Posted by: Ron Hanscome | October 5, 2010

HR Tech 2010 Recap: Unsexy, but Critical Part I – Global Payroll

Part of what draws me to HR Tech year after year is to be exposed to the latest and greatest, to see “what’s new” (or at least what is being marketed as new by the vendor community). However, another reason I attend is to be reminded of “what’s old” — those components of HR technology that are foundational to success, even if they are not the trendy topics. Ladies and gentlemen, there is a reason that sports teams of all ages spend huge amounts of practice time on what they call the “fundamentals” – team leaders know that all the flash and fancy stuff is useless without them. We can talk about new social tools and wonderful ways to graphically visualize information all we want, but if your core HR and talent management systems do not serve up clean, consistent data in a usable format, you gain nothing. So, here are my lessons learned from the first of two customer presentations covering topics that are certainly less glamorous, but nonetheless important:

In “Thomson Reuters Does Payroll the Same Way!” VP Global Business Services John Kelso shared his firm’s journey towards a more standard, consistent global payroll process. This large ($13B revenues US, 57,000 employees) global (operating in 100+ countries) organization began with 58 payroll providers and 100+ contracts.  Pursuing the key design principles of “Rationalize, Standardize, Optimize” has resulted in a desired end state of three payroll systems/contracts US/UK on Hewitt PeopleSoft – 60% of workforce, India on Ascent – 11%, and remainder of countries on Patersons Global Payroll – 29%). The project began in late 2009; process standardization has been completed, and five countries per month are transitioning to Patersons, with migrations scheduled to be completed by September 2011. John shared a number of key lessons learned from the process to date:

  • Strong partnership with the vendor is critical — including partnership at all levels of the vendor organization linking up with equivalent levels at Thomson Reuters
  • Vocal, visible executive support — not only at the beginning, but throughout the project lifecycle
  • Strong project management and leadership — PMO office was established and given the authority to make the tough calls in order to keep things moving forward
  • Partnership with internal stakeholders — the vital aspect of consistent and ongoing communication was highlighted to cultivate and involve key internal partners
  • Solid mitigating controls — critical to ensuring a smooth transition, swift error correction, and ongoing process efficiency

While none of these lessons learned is particularly surprising, one comment perfectly summarized need for strong contingency planning for a project of this type — “Payroll ALWAYS needs a Plan B!” John also highlighted the fact that creative thinking is always needed, regardless of the type of HCM technology being implemented; the example given was the desire to use the project to standardize working hours in the US amongst all of the acquired organizations, which had never been done. Bringing the hourly workforce up to a 40 hour per week standard was calculated to cost the organization more than $6M US if done via directly increasing standard hours; however, a project team member had the bright idea to simply give employees additional vacation days to make up for the increased standard hours, which resulted in no additional hard costs to the firm.

All in all, this was a solid presentation that gave everyone attending some great reminders of the fundamentals needed to manage large, complex projects. I’m looking forward to an update next year once all of the country payrolls have been migrated to the new global system and we can see the actual time, cost and qualitative improvements of this grand consolidation.

So, what do you think about this topic? Too boring for words, or an important reinforcement of the fundamentals?

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