North America | Latin America | Europe | Middle East | Africa | AsiaNorth America | Latin America | Europe | Middle East | Africa | Asia©Chazey Partners 2016 1© Chazey Partners 2016
THE HABITS OF HIGHLY
EFFECTIVESSCs
710th Annual Shared Services & Outsourcing
| August 22, 2016 |Miami, Florida
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The senior staff you meet at the introductory meeting will be
integral to the project, driving content and available for your
questions
Operationally delivered and consulted numerous programs
globally, over the last 25 years in both public and private sectors
Chazey Partners is a Practitioners-led Global Management Advisory Business, specializing in Business Transformation of Support Functions, including implementing and optimizing Shared Services & Outsourcing Operating Models, and targeted Technology Enablement
Strategic advice Business case development Support from concept to
realization Project management End-to-end implementation For new, existing and mature
Shared Services Organizations
Service Offerings
Finance & Accounting Human Resources Information Technology Procurement Corporate Planning Facilities Management OfficeAdministrationistration Legal Tax Marketing & Communications Other Support Services
Functional Coverage
Our hands-on approach is delivered by our seasoned
practitioners who have ‘lived and breathed’ a great number of
projects
Robust knowledge Transfer & Client-focused approach to
ensure the optimum sustainability of the solution
Who We Are
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Global Operations
Who We Are: Founded 2006 • Global offices headquartered in California • Over 50 full-time and 70 specialist resources
What We Do: Evaluations and Assessments • Strategic Advice • Project Management • Business Continuity
Where We Focus: Transformation of Finance • Human Resources • IT • Procurement • Facilities • Other Functions
The Chazey Difference: Practitioners first • Staff Continuity• Knowledge Transfer • Client Engagement in Transformation
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OUR CLIENTS
WHERE HAVE WE COME FROM
Who We Have Worked With
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Breakout Session
• Form a group of 4 different organizations
• Briefly introduce your current operation/SSC (scope, FTEs, years of operation, etc.) 2 minutes per person
• Share 2 strengths and 2 challenges of your operation 5 minutes per person
2 Challenges• Organization• Client• Technology• Processes
2 Strengths• Organization• Client• Technology• Processes
Introduction• Business• Maturity• Processes• Employees/FTEs
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Level 1
Level 2
Level 3
Level 4
Level 5
Decentralization•Local needs•Duplicated Efforts•Poor central controls•Multiple platforms
Centralization•Consistent controls•Limited scope•Labor arbitrage•Lift & Shift•Single instance of ERP
SSC•Client Management •Process Efficiency•Standardization•Improved Controls•Increased Scope
Global Services• Governance Model•End-to-end process•Multifunctional scope•Hybrid Model
Integrated Services
•Value-add•Analytics•Data Intelligence•Business Partner
Operating Model Maturity Level
Saving opportunities can vary from 20-40 % depending on the implementation and successof the model adopted
Evolution of Shared Services
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Tendency 7:Outsourcing
Decentralization•Local needs•Duplicated Efforts•Poor central controls•Multiple platforms
Centralization•Consistent controls•Limited scope•Labor arbitrage•Lift & Shift•Single instance of ERP
Operating Model Maturity Level
Tendency 2: Consolidation
Tendency 3:Labor arbitrage
Tendency 4:Processes end-to-end
Tendency 5:Client Management
Bene
fits A
chie
ved
Tendency 1:ERP
Implementation
Tendency 8:Value-added processes
Tendency 9:Business Partners
Tendency 6:Multifunctional
services
Problem 2: Inefficient processes
Problem 3: Lack of customer
focus
Problem 1: Ineffiicient labor
Problem 4: High level of exceptions Problem 5:
Shadow systems and processes
Problem 6: Lack of vision and
insight
POTENTIAL BUSINESS
VALUE
SSC OPPORTUNITY
Challenges facing SSCs
SSC•Client Management •Process Efficiency•Standardization•Improved Controls•Increased Scope
Global Services• Governance Model•End-to-end process•Multifunctional scope•Hybrid Model
Integrated Services
•Value-add•Analytics•Data Intelligence•Business Partner
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Consistent end-to-end
process
Evolution of services Service internal
customer as if external client
Technology Utilization
Skilled workforce
Flexible Operating
Model
Continuous Improvement
The 7 Habits of Effective SSCs
+
1
23
4
56
77 Habits of
Effective SSCs
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#1 Consistent End-to-End Process
Procurement
Supply Management Master Data Purchasing
Admin
Receipt of goods and
services
Invoice Processing
Reimburse-ment
Bill Payment
Client Management
Period close and reporting
Establish policies and procedures
purchases from suppliers
Supplier set-up, cancellation
and modification
Manage and administer
supplier contracts
Receipt of goods and
services
Receipt and validation of
invoices
Application and approval ,
disbursement and processing
advances
Generate payment
documents
Support providers and
internal customers
Reconciliations and
adjustments
Approval of the purchase request
Master data review and
maintenanceCreation of
purchase order
Identification and resolution
of issues
Registration of exceptions:
urgent/missing documentation
Submission and approval of expenses
Set-up Disbursement
Manage internal and
