2013 Towers Watson Payroll-Global-Regional-and-Local-Approaches

Explore the Possibilities
2013 HR Service Delivery Forum
Payroll: Global, Regional and Local Approaches
© 2013 Towers Watson. All rights reserved.

Agenda
 Why global payroll is different

 The marketplace
 Practical execution on strategy
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Global payroll…an oddity
 Payroll is a “commodity”…but it isn’t cheap
EE Size = 500 US China Switzerland Brazil
Cost per payslip $8 $10 $40 $15
 Payroll isn’t just payroll … there are other services to buy from a vendor
Other
Statutory Meal
Registration Employment
Reporting Vouchers,
and Certificates for
(training hours Commuter
Deregistration Leavers
in FR, social Benefits
club in PL)
 Ownership hot potato HR Finance Global Local
 Multiple delivery models within a single vendor framework

ADP ADP ADP In
GlobalView Streamline Country
Payroll Vendor/System for Global/Multinational
Organizations
Significant Payroll Vendor/System Used
Where Not Part of Core HRMS
Does Your Organization Primarily Use a Single
Payroll Vendor/System ADP Enterprise 26%
Yes, it is part
of our core
HRMS ADP Other 25%
35%
Ceridian 14%
ADP Globalview/Streamline 12%
Responses of 2% or less
NorthgateArinso 6%
Activepayroll, Celergo,
Yes, but it is Frontier/CHRIS, GlobalPay,
Talent2 Grant Thornton, i-admin,
not part of our 6% Infosys, Intercomp Global
core HRMS Services, Meta4,
13% Oracle/PeopleSoft, Paychex,
No, we have Aon-Hewitt 5% SafeGuard World
International, TMF and
no plans to Ultimate/UltiPro
consolidate PwC 5%
31% No, but we The most common
are planning responses in the
Other category were
to consolidate SAP 5% in-house/custom solutions or
globally local/regional solutions.
No, but we 7%
are planning BDO 3%
to consolidate
(n = 571) regionally
14% Other 41%
(n = 289)
Source: 2013 TW HRSD Survey
Payroll Strategy
Identified a small number of

systems/vendors and select Other
the system/vendor based on 7%
We allow each location to
number of employees determine its payroll
in the location/region strategy
4% 22%
Selected a global
system/vendor and only use
other systems/vendors on
an exception basis
14%
We make an effort to use a

single system/vendor within
a region We make an effort to use a
12% single system/vendor within
a country
40%
(n = 969) 30% of all organizations are

applying a regional/global strategy
Source: 2013 TW HRSD Survey
Global payroll decision spectrum
Cost Management Approach (Who “Owns” the Cost Model)
 Maximize country deal  Maximize geography deal  Maximize deal across organization
Delivery Approach (Degree of Centralization)

 “High touch” administration desired  HR practices are regionally focused  Desire to minimize contact points
 Volume and complexity warrant an in-  Aligns with HR and/or Finance shared
country presence services strategy
Capacity for Vendor Management (Tolerance for Multiple Vendors/Contracts/SLAs)

 Tailored solutions are required  Minimize vendors by region  Streamline vendor management
 In-country relationship desired  Regionalize practices  Maximize standardization
Reporting Requirements (Degree of Consolidation)

 Little need to compare pay-related  Regional approach to people  Global reporting capabilities desired
items across countries management and analysis of pay by management
 Other tools are already available (e.g.,  Database for ALL pay items
data warehouse)
Business Expansion (Anticipated Growth in New Countries)

 Focus on existing markets  Desire to leverage existing
 Need for new vendors not anticipated relationships
 Accepting of provider’s solution
Local Regional Global

Overview of global payroll landscape — Five markets
BPO/HRO Solutions  Global payroll generally included as part of broader HR

outsourcing solution, although payroll only solutions are possible
Global
Managed/Bureau  Multiple countries across the globe with a mix of employee
Services population levels; generally includes consolidated reporting
Regional Payroll
Providers  Focus on countries in a region
Exotic Payroll  Providers in non-standard countries (e.g., Rwanda, Iraq,

Providers Barbados, Fiji) generally with small employee populations
Expatriate Payroll
Providers  Providers who provide expatriate or shadow payroll services
Multiple delivery platforms
ADP GlobalPay Single platform

SAP, PeopleSoft, Oracle
NGA TCS SaaS
ADP activpayroll Aggregator

Contract with In Country Providers
Celergo Ceridian Provide secure workflow and reporting tool
ADP Acctg Firms Corporate Network

Locally owned franchises or corporate offices
Ceridian TMF Often provide other services (e.g., accounting)
ADP CloudPay Hybrid

Single platform for larger countries
NGA SGWI Aggregator for smaller countries
Vendor landscape
Global CloudPay ADP GlobalView

