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The challenge is that the aggregator model primarily solved vendor consolidation and country coverage; it did not necessarily solve technology consolidation. Behind the global platform, many organizations are still operating across numerous local payroll engines, providers, databases, integrations, file formats, and operational processes. The customer may interact with one global interface, but underneath that interface employee data can still travel through multiple systems before a payslip is produced. Information may move from an HCM platform into an integration layer, then into a global payroll platform, then to a local payroll provider, and finally into that provider’s payroll engine. The results subsequently travel back through some version of that chain before moving into payments, accounting, reporting, and reconciliation. Multiply those
movements across dozens of countries and what looks like one global payroll solution at the user-interface level can actually represent a highly fragmented technology environment underneath. The aggregator model is not inherently bad. In fact, it was an important stage in the evolution of global payroll and remains effective in certain circumstances. The problem is that an architecture designed primarily to create geographic coverage is increasingly being asked to deliver something it was never originally designed to provide: a real-time, intelligent, standardized global payroll infrastructure. Enterprises today expect automated HCM integrations, faster implementations, global reporting, payroll-to-payment visibility, automated reconciliation, predictive analytics, and increasingly artificial intelligence
The nature of payroll risk is also changing. Payroll accuracy is no longer determined solely by whether a local calculation engine correctly applies tax and statutory rules.
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GLOBAL PAYROLL MAGAZINE ISSUE 28
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