external auditAP aging analysis
Negotiation and selection of suppliers
Management reporting
Monitoring and maintaining
purchase orders
Periodic assessment of
supplier performance
Resolution of price/quantity
differences
Submission and control of advances
Approve disbursement
Customer satisfication review and
management
AP Reconciliations
Maintenance of purchase
requisitionsIntercompany
billings
Manage declined
paymentsIntercompany
account reconciliations
North America | Latin America | Europe | Middle East | Africa | AsiaNorth America | Latin America | Europe | Middle East | Africa | Asia©Chazey Partners 2016 10
#1 Consistent End-to-End Process
Procurement
Supply Management Master Data Purchasing
Admin
Receipt of goods and
services
Invoice Processing
Reimburse-ment Bill Payment Client
ManagementPeriod close
and reporting
Establish policies and procedures
purchases from suppliers
Supplier set-up, cancellation
and modification
Manage and administer
supplier contracts
Receipt of goods and
services
Receipt and validation of
invoices
Application and approval ,
disbursement and processing
advances
Generate payment
documents
Support providers and
internal customers
Reconciliations and
adjustments
Approval of the purchase request
Master data review and
maintenanceCreation of
purchase order
Identification and resolution
of issues
Registration of exceptions:
urgent/missing documentation
Submission and approval of expenses
Set-up disbursement
Manage internal and
external auditAP aging analysis
Negotiation and selection of suppliers
Management reporting
Monitoring and maintaining
purchase orders
Periodic assessment of
supplier performance
Resolution of price/quantity
differences
Submission and control of advances
Approve disbursement
Customer satisfication review and
management
AP reconciliations
Maintenance of purchase
requisitionsIntercompany
billings
Manage declined
paymentsIntercompany
account reconciliations
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#1 Consistent End-to-End process
SSC Director
P2P O2C R2R Hire to Retire
Advantages Disadvantages
High efficiency Difficult to recruit function leaders
Promotes standardization Major change management
Promotes cross-training and automation
Complexity of understanding customer
Capture synergies and improves customer service
Business Unit #1Business Unit #2Business Unit #3Business Unit #4
Payments Bills OrdersPurchases
Collection & Application Billing CreditsSales Orders
Retirement Staffing Personnel Admin
Recruitment and Selection
Reports Monthly Close ReconciliationsJournalEntries
• Integrated model
• Improved processes
• Value-add services due to analytics and inisght
• More than just cost savings
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#2 Evolution of services
SSC service offering s are growing beyond traditional “back office” processes and incorporating Administration, Purchases, Legal, Marketing, Logistics and others.
SSC Tradicional SSC Multifuncional
IT Finance HR
IT
Finance
HR
Purchases
Admin
Legal
Logistics
Marketing
Sales
Effective SSCs:
Functions -Stable operations -Common support areas
Support of Senior Management-Executive buy-in-Mulitple stakeholders-Big bang vs. evolutionary
Planning -Defined Scope -Single center, Multiple center, Hub and spoke? -Center of Excellence?
Organization Model-Breakdown silos-New org structure and reporting
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Initial Intermediate Advanced
General Services
Communications Legal Travel Security Maintenance
Event Management Graphic Design Branding Public Relations
Campaign Management Health and Environmental
Security Risk Management
Finance and Accounting
Payables General Ledger Fixed Assets Accounts Receivable
Reporting Cost Accounting
Cumplimiento tributario Tesorería Planning Financiera
HR Payroll Compensation and Benefits Personnel Administration
Organizational Structure Q&A Recruitment & Hiring
Expatriates Services Personnel Development Medical Services
Information Services Helpdesk Infastructure Support Application Support
Development Telecommunications
Hardware y Software Acquisition
Customer Service Customer Support (local) Product Support Settlement
Internet/SupportE-mail Customer Support (International)
Call Center Dispatch
Purchasing Requisitions Purchase Orders
Indirect Purchasing Negotiations Inventory Management
Distribution/Logistics Master Data Management
Other Services Real Estate Facilities Fleet Management
Grants Management Disaster Recovery Restaurant services
Health Clinics Engineering Subsidiary Management
#2 Evolution of Services
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#3 Service the Internal Customer as if an External Client
• Form a group of 4 different organizations – Different from the first group
• What are the main challenges faced with internal customers?2 minutes per person
• How do you manage customer service?5 minutes per person
North America | Latin America | Europe | Middle East | Africa | AsiaNorth America | Latin America | Europe | Middle East | Africa | Asia©Chazey Partners 2016 15
Without CIF
• Lack of clarity on responsibilities• Perception vs. reality• Focus on negative aspects of
service• One-way communication• Strained relationships with
customers• Efforts required to
maintain/improve morale
With CIF
• Customer oriented• Defined delivery expectations• Peformance measurement and
reporting• Enhanced service delivery and
efficiency• Improved customer
relationships
Through a formal framework: The Customer Interaction Framework (CIF) distinguishes a Shared Services organization from simple act of centralization and fosters a spirit of partnership between the SSC and its clients.
