finance operations executive advisory program q4, 2006
TRANSCRIPT
Finance OperationsExecutive Advisory Program
Q4, 2006
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Finance Operations Executive Advisory Program
Was designed to help clients stay connected with the latest best practices, research, client networking - learning, and unmetered Hackett advisory, for the following 5 business process groups:
– Finance Shared Services– Invoice to Cash– Purchase to Pay– Payroll– Account to Report
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Finance Operations Executive Advisory ProgramDeliverables
– Research and Best Practice Details• Enterprise Book of NumbersTM (1 volume, 2 Books per year)• 1 Theme based Book of NumbersTM (1 volume, 2 Books per year)• Hackett Perspectives (50 -100 per year)• (75) Seats to Hackett Knowledge Center (Performance Metrics, Best Practices and Quick Wins)
– Advisor Access• (5) Named Individuals for un-metered inquiry.• 2 onsite executive briefings with member chosen topics
– Peer Interaction• Member Topical Web casts (1 per program, monthly)• Attendance at Annual Member Forums (Atlanta)• Attendance at Hackett Best Practices Conference in April (Atlanta)
– World-class Progress Report• Use of online dash board subset metrics from the NASACT benchmark
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Finance Shared Services Process Advisory Overview“The art & science of high-performance shared services”
Finance Shared Services
The management of finance processes typically contained within a shared service environment along with associated operational support processes including:
Client relations Governance Transition planning Learning & development People management
Optimizing the Talent BaseStaff training and developmentEmployee satisfactionSkill/competency modelsProcess IssuesCenter designCommunication plansCompensation designLegal structurePricing models, charge-backs, etc.Technology IssuesTechnology and systemsAligning finance process sourcing with business strategyConsolidation strategiesProcess sourcing; outsourcing, off-shoring, localSite selectionPartnering IssuesCustomer satisfactionKPI models; SLA’s
Program CoverageCoverage Core Topics Core Topics (Partial)(Partial) DeliverablesDeliverablesRecent Research “European Companies Are
Reaping the Economic Rewards of Finance Shared Services”
“Six Sigma: A Powerful Process Improvement Technique, If Used Appropriately”
Recent Webcasts “Offshoring for Shared Services”,
Agilent Technologies “Process Improvement
Methodologies in Shared Services”, Pfizer
Recent Inquiry Topics Outsourcing compared to
Offshoring –advantages and disadvantages?
Can you review my SLA or help get me started?
Relocating or consolidating the center – key things to consider?
Growing the activities in the center – what are others doing?
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Invoice-to-Cash Process Advisory Overview“ Increasing the speed & amount of receivables conversion to cash”
Invoice-to-Cash
• Credit Authorization
• Invoice Creation
• Payment Collection
• Cash Application
• Discrepancy Resolution
• Performance Measurement and Reporting
Organization• Establishing a Single Process Owner• Investigating business process sourcingProcessing• Standardizing and streamlining the end-to-end
accounts receivable process• Simplifying and reducing discrepancy resolution• Collection effectiveness• Establishing Effective Performance Measures
Effective use of Technology and Tools• Utilizing receivables software to its fullest
potential• Automating clerical tasks
Adding Value• Leveraging productivity information for
performance improvement• Cash Forecasting
Program Process Scope Core Topics (Partial) DeliverablesRecent Research “What’s Keeping Companies
from Establishing a Single Owner for the Invoice-to-Cash Process?”
