Transforming finance – there’s no turning back from shared services and outsourcing say experts

Date

12 Jan 2012

Sections

Euro & Finance

On-going challenges in finance transformation through shared services and outsourcing remain, but there are significant future opportunities for value say global leaders 

There is ‘no turning back’ from finance shared services and outsourcing as a future delivery model for the finance function, say finance experts from 20 leading global organisations including Coca Cola, Deloitte, PwC, Shell, Unilever and WPP, in a new report from ACCA (the Association of Chartered Certified Accountants) called Finance Transformation: expert insights on shared services and outsourcing.

The report reveals that the use of finance shared services and outsourcing to transform the finance function is here to stay, with gains already made in reducing costs and improving processes. 

Jamie Lyon, head of employer services at ACCA and co-author of the report, says: ‘In this report we wanted to explore how leaders are transforming the finance function to improve finance capability through shared services and outsourcing and the issues, challenges and opportunities faced. Finance transformation continues to be a critically important issue for Chief Financial Officers and finance leaders, especially in an ongoing challenging business environment.’

Looking to the future, the report’s global experts see much greater opportunities to drive improved business results, where finance transformation moves beyond just delivering cost savings and process efficiencies - Accenture’s Anoop Sagoo says in the report ‘the CFOs I work with see finance transformation as a vehicle to drive change. Now they are most interested in business performance.’ 

However, the report reveals a number of challenges which must be overcome to unlock future value. 

Global leaders featured in the report continue to recognise capability shortfalls, from the effectiveness of change management processes to the lack of focus on the retained finance team and inability to see shared services and outsourcing in the context of an overarching vision for finance. These factors are cited as major barriers to finance transformation success. WPP’s Graham Russell says ‘in all these finance transformation journeys the hardest part is always change management’. Pearson’s John Ashworth states that the new retained function ‘requires a certain sort of behaviour…..it needs to embrace the change and look for opportunities to push deeper and create purpose.’ 

The report also suggests that good working relationships with outsourcing partners are important, but concerns were expressed that providers of outsourced finance solutions are not always aligned to the real needs of the clients. Different cultural values, targets and incentivisation approaches and different views on transformation speed of delivery can "make or break" the success of the finance transformation programme. Clients see differences in provider capability, and some clients express concerns about losing vital 

in-house finance knowledge, such as Unilever’s Christian Kauffmann who states ‘some companies have outsourced their entire knowledge of process…we say you can’t outsource ownership of process.’

Jamie Lyon concludes: “What comes across clearly from the global leaders we interviewed for this report is that there is much more value still to be gained through finance transformation with shared services and outsourcing so that it drives long term sustainable business performance improvement. 

“The key issue here is about capability; the capability and ambition of business leaders, of providers and their clients to optimise the finance model that best supports the business; the capability to manage the ongoing change process effectively; the capability of the retained finance team to develop effective business partnering skills and provide true insight to the business; and the capability to develop an end-to-end finance model with shared services and outsourcing that best supports the business. This report suggests clear benefits from finance shared services and outsourcing have materialised, but it also recognises how much more can be done. The so called “softer-stuff” continues to be the hardest challenge.” 

Interviewees were:

• Anoop Sagoo, senior executive, business process outsourcing, Accenture

• David E. Powell, senior director, global finance processes, AstraZeneca

• Chris Stancombe, global head of finance and accounting outsourcing, Capgemini

• Patrick van Hoegaerden, finance transformation director, Europe, The Coca-Cola Company

• Peter Moller, partner, Deloitte Consulting

• James Meader, partner, Ernst & Young

• Terry Balzanella, vice president for the EXL centre of excellence for finance and accounting in Europe

• Pascal Henssen, senior vice president and chief operating officer, Europe at Genpact

• Austen McDonach, F&A leader, Europe, IBM Global Process Services

• Gautam Thakkar, vice president and global head, enterprise services BPO, Infosys

• Simon Newton, vice president, shared services, Kimberly-Clark

• Claudio Altini, director, sourcing advisory, KPMG

• Joanna Reynolds, Global Shared Service Lead, Marsh & Mclennan

• John Ashworth, global head of business process outsourcing, Pearson

• Nick Atkin, partner, PricewaterhouseCoopers Consulting

• George Connell, vice president strategy, finance operations and centre finance lead (Glasgow), Shell

• Vijay Damle, vice president, operations, Tata Consultancy Services (TCS)

• Christian Kaufmann, vice president, finance services, Unilever

• Graham Russell, director of business process outsourcing, WPP Group

• Caroline Curtis, senior director, Controllership Accounting and Reporting, EMEA

- Ends - 

For further information, please contact:

Nick Cosgrove, ACCA Newsroom

+44 (0)20 7059 5989

+44 (0)7963 496144

nick.cosgrove@accaglobal.com

Notes to Editors

1. The full report can be found here: www.accaglobal.com/transformation

2. All of ACCA’s work on shared services and outsourcing can be found here: http://www.accaglobal.com/en/employer/why-acca/SSO.html

3. ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. 

4. We support our 147,000 members and 424,000 students in 170 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. We work through a network of over 80 offices and centres and more than 8,500 Approved Employers worldwide, who provide high standards of employee learning and development. Through our public interest remit, we promote appropriate regulation of accounting and conduct relevant research to ensure accountancy continues to grow in reputation and influence. 

5. Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. We believe that accountants bring value to economies in all stages of development and seek to develop capacity in the profession and encourage the adoption of global standards. Our values are aligned to the needs of employers in all sectors and we ensure that through our qualifications, we prepare accountants for business. We seek to open up the profession to people of all backgrounds and remove artificial barriers, innovating our qualifications and delivery to meet the diverse needs of trainee professionals and their employers. 

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