Tim Leger on the Finance Organization’s Digital Transformation

Tim LegerThe digital revolution is impacting every industry, affecting the way companies service customers, manage operations, engage with their workforce, and remain competitive. According to IDC analysts, within the next two years, two-thirds of Global 2000 enterprise CEOs will have a digital transformation at the center of their corporate strategy. This creates tremendous challenges and opportunities for every organization in the enterprise.

I was delighted to sit down recently with Sutherland’s Tim Leger, SVP Finance Transformation Practice, to discuss the impact a digital enterprise will have on the CFO, as well as the entire finance organization.

Tim has over 25 years’ experience in the Business Process Services (BPS) industry and is at the very forefront of transforming finance operations in this digital era.

Join us as we discuss the era of what he calls intelligent digital processes.

SC: Every business journal you read today talks about need for an enterprise to accelerate their digital transformation. In your discussions with CFOs, what importance do they place on becoming a digital enterprise, and what is the main benefit they are looking to achieve?

TL: Today, companies are at various stages in their digital journey. In my conversations with CFOs, they unanimously recognize that completing their digital transformation is fundamental to their growth, and even their survival. They see the pace of change accelerating, and they cannot afford to be left behind. Gartner predicts that firms that have not yet started a digital transformation will not perform in the top quartile for productivity and operating profit by 2020.

CFOs absolutely understand the importance of becoming a true digital enterprise. They view the finance organization playing a major role. More importantly, they see this as a catalyst to transform their enterprise business processes. However, the majority are struggling to sort through the hype vs reality in how to digitally disrupt the business without impacting operations that, for the most part, are still running on legacy platforms. There are a host of automation software and platforms available to support their journey, but many admit they are a bit overwhelmed and not sure where to start. Continue reading

Hari Srihari on Supply Chain Management Insights, Trends & Technologies

hariWith increasing globalization, competition flooding the marketplace and shrinking margins, organizations around the globe are looking to improve their supply chains and improve the customer experience. So it is my pleasure to speak to Hari Srihari, Vice President of Supply Chain Management for Sutherland Global Services. Hari is a thought leader, known for his strategic vision and sound execution. At Sutherland, Hari draws from his expertise in manufacturing, supply chain operations and digital transformation using emerging technologies to help focus organizations on improving growth and profitability.

I recently had the opportunity to chat with Hari about the current opportunities for driving deeper insights from supply chain operations, and the overall state of the industry, and am happy to be able to share that conversation with you.

Scott Cutting: Welcome to The Accounting Minute! It’s a pleasure to talk with you today.

Hari Srihari: Thank you for the podium to talk about my favorite topic, Supply Chain Operations.

Scott: Improving customer experience is key to developing repeat business and buyer loyalty. What do you see as the levers companies can use to attract, retain and grow customer relationships?

Hari: In today’s digital world, having excellent insight into buyer behavior, products and services —and their availability— to be able to adapt quickly to shifts in expectations or buying patterns. Along with the past data, it is also necessary to create a shared vision of a better customer experience, with an improved products and services roadmap.

One of the inputs to the Customer Experience Management (CEM) strategy is the information acquired from the CRM system. However, CRM information is unidimensional and reactive. CEM goes beyond the generic by allowing companies to leverage context, segmentation and event triggers to design customer engagement strategies at an individual customer level.

Supply chain visibility, an integral part of the digital supply chain management, is another important factor for repeatable and reliable customer experience—especially when there is volatility in the processes. Thus a CEM model of engagement ensures collaboration and interactions in an omni-channel environment and the next steps (Next Best Actions) are decided on insights at either the segmentation or event-based level and then personalized to the customer being serviced. Continue reading

How to Improve Hotel Investor Satisfaction

600px-shutterstock_158174519Knowledge is power. And, the ability to get an instant gauge on the fiscal health of a hotel portfolio or brand, as well as the knowledge needed to make a new acquisition or divestiture is even more powerful. Investors —and other key stakeholders—want to know how their assets are performing with access to accurate statements and reports as well as KPI dashboards from anytime or any location.

Enhanced financial reporting transforms data into actions for investors, giving them greater insight into risks, opportunities and value creation potential. Better quality reporting, delivered rapidly, also engenders better relationships and increased investor satisfaction.

Step 1: Get Over the Hurdles

Finance reporting places a pressure on the management and delivery mechanisms used by hotel management organizations. Consolidated, standard reports (and ad hoc reports) tailored to each hotel brand or portfolio owner can be a challenge to produce in a timely and encompassing manner. Continue reading

Hotels: Get Onboard!

hospitalityIn the hotel industry, M&A deals have continued to remain upbeat in 2016, with capital and portfolio optimization as the key drivers. At the recent NYU International Hospitality Industry Investment Conference, much of the chatter was about mergers and acquisitions, with the big story being Marriott’s pending acquisition of Starwood Hotels & Resorts. This is hot on the heels of Paris-based AccorHotels intention to buy FRHI Hotels & Resorts (the parent company of the iconic Fairmont, Raffles and Swissotel brands.)

Why all the M&A activity? To better resist the ups and downs of the economy as well as increased competition in the form of online apartment sharing startups, a fragmented hotel industry is witnessing rapid consolidation. This merging of hotel entities and brands also gives hotels a better collective clout when dealing with third-party online travel agencies and negotiations with suppliers.

