Overview
A prominent U.S.-headquartered company in the Information Technology sector with a growing presence across multiple geographies sought to centralize its HR, Finance, and Payroll functions in India. Previously, their payroll operations were managed through multiple vendors across different regions, requiring coordination among various stakeholders from HR, Finance, and Payroll teams.
To streamline operations and ensure seamless transition, the client engaged Nexdigm to support the set-up of Global Shared Services Centre (GSSC) with a key milestone of consolidating payroll functions under a single payroll vendor.
Challenge
Managing such a large-scale transformation across multiple geographies posed several complexities:
- The absence of a unified payroll, finance, and HR system resulted in operational inefficiencies, increasing administrative burdens and reporting challenges.
- Managing payroll across multiple geographies introduced complexities in adhering to varying tax laws, labor regulations, and statutory requirements, increasing the risk of non-compliance and penalties.
Case Highlights
- Successfully centralized payroll operations across 4 countries and 6 entities in the APAC region, including Year-to-Date (YTD) data migration.
- Consolidation under a single vendor and process optimization led to a reduction in payroll outsourcing costs.
- Ensured 100% regulatory compliance across all regions, mitigating risks and avoiding penalties.
- Streamlined processes through AS-IS and TO-BE mapping, eliminating waste and improving efficiency across departments
- The involvement of multiple vendors in handling sensitive employee payroll data heightened security risks and required a standardized approach to ensure privacy and compliance.
- Transitioning from multiple vendors to a single provider required strong change management, stakeholder engagement, and comprehensive training strategies to secure buy-in.
- Inefficiencies in existing payroll operations resulted in increased costs due to redundant processes and heavy reliance on manual intervention.
- Without defined guidelines and checklists, payroll processing lacked consistency, leading to discrepancies and operational delays.
Solutions
To address these challenges, Nexdigm executed a structured approach that ensured a smooth transition and long-term operational efficiency:
- The team conducted a detailed discovery workshop with HR and Finance leadership to assess current pain points and highlight the benefits of payroll centralization.
- A comprehensive business blueprint was created outlining the transition approach, operational workflows, and key milestones for payroll consolidation.
- Engaged stakeholders to map out existing processes (AS-IS) and design optimized workflows (TO-BE), ensuring efficiency, compliance, and scalability.
- Executed a phased transition plan to migrate payroll data from multiple vendors to the new centralized system, ensuring minimal disruption and data integrity.
- Established efficient processes to eliminate redundancies, enhance automation, and reduce manual intervention, leading to long-term cost savings.
Impact
Nexdigm's solution helped the client achieve operational efficiencies and establish a scalable payroll model that could support future growth and expansion, reinforcing the value of a GSSC as a critical enabler of business success.
The consolidation of payroll functions resulted in significant cost savings, as administrative overhead was reduced, and vendor management became more efficient. Automation improved processing speed and accuracy, eliminating manual errors and ensuring timely salary disbursements. Employees, who previously faced payroll discrepancies and delays, now had confidence in a system that ensured timely and error-free payments, leading to higher job satisfaction and trust in the organization.
From a compliance perspective, the standardization of payroll processes strengthened adherence to local and global regulations, significantly reducing risks associated with tax penalties and non-compliance. The newly implemented security measures safeguarded sensitive payroll data, ensuring compliance with global data protection standards. The company also benefited from greater visibility and control over payroll operations, allowing for strategic decision-making and long-term scalability.
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