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PayrollResilianceCOVID_Horiz

Payroll in a Pandemic Takes Planning, Agility, and Perseverance

By Peter Holland

 

PayrollResilianceCOVIDOne of the greatest lessons I learned from the military, as a nomadic Royal Air Force child and then military officer, was the importance of resilience. This is not just about physical and mental robustness, but team capabilities, flexibility, and planning. I saw crises paralyse and polarise human behaviour, and those who succeeded were not the strongest or the brightest, but the most equipped, determined, and mentally prepared.

Resilience is about recovering quickly from difficulties. COVID-19 will be one of our biggest challenges, for all our nations. It affects people and business in different ways, and across the spectrum of society. I will give my perspective on some of the effects, expectations, and solutions from the strategic to the detail using global payroll as a model and endeavour to look for the good in adversity.

 

Global Payroll as Single Source of Capability

My focus is on resilience and sustainability. These are both inextricably linked and broad topics. With all the uncertainty, COVID-19 undoubtedly initiated some horrendous outcomes. I believe in the fundamental good in most people, which currently rails against some of the more extreme views on the breakdown of societies and the economic meltdown. This view is supported every day by the altruistic actions of many people who are helping others around the world and goes far beyond the incredible medical staff risking their lives every day for strangers. 

Firstly, payroll is a critical business function and affects almost everyone and is thus a good business to be in, and to use as a model. Payroll should be uneventful and ”just happen”; it isn’t and it doesn’t. But it must quietly allow people and businesses to do what they do best. Furthermore, other business support functions such as HR, finance, and IT must interact with payroll in some way. I have been fortunate enough to have seen many different companies and most industries in my 20 years as a service provider from the operational and strategic perspective, and know payroll to be very complex, diverse, and emotive.

Layer in the effects of a global pandemic and the uncertainty for people and businesses worldwide, and plans will now need to be fluid and demand tremendous agility. It is like a war and, as such, some of the principles of war are worth consideration. These include ”selection and maintenance of the aim,” in what we are really trying to achieve in what we do, through to sustainability.

Over the next few months, there will be a huge cultural shift, which will greatly change how we live and likely work in the future. Organisations will create new and better structures, and resilience will catalyse the change to enable us to work more robustly. This will require greater flexibility for our people, including more remote working.

Global payroll is a business process that lends itself to this, but key to its success will be better integration with other systems as well as automation and structures to provide depth of human capability within organisations. This will require improved communication between specialities, which can generate immediate savings in time and costs. I see companies big and small with a multitude of systems for different, but overlapping, tasks, and only one or two people with the knowledge to carry those out.

So, there needs to be a single source of capability for both systems and people with the depth at primary, secondary, and tertiary levels to face and resolve any payroll situations. I would further suggest that understanding and context across areas such as HR and finance, adjoining payroll, are essential in bringing this all together.

Organisations and their business units will need to revisit what they do, how they can do it better, and how they can support other elements of the business and wider community. We are seeing this in April with restaurants becoming takeaways and supporting the vulnerable; engineering firms providing ventilators; fashion manufacturers providing protective clothing; and many more. However, when the new normality returns, how do we change our approach to business and what other things do we do, keep, and implement?

In payroll, remote working, integration, and automation are going to be key, but also the breadth of skills and flexibility. For example, data required for payroll is also required by HR and finance, often linked by different software systems and required for reporting purposes, nationally and globally. Payroll specialists need to understand the context into which they fit and the different business functions that benefit the company and the individual through their broader skills.

 

Payroll’s Role in COVID-19 Resiliency

In the military, I had the opportunity to work in contingency plans. A year later, I was commanding an operational squadron and sent to a country to enact one of those plans. As predicted, the first casualty was the plan, but we already had the direction and resources from that plan to adapt and meet the specific need and to do so very quickly. As the company founder, I have had to make similar changes over the years, albeit in a less challenging environment. We are now at war with COVID-19 and need to adjust our business and approach and do this smartly and responsively. We do not have any real choice.

Sustainability is an integral part of resilience, and value is created when you can bring more capability and save more money than you cost. The breadth of understanding payroll’s integration with adjacent supporting areas within an organisation enables resilience to the present pandemic. It also has the potential to create value in the future for the company and for the betterment of society.

In a recent example, by improving a process, we reduced the time taken to run a U.S. payroll from six to 1.5 days and across several payrolls, this saved one full-time position a year. Rather than stop there, we looked at how that important resource can be utilised elsewhere to improve the business capacity utilisation of other separate but related areas. There are many ways of measuring this creation of value and providing financial metrics. To extend this to the creation of sustainable value involves including the social and environmental impacts of your organisation.

Corporate social responsibility (CSR) is at the forefront of companies’ minds like never before, and their values are being tested in real time. While the momentum to take CSR seriously has been gaining for some time, COVID-19 has now made it very real for companies and their stakeholders. All of this can be done as a separate project or within an implementation/transition project as part of the payroll process. As payroll becomes more efficient, the company manages its resources and therefore its profits better, which can help others at the same time. These processes used within companies for looking at efficiencies, directly and positively affects their sustainability. There are many advantages of this scientific approach to business alone, including a virtuous cycle of efficiency, effectiveness, and employee engagement.

I have heard differing views on planning (and planners), but, critically, to be effective, plans must be made early and be adaptable. Waiting for outcomes, absolutes, and clarity within an uncertain environment can be catastrophic, hence, the selection and maintenance of the aim. Organisations may be forgiven for not having resilience and sustainability when this pandemic started, but we now have some time to plan for the future, as we will be living with the effects of this for many months and years ahead.

There are multiple opportunities within payroll to make it more resilient and sustainable and create value, while saving the planet. This may seem a bit of a stretch; however, the necessities catalysed by this dreadful pandemic could be turned into good—hopefully soon—and we can all be involved and determined to ensure our lives are enriched thereafter.

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Peter_Holland

Peter Holland is the Founder and Chief Executive of Global EMS Ltd., headquartered in London with offices in Norwich, Singapore, and the United States, supporting global and multinational payroll, expense management, and business services in 146 countries worldwide. Holland has broad experience in operations and planning in the business services sector, emergency planning, and the military.