When Fewer Partners Mean Greater HR Impact 

Bringing new talent into multiple countries should be a sign of progress for a growing business. For many HR teams, it means managing several payroll providers, compliance calendars that rarely align, and reporting systems that don’t talk to each other. What seems simple on paper often turns into errors in data transfers and hours spent coordinating between vendors. 

TMF Group highlights that this fragmented model often grows without a clear strategy as organizations expand into new markets. Each additional provider creates another set of contracts and processes to oversee. The result is a heavier compliance burden and reduced visibility over the workforce. 

According to the PayrollOrg 2025 Getting the World Paid Survey, more than 36 percent of organizations manage payroll in six or more countries, often with a mix of systems and providers. This setup magnifies visibility gaps and raises compliance risk when no single party has end-to-end accountability. 

Why Fragmentation Creates Risk 

More vendors mean more touchpoints, and more touchpoints create more opportunities for mistakes. TMF Group’s guidance on choosing a consolidation partner notes that when HR must track multiple providers, small issues can snowball, leaving HR teams scrambling to correct errors after the fact. 

As companies expand, this complexity can also slow their ability to respond to regulatory changes. TMF Group points out that with separate systems, compliance teams often have to chase data from multiple sources before they can confirm whether a new requirement has been met. That delay can increase exposure to fines and undermine confidence among leadership that risks are being actively managed. 

Consolidation as a Strategic Advantage 

The report by Harvard Business Review Analytic Services in association with TMF Group shows that consolidating service providers improves decision-making speed and strengthens compliance performance. Organizations with a single, global provider have a clearer view of workforce data and can act on it faster. 

This shift also gives HR back valuable time. Instead of coordinating vendors and reconciling data, HR teams can focus on shaping policies that improve employee experience and building programs that support retention. 

Lessons from TMF Group’s Experience 

One example featured in the report by Harvard Business Review Analytic Services in association with TMF Group comes from Brown-Forman, which discovered it was using 17 suppliers for identical services across its markets. By consolidating those suppliers, the company was able to negotiate consistent terms and unlock volume-based savings. 

TMF Group emphasizes that consolidation can be a turning point for HR. When organizations bring services together, they create an opportunity to standardize processes and adopt modern technology that supports compliance monitoring at scale. This is particularly valuable for HR teams managing international mobility or responding to evolving labor rules, where a consistent global framework reduces risk. 

With operations in 87 jurisdictions and partnerships with many Fortune 500 companies, TMF Group has seen how a single global provider can become a true extension of an HR team, providing oversight, surfacing workforce insights, and supporting growth into new markets. 

Key Considerations Before Making the Move 

Consolidation works best when it is treated as a deliberate change program. TMF Group recommends starting with an assessment of where fragmented vendor relationships are creating the highest risk or inefficiency, often in payroll or entity management. 

Selecting the right provider is critical. TMF Group suggests evaluating whether a partner offers global reach with local compliance expertise, proven technology infrastructure, and the ability to scale as the business grows. The report by Harvard Business Review Analytic Services in association with TMF Group notes that organizations adopting a phased approach to consolidation are more likely to maintain momentum because they can demonstrate benefits early and build internal support over time. 

Why HR Needs to Pay Attention Now 

HR leaders are under pressure to keep pace with new labor regulations and deliver insights that inform business strategy. A fragmented vendor model makes those tasks harder than they need to be. 

Consolidation gives HR leaders the chance to simplify operations and strengthen compliance in a single move. Organizations taking this approach gain speed and confidence in decision-making – a critical advantage for businesses expanding into new markets or facing tighter reporting timelines. 

Exploring consolidation is an opportunity to build a more resilient HR operation. For HR leaders looking to free up capacity for strategic work and prepare for future growth, this is a step worth considering. 

HRD Connect Curators of the New Business Landscape. HRD Connect produces industry-recognized content for senior HR leaders. Through articles, case studies, Q&As, podcasts, events, and more, we offer truly progressive and cutting-edge insights designed to help people leaders address core HR challenges and add greater value to their business.

Share