Top Seven Tips in Managing Transitions

There are numerous examples, where setting up a Shared Service Centre (SSC) or Business Process Outsourcing (BPO) has not succeeded in winning over the business, or has failed in being set up as "world class". The root cause is more often than not, due to a poorly run transition.

To avoid these pitfalls, I wanted to share with you the Top 7 Tips for Managing Transitions and ensuring the migration provides the desired benefits.

1. GET THE KEY STAKEHOLDERS BOUGHT IN!

The key to success will be in managing the perception of the stakeholders. This will include the function impacted (i.e. Finance), the business divisions, the operational leads and the offshore provider.

To do this, it is recommended to identify who the stakeholders are early, figure out their views on the migration, and influence them throughout the process. Make sure that you mitigate the key risks that they see, and obtain their buy in – as this will break down resistance barriers that you will face during transition.

2. MANAGE THE OFFSHORE PROVIDER

When working with an offshore provider (either internal captive or external), they will wax lyrical about their processes and methodology, and it is easy to get railroaded into a set up that you do not necessarily agree with.
Do not be afraid to disagree, the methodologies and "best practice" processes act as a guide to what you should be utilizing, but there is a degree of customization required. If you fail to customize, then you risk setting up a process that does not work for your business. The end result will be a series of workarounds which eats up effort and effectiveness.

3. MAKE SURE THE TRANSITION PAYS

At some point in the process, the cost and benefit of the change will be challenged. It is key, to set up the business case early on, to consider not just the cost of what is in the "box" (i.e. the cost of the SSC or BPO) but also consider costs for the roles that have been created because of the change; scanning; technology changes; and the cost of communicating and changing within the business.

A robust business case should be set up early, and validated during the transition. This will then be utilized to measure the actual realization of benefits.

4. THE T (ECHNOLOGY) FACTOR

Engage with the IT team early and work with them through the transition. In many organizations, IT is a beast with its own internal bureaucracy and engaging can take more than a few weeks, and obtaining the appropriate IT resource can be challenging.

Ensure that the business, leads the IT requirements and not the opposite through the design and build phases of each IT application and infrastructure deployment. Also make sure that there is enough IT support / resources available to insure that the timelines are met.

A Finance executive once stated that they did not need to ‘understand’ IT to be successful. This is certainly the wrong attitude – bear in mind that the greatest Grand Prix drivers are those that have been intrinsically involved with the technology of the car!

5. WHAT IS LEFT BEHIND IS IMPORTANT!

Change is not singled out to the functions migrated offshore only, there is an impact on the rest of the functional organization, the business, and third parties. It is important to have a clear change management strategy, which includes effective communications & encompasses all groups impacted by the change, to enable the transition to be a success. This will also assist in managing the stakeholder effectively.

I would suggest a particular focus on the retained organisation, as this is just as important as the offshore capability. In many transitions, time and effort is not invested in designing, training and implementing the optimal retained structure.

6. CONSIDER THE BALANCE OF SCOPE

Scope creep is a two way street. Affected staff and managers will try and reduce scope, whilst the offshore provider will try to increase the scope of the engagement. The project team can sometimes be caught in the middle!

The project plan with executive approval would have been agreed based on the scope set out during feasibility. Changes in either direction will impact the people involved, the consultation process, the business case, and the project plan. Therefore be strong and clear regarding the position regarding scope, and only change this when there is a clear, agreed rationale.

7. PROACTIVELY MANAGE RISKS AND ISSUES

What is common in any offshore migration is for the organization to encounter a problem and immediately blame the offshore provider. Managing the perception of the business is important, and do to so effectively one must proactively assess the risks and be responsive in resolving issues.

Whilst issues, such as a process not being followed, a poor knowledge transfer and attrition can be attributed to the offshore provider; there will also be many issues such as non-compliant business behaviour, and a poorly trained retained organization that will fit with the onshore team.

The trick is to combine the proactive use of risk and issue logs with an end to end view of processes and a partnership approach to mitigation and resolution.

ABOUT THE AUTHOR
Neville is an experienced senior consultant specializing in Transformation and Transition Management, with a particular focus on the Finance Function. Neville has the advantage of experiencing change projects at large multinational companies and as a lead delivering change projects across Professional Services, Travel & Aviation companies, Utilities and Financial Services.

You can get in touch with him at neville.barretto@proservartner.co.uk

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