On Home Turf: Sourcing Trends

Photo: Via Wikipedia

Photo: Via Wikipedia

A potent combination of new technologies combined with rising costs in traditionally lower-cost locations and a move toward domestic protectionism has had a direct — and positive — impact on onshore sourcing. That’s the word from a recent Everest post.

Everest points out that traditional service models grew by only 0.1 percent last year, while IT and business process services that were rooted in digital offerings are growing at a rate of 18 percent a year.

Digital Offerings

This echoes a sentiment throughout the analyst community. Horses for Sources has written extensively on the need to tap into a global resource to achieve desired outcomes, and notes that with the rise of digital and as-a-service offerings services become location-neutral. Location becomes a side issue as factors like access to automation, process transformation and alignment with digital business models/outcomes move to the forefront.

As automation becomes the great equalizer, F&A onshore locations are appealing for several reasons. There are a few key reasons: Firstly, there’s a desire for closer proximity to facilitate real-time communication and management; secondly, as business process delivery maturity continues to grow, companies are sourcing more complex tasks and need skilled talent; and lastly, the much discussed new technologies that can drive down costs once gained through labor savings.

The Skill Factor

Talent can be a key consideration. Companies want to ensure that the F&A talent working on their account have the skills and understanding of their industry and organization. The F&A market is maturing and with that maturity comes a need for higher value work, from treasury services to forecasting, planning and analysis. Due to the sensitive nature of this work, as well as compliance issues, companies may want to keep these functions onshore.

In a report from May 2015, Everest reviewed domestic US-based delivery locations, and the south has a clear advantage. By shifting work away from a Tier 1 city, like New York, to a lower cost Tier 2 or Tier 3 city, companies can cut costs anywhere between 15% and 30%, while still drawing a highly skilled human resources.

Locations like our Deloitte-heritage F&A Controllership & Management Center in Tulsa, OK, are optimal for highly complex end-to-end F&A work.  For example, our Tulsa location features a depth of talent, including CPAs, MBAs and Six Sigma experts amongst its staff members.

Located in the Central time makes it highly convenient for real-time communications from both the east and west coasts—and helps companies avoid extensive travel times (and costs) for site visits.

More importantly, our consistent delivery practices, policies and strong internal control structure gave clients the stringent, accurate financial, investor and tax reporting they are looking for.

To learn more about how Sutherland can help improve your F&A function, and to arrange an assessment of your current practices and processes with one of our finance experts, schedule an appointment today.

 

transformation-roadmap

Setting Goals, Meeting Targets: KPIs for the Win

qualityIt’s a fierce business world out there. The stakes are getting ever higher, with growing competition and an increasingly integrated landscape. It’s essential that companies have key performance indicators (KPIs) that can help drive operational improvements, accurately assess performance across all levels of the organization and deliver long-term value.

The only way to achieve all that is to have an effective process for selecting and monitoring KPIs.

The KPI Uncovered

These indicators show how a company or group is performing on its goals, measuring specific activities against a set target or benchmark. Remember, if a measurement doesn’t directly influence the achievement of business goals, it’s not a KPI; it’s merely a metric. Continue reading

A 1-2-3 Approach to Tail Spend Management

600px-shutterstock_157405238To be able to drive down costs as well as reap the additional benefits of a more rigorous tail spend management process, procurement organizations must lead with a best practices approach.

This involves a three-step process of: centralize, analyze and standardize for ongoing transformation.

1. Drive Visibility Through Centralization

Scoping and understanding current contracts at all levels in the organization is critical. Poor data quality is the most common problem across industries and organizations. It’s not unusual to find companies that have procurement agreements issued at various levels and varying business unit entities without a single source of reference to validate agreements, terms and positions. Many times, where a contract application does exist, there is no connection to the procurement system, and once again visibility is thwarted.

Centralizing purchasing activities cuts through the complex and significantly large number of suppliers across procurement categories. Continue reading

5 Ways RPA Increases Data Security

Companies around the world can run the tightest ship, with enforced and strong compliance, there can be a protocol book given to every employee, but walk into any call center or collections center, and inevitably you will see agents with post-it notes or a notebook with client information.

