Where does the inspiration for finance transformation come from? At sharedserviceslink.com we hear lots of stories from shared services that have transformed their finance operations to be able to support the complex global enterprises they support.
But how does the transformation process start? Some organizations change when someone brave and visionary comes into the organization. Some organizations may be in need of help, but no one is raising any alarms because they might be afraid of what it might mean for their job.
Transformation is also often driven by third parties. Sometimes it takes an outsider to see the problems within a company. Third parties can be neutral enough to drive real improvements, and have the experience to know what works. These third parties used to be called Business Process Outsourcers (BPOs) are now increasingly rebranding themselves as Business Process Services or Business Process Solutions.
As the market becomes more competitive, these service providers are focusing more on customer service and what they can do to add value, rather than just cut costs through labor arbitrage.
We recently heard a case study from Xchanging, a Business Process Services organization who helped turn around an ailing finance operation into a well-oiled global shared services organization.
Their client is the world’s largest property management and full service real estate services firm which has more than 20,000 employees operating out of 356 Offices in 58 countries.
The starting point
At the beginning of the journey, this real estate company had disparate non-standard operations. They had the equivalent of 112 data entry FTEs and an average cycle time of 45 days. 70% of their invoices were on paper.
The Journey
Some of the key elements on this finance transformation included:
- Consolidating the back office accounting operations from over 300+ operating locations into delivery centers in India, Malaysia and China.
- Transforming paper based manual intensive operations to a digital environment with the help of an electronic workflow management tool supported by a robust scanning & imaging solution.
The results
Working with Xchanging, they reduced data entry FTEs by 51%. They cut the cycle time by 66% and reduced the number of paper invoices by 45%. In their global shared service model, they now have a cycle time of 15 days and now have only 25% of their invoices on paper.
They achieved productivity efficiencies of over 60% in 5 years that resulted in overall cost benefit of over $5 million.
Not only have they cut costs, but quality has improved, but the quality of the service has improved and the customer satisfaction metrics are all green.
Who has driven transformation in your organization? Have you had good experiences with third parties?
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