By Jamie Lyon, head of corporate sector at ACCA
The benefits of finance transformation and the adoption of alternative finance models such as shared services and outsourcing — transparency, lower cost, greater efficiency, standardisation and improved governance, and more – continue to be lauded.
Recently ACCA spoke to finance leaders from 20 of the world’s leading global brands to discuss their views and perspectives on finance transformation and the use of shared services and outsourcing.
Client organisations such as Coca Cola, Kimberly Clark, Shell, Unilever, Pearson and WPP shared their client insights on the successes, or otherwise, of remote delivery in the finance function. The analysis was complemented further from key advisory firms Deloitte, KPMG, PwC and Ernst and Young, as well as key business process outsourcing players such as Accenture and IBM. Critically, we asked participants what are the finance transformation issues that kept them awake at night?
The report, Finance Transformation: Expert Insights on shared services and outsourcing makes for interesting reading. For example, some leaders use shared services and outsourcing as a functional finance fix, improving the “factory,” while others see shared services and outsourcing as having a greater purpose — transforming the business, not just stopping at a better finance function; focusing on fixing the end-to-end business processes. Using finance transformation as a catalyst for business change, typically brings into play greater complexity and requires the finance function to be truly connected and influential across the organisation to drive the change process.
This brings me nicely on to the concept of change. Change management was cited across leaders as being the biggest challenge, underestimated often at the outset of the journey, and insufficient change management capability being evident to manage the transformation process effectively. The retained finance function was also cited as another key challenge. How do you truly make the retained finance function tick with the shared service/outsourced delivery to drive the optimal finance function, and how do you develop those entirely new relationship management and governance skills to make these new finance models work?
After the initial benefits of implementation had been gained (cost reduction, standardisation), finance leaders also recognised the business they are serving don’t just want a better finance function per se – they also want to see what else the finance functions can deliver. For finance leaders, their internal business counterparts continue to look for ‘more’ — how do I get more cash, more information, more service, more intelligence, more cost out from finance? It’s a big ask for finance leaders to meet, and the solutions are not cut-and-dried. For finance functions adopting shared services and outsourcing, the report suggests there is plenty more to do to unlock all the value and meet business needs. Undoubtedly, however, one point came through very strongly across the board – there’s no turning back from finance shared services and outsourcing.