PwC
ADP Streamline NorthgateArinso euHReka
E&Y TMF Celergo
KPMG Grant Thornton IBM
SafeGuard World
BDO
Ceridian
NorthgateArinso agoHRa activpayroll
Geographic GlobalPay AonHewitt

Reach Payroll Services Alliance (EU) Symphony
Meta4
Acrede Infosys
Visma
TCS
Talent2 Ascent
i-admin Intercomp
ADAM
Frontier
Local
Small Large
Population Size
The reality…a combination of approaches can co-exist
 Overarching framework
Global  Standardized processes
 Shared services delivery

Regional 
model
Time zone arbitrage
 Unique circumstances
Local  Business case
Lessons learned
What we learned from supporting global companies implementing future payroll service model:
 There will be resistance to change…ensure senior leadership sponsorship and buy-in
 Develop detailed requirements prior to sending out the RFP to limit the “add-ons” during the contracting
and implementation phases
 Run current cost analysis to baseline for cost impact projections and validation before committing to a
solution
 Take a phased implementation approach — determine implementation order based on existing factors
(e.g., if current system is no longer being supported, contract ending, etc.) — and revisit plan as
circumstances change
 Define clear requirements, scope and ownership between client and provider (e.g., interfaces, sign-off
each stage, hand-offs)
 Capture all demographics and compensation data at source (HRMS) and interface systematically to
ensure data integrity — data clean-up projects almost always must be done in conjunction with the
implementation
 Understand the provider’s solution and what tools and access you will have
 Ensure alignment with the global approach and implement a governance model for approving any
regional or local deviations
 Don’t underestimate the complexity of country payrolls and local compliance
One Company’s Approach:
JPMorgan Chase
Background
 JPMorgan Chase has 250,000+ employees in 63 countries

 Asia Pacific: 38k employees in 17 countries
 EMEA: 18k employees in 35 countries
 LATAM: 1.5k employees in 9 countries
 NAMR: 202k employees in 2 countries (200k in the US)
 Our global payroll strategy
 Fewest number of vendors possible without using aggregator model
 Leverage our regional HR centers in Delaware, Bournemouth (UK) and
Mumbai
 In-source operations where practical to take advantage of internal capabilities
About JPMC
 Global financial institution — consumer, commercial and

investment banking
 Millions of consumers, small businesses, large corporations, institutions
and governments
 Full-year 2012 Record Net Income of $21.3 Billion
Long-term strategy
 Fewest number of
vendors possible, without NAMR
Leverage PeopleSoft and Internal
using aggregator model Capabilities
 Insource operations
where practical to take
advantage of internal Large ADP GlobalView
capabilities
 Leverage regional HR
centers in US, UK and IN
Others “Best of Breed” Regional or Local
Work in progress
Region Current Activity

ASIA  ADP Globalview for IND, PHP, SGP, HKG,  Status quo for now
AUS and CHN
 “Best of breed” local solutions for remaining
10 countries
EMEA  ADP Globalview for UK  Regional vendor for MENA
 “Best of breed” local solutions for remaining  Regional vendor for part of EU
35 countries
LATAM  “Best of breed” solution for all 9 countries  Regional solution for at least 8
of the countries (Brazil TBD)
NAMR  PeopleSoft for 3 countries (USA, CAN,  Maintain efficiency
BHS)
Questions
Today’s presenters
David Mitchell
Brad McCaw
Regional Practice Leader (AP) – HR Technology
Sr. Consultant [email protected]
[email protected] 86 21 2211 5429
44 207 170 2136
Mary St. Cyr
Sr. Consultant
[email protected]
1 216 937 4134

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Explore the Possibilities

2013 HR Service Delivery Forum

Payroll: Global, Regional and Local Approaches

© 2013 Towers Watson. All rights reserved.

 Why global payroll is different

 Ownership hot potato HR Finance Global Local

 Multiple delivery models within a single vendor framework

ADP Globalview/Streamline 12%

Identified a small number of

We make an effort to use a

(n = 969) 30% of all organizations are

Delivery Approach (Degree of Centralization)

Capacity for Vendor Management (Tolerance for Multiple Vendors/Contracts/SLAs)

Reporting Requirements (Degree of Consolidation)

Business Expansion (Anticipated Growth in New Countries)

Local Regional Global

BPO/HRO Solutions  Global payroll generally included as part of broader HR

Exotic Payroll  Providers in non-standard countries (e.g., Rwanda, Iraq,

ADP GlobalPay Single platform

ADP activpayroll Aggregator

ADP Acctg Firms Corporate Network

ADP CloudPay Hybrid

Global CloudPay ADP GlobalView

Geographic GlobalPay AonHewitt

 Shared services delivery

 JPMorgan Chase has 250,000+ employees in 63 countries

 Global financial institution — consumer, commercial and

Region Current Activity

Mary St. Cyr

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