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Building a Successful Global Payroll RFP: Part 1- Creating an Internal RFP Strategy

Jun 28, 2017 

For multinational organizations, moving from a decentralized vendor landscape to a true global payroll solution involves multiple steps. Before a company can implement a new solution and onboard its Payroll team, it needs to build a business case, win internal buy-in, prospect potential vendors, and finalize an agreement with its selected service provider.

Over the course of that process, many organizations use a tried-and-true approach to enterprise software selection: the request for proposal, or RFP.

As most payroll leaders already know, an RFP is a document that an organization posts to elicit bids from potential vendors for a desired IT solution. At minimum, the RFP specifies what an organization is looking for and establishes its criteria for evaluating proposals. That description makes RFPs sound simple, but many are incredibly complex – not to mention poorly structured and packed with redundant questions.

 

Rethinking the RFP

A jumbled RFP file is rarely the only issue: Even many of the world’s most sophisticated global companies manage RFPs in a disorganized manner, creating unnecessary internal bottlenecks that can delay vendor selection and implementation.

What’s worse, many organizations engage in the RFP process simply out of habit. They’ll post an RFP as soon as they decide to make a change in order to elicit responses from as many vendors as possible – but that creates unnecessary work for their internal teams that could easily be avoided with a more targeted RFP strategy.

Rethinking RFPs is the first step to engaging in a streamlined vendor selection process. By following a few key best practices, payroll stakeholders at multinational companies can engage in a more strategic approach to RFP creation, deployment, and management – ultimately helping their organizations select and implement a global payroll solution that aligns with their enterprise-wide goals and objectives.

 

4 Steps to the Ultimate RFP

An effective, actionable RFP process is possible by following the steps outlined in this four-part blog series. While these posts focus on RFPs for global payroll solutions, many of the best practices apply to RFP creation and management in other areas of your enterprise.

So get your RFP or download our specialized template to begin designing the definitive RFP for your organization.

Download Now: Global Payroll RFP Template

Step 1: Strategize

Create a goals-driven internal RFP strategy

In a global enterprise environment, stakeholders rarely want to start from scratch. That’s why the jumping-off point for many payroll change initiatives is an existing document: the RFP created the last time the organization engaged in vendor selection.

While there’s nothing wrong with reviewing an old RFP, to start there is skipping a step. Previous files are unlikely to address your organization’s current needs and goals, and could create delays further along in the process, since they don’t account for your strategic objectives in making a change. Before revisiting the RFP used to engage your current provider, you should spend time thinking about why you’re soliciting new vendor proposals.

A better RFP process begins with the questions an organization asks itself to understand current problems, future objectives and what they hope to gain from a new vendor. Taking an end-to-end look at your existing circumstances is an important part of vendor selection, as is mapping out how a payroll transformation aligns with departmental and organizational goals. From there, you can craft a smart strategy for internal RFP management.

 

Problems: What are you struggling with in your current model?

Your organization wouldn’t be pursuing a new solutions provider if you were happy with your current approach to global payroll. To help prioritize the questions and concerns most important to your RFP, map out the pain points – large and small – that you’re struggling with at present. These could include:

  • Managing too many vendors
  • Lack of standardized processes among vendors
  • Poor visibility into payroll
  • Inadequate control over payroll processes
  • High rates of re-runs and/or supplemental runs
  • Poor or no integration with HR solutions
  • Bloated costs in a given country or region
  • Minimal vendor support availability
  • IT challenges (bandwidth, downtime)
  • User experience issues (functionality, usefulness)
  • Data security issues or concerns
  • Compliance gaps or lapses

 

Objectives: What is your payroll team trying to achieve? What about your business?

A global payroll transformation isn’t just a change for payroll – it’s a change for your entire company. Payroll touches every employee in a multinational organization, interfaces with many different departmental functions, and plays a key role in enterprise initiatives such as overseas expansion (or contraction), recruitment and talent management, and cost cutting. Consider the objectives for both payroll and 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 to the cloud?
  • Enhance data security, compliance management, or analytics?

By engaging in more thoughtful, strategic thinking in advance of developing your RFP, you will set your organization up for greater success in vendor selection. Armed with a solid understanding of your company’s current issues and future objectives, you can start mapping out your organization’s approach to global payroll vendor solicitation, beginning with your internal RFP action plan.

 

Strategy: What is your internal plan for vendor solicitation?

Having an internal game plan – even a loose one – will make it much easier to manage the process down the line. Questions that will help you craft an internal RFP strategy include:

  • What is your target date for having a new solution implemented?
  • How many countries are in the project scope? What are they?
  • For how long will you accept RFP responses from vendors?
  • Who in your company will be involved in RFP creation?
  • Who will be involved in reviewing vendor RFP responses?
  • Do you have an existing shortlist of vendors? Why or why not?
  • How will you evaluate vendors’ responses to specific questions?
  • How will you evaluate and grade vendors’ overall submissions?
  • What is your budget? Is it approved? Will there be pushback if you exceed it?
  • What countries are being left out of the change project? Why?
  • How will you judge the ultimate success or failure of the project?

 

Be selective

One critical consideration is how many RFPs you want to review. Many organizations seek to elicit proposals from as many vendors as possible, but that’s an unsound strategy for many reasons – chief among them that it ultimately requires you to review more RFPs than you really need to.

Think about how many proposals you want to receive. If you think any more than four is acceptable, you’re vastly underestimating how much time, thought, and effort should go into the review cycle for a decision as significant and wide-ranging as a global payroll solutions change.

In fact, even four RFPs is a lot to review. Often one or two vendors out of four could be eliminated based on information that is easily accessible beforehand via sales calls, product demonstrations, or virtual or in-person Q&As.

 

Next up: Identify and prioritize your needs

You now have a greater understanding of the issues affecting your global payroll, your payroll objectives, and the process that will guide your vendor selection. It’s time to figure out what information you need to get from the contenders.

Get your RFP file ready or download our comprehensive template, and stay tuned for the next blog, which will guide you through the second step in creating the definitive global payroll RFP.

Read Part II: Identifying and Prioritizing the Questions

Read Part III: Crafting Your RFP Questions

Read Part IV: Deploying the Definitive RFP


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