Werkt BPO voor kleinere organisaties?

Werkt BPO voor kleinere organisaties? PON Seminar 10 april 2014 KPMG – Joyce van Breugel

Intro Joyce van Breugel 20 years experience in finance management and consultancy functions

Finance management functions  Business Control, Shell  Project Management SSC strategy and implementation, Shell  Head SSC, Unilever

 Project Manager BPO, Unilever  Financial Controller Continental Europe, Heinz

Consultancy – Finance  Financial Management & Shared Services – PwC  Shared Services & Outsouricng – KPMG

© 2014 KPMG Advisory N.V., registered with the trade register in the Netherlands under number 33263682, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (‘KPMG International’), a Swiss entity. All rights reserved. The name KPMG, logo and 'cutting through complexity' are registered trademarks of KPMG International.

2

Agenda

1. Introduction BPO 2. Trends 3. Maturity in shared services & outsourcing 4. Bigger versus Smaller; Company view and Provider view 5. What does it take?


3

1. Introduction BPO Business process outsourcing (BPO) is a subset of outsourcing that involves the contracting of the operations and responsibilities of specific business functions (or processes) to a third-party service provider. Originally, this was associated with manufacturing firms that outsourced large segments of its supply chain. BPO is typically categorized into back office outsourcing, which includes internal business functions such as human resources or finance and accounting, and front office outsourcing, which includes customer-related services such as contact center services.


4

2. Trends in BPO ■

Different opportunities across Europe 

■

Benelux -

Only one or two bigger contracts per year

-

New initiatives  Smaller contracts

-

Contract renewal driving many discussions following closure of contracts of the ‘00s



High traction in Nordics  smaller BPO contracts in targeted industries or high profile companies



Different view in Continental Europe versus UK

Industry or Domain specific BPO solutions, beyond traditional back office processes 

Banking & insurance – e.g. Clearing services



Telecom



New specialist solutions (e.g. Social Media support of KLM outsourced to TCS)

■

BPO opportunities following maturity of SSC models or following ITO experience

■

Differences per process domain 

Modest in F&A and HR



More traction in Supply Chain


5

2. Trends in BPO & Shared Services ■ Sourcing and Shared Service Goals are moving beyond just cost savings ■ Leading sourcing and shared service organizations are advancing their capabilities, evolving to models engineered to be positive influencers of change ■ Success in this new model depends on the ability to dynamically assemble a variety of capabilities – regardless of where those capabilities reside – into a seamless end-to-end process that’s focused on a specific business outcome IT

HR

F&A

Procurement

Labor Arbitrage

Product Innovation

Capacity Management

Business Intelligence

Quality Improvement

Business Agility

Process Efficiency

Process Transformation

Offshore Leverage

New Market Entry

SERVICE DELIVERY FOCUS

Drive the business through information and innovation

Align operating model for efficiency and effectiveness

Create a platform for growth

Optimize the global operations footprint Collaborate across teams and mine data to drive insight

Enable access to technology

Protect the brand and foster a common customer experience


6

3. Maturity: Characteristics at each level ■ There are 5 stages to reaching full Global Business Services maturity. ■

Level 5 is not a goal in itself - Those organizations that get there see significant value from their operations. Characteristics ■ Delivery of business services providing true end-to-end customer-centric services

Business services maturity

Level 5 – GBS

5 5

4

Level 4 – Integrated services

■ Customer-focused organization that provides value ■ Value creation versus cost reduction ■ Shared services cover transactional and some high-end processes

4

■ Optimized balance of internal/external capabilities ■ Integrated internal capabilities supporting service delivery

Level 3 – Multifunction shared services

■ Global process owners ■ Multi-function shared services covering all transactional processes, with all business units and locations supported

3

3 2

■ Outsourcing strategically used

Level 2 – Functional shared services

■ Single function shared services covers most transactional processes with tactical on/offshore outsourcing 2

1

■ Most BUs and locations supported by shared services.