Despite strict protocols, well-intentioned employees can put private and confidential data at risk. From emailing sensitive information —financial, customer, internal or otherwise— using a personal account because it exceeds corporate mailbox limits to chatting with friends about work in a public place, IT managers and compliance officers simply cannot get visibility into all the actions a human may take.

There is no way to gauge what data employees commit to memory, what they retain, what they forget or the knowledge they take with them when they leave for another job. Continue reading

CFO Risks on the Horizon: Regulatory Change

CFO risksFrom data integrity compliance to financial compliance and personal data compliance, the list of federal and regulatory compliance challenges only keeps growing. And, report after report indicates that CFOs are losing sleep over it.

In fact, the latest survey cites 535 global respondents (compromising board members and executives), wherein a full 60% pointed to regulatory change and scrutiny as a risk that will have “significant impact” in their organization in the next year.

F&A Complexity

In today’s busy finance environment, most F&A professionals are immersed in performing their “day jobs.” When the focus is on just getting it done, sometimes proper accounting documentation and process controls aren’t followed to the letter. Without strong internal controls and protocols, it’s easy for financial errors to occur, which can impact investor, customer and vendor relationships. Continue reading

Outsourcing Risk Mitigation Strategies

risk mitigationFor any company testing the waters of outsourcing the first time, a rough transition or an unforeseen risk can quickly sour a buyer-provider relationship. Often, poor transitions (and subsequent engagements) stem from inadequate risk identification and early mitigation.

Risks must be pinpointed, evaluated and prioritized, with a mitigation strategy in place. Here are strategies to help mitigate four of the most common risks associated with outsourcing finance and accounting functions.

Governance Risk: Issue escalation and dispute management

When issues and disputes are not handled correctly, it can present a risk to the client company’s end-user experience and negatively impact revenue.

Mitigation Strategy:
BPO providers must have concentrated focus on five key areas critical to avoiding or eliminating client escalations: Controls, Compliance, Quality, Transformation and Governance. A clear governance model for each phase of any engagement allows BPO providers to adhere to the contract with the client, deliver on SLA and transition work smoothly and in a timely manner. Without them, issues can quickly escalate and client satisfaction can plummet. (You can learn more about our evolving governance model here.) 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

Technology Spotlight: Customer Engagement Management Portal

Good business depends on good communication. Whenever an external supplier is involved, it’s inevitable that an extra layer of communication complexity is added.

Especially during transition, it’s not uncommon for massive volumes of email go back and forth every day. There is an avalanche of mission-critical information that needs to be accessible to key stakeholders – all while keeping tight control on the security of the “single version of the truth.” It’s critical that nothing falls through the cracks, no documentation is missed, no email overlooked, and that everyone on the team has visibility into the current status of KPIs and SLAs.

Clear, open communication is a building block for ongoing relationship-building, good governance and delivering on all promises.

Engaging Our Customers

One of the ways we support and enforce service delivery quality is through our Customer Engagement Management (CEM) portal. This portal provides a single site from which our clients can collaborate and share information with the Sutherland team. Through our patented SmartLeap dashboards, you’ll have instant access to daily performance processing and status reports. Continue reading

How Robotic Process Automation Improves Compliance

From mortgage originators who need to ensure compliance with the SEC and CFPB, to healthcare providers who must be in accordance with HIPAA privacy rules to financial services firms that guarantee PCI compliance – there has never been so many every-changing compliance rules and regulations. Data integrity compliance, personal data compliance, financial compliance, federal and regulatory compliance… the list goes on and on. And, report after report indicates that CFOs are losing sleep over governance, risk and compliance.

When providers talk about automation technology, like Robotic Process Automation, you often hear about it in terms of productivity gains (Volume), data quality and accuracy improvements (Veracity) and better transparency (Visibility).

This “3V” approach is a foundational base for stronger compliance. Here are a few examples of how we used RPA to help ensure compliance for our clients. Continue reading