How to cut $20million out of your operational cost (and save a company) – plus other stories from Orlando…

We’re reporting "live from Orlando" this week, where, for the 18th consecutive year, SSON is bringing together the movers and shakers of services delivery. We’ve heard lots of great ideas – from how to take advantage of federal and state tax credits for hiring from certain target groups, to impacting ROIC and profit margins by bringing down operational costs. Coca-Cola’s HRSSC in Tampa gave us the brilliant idea of visual performance tracking boards in the middle of the room, while one of Wednesday’s speakers said that the best money you can spend on outsourcing is on a "great lawyer" (that "great lawyer" helped his company save $20million in costs through outsourcing, and brought the company back to health). We’ve got more here... The 18th Annual Shared Services & Outsourcing Week kicked off in Orlando on Tuesday March 11, welcoming more than 800 delegates and ushering in four days of information exchange, benchmarking, and best practices. Those of us for whom SSOW means "Sam Poston", experienced a few fond pangs at this gentleman’s absence, but were quickly reassured: Brad DeMent, Senior Partner at ScottMadden stepped smoothly into the breach, opening with a wonderful video of him chasing down Sam in South America to ask for "tips on Chairmanship", and then tearing into the plenary hall in orange monk’s robes. Brad warmly welcomed delegates, and the continuity of the chairmanship was ensured. We’re all in good hands! The conference reflects the current hot buttons for Shared Services practitioners, featuring plenary sessions on customer experience, data, continuous improvement, and change management; and breakout workshops on Finance, Procurement, multifunctional Shared Services, and HR. In addition, the Roundtable breakouts in the workshops allow delegates to gather with folks that had the same interests – whether Talent Management, Branding, Communication, Change Management, or Technology (to mention just a few). New this year is the more informal design of the exhibition room, with a lounge area in the middle of the hall, where coffee and tea are served during networking breaks, and cocktails kick off the evening’s entertainment. SITE TOURS OFFER REAL INSIGHTS The Coca-Cola Company Florida attracts Shared Services like light attracts moths. Maybe it’s the sunny skies, maybe it’s the incentives (ask Tampa Bay Economic Development Corporation) – whatever the reason, the Sunshine State is well supplied with Shared Services Centers, and delegates were lucky enough to visit three on Tuesday – Citigroup’s Shared Services Center in the morning, and the Coca Cola Company’s two North American SSOs in the afternoon: the HR center tour was graciously hosted by Karla Younger and her team (Karla will be taking part in a panel on Thursday, so look out for her then) and the Finance SSO down the road, where Karen Dobson and her team led a tour around those facilities. The Coca-Cola Company is the world’s best-known and most valuable brand. Its growth has been based on multiple acquisitions, and today this global company relies on its two state-of-the-art SSOs just outside Tampa, to support its North American operations. But it was not always like this. A 2007 Hackett review of both Finance and HR highlighted the opportunity for selective outsourcing for the former, and more standardization for the latter. This prompted an HR transformation program, the results of which are still being felt today, as Karla Younger explained. Continuous improvement is part of the fabric at the Coca-Cola Company, and in 2012 a brand new optimization initiative led to a brand new HR Services model being deployed in January of this year, with a central strategy of driving specialization to improve customer service. This new model has just gone live (and "just" means last week) with a new "Pod"-based organization, backed up by Centers of Excellence that provide additional support. As a result of this optimization, the number of telephone inquiries the center receives is now down to 500,000 per year, but that is still a number the team wants to lower, as queries are shifted online. An analysis of the top 10 themes driving calls led to automated responses for these, while a "Pod"-based expertise is driving additional efficiencies across the service. On the technology side, additional improvements will be driven by moving to Salesforce.com. Over in the Finance building, the impressive facilities wowed tour participants, as did one unusual aspect of office layout: all managers sit in the middle of the room, so there are no corner offices. The impact of this has been a notable improvement in office culture and increased accessibility to senior leaders, the tour was told. In addition, flexible work arrangements allow for home working, with floating desks available to employees who don’t have a permanent station. Citigroup At Citigroup, "culture" was the dominating theme – defined as a core competency that drives success. Leveraging its diverse workforce (the cafeteria reflects this, as do the many international holidays that are celebrated throughout the year), Citigroup is making the most of "Culture Networks" and driving home the point that Shared Services is in partnership with the business through two themes: first, "We’re sitting outside your door" as a reminder of the seamless integration with the business side; and second, "multiplying our experts" to drive talent as a determinant of business success. LESSONS ON CHANGE MANAGEMENT: Deal with Change, Don’t Let Change Deal With You At AOL – today a digital media and technology company that still has 2.5 million clients who rely on it for dial-up Internet connection – the company has had three different CFOs and three different CEOs in 10 years. If that does not forebode change, nothing does. And as each of the new leaders initiates a slightly revised vision of where to steer the company, learning to take these new directives in stride is part of what Cindy Gallagher and her Finance team have been doing very well, at AOL. Over the past few years, Gallagher explained in her presentation, her team has worked to gain the trust of the C-suite, as concerns around cost and cash drive improvements in the SSO. In fact, they’ve been so successful at gaining trust that the sales team (AOL’s business is heavily dependent on advertising dollars) is comfortable with the SSO meeting directly with their clients to discuss improvements to the invoicing and cash cycle – a big step as anyone working in a similar position will appreciate. Gallagher’s team has been leveraging a "Lite" version of 6 Sigma, which is a 6 week "sprint cycle" called SLIM (Simplified Lite Improvement Methodology) and which takes the best ideas from DMAIC and translates them into a faster, cheaper version. Today, every change initiative is evaluated on its ability to impact a desired output, for example "effect on DSO", and the results are impressive: 50% reduction in resources 400% increase in AP volume 70% reduction in unapplied cash 72% reduction in time to reconciliation time (from 45 days to 8) Gallagher closed by sharing 5 tips on overcoming resistance to change: first, remove fear; second, gain buy-in from stakeholders and build strong relationships/trust; third, develop more transparent rules of engagement; fourth, establish and cultivate strong partnerships; and fifth, celebrate success and failure (this last is crucial, she emphasizes. If you don’t have a culture that allows people to make mistakes you place a limit on the positive changes that can take place). IMPACT: The Ultimate Outcome? Improved Share Price Proves Shared Services' "Enterprise Value" at Ferro One of the more memorable presentations in Orlando this week was from Jeff Rutherford, from materials company Ferro, who caused a momentary intake of breath in the room when he put up a slide charting Ferro’s share price over the past two years. Pointing to a dip in the line (and a subsequent, steady rise – which you can check yourself online) he showed us exactly where the impact of Shared Services had kicked in, and how the results of this impact were being felt throughout the company. Ferro had pretty much hit rock bottom, as far as numbers were concerned, when Rutherford joined. For him, it was a simple matter of numbers; specifically, return on investment capital and operating profit. To get ROIC to an acceptable level (it was at 5% in 2012 while the mean of Ferro’s industry peers was 11.1%), and improving operating margins from 4.3% to the industry average of 12.2% required a big shift in ratios somewhere. Rutherford targeted $25million in cost cuts, and has already reached $20million. His partnership with Capgemini for outsourced F&A support is a crucial driver of this result, as he explained. One strong word of advice from Rutherford: Get yourself a good lawyer – because your provider will have one! LOW-TECH, HIGH IMPACT: VISUAL DISPLAYS Do you want to know how to keep your performance results & targets front-of-mind at all times? Coca-Cola Company’s HR SSC uses Lean methodology with Visual displays to keep everyone aligned. Each team has its unique sets of measures displayed on a board: roughly 12 pieces of standard size paper listing charts, metrics, measures, and increments are displayed visually right in the middle of the room. This means not having to huddle in boardrooms for reviews. Instead, everything is done out in the open, next to the desks, and the performance metrics and targets are always visible. It’s a low-tech point of conversation right at the place work happens. And it’s working. MONEY TIP: Tax Credits Take advantage of federal and state tax credits available to employers for hiring individuals from certain target groups, such as: Work Opportunity Tax Credits (WOTC), HIRE Act Tax credits, state enterprise zone credits, and other state specific credits. Get more information at https://www.doleta.gov/business/incentives/opptax OVERHEARD in the Halls… "We decided not to outsource to India to avoid the spiraling cost situation as markets are becoming saturated. Instead, we went to Malaysia. Today, unbelievably, we find ourselves hiring Indian expats into the Malaysian operations as we just cannot find the quality onsite. The whole exercise has been something of a disaster..." "We are trying to get a handle on Tier zero resolutions in HR, but we just cannot find a reliable method. We track portal hits but we have no way of knowing how many of those queries were resolved first time." Check back for more later...till then, if you're on site be sure to stop me to say hello. Barbara Hodge