■ Outsourcing tactically used

Level 1 – Decentralized support functions

1 The journey…development stages…time

■ Non-integrated internal (shared services center) capabilities

■ Decentralized functions with little central control over business support services ■ Outsourcing not used


7

3. Maturity: What is Global Business Services (GBS)? Global business services (GBS) is the next stage of maturity for organizations looking to drive increased value from their operating models, particularly when some shared services and outsourcing has been deployed. GBS delivers business support services to customer organizations by deploying common processes, tools, and leading practices, generating synergies across multiple function areas, (e.g. finance, HR and IT), by consolidating activities into one centralized function. Services are delivered on a global scale – using centers of expertise, captive shared services and outsourcing – to optimize scale and capabilities across all functions ■ In the last 10 years, many multinationals have established a GBS organization

Key Attributes of GBS

■ GBS organizations generate synergies across multiple function areas, (e.g. finance, HR and IT),by consolidating activities into one centralized function with the aim of delivering significant cost, quality and customer satisfaction benefits ■ A core idea underpinning GBS is to create a function that can be adapted to changing market and company conditions,(e.g. to enable smoother integration of acquired firms), and business objectives (e.g. to serve customers in new markets) ■ Services are delivered on a global scale – using specialist centers, captive shared services and outsourcing – to optimize scale and capabilities across all functions. For example, a FMCG company built a GBS organization composed of 7,000 people, delivering 170 different services (employee and business services)

Centers of expertise

Sourcing models

Scope

GBS Process ownership

Technology

■ The emphasis today is on driving greater GBS maturity via better integrated operations across functions and geographies, and better supporting wide-ranging business processes Talent

■ Management of GBS third parties and operations to ensure efficiency and effectiveness of the service delivery models

C-suite ownership

Service delivery management

■ This requires evaluating the eight key attributes of GBS (see illustration)


8

4. Bigger versus Smaller

Grote, internationaal opererende ondernemingen besteden steeds meer bedrijfsprocessen uit, zoals delen van hun financiële administratie of HR-processen. Is BPO ook interessant voor

organisaties die niet tot de top 100 van de grootste bedrijven van de wereld behoren? Case Medical Mobility Products

~40 FTE

The finance function is located in 11 countries (high cost locations). The biggest footprint is in Western Europe and USA / Canada. The current set up is considered sub –optimal. The CFO’s agenda is to grow the company to a USD 1 bln . Company over the next few years and transform the finance function to support this ambition. Strategic objectives • Transform finance function • Harmonize processes and systems • Consolidate activities and re-locate at a low(er) cost location • Scalable and sustainable solution

Case Hospitality Industry

~50 FTE

The finance function is spread over a limited number of European countries. The company has been considering shared services or outsourcing as a future model supporting the finance functionstrategy. Key strategic objective with sourcing solution: • To increase added value of services provided to internal customers • Standardization and harmonization of finance processes and reporting • Centralization of transactional processes in a service centre • Harmonization of ERP system and application


9

4. Smaller companies: Why consider BPO as feasible solution? ■ Should we strategically want to do these activities in house? ■ Is a BPO provider capable of delivering value beyond our (SSC-)optimised model?

■ Are we able to build our own captive global shared services organization? ■ Do we have the resources? ■ Do we have the scale to create a sustainable position? ■ Would a BPO partner provide easier access to innovation, process solutions and quality?

Experience Telecom ~20 FTE “Een BPO partner biedt een aantal voordelen waarbij kosten reductie en kwaliteit verbetering wat mij betreft de belangrijkste zijn. Stukje kosten reductie kun je zelf wel invullen maar bij kwaliteitsverbetering zou ik ook zeker de gedrevenheid en trots van de mensen willen benoemen die (in ons geval in Hydrabad bij BPO Provider) voor ons als klant aan het werk zijn. Deze arbeidsethos kom je in veel gevallen niet meer tegen in de VS of west Europa. Ook de verbondenheid met de opdrachtgever is heel aansprekend. Dat ons team in Hydrabad een beetje gepikeerd was dat ze nog geen spiegeltjes en kraaltjes (lees petjes en horloges) van ons hadden vond ik tekenend. Ik zie in onze kantoren niemand met bedrijfslogo’s en spullen rondlopen.”


