Leader Spotlight

By Frank J. Mendelson

Editor’s Note: Lara Smart ChFCIPPdip, BA (Hons), is a Consultant Director and Founder of LSC Group, that delivers global payroll consultancy and program design and management, with a focus on core areas around people, processes, technology, service, data and controls, and the corporate governance required. From leading startups, divestitures, and acquisitions to recalibrating and re-baselining programs for success, she is an advocate for the payroll industry, supporting and enabling people on the journey.

Q: What do you see are the emerging trends in global payroll, and therefore, affects the changing role of the payroll professional?

There are seven areas I believe commanding attention:

1. Cybersecurity risk: As cybersecurity attacks increase, careful due diligence and supply chain security assessments, transparency of solution framework, and data are showing that caring about tiny details are required to ensure risk mitigation.
2. Flexible product and service offerings: Remote and flexible working, global mobility, earned wage access (EWA or on-demand pay), financial wellbeing, smart absence monitoring linked to wellbeing and labor forecasting.
3. Heightened complexity: As governments continue to change and require more monitoring and reporting, vendors and businesses must ensure technology is up to date and that business processes support the change. Globally mobile employee tracking remains a challenge where there are large volumes of movement.
4. Talent retention: The pandemic disrupted the marketplace; inflation rates are high, and talent is turning over quickly, impacting businesses and their pay vendors.
5. Service excellence: Service level agreements (SLAs), key performance indicators (KPIs), relationship management, cycle processing times, query response times, and value for money are being scrutinised as businesses look to offer better service to their employees and teams.
6. RPA and AI: Automation of process, administration, and simple information; these tools are available to help businesses understand what they need to do for successful adoption. How to best utilise robotic process automation (RPA) and artificial intelligence (AI) is generating a requirement for vendors to educate clients and not act solely as technology providers.
7. Global model strategy: There are several key points that must be addressed here, to include the following:

• In the past, the only way for multinational organizations to have consolidated global payroll was to work with a global aggregator.
• Global payroll isn’t processing, it is the system of controls, processes, and standards that determines how global payroll is managed.
• Technology has significantly advanced with flexibility and agility more necessary now than ever before.
• It’s not always about best in breed – it’s about what solution is best for the business and what it needs.

Q: What are the chronic challenges for companies that have or are moving into global expansion?

When considering any global change, be it moving from domestic to regional or global expansion, there are different strategic areas for consideration.

While vendors can make a huge difference to support the automation of your operations to be more effective and efficient, the burden of responsibility still falls with the employer and service is paramount to complement any technological advancement. Always be cautious about sales tactics and have a clear picture of what gaps you are looking for a vendor to address when opening discussion around improvements.

The following is an outline of the four areas, with thoughts on the strategic choices for each:

1. Market and Model Options—Depending on the strategic direction of the business, an employer of record (EOR), in-house payroll, outsourced managed service, or full business process outsourcing (BPO) model could be on the horizon. Take the time to understand what is required internally. What’s the strategy? Do you want a global aggregator model for a single contract and consolidated reporting, local vendors in country, or regional vendors? Survey the market at a high level through a request for information (RFI) and understand what each vendor can offer then build a detailed request for proposal (RFP).
2. Internal and External Due Diligence—When performing detailed due diligence on any products, offerings, patch updates, or enhancements, ensure there is very clear supply chain risk assessment. Often, vendors will provide system and organizational controls (SOCs), International Organizations for Standardization (ISOs), and answer questions limited to their platform and direct services. With an increase in middleware, data transfer sites, and a common place practice of third-party vendor engines and associated infrastructure, this widens the solution architecture portfolio of your payroll operations open to risk.You could be looking for a single global contract, but it has never been more necessary to mitigate risk around any supply chain. Ensure transparency of all the technology landscape and IT/cyber security, data protection impact assessments (DPIAs), and global risk and compliance (GRC) requirements are satisfied. This requires strong corporate governance from the business, key corporate function stakeholders such as legal, procurement, IT, HR, finance, and others, and the responsibility of covering all bases.
3. Target Operating Models—Geographic considerations laced with service model options (centralization/decentralization, local, global) are paramount to understanding how to navigate internal resource and service structure options and should be designed in parallel with the strategy of market and model options to ensure in house and external viability.
4. Corporate Governance—A governance framework is required to establish the steps to understand what is required to assess the right business model and requirements, technology, services, resource, cost, time, and quality control. A full assessment of the options available against risks and benefits and recommendations from key corporate function stakeholders should be compiled into a business case.

