Transcend the Transactional - Improve your Brand Equity
Vivek Nijhon, Head Global Sourcing and Asia Pacific, Equaterra
GM: Gary Madden, Business Process Director, HR, Cadbury
MD: Morag Dunlop, European Head of Finance, Cigna International
SC: Simon Cramond, Head of Shared Services, LIME
JC: John Cogan, VP IT Shared Services, Shire Pharmaceutical
How do you rebrand yourself or how do you brand yourself?
Vivek Nijhon: I thought a good topic for us today, based on the experience Equaterra has had recently and from conversations with senior leadership of shared services is - ‘How do you rebrand yourself or how do you brand yourself?’ There’s a constant issue of being very transactional focused - so what is the best way to come out of that transactional mode and brand yourselves to something different which is exciting for the organization and for the Shared Service Center.
Morag Dunlop: So ensuring services across Europe. There’s a small specialist SSC function and I’m here to finance this. And it is quite specialist services we’re providing, but again there is always the image of SSC being a little bit like the sort of distant cousin or they’re not quite at the top of the table. And we really had to work with employees on that, to try and turn that around.
VN: The employees who are part of the SSC?
VN: Just to motivate them and be part of the...
MD: Absolutely and also to get the businesses to buy in and say; well actually you don’t have this capability to do this at the moment and how do we best partner with it.
GM: My name’s Gary Madden, I work at Cadbury Kraft. I work in human resources and so I led Cadbury’s program to outsource certain elements of HR, not everything - recruitment and the running of things. Obviously I am now working with Kraft who have also outsourced part of HR and the question is - ‘how do we get into the station that we’re both going to arrive at with a better solution?’ I guess - the only time the phone rings is when someone hasn’t got paid correctly or whatever. I think the key to it is looking at the finance of the CM sort of model - the business partner. If the business partner believes that you can add value, they will promote you.
VN: Excellent, yes.
GM: So in my view, that’s the key to that wheel - outsource finance into some other area, again AP and AR and some other elements. I have some experience in finance outsourcing, but that’s not my area of expertise.
VN: One of the things which I see is - if you’re performing your task as required and service levels are met, it’s not relevant to discuss? But suddenly when there’s a dip - there’s a big fire over why the Shared Service Center is not performing, so until that time there’s no recognition of the Shared Service Center in the larger organization and that’s an issue which a lot of our customers face as well. Do you see that happening on the HR front, because you touch more people than F&A typically, right?
GM: Yes, but we are very visible. So if something goes wrong, it’s the shared service that is looked upon as the cause, when that isn’t necessarily the case. It could be anything; it could be supply chain because they haven’t submitted the time and attendance file on time, but its shared services that takes the brunt, because they’re at the front line. So you’ve got to partner with the business and the business has to follow the processes that you have designed. It’s nurturing and trying to understand. The old root cause analysis doesn’t always point to shared services and if they aren’t prepared to partner and change, you won’t make it - you’ll never get to process improvement. In the truest sense, you’ll always be firefighting.
Simon Cramond: My name’s Simon Cramond, I work as an interim Shared Service Manager. I’ve worked now in this sector for about 14 years. I’ve been involved with about over 14 centers for about eight or nine large companies and I’ve just set up a shared service center in Kingston, Jamaica for Cable & Wireless, Caribbean.
In terms of a center, I generally propose shared service centers as providing finance services (rather than just transaction services) and if people start talking about transactions I tend to ask them to stop the conversation, because that’s not really what people are looking for; they’re looking for a service.
John Cogan: I work for Shire pharmaceuticals and I head up IT shared services globally. We’ve outsourced IT infrastructure service desk, networks, all that kind of stuff. For HR - much more limited - usual things like payroll is outsourced, but the rest of HR shared services is internal and pretty much all of finance is internal.
These choices were led by the experience in the IT space where we learnt a lot of things about the outsource market. I’ve got some pretty strong views about branding in an outsourced space. I speak a lot with my colleagues in IT and pharmaceuticals in the UK and they all tell me the same thing. It doesn’t matter whether you’re Pfizer or Novartis, Shire or some small guy, the brand rarely matches the delivery in the outsource space, because although the brand has done this thousands of times - the team that you get rarely has.
VN: The surprise.
JC: No, but you learn about yourself too. I’m speaking this afternoon on the topic of change management and my absolute belief in change management is that people know an awful lot about where they want to go, but they don’t know enough about where they’re coming from. They go into this journey, like we have for the last three or four years. And it’s a very rocky journey when you haven’t really sold the business case to everyone who needs a change.
