- Case Studies
- Transforming Global Finance: A Multi-Million Dollar Success Story
Transforming Global Finance: A Multi-Million Dollar Success Story
Our client was a large, multinational in the top three for global revenue for its industry. The organization consisted of country structures operating more as a federation of independent states, rather than under a single and globally standardized operating model. The decision was made to build Global Business Services (GBS), leveraging both captive and outsourced service provision to transform finance, including order-to-cash, procure-to-pay, record-to-report, master data management, treasury, financial planning and analysis, and financial business partnering. The client had not completed a large-scale transformation of this type before and needed to ensure independent and transparent decision-making that was informed by leading practices. Prior initiatives were not transformative on scale envisioned by this project, as they were smaller scale, lift-and-shift, and/or emphasized location savings, with efficiencies diluted by additional in-country costs.
The client operates in a competitive landscape with challenges from both global players and smaller firms, increasing the pressure to provide more value for lower cost and at higher speed. The global talent gap particularly impacted this client’s industry, increasing the effort to find suitable candidates and bridge the gap between current workforce capabilities and requirements of the future labor market. The client’s federated structure is designed to operate under a myriad of employment regulations, developing solutions for the local markets, but it is resistant to change and not well situated to take advantage of automation, artificial intelligence, and digital transformation, nor to develop more agile service delivery models for customers.
Chazey Partners has worked with this client on several initiatives, including establishment of its internal shared services center in Mexico which services Latin America. With the drive to transform finance that would impact a significant portion of the finance organization, there was skepticism and resistance from leadership, management, and staff. In 2022, Chazey joined with the client and the outsourcer, creating a three-in-a-box structure, with Chazey acting as a trusted advisor and an independent, skilled voice, who would balance out the assertions of the design team with prudent and practical advisory support, program management, business case development, and direct responsibility for implementation of the GBS model. The three-in-a-box structure was successful due to unified agenda, clear roles/accountabilities, practical and effective transformation methodology, and strong program management/governance.
The future target operating model (TOM) included outsourcing transactional and administrative processes, creation of Centers of Expertise (CoEs) for professional and technical services, and reorganizing the retained organization around corporate, regional, and local processes. The project would also introduce best-in-class technology to transform, automate, and modernize finance processes. Chazey developed the consolidated business case and completed scenario analyses, identifying the marginal gains to outsourcing in Latin America and APME (Asia, Pacific, Middle East), and enabling the decision to create captive shared services in these regions in lieu of outsourcing. Chazey assessed and benchmarked the outsourced components of the model, enabling the client to negotiate and drive more value from the outsourcing contract.
Oversight was a critical part of the TOM, and Chazey established process towers to have responsibility over end-to-end processes, whether provided directly by the client’s staff or outsourced staff. The business case was complex, and it was a challenge to build trust in the financial targets when the calculations felt opaque. Chazey met with the country stakeholders and walked through the detailed calculations and documented assumptions to build trust and allow decision-makers to focus on principles, rather than detailed formulas. This included completing multiple scenario analyses to ensure that decisions were fact-based.
Chazey hosted an Activity Based Analysis (ABA) application to enable staff to report their activities at the subprocess level. The client did not have a global HRIS nor payroll system, so completion was country dependent. We facilitated an ABA validation processes concurrent with the development of employee transition plans during build/deploy, to address any inconsistencies in the initial data collection. The multi-year deployment program was aligned with the rollout of Oracle Fusion and Chazey ensured local TSLL (tax, statutory, legal, language) requirements were captured and built into the model. The extended deployment led to longer payback periods, but also provided time for the complex change management and consultation needed to support the program, and achieved net ongoing savings, including fully paying for modernization of the technology landscape.
Chazey’s team of senior practitioners were able to partner with the client and outsourcer team members, to ensure even footing as the project progressed, achieved multimillion in savings, and optimized with ~100 transformation initiatives. Our partnership approach is allowing the internal team to act as an experienced and empowered partner with the outsourcer as the client looks to expand and leverage its investment in Finance global business services to support Finance services higher up the value chain, as well as other functions such as Human Resources and Information Technology. The project demonstrates the approach and value of moving from a country-based to regional/global and globally consistent operating model, achieving targeted outcomes on time, on budget, and on value.