1 Finance Shared Services & Outsourcing ______________________________________ How to Prepare for outsourcing Choose the right partner and Negotiate the best deal Phil Price : Chartridge Associates www.chartridgeassoc.com 14 March 2012 Phil Price : Chartridge Associates Making things work - Properly www.chartridgeassoc.com
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How to prepare for outsourcing, choose the right partner and negotiate the best deal
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1
Finance Shared Services & Outsourcing
______________________________________
How to Prepare for outsourcing
Choose the right partner and
Negotiate the best deal Phil Price : Chartridge Associates
www.chartridgeassoc.com
14 March 2012
Phil Price : Chartridge Associates Making things work - Properly www.chartridgeassoc.com
_____________________________________ Introduction – Phil Price
• International CFO, passionate about driving and delivering Profitable, Cash Positive Business Growth based on World Class Finance through a focus on total quality, process excellence, ruthless continuous improvement and high performance teams. • Significant experience in leading and driving successful transformation, shared services, BPO and erp programs in Quintiles Transnational, Iron Mountain, Bausch + Lomb and Readers Digest Association in the US, UK and Europe.
• Committed to “Making things work – Properly”
Phil Price : Chartridge Associates Making things work - Properly www.chartridgeassoc.com
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Finance Shared Services & Outsourcing
_____________________________________
Agenda
• The “Pit of Despair”; Managing the “J” curve
• Preparing for outsourcing
• Choosing the right partner
• Negotiating the best deal
• Implementation
• Q&A
. Phil Price : Chartridge Associates Making things work - Properly www.chartridgeassoc.com
The “Pit of Despair” - Managing the J-curve ________________________________
Phil Price : Chartridge Associates Making things work - Properly www.chartridgeassoc.com
Current State
P1 P2 P3
What usually happens
PER
FOR
MA
NC
E
TIME
What stakeholders (mistakenly) expect
Source: David Viney - The J-Curve effect observed in
Change
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Preparing for 0utsourcing
_____________________________________ What do you want to achieve?
• If you don’t know where you are going any direction will do
• $1 spent in preparation saves $10 in back end fixes
• What is the scope, what activities to be covered
• Your mess for less, labour arbitrage
• Standardised processes; improved processes
• Better; faster; cheaper : which order?
• Access to better technology (paperless; reconciliations, t&e)
• Part of a Business transformation program
• Partnership v Customer/Supplier
Establish a clear set of goals to benchmark success . Phil Price : Chartridge Associates Making things work - Properly www.chartridgeassoc.com
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Preparing for outsourcing
_____________________________________ Internal Team
• All in this together; put the best people on the project
• Experienced interims/independent consultants
• External consultants
• 100% time commitment; backfill as required
• Get comprehensive executive buy in and get it communicated
• Establish the “burning platform” and communicate it
• Address the WIIFM of all stakeholders
• Train key participants in change management
Total clarity of ownership of all aspects
. Phil Price : Chartridge Associates Making things work - Properly www.chartridgeassoc.com
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Preparing for outsourcing
_____________________________________ Current status – Are you really ready?
• How standardised are your processes; are they documented?
• How are purchase invoices approved; no PO no pay?
• Do you track errors; what is the error rate?
• Do you track exceptions; what is the exception rate?
• How fast and painless is the month end; is it well documented?
• What state are your balance sheet reconciliations in?
• Do you know what the current cost is by activity?
• Establish as-is benchmark for RFP & to track improvement
Prepare risk profile & mitigate through the process . Phil Price : Chartridge Associates Making things work - Properly www.chartridgeassoc.com