Telecommunications Company: Offshoring Shared Services to Improve Performance and Cost

Accenture helped this telecommunications company move key business support functions to a shared services center at an offshore location. While the key driver for the exercise was reducing costs and protecting margins, the client also saw it as an opportunity to standardize and consolidate processes.

This telecommunications company provides a range of services using a shared services model. This client is a major global player with operations in most countries. Its 2010 revenues exceeded $72 billion.

Facing severe cost and margin pressures in the European market, the client needed to move key business support functions offshore. At the same time, it was clear that such a move would also offer the opportunity to standardize and consolidate processes, thus gaining efficiencies as well as cost benefits.

To help it plan this process and establish a viable business model, the client chose to work with Accenture. This decision was based on an existing relationship, Accenture’s innovative ideas and its significant experience in shared services.

The Accenture Finance & Enterprise Performance team worked closely with the client to quantify the potential benefits and assist in creating a business case for moving the IT, network, finance and accounting and customer service functions to India.

Accenture then helped transition the services to the new shared services centers in Pune and Ahmedabad, India, and developed a cost-recharge model with full-time equivalent rate cards that were transparent to business users and compliant with local transfer pricing requirements. Thanks to Accenture’s robust monitoring mechanism and close liaison with the client, the project was delivered in approximately 48 weeks.

During the first year of operation, the new shared services centers reached over 1,700 FTE dedicated for international operations. With Accenture’s help, the client was also able to obtain ISO27001 certification for the centers within six months of operations.

Accenture’s teaming model and consulting approaches helped keep the work aligned with the client’s strategic goals, and also helped to bring the project in on time. A formal transition process toward the end of the project helped provide the client team with the necessary skills to continue once Accenture left the project.

Thanks to the project’s success, the scope is being extended to also include marketing of data services and R&D services. The client’s feedback is overwhelmingly positive and it has continued discussions with Accenture to further refine the delivery model.