,” such as submitting returns on time, to assess global compliance, but “struggle to relate this back to improving processes.” From 25% to 29% of employers each answered that in tracking global compliance they only learned about mistakes when doing an audit, when an employee complained, or when they heard from a government.

Myers outlined benchmarks of maturity in agility as integrating payroll systems with other business systems, and in the best case “intrinsically integrated.”

Top answers to the question of “key business drivers for transforming your payroll operations” from the survey included cost efficiencies, digitalization, and operational or product efficiency, immediately followed by the employee experience, Myers said.