Optimizing Finance and Accounting Function

Executive Summary

Everest Group helped a global, diversified services firm in the oil and gas industry transform its finance and accounting (F&A) function into a more efficient and effective operation with less exposure to regulatory risks. The transformation generated cost savings through processes standardization and outsourcing of transaction-based activities, and also supported compliance mandates.

The Client’s Challenge

Benchmarking studies performed by a third party indicated that the client’s F&A effectiveness and efficiency metrics were below industry standards. Moreover, regulatory initiatives exposed accounting compliance risks, and created financial pressure to standardize F&A policies and procedures in certain regions.

Due to the financial and regulatory requirements, the client needed to transform its global F&A organization through system and process standardization. To assist in doing so, it implemented a standard ERP system in each geographic region, and outsourced the transaction-based activities of over 500 FTEs (full time equivalents) to a global business process outsourcing (BPO) provider.

While the client strived to meet the F&A regulatory requirements and business case objectives, the enterprise was realigned from a product-based organizational structure to a geographically aligned organization with standard, global F&A policies, systems, and processes. During this time, the client also made a large acquisition that required full integration, including the F&A operations.

The project team needed to ensure the success of the transformation through:

• Consistent tracking of the business case financial objectives to validate that the global standardization and outsourcing proved valuable to shareholders
• Project management to enforce the standard use of the ERP system and processes to drive efficiencies, and transition the transaction-based activities to lower cost resources
• Training the retained client organization to follow the standard processes and efficiently interact with the service provider, while recognizing that the retained organization was realigning to a geographic based organization

Insight to Action

As part of the program management activities, Everest Group maintained a consistent method of tracking the financial and headcount objectives of the business case by consolidating details from regional management and HR reports into a single repository. The program management office used this comprehensive, centralized data to generate detailed and summary reports for executives. When changes to the timeline or scope affected the financial or headcount reduction objectives of the business case, Everest Group incorporated the analysis and implications of the change, enabling real-time assessment of progress against goals.

Everest Group provided the program management support to align the country or region F&A operations to the global standard policy and processes as the ERP system was implemented and the transaction-based activities were transitioned to the service provider. Everest Group also established a repeatable methodology that enabled teams of resources to gather the required data, identify country or region variances from the global standards, determine how those variances should be resolved or approved, implement the standard and approved variances, and stabilize the environment to ensure that the provider met required service levels.

To help the client address the significant change caused by this transformation, Everest Group not only initiated a substantive change management program but also developed and delivered a training curriculum and materials for the retained personnel. The comprehensive training program and materials covered how to adjust to operating in the new geography-based organization, how to use the new ERP system, how to interact with the service provider to ensure the outsourced, transaction-based activities were effectively completed, and how to perform the retained F&A responsibilities.

Impact

Everest Group enabled the client to achieve its objectives in that:

• The business case tracking empowered the client to identify regions or business units that were not meeting business case savings, thereby enabling leadership to take corrective actions in a timely manner. This rigorous tracking ensured that the client captured more than 25 percent cost savings as established in the business case
• The program management support and repeatable methodology allowed the client to achieve an aggressive timeline to implement the global standards in over 90 countries
• Hundreds of client employees were trained to perform the required F&A activities