Lars Nordestgaard Nielsen, ISS - Amazon S3s3-eu-west-1.amazonaws.com/deloitte-conf-2015/presentations/deloitte... · Local authority on organizational design within the country finance

14-15 September 2016

Lisbon, Portugal

#DeloitteSharedServices

Deloitte Shared Services, GBS & BPO Conference

Breakout 3: ISS - Developing a mature relationship with BPO providers: Maximising potential and adding strategic value

Lars Nordestgaard Nielsen, ISS

ISS - Our Service Offering

Cleaning

Services

Support

Services

Catering

Services

Security

Services

Technical

Services

Facility

Management

A Few Facts

3

Finance Organization – Pre-BPO

Very strong discipline and competency in financial reporting and performance management

In terms of transactional finance

Local authority on process design

Local authority on organizational design within the country finance organizations as well

as between finance and operations

Varied level of investments in standardizations

Implementation of the global ERP platform on-going and thus a fragmented ERP

landscape

Feasibility analyses (supported by Deloitte) identified opportunities to increase

efficiency

Sourcing and Solution Decisions

Own SSCOutsourcing

BPO - external

1

Near ShoreLocation

Off Shore

2

“Fix & Ship”Solution

Structure “Ship & Fix”

3

Sourcing and Solution Decisions

Own SSCOutsourcing

BPO - external

1

Strategic Choices from a CEO

perspective – the 3 essential questions

1. If we started from scratch today, would the

business build the capability internally?

2. Is the business so good at the activity that others

would hire it to do it for them?

3. Is this an activity of the business where its future

leaders will come from?

BPO Value Drivers

• Harvest cost benefits from:

• Labor cost arbitrage as processes are off-shored to India

• Economies of Scale as processes are centralized and productivity

increased

• Service Provider will commit to up-front and future cost reductions to be

obtained via process efficiencies

Cost

Reductions

Risk

Reductions

• Allow for a more harmonized process and systems environment

• Allow for more standardized internal controls

• Improved management and control of process adjustments based on process

ownership

• Increase scalability

Australia

Belgium

Netherlands

FinlandSweden

Denmark

Norway

UK

Germany

Austria

OtC

• More than 146k invoices raised

• $3.1 Bn. Worth cash applied

• 11k customers created/modified

• 24k Contracts created/modified

PtP

• 5 Different ERPs

(SAP/Oracle/Navision/Main Frames)

• More than 1 Mn. Invoices Processed

• Nearly $1 Bn. worth payments

disbursed

• 8k Vendors managed

(created/modified)

RtR

• 30k Reconciliations performed

• More than 77k Journal entries posted

• 8.5k Fixed assets accounted for

Status …. 120 FTEs outsourced across Europe and APAC

ISS OFFSHORE

DELIVERY CENTER

Hong Kong

Switzerland

BPO in a Lean Group Structure

The first 2 years of the ISS BPO journey, one group employee was assigned to the programme

Thus the BPO programme has been planned and executed leveraging

Strong execution culture in the local ISS country organizations

Countries took full charge of the change management activities

Solution ownership shared between country and group

Customized Solution Design and Transition Methodology

All input and deliverables required for Solution Design has been templatized

Very rigid Transition execution with no exceptions from the customized methodology allowed

Capabilities of the Service Provider

Dedicated Cognizant transition manager, managing

Cognizant specific activities

ISS activities through the transition methodology

Programme Highs and Recommendations

Programme Highs

Strong transition performance with very few service issues and errors

Strong performance by local finance driving the change

Great collaboration between ISS and Cognizant – no finger pointing !

Country business cases have been realized

High level of trust and transparency between Group BPO and Cognizant

Recommendations

Keep a critical eye on Service Provider during pilot to ensure methodologies, tools and templates are adjusted to fit client

Prioritize error free transitions !

Ask early for changes to key personal at the Service Provider in case of low performance

Spend time with local CFOs to ensure that benefits and risks of BPO are well understood

Understand capabilities of retained organization in each country, to manage risks

10

Establishing a Strategic Partnership

Main Components

Trust

Joint Objectives

ISS F&A BPO Operating Model

HarmoniseBPO Scope Global Finance Processes

Organize the BPO journey around Joint Objectives

30 months +12 to 30 months

Build & Stabilize Harmonize Scope Transform

6 to 12 months

Finance & Accounting - Feasibility Study

Selection of Service Provider

Solution Design

Transition Approach

Contracting & Go-live

-Live

-Benelux Go-live

13

The Sourcing Process – First Step in establishing Trust

Establish Trust

Trust in Shared Services and in off-shore BPO

Trust in the Service Provider Organization

Trust in key individuals at the Service Provider

Key Actions

Involve key stakeholders across Group, Region and Country levels in the selection process

Invest in site visits

Invest in customer reference visits

Document that selected Service Provider is compliant with relevant Group policies

ISS F&A BPO Operating Model

HarmoniseBPO Scope Global Finance Processes

Organize the BPO journey around Joint Objectives

30 months +12 to 30 months

Build & Stabilize Harmonize Scope Transform

6 to 12 months

Joint Objectives

Expand the BPO scope and pursue selected

improvement initiatives to demonstrate value:

- Alignment of BPO scope across

countries

- Blackline implementation

- Various improvement projects

Joint Objectives

Drive efficiency and risk reductions through:

- Joint design of of end-2-end global

finance processes

- Joint implementation of global finance

processes

- Deployment of global ERP platform

- Deployment of Robotics

Joint Objectives

Deliver respective financial business cases through:

- Error free transitions

- On time transitions

- Strengthen trust and expand to trust to country and

regional stakeholders

ISS F&A BPO Operating Model

HarmoniseBPO Scope Global Finance Processes

Organize the BPO journey around Joint Objectives

30 months +12 to 30 months

Build & Stabilize Harmonize Scope Transform

6 to 12 months

Joint Objectives

Deliver respective financial business cases through:

- Error free transitions

- On time transitions

- Strengthen trust and expand to trust to

country and regional stakeholders

Joint Objectives

Drive efficiency and risk reductions through:

- Joint design of of end-2-end global

finance processes

- Joint implementation of global finance

processes

- Deployment of global ERP platform

- Deployment of Robotics

Joint Objectives

Expand the BPO scope and pursue selected improvement

initiatives to demonstrate value:

- Alignment of BPO scope across countries

- Blackline implementation

- Various improvement projects (pilot of Robotics)

ISS F&A BPO Operating Model

HarmoniseBPO Scope Global Finance Processes

Organize the BPO journey around Joint Objectives

30 months +12 to 30 months

Build & Stabilize Harmonize Scope Transform

6 to 12 months

Joint Objectives

Deliver respective financial business cases through:

- Error free transitions

- On time transitions

- Strengthen trust and expand to trust to

country and regional stakeholders

Joint Objectives

Expand the BPO scope and pursue selected

improvement initiatives to demonstrate value:

- Alignment of BPO scope across

countries

- Blackline implementation

- Various improvement projects

Joint Objectives

Drive efficiency and risk reductions through:

- Joint design of of end-2-end global finance processes

- Joint implementation of global finance processes

- Deployment of global ERP platform

- Deployment of Robotics

17

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