So in terms of brand, I don’t want to talk to any vendor about innovation, because I don’t believe that there is anything innovative that the vendors can do for me in the IT space. Innovation to me is just something that they’ve dreamt up to believe that they’re somehow valued. The value I want is; deliver against the service levels that I have contracted with you for and deliver me robust industrialized processes that I bought from you. IT, Finance and HR add value from innovation in the retained organization. It’s our shared services within HR of talent management and total rewards and all this - sure you can add value to a business. So I think you have to look at both the shared service piece of a company, whether you group them all together and then how that thing sits functionally and so that functions can add value if you can standardize at the shared service end.
But I agree with you about motivating the retained shared services staff, we call them the redheaded stepchildren, in the shared services function. They feel very undervalued because of the feeling that you’re in this sort of transactional space that at any moment is going to get outsourced to somebody who can do it cheaper than you. Our journey is young, we struggle with some of the key things around organizational maturity that you would expect so early in the journey. We’re a company who wants all of the economic benefits of shared services but struggle with some of the user behaviors required to achieve them.
MD: It’s about the culture thing. There was the usual argument every year about how much it was going to cost and what the service is going to be. We’re quite an expanding business and there’s an element of complaint driven people who will remember the things that didn’t go well, but not the things that silently went fine in the background.
I suggested a very strict service level and I would guarantee it - this is how much it’s going to cost and that’s it. But we’re constantly being asked to do more and more because we’re expanding the business. They want us to be really flexible?
VN: I don’t want to stop you, but one of the things a lot of my shared service colleagues are telling me is that there’s a lack of trust for a lot of functions. They have a very strong relationship with a view for the CFO level; where it comes to the functional level, either there’s negative relationship or there’s slightly a feeling of lack of trust, they perceive, especially in the financial accounting area. Is that something you see in your area as well? Or transparency?
MD: There’s transparency, I don’t think there’s a relationship issue. I think in a finance area you’ll normally have somebody in finance in the business unit and someone in the shared services center, so you have to partner. The shared service center has the IT people who do all the development. So that’s a very different relationship to have. But in general, you’ve got to be really clear on your strategy that if you’re the finance person in the business; well okay, your job is to be outward looking, commercial, drive the business, partner the business set. Whereas my role it to make sure that we’ve got all the platforms to enable all the statutory is sorted out - you don’t have to think about cash management, taxation, all of that’s sorted out, so you’ve got to draw quite a clear line in the sand.
GM: Yes, I agree with what you’re saying, but I think the other thing that you can do is to provide the information that enables the business partner to have the dialogue, if we don’t do something about this, this is what it’s going to cost us, because if you’ve got the systems and the data, you should be using them, they’re part of the brand. It’s taking it to the next level, this is what we do. For example, we say - in this plant you have 20 people retiring in the next ten years and you have junior people, who have only been in the business for three years - then you’re going to have a problem.And it’s simple statistics, you know. That’s just an HR example.
MD: I think it’s how you use your information to demonstrate the cases and I don’t think we’re always that good at demonstrating that.
GM: Where I think you need to be good at is; you need to be a storyteller. You need to come with a story, not just facts. What does this mean? What is this data telling me? And that’s what the shared service should be doing, so it is coming and telling the story so that the business partner can understand what they’ll end up doing if you get it right - they’ll end up bringing you with them to the meeting with the business leader, because they’ll want just some sort of backup. But the storyboard is key.
SC: In Jamaica we used a number of tools in this. Firstly, we have a SSC portal that everything goes through and we publish our performance statistics every day, so we’re on the hook for 85% of all enquiries dealt with the same day and so consequently if people start to complain about poor service or whatever, we’ve got the statistical data to show we are hitting our targets.
Secondly, we’ve got daily activity logs, so you can actually see the amount of work being done. But we put that together into stories, one of which is a monthly dashboard where we actually say - this is where we should be, this is where we actually are; what’s the gap between the two? And it’s very simple, nine or ten measures going back over three months, and then we can just look at the color of the dashboard. And that is actually a stakeholder management tool with all of our users in terms of this is how we think we’re doing, and then lastly we’ve followed these up with a customer satisfaction survey. And we got a response that was 90% satisfactory or better. So these are the tools we use internally, with the staff to say; look guys, you’re doing a great job and it’s not just us, other people are saying it too!
JC: And how did you set those measures in place? There’s a big danger, particularly if you’re in IT - you can measure a million things in IT, however, how many of those are really relevant? So there is a danger, and you said it, about being accused of using data to defend yourself. So I might say; network availability is 99.9%, but the 0.1% was during month end close and in the middle of the afternoon, US time and I lost one hour of processing time. Well, they don’t care about the other 99.9% if that 0.1% is wrong. So I’m just interested in how you get agreement to the metrics.
SC: We used a blend of measures based on discussions with senior stakeholders to determine what’s important to them, is it stability, is it time, is it cost? We’ve put that all together when we tested this dashboard with the CIO and other people and said; look, visually does this tell you what you want. And we got a positive reply that the dashboard told them what they needed to know.