Editor’s Note: Bjorn Reynolds is the Founder and Chief Guardian (otherwise known as CEO) of SafeGuard World International. A recognized industry leader and strategist for the global payroll markets, Bjorn’s passion for payroll is the driving force behind SafeGuard World’s vision, strategy, and culture, instilling his enthusiasm for service excellence and success throughout the organization. Bjorn has been at the forefront of transitioning businesses and creating successful value propositions for customers, shareholders, and employees throughout his career. His entrepreneurship led SafeGuard World to a prominent position in the U.K. Sunday Times “Virgin Fast Track 100, ″ was recognized in 2016 as Payroll World’s “Top 50 Most Influential People in Payroll, ″ and as a “Game Changer” by Workforce Magazine. He is a business graduate in Politics and American Studies, holding a BA (Hons) from Wolverhampton University in the U.K.
How is the changing role of the payroll professional—typified by greater interaction with the human resources (HR) department, data analysis, and strategic planning—making an impact in the field?
The role the payroll department plays is, without doubt, evolving at a frantic pace. People aren’t establishing companies to limit sales of their goods and services to the domestic market. The ability to expand globally and move into new markets is simpler than ever. And, in terms of paying employees, it is not only a question of how payroll professionals manage payroll, but also the financial and strategic impact global payroll has on a company. The rate of adoption of cloud HCM platforms signals businesses are looking to improve their systems and processes in order to harmonize global HR, drive greater decision-making through better data quality and accessibility and, additionally, enhance the overall employee engagement experience.
Today, payroll professionals can use this commitment to a global footprint and improving the HR systems to really get involved in the strategic side of payroll, which pushes all the solution providers, like SafeGuard World, to really examine their solutions, technology, and services. It’s critical to think about and answer the question: How are we enabling our clients to become more proficient in their enhanced roles by using the systems and technology that are now available to them?
What are the emerging trends demanding your attention?
I am obsessed with the strategic value of payroll data and the part technology and AI can play in enabling organizations to see trends and make decisions based on their payroll data. Operationally, we are seeing RPA (robotic process automation) becoming an increasing trend that will affect the services element—a broadly transactional part—of payroll. Companies providing payroll services will make use of the process and learnings from RPA to reduce the manual processes and implement bots instead.
Lastly, as we have seen during the last five years, there’s the “consumerization” of enterprise technology for HR that’s now following through to payroll. That requires creating consumer-style applications that simplify the complexities of payroll and are just nicer to use than legacy ERP, for both the client users and their employees. From a service provider standpoint, the user (employee) experience (as opposed to the client or HR and payroll professional experience) is gaining traction. How easy is the technology to use? Do people enjoy using it? Those are some of the questions the service providers will, or should, be asking themselves because it is the question HR leaders are asking.
Is there a frequently asked question that will no longer be part of the conversation in payroll in the near future?
Because of the complex nature of global payroll, there are always some common questions that surround our profession. It’s not easy for clients; sometimes the only thing they can do is try and correlate what they know about their domestic market to requirements for another country or region. So, we expect questions around service scope and local requirements to continue because they’ll always be changing.
GDPR (General Data Protection Regulation; a data privacy regulation scheduled for implementation in the European Union in May 2018) compliance is a regular question right now because many companies are still in readiness mode. However, we presume it will become expected within the scope of services and clients won’t feel the need to ask about it. (See Global Payroll’s Aug/Sept article on the GDPR.)
Another question we get now, but will slow down or stop, is “Do you encrypt data?” Historically there have been some difficulties in achieving this because a lot of payroll technology around the world relies on dated architecture and technologies, but the shift to the cloud is resulting in enhanced security of customer information. Therefore, we expect this question will also cease needing to be answered. Unfortunately, however, the increase in global cyber threats will continue to keep us busy in securing our customers’ information.
What resources do you use to stay current on the latest trends and legislation in payroll?
We subscribe to several analysts in the market who I think cover global payroll really well; they produce great content and their research divisions are very strong. Also, because global payroll is now a more defined industry sector and analysts are investing in global payroll practices, access to information is becoming easier. Equally, I read publications such as Global Payroll Management Institute (GPMI) papers for some of the hot topics and trends.
Most importantly, for trends in the industry, I talk to our clients. Our clients are the best resources we have to understand what challenges and needs exist, what technology trends they are seeing and what their companies are supporting or experimenting with. It helps us understand how we can collaborate with them to bring their tools and technologies into our own solutions so they get the service they need. This is critical to us staying ahead of the innovation curve in this marketplace.
How can a payroll department integrate on a strategic level with corporate finance, human resources, and other departments to provide competitive advantage?