10

4. Smaller opportunities: Provider View and Considerations ■ Scope and size of the contract: ■ Geographical fragmentation of activities in scope for outsourcing

■ Brand value of the potential customer in addition to vertical strategy of providers ■ Development potential: Does the customer provide opportunity for development within same function or other functions to grow the relationship to a strategic partnership ■ BPO-provider presence in European Markets

BPO-providers show differences in their srategic focus and approach to smaller sized opportunities


11

5. What does it take? - Example project approach

June / September

1

BPO Strategy

2

Explore the strategic options & introduction to service providers

Stakeholder analysis

January / February

October / December

Define scope & Cost baseline

Partner selection

3

Select capable and reliable service providers (‘Best Fit’)

Validate RFP Scope & Cost baseline

RFP (Design, Assessment & Evaluation)

March <

Contracting & Negotiation

4

Prepare for Contracting

Transition & Start Services

Prepare for first migration

BAFO - Best and Final Offer

Refine Operational Model

Design process definitions & Work instructions

Sign Off Process Definitions

Define retained organization

BPO RFP Pitch (local / on site)

Design Pricing model

Finalize Business Case

Design SLA & KPI’s

Implement SLA & Pricing model

HR & IT impact

Business Case (Saving Potential)

Site visits/ Reference Calls / Visits

Design Contract schedule

Negotiations

Work Shadowing

Train the trainer

Define Strategic Direction

Risk Assessment

Validate Strategic Direction

Define Migration Strategy

Sign Agreement

Prepare Migration

Wind down employees

BPO Selection for RFP

Communication Plan

BPO Selection

Workers Council Strategy

Due Diligence

RFI light

Site Visits

(Design, Assessment & Evaluation)

(incl. Assessment & Evaluation)

Business Case (RFI saving potential)

Cut over Processes & Start Services

Project Management & Communication Project kick-off

BPO Strategy Defined

Validated Business Case

Signed Contract


Migrated organization

12

5. Waar moet je op letten om BPO tot een succes te maken? ■ Een outsourcingsinitiatief past binnen een strategische beweging van een organisatie van transformatie “Er moet commitment van de hogere legerleiding zijn” “Betrokkenheid van C-level functionarissen gedurende het proces”

■ Procesvolwassenheid en weten wat je uitbesteed reduceert risico op teleurstellingen “Het is heel belangrijk dat het proces welk je wilt outsourcen heel volwassen is (je moet dus optimaal geautomatiseerd, gestandaardiseerd, uniform, volledig etc. etc.)” “We hebben onze BPO provider gebruikt om standaardisatie en optimalisatie van onze processen te versnellen” ■

Besteedt voldoende tijd aan het selecteren van de juiste partner

“Het gevoel met de uiteindelijke partner moet heel goed zijn => cijfermatig kan iedereen meestal alles maar dit is een commitment voor langer en dan gaan ook emoties meespelen. Je moet er dus niet inzitten als klant vs leverancier maar veel meer als twee echtelieden” ■

Bereidheid om te investeren in de ondersteuning van het BPO proces “Je moet hele goede externe ondersteuning hebben bij alle facetten van dit proces “


13

5. Waar moet je op letten om BPO tot een succes te maken? ■ Goede aandacht voor je contract en daarin opnemen van de zaken die belangrijk voor je zijn ■ Voldoende investeren in het opzetten van een governance organisatie gericht op samenwerking “De aanvliegroute welke uiteindelijk resulteerde in een contract waarbij de afstap aan FTE bij de BPO Provider en de reductie in kosten over de komende jaren was vastgelegd vormde voor mij wel de basis voor het stukje innovatie. Dit heeft naar mijn mening gezorgd voor borging van de innovatie aan de BPOzijde. “Het opzetten van de governance structuur om innovatie initiatieven te beoordelen en te implementeren zijn dan key. Het resulteerde bij ons in Q1 2014 tot 44 initiatieven (op lean six sigma) waarvan wij er uiteindelijk 29 hebben goedgekeurd.“

Toegevoegde waarde:

“Als je mij dan vraagt naar de toegevoegde waarde zie ik 1) kosten reductie 2) kwaliteit en positieve uitstraling (dat is in eerste instantie natuurlijk niet zo) naar de eigen (SSC) organisatie. 3) Vreemde ogen dwingen principe. Doordat we op een minuscule wijze door ons eigen proces heen moesten heeft dit ook bij onze interne organisatie een extra stuk aan finesse aangebracht en behouden.”


14

Thank you Presentation by Joyce van Breugel

[email protected] +31 (0)6 5160 8486

Werkt BPO voor kleinere organisaties?

Recommend Documents