#3 Service the Internal Customer as if an External Client
North America | Latin America | Europe | Middle East | Africa | AsiaNorth America | Latin America | Europe | Middle East | Africa | Asia©Chazey Partners 2016 16
#3 Service the Internal Customer as if an External Client
Account Management• SSO to client; via reporting,
interaction, escalation & communication
Client Contact Management• Client to SSO; to manage
and resolve queries and drive learning/improvement
Service Partnership Agreements• SPAs are 2-way agreements
clarifying both SSO services and client inputs
Client Feedback• Client satisfaction
continuously monitored both informally and formally
Continuous Improvement• Mechanisms to identify the
areas for improvement and to develop solutions
Process Control Database• Documents end-to-end SSO
processes; highlights activity of both SSO & client
Performance Measurement• Comprehensive KPIs,
measures and metrics framework, SSO & client
Performance Reporting• Process performance will be
reviewed monthly by SSO and client
Recharging Methodology• Define basis for charging for
SSO services to turn consumers into clients
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• Is a single ERP platform required to run a SSC?
• What technology enablers are used in your SSC? • How do you use social in your SSC?
#4 Technology Utilization
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Technology helps SSC provide effective, efficient service
#4 Technology Utilization
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Fuente: Global Report SSON 2016
#4 Technology Utilization
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• How was your SSC staffed?
• What core competencies have been determined? • What is your compensation strategy? Industry vs. SSC?
#5 Skilled Workforce
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#5 Skilled Workforce
Effective Communicator
• Understands how to effectively communicate with audience
• Clearly explains information• Adapts style to situation
Takes Initiative• Makes good decisions in all situations• Accountable • Leader, who can influence others
Adapatable
• Keeps composure in stressful situations• Open to change• Can communicate with different personal
Problem Solver• Solution-oriented• Able to idnetify pertinent information of the problem
Functional Expert• Knowledge of required concept (Accounting, HR, etc.)• Understands processes (P2P)• Understands tools and systems (SAP, Oracle)
Results Oriented• Monitors progress against milestones and deadlines• Motivated to achieve objectives• Requires quality outputs
Compliant
• Adheres to policies, tasks and procedures• Encourages other to adhere
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Quienes “solucionan Problems” identifican correctamente los desafíos mas críticos y desarrollan soluciones
efectivas que agregan el mas High valor a los clientes
Solucionar Prob-lemas
Orientación a Resultados
Comunicación Efectiva
Experto Funcional
Iniciativa Propia Adaptabilidad Cumple las reglas
40%
19%15%
11%8% 7% 7%
Problem Solver Results Oriented Communicator Functional Expert Takes Initiative Adaptable Compliant
The ability to correctly identify chal-lenges and develop effective solu-tions are the most valued by cus-
tomers.
n: 1.131 empleados de Shared ServicesFuente: CEB Prueba de Talento en Shared Services 2013
Although these skills help minimize risks, not considered to be as valuable
of those that create value through developing solutions
Key skills for value creation
MOST VALUABLE SKILLS
#5 Skilled Workforce
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Actitud de Servicio
Comunicación Efectiva
Trabajo Bajo Presión
Cumplimiento de Tareas
Trabajo en Equipo
Solucionar Problemas
Iniciativa Propia
0 0.5 1 1.5 2 2.5 3 3.5 4
Juan Rodrígues- Gerente/Manager P2P
Escala de Evaluación: 1. -No Demostrado; 2.- En Desarrollo; 3.-Competente; 4.-Experto
Nombre/Name: Juan RodríguezUsuario/ID: FADG710123I18Postulado/Date: 14/05/2015Reclutado/Recruitment: N/A% Necesarias/ % Desired: 86.1 %% Compatibilidad Total/Compatibility %: 83.3 %
#5 Skilled Workforce
Takes Initiative
Problem Solver
Teamwork
Results Oriented
Handles Pressure
Effecitve Communicator
Service Oriented
Evaluation Scale: 1. – Not demonstrated; 2.- In development; 3.-Competent; 4.-Expert
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Tech
nica
l Ski
lls
Management Skills
23 32 41
34 32 41
39 32 41Low Medium High
High
Medium
Low
The Competency Model allows a strategic map of what the skills required for each position/employee of a Shared Services Center to identify potential risks and establish training programs.