Q: What do you see as the value and limits to emerging technology, robotics, and AI in managing global payroll?

With a rapid increase in the AI trend, thanks to the likes of ChatGPT and media interest, RPA and AI are being implemented in various industries, thus showing their potential impact on our society, economy, and industry. RPA is designed to automate repetitive, rule-based tasks and is effective at structured processes, while AI aims to replicate human intelligence and decision-making capabilities, excelling at handling complex, unstructured tasks. Both technologies have their strengths and applications, and payroll can benefit from using them according to their specific needs and goals.

These technologies offer huge potential, each with unique benefits and challenges (see table below). Through understanding the differences and sourcing appropriate solutions, businesses can harness the power of technology to increase efficiency and improve decision making. To date, vendors utilize RPA heavily, but AI is still being investigated by some to understand where it can be utilized with awareness of regulation, policy, and ethics at the forefront.

Q: How did you get started in your career?

I hear the line often that people “fall into payroll,” but I was always interested in how people were paid from early on.

As a Chartered Fellow of the CIPP, having studied PRINCE2, Agile, a BA in Business and Management, and ILM studies, I am passionate about professional and personal development and providing the best services to those I am fortunate to collaborate with.

Nineteen years ago, I entered the world of pay operations working with managed services for the BBC in the U.K. and moved swiftly into the bureau industry, servicing many clients on multiple pay frequencies, processes, technology, operationally, and implementation for years. I loved the bureau industry and working with different clients and the streamlined processes, teamwork, and service that goes into it. From there I moved to corporate in-house with my first international exposure, migrating the Nordic region into a U.K.-based HR services whilst managing a European team.

Early opportunities and a willingness to grow outside my comfort zone took me into consultancy, where I worked with group companies needing transformational change and managing large offshore teams.

With a passion for influencing change, problem solving, and a background enabling global strategy and project and program management, I set up my own consultancy and have been delivering for a multitude of clients since; writing for the industry; speaking at round tables, conferences, and industry forums; and judging awards. It’s a pleasure to work with so many talented people and support them on what can be challenging journeys at times, bringing structure, clarity, and a defined approach to setting up and managing programs.  

Please don’t limit yourself. If you want to be as effective and efficient in your career as possible, be organized, set goals, and take opportunities. Be curious, be willing to sacrifice time to learn, and be consistent in your approach to gaining experience in different fields. Find a mentor and coach. In general, good people love to help people who are willing. Enjoy the journey—including failure—and you will fly!

Q: What are the most important qualities of effective leadership?

As a program director, it’s essential to have a team who can trust and rely on each other remotely to understand what they need to deliver and when—on time, in budget, and with a high degree of quality. Some important steps in this process include the following:

1. Learn one thing that’s important to every person you work with.
2. Value people. They work hard and spend a lot of their time with you.
3. Listen to your team. They likely know more than you do in different areas.
4. You don’t always need to reinvent the wheel.
5. It’s not always about hierarchy; it’s about respecting each person and playing to different strengths and weaknesses.
6. Communicate clearly, concisely, and regularly through multiple channels: email, video calls, messages, content, stakeholder updates.
7. Deal with issues as they arise; don’t sit on them.

Q: What are your management and leadership approaches?