Recent Webcasts “Implementing Process
Performance Measures in Invoice to Cash”, Agilent Technologies
“Benefits and Challenges of Web Invoicing”, Intercontinental Hotels Group
Recent Inquiry Topics Training for the invoice to
cash process Using web-based accounts
receivable products
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Purchase-to-Pay Advisory Overview“Bringing processes together to manage as an end-to-end process”
Purchase-to-Pay
Purchasing• Requisition processing• PO Processing• Supplier Master File• Item Master File• Receipt ProcessingAccounts Payable• Supplier set-up• Pre-processing• Verification / Approval• Electronic and paper
processing• Discrepancy resolution• PaymentsTravel & Expense• Travel advances• Travel expense
processing & filing• Policy / AuditingCard Administration• Procurement Card• Travel Card• One Card
Organization• Globalizing / Regionalizing P2P• Optimizing purchase-to-pay as an end-to-
end process• Outsourcing / Off-shoring• Minimizing business complexityProcessing• Measuring purchase to pay performance• Decreasing cycle times• Duplicate payment prevention• Charge back policies for standard and
premium payables services• Impact of excessive controlsTechnology• E-procurement• Web invoicingAdding Value• Payment Forecasting• Utilization (Demand management)
Program Process Scope Core Topics (Partial) DeliverablesRecent Research “Effective Performance
Measurement in Purchase-to-Pay Possible Only with Single Process Owner and End-to-End Accountability”
“Top Performers are Twice as Likely to Use Process Measurement Tools to Uncover Improvement Opportunities, Manage and Reward Employees”
Recent Webcasts “Benefits and Challenges of
Web Invoicing from an AP Perspective”, IBM
“Improvement Methodologies in P2P”, Rockwell Collins
Recent Inquiry Topics P-card costs Utilizing balanced scorecards
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Payroll Process Advisory Overview“Balancing the cost of payroll & the level of services provided to payees”
Payroll
• Time Reporting• Employee Data
Maintenance• Employee Inquiry and
Response• Pay Calculation• Payment Distribution• Reconciliation of Checks
and Direct Deposits• Deduction Remittances• Coordination and
Submission of Garnishments• Payroll Tax Payments
and Filing• Payroll Accounting• Year End Processing
(taxes, incentive reconciliation, adjustments)
• Understanding the benefits of time reporting systems• Outsourcing Payroll processes• Adopting electronic pay options• Employee Inquiry/Response• Pay Calculation• Assuring the security of personal
employee data• Payroll Tax Payments and Filings• Payroll Accounting• Disability Pay• Expatriate Payroll• Payroll Services• Surveys, Performance Measures and
Chargebacks• Job Enrichment• Pay and Work Schedules• Consolidating Payroll from Mergers,
Acquisitions, Divestitures• Business Backup
Program Process Scope Core Topics (Partial) DeliverablesRecent Research “Automation, Other Best
Practices in Time Reporting Offer Significant Savings Opportunities”
“Hackett Survey Finds Over Half of Companies Outsource Secondary Payroll Processes, But Only When Economic Benefits Are Certain”
Recent Webcasts Meeting the Training
Requirement - Payroll by Northrop Grumman
Leveraging Employee Self-Service by Kraft Foods
Recent Inquiry Topics Best Practices for collecting
time and attendance from remote employees
Pay cycle analysis
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Account-to-Report Process Advisory Overview“Streamlining accounting processing and improving the value of reported financial information”
Account-to-Report
• General accounting and external reporting• General Ledger• Intercompany accounting• Fixed Assets• Automated Transaction
Feeds• Semi-Automated
Transactions• Manual Journal Entry
Process• Reconciliation and
Analysis• Operational Audits
• Journal entry process• Reconciliation and analysis• General Ledger Reporting• Maintain General Ledger• Maintain Accounting Policies• Auditing of Financial Results• Domestic originating, receiving and
reconciliation activities• International originating, receiving and
reconciliation activities• Intercompany Systems Activities• Recording and Accounting for Fixed
Assets• Recording and Accounting for Capital
Work-in-Progress • Asset Control Activities and Policies
Supporting Statutory Requirements• Compressing the Close Cycle• Leveraging Compliance Initiatives
Program Process Scope Core Topics (Partial) DeliverablesRecent Research “Sarbanes-Oxley and
Regulation FD Are Hindering Efforts to Shorten Closing Cycle Times”
“Improving the Quality of Reconciliation and Analysis Can Simultaneously Lead to Reductions in Cost”
Recent Webcasts “Implementing a Global GL
Solution” by NCH “Step Change and Offshoring
to Budapest” by Diageo
Recent Inquiry Topics “What are the best practices in
corporate function allocations?” “How are leading companies
automating the reconciliations process?”