Yet the key to success in this dynamic, hypercompetitive market is the velocity at which hotel management companies and REITs can integrate and synchronize the merged/acquired brand.

The Need for Speed

The ability to swiftly transfer and combine new acquisitions’ finance and accounting departments into a standardized environment is mission critical for a multitude of reasons: Continue reading

Reporting on Hospitality: BPO for a Better Grade

hospitalityIn the hotel industry, growth is a top priority. Efficient operations and first-rate customer service are crucial to business success. Yet for hotels using an asset-light strategy — a franchise model or long term property management contract— it can be a significant challenge to deliver the comprehensive reporting required for optimal performance and consumer satisfaction.

Front office workers rely on customer relationship applications, while back office staff use ERP applications and workflow tools. As a result, customer, vendor and financial data are isolated within each location, leaving hotel organizations with next to no shared information or transparency.

Pulling metrics like occupancy rates, cancellation rates, ADR and RevPAR are all key to keeping a pulse on the business. Yet, multiple, incongruent systems and non-standard reporting practices make it difficult to draw insights about the overall brand and property performance— and nearly impossible to make mission-critical business decisions. Continue reading

Awash in Complexity: Hotel Billing

600px-shutterstock_114446479Every day hospitality organizations tread water to try to stay on top of a sea of complex billing. In addition to billing guests, these franchisees or property management groups must also address intercompany billing transactions as well as billing to online travel agencies (OTAs).

Spreadsheets and other manually intensive activities for intercompany and OTA billing open the door to inefficiencies, create room for error and can negatively impact revenue.

One Company, Multiple Entities

Tracking and reconciling intercompany transactions is often very difficult in a non-consolidated environment. These types of billing transactions (which happen between two entities of the same company) can be upstream, downstream or lateral. When key stakeholders want to see the big picture of their brands, the difficulty in adjusting intercompany transactions results in financial statements that do not offer an accurate view of the hospitality group’s financial situation. Continue reading

Speeding up the Slow Flow of Corporate Receivables

hospitalityHow many conferences or events did you attend last year? One, two, five or more? If so, you’re not alone. The conference industry is booming, and with it, corporate event room rentals and accommodations play a significant role on the hospitality industry’s balance sheet.

All hotels recognize that prompt payment of all corporate billing is key to ensuring cash flow and profit margins. Yet, it is not unusual to see corporate accounts receivables with an average collection period of 60 days or more. This can have a downstream effect on financial statements, budgeting and collections – as well as a hotel’s ability to pay its short-term liabilities.

There are some key challenges facing hospitality organizations: Continue reading

Hospitality Accounts Payable: Room for Improvement

hospitalityOver the last 10 years, many hotel chains have started to pursue an asset-light strategy, a model that is focused on building its brand presence through franchising and third-party management, rather than acquiring real estate. This approach lowers operating costs and lightens an asset-heavy balance sheet.

It also helps safeguard against profit volatility while allowing hotel chains to rapidly expand into new markets without investing in brick-and-mortar real estate. As a result, capital risk is reduced, and hotels can go to market faster.

However, as hospitality chains hand over the management reigns to franchisees, property management companies and REITs, the already decentralized back-office environment becomes more complex. Fuelling this complexity is a potent mixture of multiple systems, non-standard practices, input variances and low-value, often manual, tasks.

For an industry that is highly committed to growth, a sluggish back office mired with inefficiencies and higher-than-average costs is a recognized pain point among hospitality executives.

In the Accounts Payable (AP) function alone, several issues are all too common: Continue reading

Improve Your Audit Trail with RPA

audit-trailNo matter what the industry, one thing is certain: regulatory requirements and compliance is constantly increasing. Yet, for enterprise organizations, a convergence of legacy systems, globally located F&A departments (many with diverse practices) and information that must be keyed in manually, all add up to inaccurate data and reporting, human error and business process activities that simply don’t have a reliable audit trail.

It’s little wonder that in survey after survey audit risk and compliance management are in the top greatest pressures facing the finance and accounting function. This is where Robotic Process Automation (RPA) can play a significant role.

How Robotic Automation Works

If you’re not familiar with RPA, it’s a ”virtual robot” that performs work, like finance and accounting tasks, in exactly the same way a human user does. Much like their human counterparts, the robots control a virtual keyboard and mouse and use the clipboard function to navigate between screens and around screens. They can click buttons, select from drop-down lists and to click on fields where data is either copied or pasted. In other words, they can do all that repetitive work that back-office talent shouldn’t be doing in the first place. Continue reading

The Evolution of Governance

Finance and Accounting (F&A) outsourcing is a mature service, and buyers are looking for something more than delivering on the agreement. This means never getting complacent and looking for new ways to drive further efficiencies through continuous improvements.

Today, clients aren’t willing to settle for costs reduction through labor arbitrage. No one wants to outsource poor existing processes and see the same outcomes, only cheaper! Today, performance improvement is critical. Clients want technology like automation; they want to know where Robotic Process Automation (RPA) can be applied to reduce manual tasks. Clients want process improvements, and a partner who will come to the table with an idea that is beneficial to both parties.

To deliver beyond table stakes, outsourcing must be governed accordingly.

Any governance model must evolve through the stages of the relationship to avoid “set and forget” stagnation.

Continue reading

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