There are several key leadership traits that I have learned and incorporated over my years in the business world. They include the following:

• Always seek to understand. Everyone wants to be heard; give people a welcome space to hold them there. Everyone has good days and bad days, and everyone is different.
• Encourage open communication to support each other.
• Be honest, transparent, authentic, and genuine. Have a high degree of integrity. Do what you say you will. Have a clear strategy, mission, and values for people to aim for.
• Everyone is capable. Trust people to do their jobs and if they don’t, coach them. Provide clear roles and responsibilities, deliverables, planning, organisation, structure, education, and your time. Limit assumptions and communicate clearly.
• Regular touch points will keep you in check with where a person/team is, their successes, risks, and blockers. Hold the uncomfortable conversations; this is where growth and change happen.
• Deal with issues quickly and nip them in the bud. Negative situations can become toxic when not dealt with and bring motivation down.
• Celebrate people’s successes and make other stakeholders aware of them. Remove blockers to allow people to be proactive. People want to enjoy their work; you’ll get more out of everyone and retain talent this way. People can burn out when they’re doing too little of what lights them up.
• Know when to step in and always have your team’s back.
• Leading people professionally requires strong experience, knowledge, emotional intelligence, and above all a sense of humor. Cheerfulness in the face of adversity builds resilience!

Q: How has your approach to change management helped to make a successful organization?

Change management requires structure to be successful. An experienced transformation lead can support you with the relevant data and information structure required across the below key strategic pillars to ensure core due diligence is performed:

• Technology
• Process
• Service
• People
• Data
• Controls

You can affect change by following a process. Start with a methodology (incorporating corporate governance, project management office (PMO), and communication) that includes the following steps: Discovery (as-is) > (2) Design (to-be) > (3) Gap analysis > (4) Change impact analysis > (5) Business case.

Q: How do you personally manage to balance work and pleasure?

Values. You’ll likely know your company values and what they expect from you. What about your own? What’s important to you? Having values gives you a strong sense of who you are and what’s important to you and leads to goal setting. 

Consistency. Wonder why the military is successful? Routine. Create goals, then create actions for those goals, prioritize these, and write them down even if it’s on your phone. In a fast-paced society with an average attention span of 8 seconds (yes, think TikTok), there is a fallacy and false narrative that promotes quick success. Don’t be fooled by this; greatness comes from dedication, discipline, time, patience, and experience.

Time blocking. If you don’t control your schedule, it will control you. I’m a visual person and find color blocks in my calendar aid my organization in blocks of time for tasks. I draw these blocks in my notepad sometimes as well when working through requirements.

Hobbies. Have something you love! I love travel, hiking, photography, and Pilates.

Habit stacking. It’s no wheel invention, friends; it’s as simple as walking and talking. Get your beautiful body some movement and connect with your colleagues at the same time. 

The time and love with friends and family.

Limit screen time. I’m not a huge social media fan. I recognize the importance and positives of online presence, but it’s incredibly distracting and time can quickly run away scrolling.

Find enjoyment in your work!

Q: What books are on your recommended reading list?

I’ve been an avid reader since I was young. I used to read all the Roald Dahl books with a torch under my cover when I was supposed to be sleeping! I believe you can learn more from a good book than a training course at times and often they can help us become more compassionate and empathetic, viewing the world from someone else’s character. I always say my brother prefers to “watch” books and nowadays platforms can turn words into audio and screen for those who prefer alternate ways.

Books lift us from the reality of life into a world of imagination and improve vocabulary, memory, imagination, and focus as well as reduce stress. And what an easy way to fall asleep! They give us access to the world’s best mentors to grow in wisdom and enable better communication. Some of the books on my must-read list include:

• “Economic Facts & Fallacies” by Thomas Sowell. The real economy without the political bias.
• “Feel the Fear and Do It Anyway” by Susan Jeffers. Providing the insight and tools to improve your ability to handle any situation.
• “Time to Think” by Nancy Klein. What and how we think and how it determines everything we do and say.
• “Principles” by Ray Dalio. The principles developed by a hedge fund manager: own your outcomes, have clear goals, identify, and don’t tolerate problems. Diagnose problems to get to the root cause.
• “The Nightingale” by Kristin Hannah. Love and loss, doing the right thing even when it’s dangerous.
• “Demon Copperhead” by Barbara Kingsolver. Fiction with interwoven social messages around foster care, child hunger, rural struggles, and people who are often disrespected and undervalued by people in power. Addresses some heavy topics but enlightening and hopeful.