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Enterprise Book of Numbers™ ResearchAn objective, empirically based portrait of performance metrics and enabling certified-practices used by world-class organizations
Detailed analysis defining world-class performance across G&A
Provides median and world-class metrics from over 3,500 benchmark studies since 1992
Compendium of certified practices and other characteristics of world-class performers
Identification of trends and emerging practices
2 Volumes per year:– Enterprise– Finance Operations
Exclusively available to our Executive Advisory Clients
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Original ResearchRegular Hackett Perspectives containing data, insights and advice on key business topics
Hackett Perspectives
Published semi-monthly to members Core research agenda driven by topical, current
business issues Report types based on rigorous research methodology
– Best Practice Analysis (proven, emerging, observed)– Survey Results– Case Studies– Management Issues
Fact-based -- backed by empirical data
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Value of Benchmarking and Practice Assessment
Knowledge Center - Access to Best Practices and Member PresentationsKnowledge Center - Access to Best Practices and Member Presentations
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Peer InteractionPeer-to-peer contact and executive interaction
Webcasts 5 Monthly (1 per process area) covering relevant issues with topics
chosen by members Each is recorded; presentation materials are posted for download Recent webcasts:
• Implementing a New Planning Process• Challenges of Sarbanes-Oxley – What’s been done, what’s next• Implementing an Enterprise GL Solution• Compressing the Close Cycle• Streamlining the General Ledger Chart of Accounts• Sourcing Decision Criteria• Six Sigma Approach to Shared Service Effectiveness
Annual Member Forums5 per year (1 per process area) exclusively for client membersPresentations are generated from within the membershipAnnual forums are conducted in the spring and fall each year, in Atlanta
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World-Class Progress ReportA continuous, quick health-check of finance operations at your fingertips
Description Track performance metrics on a distributed basis
(e.g. by business unit or geography) Gain visibility of finance performance, updated
quarterly- ported over from Finance benchmark
Benefits Monitor progress on organizational initiatives Identify specific areas of opportunity Use consistent definitions of processes Compare your performance to the richest database
in the world
Progress Report Characteristics Web-based Interactive Dynamically prepared charts and graphs Comparisons to varying Peer Groups
Overall Finance – Cost as a % of revenue
Finance Sample
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Finance World-class Progress Report delivers key metrics for each of the process groups, including Costs, FTEs, Productivity, Complexity
Overall Finance• Costs as a % of revenue• FTEs per Billion in revenue• Technology cost as a % of revenue
Cash Disbursements• Cost as a % of revenue• FTEs per Billion in revenue• Cost per transaction• % of transactions automated• Transactions per FTE• Use of a procurement card for
purchases
Revenue Cycle• Cost as a % of revenue• FTEs per Billion in revenue• % of cash remittances performed
electronically
Revenue Cycle (cont.)• % of customer bills processed
electronically• Cost per transaction
General Accounting & External Reporting
• Cost as a % of revenue• FTEs per Billion in revenue• % of journal entries automated
Tax Management• Cost as a % of revenue• FTEs per Billion in revenue
Planning and Performance Management
• Cost as a % of revenue• FTEs per Billion in revenue
Treasury Management• Cost as a % of revenue• FTEs per Billion in revenue
Compliance Management• Cost as a % of revenue• FTEs per Billion in revenue
Business Analysis• Cost as a % of revenue• FTEs per Billion in revenue
Management & Administration• Cost as a % of revenue• FTEs per Billion in revenue
Other Costs• Other Costs as a % of revenue
Finance Sample
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Advisor Access ServicesExecutive decision-support as an extension of your staff
What you get: Advisors with an average of 15 years
industry expertise Unmetered, on-demand phone
access 48-hour response Objective advice Data-supported directional trends Knowledge of best practices in use at
other leading firms Fact-based opinion and data
Sample Inquiry Topics: Service level agreements and charge-back models Governance models and customer councils Process management and quality programs Implementing self-service technology Eliminating paper and use of electronic imaging and workflow
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On-Site Executive BriefingAccess and alignment to data and best practices of world-class
Member-scheduled, two annual events on-site with a Hackett Business Advisor. Structure and topics to be determined by member.
Facilitation of target metrics for 2006 annual planning process
Presented 2006 profile of world-class Finance shared services organizations
Interpretation and analysis of 2006 Q2 World- Class Progress Report results
Sample Briefing TopicsFinance Sample
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Hackett’s Annual Best Practices Conference“Building Harmony in Purpose and Execution”
April 26 – 27, 2007InterContinental Hotel, Atlantawww.TheHackettGroup.com/bpconference
Session Topics (partial agenda) Speakers
Leveraging shared services to become the most successful hotel company the world over
InterContinental Hotels
“Average performance is no longer good enough”Learn how world-class organizations have raised the bar and the best practices they implement
Rick Roth, Chief Research Officer, The
Hackett Group
Impact ROI in Technology through Consolidation and Standardization
Alcoa
Managing an Asian HR Operation from the US
Technitrol
Discover how access to the right metrics can assist in attracting and retaining the best people
UnitedHealthcare Group
Panel discussion around business process sourcing
Delta AirlinesMarriott Corporation
Past Sample Topics
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Procurement
Human Resources
Information Technology
Programs all use the same format, but content is unique to the needs of each function
In addition to the Finance Function…Hackett Executive Advisory Programs are offered in the
following functions:
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Executive Advisory Program Pricing – State Government
3 year membership - $20,000 each year / function
2 year membership - $25,000 each year / function
1 year membership - $30,000 each year / function
NASACT fee: 3%
Plus: Expenses– Travel related for onsite briefings (not to exceed $3,000 per year)– Travel related to Hackett Best Practices conference in Atlanta (budget up to $1,500 per
person)
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For further information please contact
Pat O’Connor
NASACT Association Manager
Lexington, KY
Ph: 859-276-1147
Jim Anthony
Hackett Account Director
Chicago, IL
Ph. Work: 312-664-0878
Cell: 312-543-6938