How to cut $20million out of your operational cost (and save a company) – plus other stories from Orlando…

To continue reading this story get free access

Upcoming Events

Accelerating O2C Transformation: How AI Is Reshaping the Cash Conversion Cycle

WorkX

Shared Services and BPO Week Philippines 2026

Why AI in BFSI Stalls After the Pilot — and What Leading Institutions Should Consider Doing Differently

The AP Automation Reality Check: What True Intelligent Automation Looks Like Inside D365

Order-to-Cash & E-Invoicing Transformation Virtual Summit

Follow Us

Latest Webinars

Proven Profit in 90 Days: A Shared Services & Procurement Roadmap for the AI Era

The Last Mile of Procure-to-Pay: Why Payment Strategy Determines the Success of Finance Transformation

Lean, Smart, Secure: How AI Sets the New Standard for P2P Financial Operations

Recommended

SSON Podcast with the Producer of Rainman, Batman and Easy Rider

Podcast with Credit Suisse's Gary Carter: Rethinking offshoring's value proposit...

Winter is Coming…

Why is the Nordics region so "special"?

Nearshore plays well to Trinidad & Tobago's strengths

Successful SSO 'Micro-Learnings' from Monsanto and PepsiCo

Change leaves National Grid at a Pivot Point with regards to emerging services

Navigating the transition from low-cost labour to analytics and robotics service...

CEE Market Report: The Perfect Storm of Automation + Millennials = A New Deliver...

SSON Report: Understanding and Implementing Shared Services in Africa

Malaysia: Robotics and the New World View of Shared Services

Malaysia's Talent Challenge – Why it's Becoming Less Worrisome

FIND CONTENT BY TYPE

SSON COMMUNITY

ADVERTISE WITH US

JOIN THE SSON COMMUNITY

How to cut $20million out of your operational cost (and save a company) – plus other stories from Orlando…

To continue reading this story get free access

Upcoming Events

Follow Us

Subscribe to our Free Newsletter

Latest Webinars

Recommended

FIND CONTENT BY TYPE

SSON COMMUNITY

ADVERTISE WITH US

JOIN THE SSON COMMUNITY