Despite the pandemic, there are still companies that have entered phases of hypergrowth like Zoom, Checkout.com, Canva, and Snowflake. As exciting as it sounds, those in the middle of it all have to deal with many challenges, including managing a fast-paced environment and developing and executing continuously evolving business strategies. Every company will experience varying degrees of success. As noted in the Harvard Business Review, these periods of hypergrowth within industries are when the winners get sorted from the losers.
So how do you become a winner when it comes to surviving hypergrowth?
While no one factor guarantees success, the fundamental role of payroll in impacting every employee in the organization and providing visibility into a company’s cost base must be recognized. Automating payroll and investing in a global payroll solution is key.
5 ways a global payroll platform promotes hypergrowth success
Having a single comprehensive source of workforce data has many benefits.
#1 Reduces compliance burden
As organizations look to expand internationally, they can lack the resources to maintain payrolls in multiple countries. There is the challenge of multi-currency payments while understanding the complexity of local tax and employment laws in countries such as Brazil, France, Italy, and Japan is no small feat. These concerns can limit a company’s ability to react to a customer’s needs or hire the best talent.
However, a global payroll solution removes these obstacles. It facilitates the implementation of a streamlined process for onboarding employees in those new countries. Plus, the best global payroll vendors take full responsibility for compliance and proactively advise on regulatory changes. As the company expands, the last thing anyone wants is to be blindsided by hidden tax charges or penalties.
#2 Provides cash flow oversight
One of the most important activities facing any high growth company is cash flow management. Organizations that are onboarding a lot of new employees must do so in a controlled manner, otherwise, they run the risk of running out of cash.
To prevent this, hypergrowth companies should have access to analytics that track payroll costs globally. This data will enable finance leaders to identify outliers and better allocate staff.
By its very nature, payroll is repetitive. However, this also means organizations can benefit by automating a high percentage of these tasks and thereby reducing administrative costs. A bonus of the automation of payroll is that the improved accuracy of payroll enables more reliable budgeting and forecasting.
#3 Facilities faster onboarding of new hires
A common challenge for a hypergrowth organization is finding and then hiring the skilled talent they need. Once new employees are found, then there is the additional challenge of getting them entered into the system and getting them productive as soon as possible. However, having a well-oiled global payroll solution helps organizations make this process as seamless as possible and ensuring they are getting the best talent and the competitive edge required to succeed.
#4 Eliminates workforce silos
Growing fast is a good problem to have but can lead to payroll silos. How? Often when a company opens an office in a new location, they will use a local payroll provider. If it is an acquisition, they use the legacy system already in place. Such organizational silos result in data silos, with each area operating as an individual unit.
This splintering of payroll makes it harder for the CFO or financial leaders to formulate the business strategy. To do this, they need access to comprehensive and real-time analytics to forecast payroll costs accurately. However, with a global payroll platform, the CFO, CHRO, and finance leaders have a single source of truth, providing them with the required insights critical for planning the company’s future and enabling corporate alignment.
#5 Lays the framework for the next stage
Rapid expansion is exhilarating. But there is a risk of developing disparate internal controls in each new market. This is especially true if the growth results from a merger, and now the company is operating multiple legacy technologies. Implementing a scalable global payroll solution can alleviate the risk associated with such a scenario. Furthermore, standardizing global payroll processes, providing greater oversight, authorization controls, and generating audit-ready reports will prepare organizations for an IPO.
Growth, hyper or otherwise, relies on employees. Employees depend on their employers to ensure they receive the correct pay. Onboarding multiple new employees, potentially dispersed across the globe, is problematic, and doing so over a short period of time even more so. A global payroll platform eliminates many of the risks associated with this challenge and can ensure that all new hires are correctly entered into the system and, importantly, receive the proper pay.