The integration point of payroll and HR systems really becomes the point of centralization of the data. Centralizing the data allows it to be accessible by all departments. The challenge, currently, is understanding the flow and in what format each stakeholder needs the information in order to make the data useful. Really all stakeholders, the finance team, HR, and others need to be able to access payroll specific data so they can use it with other departmental information and make strategic decisions. But right now, they can’t all access that data.
In the future, “full circle” integrations will become a mainstay because everyone will be doing it and doing it well. The next challenge will be how to collaborate to exploit the resulting information the data provides. People costs are the biggest expense for most companies; understanding how to best leverage the underlying data is key to remaining competitive in the marketplace. We’re heavily focused on “total labor cost reporting”—meaning the ability to fuse data from payroll (employees), contingent labor, or contractor data to create global data sets, consistent in structure and grouping according to the company’s structure. By doing this “data” becomes “information” that can be used to make better decisions that actually have real commercial impacts.
What is the one thing that happened in the past year that you didn’t see coming but has had a most profound impact on payroll?
Brexit has had a large impact on the market and I think there is more to come. The consequences of what may come down the line are not truly clear yet. But organizations need to plan for a future state of the U.K. and what that means for existing employees and businesses within the U.K. and EU. From a payroll perspective, what happens to EU citizens working in the EU? Do I need to change anything for taxation purposes and what will the requirements be going forward?
Another is the impact of the “gig economy”—how a company can leverage skilled people, sometimes without employing them for long periods of time, is starting to create shifts in the overall global employment model. Companies need to remain agile, to “be first,” and to manage their cost base. The gig economy is an option, however, gradual shifts in employment law will impact how well this works for companies. It is about what the “future of work” looks like, and the effect this has on payroll remains to be seen. It’s a fascinating area for me. I really think the right service providers can be part of a fundamental shift of what “work” or “employment,” and therefore payroll, looks like in the future.
What are the biggest challenges for payroll teams?
I like to think of this as a question that relates to how well the payroll team manages change. Without a doubt, the largest challenge for the payroll team is adapting to the business requirements resulting from a shift toward internationalism. The culmination of international and local laws and regulations, that can change fast and sometimes without much notice, keeps payroll practitioners on their toes!
Additionally, the payroll team’s work is increasingly responsible for providing critical data and affecting other areas of the company. From hire to retire, payroll impacts an employee’s experience. As companies want to attract the best people, benefits and other incentives play a part in taking payroll from a transactional exercise to a strategic business value process. Payroll is changing from domestic based teams that serve a local payroll function to a broader business-wide function supporting the payroll needs both locally and globally—and provides a strategic service rather than just ensuring payroll is processed. How well equipped they are for this shift is one of the biggest changes in front of the modern payroll team.
What would you advise for a company moving from a domestic to a global payroll?
Understand what your objectives are by moving to the new solution, identify how you will measure those objectives, and be sure to view the project post-implementation to make sure you’re tracking back to those objectives. And then remember to adjust what’s not working for you.
Finding the right partner to work with you as you centralize, someone who has helped hundreds of other multinationals go through this change management, can ease the transition and make sure you’re accomplishing your objectives.
The other point I would add is to do the groundwork. Understand your processes, some of the country specific needs you have, and what the executive management needs and wants. They’ll likely talk about accuracy, compliance, etc. But engage them on what they would want if they could have anything. This requires some seed sowing of ideas, but ask them to think about it and consider how understanding this data would help the company reach its goals.
Then, lastly, understand market offerings. Lots of companies go into “RFP mode” and actively look at buying rather than exploring what is available and if those features actually tie back to the target operating model. That process is key—it’s critical to avoiding buyer’s remorse.
So, to summarize: do the ground work, create target operating models based upon internal minimum standards, assess market availability, adjust the target operating model, create a business case with all internal stakeholders’ buy-in, budget, RFP, contract, implement, and then continually measure, monitor, and adjust.
With the emergence of technology and data-driven HR decision-making, how do you see the role of the payroll professional evolving?
The role of the global payroll manager has now become one of the most sought after professional jobs out there, and I think that is fantastic. I am so proud to see our community grow and more payroll professionals take on huge change projects and have responsibility for the strategic use of millions of dollars in their budgets. With the emergence of global payroll, you have seen the rise of the profession and global payroll managers taking senior leadership roles within multinationals and gaining the recognition they deserve as this is such a key, strategic, and tactical role within organizations.
Frank J. Mendelson is an Acquisitions Editor for the Global Payroll Management Institute. He has been working with the American Payroll Association since 2009 as an editor for PAYTECH
magazine, and has presented workshops at the Annual Congress on effective communication.