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With Accenture’s help, this global health care company was able to identify improvements in its accounts receivable process that could generate savings of up to €250 million (US$317 million) across the Europe, Middle East and Africa region.
This global health care company offers a range of products and services, including medical imaging and information technologies, medical diagnostics, patient monitoring systems, drug discovery, and biopharmaceutical manufacturing technologies. The company generated $17 billion in annual revenue in 2009, and has over 46,000 employees across more than 100 countries.
The company undertook a global initiative to improve its use of working capital by better cash forecasting and operational and process enhancements, with a focus on some countries within the Europe, Middle East and Africa (EMEA) region. It asked Accenture to conduct a review of the accounts receivable process to identify opportunities for creating value and to develop prototype interventions for Iberia that could be deployed across the EMEA region.
Accenture was chosen because of its extensive industry and subject-matter experience, familiarity with Iberian markets, track record and skilled team. Competitive pricing was also a factor.
Finance & Enterprise Performance consultants focused on three key areas: review the Iberian accounts receivable environment and compare with leading practices; review and benchmark days sales outstanding (DSO) for the Iberia region; and review the company’s current incentive scheme. Accenture was responsible for the entire process, from creating the plan to undertaking the specific work.
The Accenture team leveraged Accenture solutions—the Order to Cash Leading Practice Toolkit, DSO Decomposition Tool and DSO Benchmarking Toolkit—plus its own experience in the working capital and order-to-cash environments.
In the Iberia region, Accenture identified improvements in the accounts receivable process of up to €40 million (US$51 million) in savings—and up to €250 million (US$317 million) in EMEA. By providing objective benchmarks, Accenture was also able to provide the company and its collections agency with a structured framework to guide their interactions. Accenture also compared the current incentive plan with actual results achieved by the company and proposed far-ranging changes. The company has an actionable plan to improve its accounts receivable process, plus a new incentive scheme that supports its broader strategic objectives. Accenture’s work helped the company move closer toward excellence in the accounts receivable process.
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