Stage 2 of Global Payroll Implementation

In the first stage of payroll implementation, we discussed both the importance and challenges of undertaking a global payroll transformation. Beyond being an essential function of any operation, payroll is typically an organization’s largest cost center and consistently an underused resource of strategic data.

As such, a transformation in global payroll can create tremendous value. By shifting from a fragmented system of legacy software and multiple disconnected vendors to a single cloud-based solution, multinational companies can standardize their payroll processes, reduce errors, and achieve vastly higher productivity and efficiency levels over time.

With so many stakeholders and considerations involved, organizations must approach global payroll implementation with a multistage approach:

  1. Planning & Preparation
    Building a Business Case, Establishing Scope, and Assembling Resources
  2. Evaluation & Selection
    Setting Objectives, Creating a Shortlist, and Engaging in the RFP Process
  3. Deployment & Onboarding
    Strategizing the Rollout, Maintaining Vendor Alignment, and Training Your Teams


Download the complete paper on the 3 Key Stages of Global Payroll Implementation now.

Stage 2

From your organization’s efforts in the Planning phase, you should have a firm awareness of the complexity of your overall payroll implementation project. Equipped with that understanding, you can begin assessing your needs and goals, narrowing down a list of potential providers, and circulating your request for proposal (RFP).

The Evaluation stage of global payroll implementation is all about due diligence and analysis. Before you apply those efforts to potential payroll partners, you need to conduct further internal assessments to ensure your long-term needs and goals will be met by the provider you select.

Setting Objectives

As you built your business case, you uncovered the problems with your existing approach, such as high costs, non-standardized processes, poor data quality, or minimal integration with key administrative systems. Keep your current challenges in mind as you determine the broader objectives of your transformation project, focusing on the desired outcomes for payroll and for the business at large. Are you trying to:

  • Decrease payroll errors and costs?
  • Support global or regional expansion into new countries?
  • Lower payroll headcount?
  • Eliminate shadow payrolls and internal invoicing?
  • Decrease IT bandwidth dedicated to Payroll?
  • Consolidate payroll into global shared services?
  • Integrate with a new ERP or HCM solution?
  • Automate more of the payroll cycle?
  • Gain a global view of payroll costs and performance?
  • Standardize processes across geographies?
  • Shift all enterprise solutions (including payroll) to the cloud?
  • Enhance data security, compliance management, or analytics?

Creating a Shortlist

Once your objectives are clear, you can craft your selection criteria and begin prospecting vendors. However, it’s important to avoid jumping straight into crafting a request for proposal (RFP) and circulating it to as many vendors as possible. If you do, you’ll waste time reviewing more RFPs than you really need to.

Most global payroll solutions vendors provide a wealth of information about their offerings online. Using that information to answer the questions below can help you winnow a long list of five to ten vendors down to a shortlist of two to four – saving you a wealth of evaluation time in the long run.

Conduct preliminary research to determine which global payroll vendors:

  • Integrate with your existing human capital management (HCM), enterprise resource planning solution (ERP), and time-and-attendance solutions;
  • Deliver managed payroll services across your global project scope;
  • Can meet your compliance and reporting needs across all jurisdictions;
  • Provide real-time transparency into cost and performance information using analytics;
  • Use a single platform globally and adhere to a global set of processing standards;
  • Service organizations of comparable size and headcount volume as your company;
  • Can scale up or down to meet your organization’s needs geographically; and
  • Have a brand identity or business reputation that aligns with your company’s culture.

Engaging in the RFP Process

The RFP process is the most substantive aspect of the Evaluation stage because it involves three separate considerations: RFP Creation, RFP Circulation (to the two to four vendors on your shortlist), and RFP Review/Vendor Selection. Our comprehensive four-part guide to Building a Successful Global Payroll RFP will help you make the most of this important step.

A well-crafted RFP should include 150-250 detailed questions assessing each vendor’s ability to satisfy your selection criteria across all desired system requirements, IT considerations, technical capabilities, and departmental areas (HR, IT, Finance, Operations, and Payroll). It should also include:

  • Background information on your organization and its lines of business,
  • A set of specifications describing what you want from a sought-after solution,
  • Evaluation criteria disclosing how proposals will be graded,
  • A realistic budget and breakdown of your cost expectations long-term,
  • A statement of work describing the tasks to be performed by the winning bidder,
  • A timeline for the vendor selection process, and
  • A timeline for the full project – spanning negotiation, implementation, and onboarding.

If your RFP addresses all of your vendor expectations in a straightforward way, you should be able to engage in an efficient review process. Once you’ve moved through contract negotiations and finalized a vendor agreement, it’s on to the most eventful phase of implementation: Deployment and Onboarding.

Download the complete guide to The 3 Key Stages of Global Payroll Implementation now to learn about this next phases and gain valuable tips for your implementation project.