Large APAC Bank: Finance and Procurement BPO

This ongoing relationship has seen a large Asia Pacific (APAC) bank outsource its finance and accounting, and procurement processes to Accenture.

The collaboration between the two companies is helping the bank reduce costs, gain efficiencies and generally progress in its journey to achieve high performance.

This bank is a regional giant, employing approximately 40,000 people with major operations across Asia Pacific, Europe and North America. In 2010, it recorded revenues of more than $15 billion.

As a leading financial services company, the client is constantly looking for ways to gain efficiencies and compete successfully. It teamed with Accenture to explore the potential benefits of outsourcing its accounts payable function. Accenture High Performance Business research shows that many leading companies use business process outsourcing (BPO) to gain access to specialist skills, economies of scale and support the drive to achieve performance.

The client recognized the benefits of using BPO to help improve the performance of its finance organization, enhance its ability to work closely with the business and embed solid financial controls and governance structure. A further aim was to provide a specialist organization that would be able to attract and retain the best talent.

The bank chose Accenture based on the excellence of its existing delivery centers in India; the professionalism of its staff; and its extensive experience in finance and accounting BPO.

As a pilot project, Accenture mobilized experienced professionals to execute accounts payable processing for the client in India. After 12 months, the bank awarded short-term accounts payable and procurement outsourcing contracts to Accenture. Accenture leveraged its existing mobilization toolsets and methodologies to help reduce risk during the important transition phase, while speeding up the process.

In addition, Accenture’s knowledge transfer capabilities, again backed by proprietary frameworks, played a key role in supporting a successful transition within a six-month timeframe.

By adapting to the client’s technology initiatives, Accenture was able to reduce the number of offshore full-time equivalents by approximately 50 percent. The scope of the procurement BPO deal has expanded from the purely transactional to include more value-added services, including supplier relationship management, spend analysis and market analysis.

A year after the accounts payables and procurement BPO began, Accenture also helped the client transition its finance and accounting processes over several waves. This phased approach was chosen to help reduce risk for the client.

Subsequent to the final wave of transition, a transformational BPO arrangement designed to move the client to a process-centric organization was put in place to benefit from centers of excellence and continuous process improvement. The finance and accounting BPO deals have all been renewed for between five and seven years.

The initial pilot was short-listed by the 2006 Outsourcing Excellence Awards program in the “Best First Steps” category. The client achieved labor cost savings of about 40 percent combined with a high accuracy rate of nearly 99.9 percent—both benefits greater than expected.

More important, the client has found that outsourcing has yielded significant longer-term benefits as well. Said the CFO: “Outsourcing has allowed us to free up capacity in the onshore team to work on more value-added analysis and provide new service offerings to the business.” With Accenture’s help, the client’s decision to outsource its finance and procurement processes is helping to support its drive to become a high-performance business.

Accenture’s experience and trusted toolsets were pivotal in helping to ensure a speedy transition of the processes and then a short stabilization period. Since the go-live, Accenture has continued to leverage proprietary assets like its Operational Excellence tool to improve predictability and repeatability.

The Accenture team is incentivized to contribute ideas for improving processes, creating a culture of continuous improvement. The procurement processes particularly require numerous handoffs between Accenture and the client, and Accenture is working on various tools to help manage this complexity.