Knowledge• Tecnología• Accounting• Taxes• Languages
Behaviors• Takes initiative• Service-oriented• Team-oriented• Communicator
#5 Skilled Workforce
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#5 Skilled Workforce
For key positions, it is important to provide salaries and benefits that competitive within the SSC market.
It is recommended that compensation ranges are established based on the SSC market rather than the other operations of the company.
Habilidades 264Especializadas Básicas EActividades IÉnfasis (+ -) +Relaciones Humanas 3Solución de Problems 87Standard DComplejidad de Análisis 3Énfasis (+-) +
33%
Responsabilidad 115Libertad de Actuar DÉnfasis (+-) +Magnitud 3Énfasis (+-) +Impacto CTOTAL PUNTOS HAY 466
Level PUNTOS HAY MIN 1er. Cuart
Medium
3er.Cuart MAX Prog Ampl
Min. Prom. Max.
1 305 354 410 12,405 13,500 15,430 16,433 17,202 50%
2 411 476 503 13,305 14,204 16,403 17,575 18,908 10% 50%
Valuación: Análista de Credits O2C
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• What processes have you effectively outsourced to a BPO provider?
• What are the main advantages you have experienced? • What are the greatest challenges you have experienced?
#6 Flexible Operating Model
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#6 Flexible Operating Model
In House Outsource Hybrid
+
The age dilemma is MAKE OR BUY?
The BPO market has grown significantly in the last decade covering financial , accounting, certain functions of HR and customer service.
Things to be considered: Cost vs. Control Level of maturity of processes Access to skilled labor Contract negotiation Time zone and language Transaction volume Flexibility demanded BPO risks Geographic coverage
CON
TRO
L S
trat
egic
IMPO
RTAN
CE O
F PR
OJE
CT
COSTLevel of INTERNAL SKILLS REQUIRED
EVALUATE OUTSOURCING
VS SSC
OUTSOURCE ALL
PROCESSES
ESTABLISH AGREEMENT WITH
OUTSOURCER
HANDLED INTERNALLY
IN SSC
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#7 Continuous Improvement
Can a SSC really innovate?
• Without disrupting the business! – Maintain process controls• Without disrupting the customer!—Keep stakeholders happy• Without exceptions!– Focus on standardized operations• Without disrupting performance!– Achieve SLA standards• Without investment!– Enablement and effectiveness• Without additional resources!– Doing more with less• Without leadership!– Gaining buy-in and support
With all of these conditions… Is really possible?
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#7 Continuous Improvement
What stops the innovation process?
• Fear of the unknown/unintended consequences• Obsession with risk management• Lack of scalability and scope• Focus on customer satisfaction• Lack of talent and appropriate skills of workforce• Rigid service level agreements• Limited use of technology and tools• Time and capacity restraints• Inability to think outside of the box
North America | Latin America | Europe | Middle East | Africa | AsiaNorth America | Latin America | Europe | Middle East | Africa | Asia©Chazey Partners 2016 30
Recognize and RefineImplement PilotAssess and
Prioritize
#7 Continuous Improvement
Effective SSCs adopt innovation as a process rather within the SSC, this provides several opportunities and channels to capture new ideas:
INPUT
•Leadership•Surveys•KPIs and Benchmarks•HR•Methodology•Market research•Suggestion box/contests•Communities and forums
End-to-end process of INNOVATION
Concept
PMO SSC
OUTPUT
•ROI•Lessons Learned•Improved Service Delivery•Internal customer satisfaction•Direct and indirect impacts•Review of KPIs
How effective SSCs innovate?
PMO assigned to SSC to ensure commitment Implement ‘quick wins’ to provide credibility to the process RECOGNIZE ideas generated and implemented Assign BEST FUNCTIONAL MANAGERS to innovation Change management and senior management support Communicate and celebrate achievements
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Questions?
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Leverage our Experience for Your Success
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Contact us
www.linkedin.com/company/chazey-partners
@ChazeyPartners │ #ChazeyPartners
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