INTERVIEW OF THE MONTH
INTERVIEW WITH MR. SUBHASH KUTTICAD,
Head – India SSC for Finance at Temenos
How do you believe shared services of the future will look like? What will they deliver beyond providing a fixed portfolio of scale services?
There are lot of enterprises who are a bit late in their journey in terms of setting up shared services. In my experience, I have seen two types of shared services: First is the third party shared services, which provides services to different companies, and are more like an outsourcing entity. These type of shared services is are adopted when the organization does not want to have an in-house shared service and finds utility in going for a market expert for carrying out their Finance, HR, IT operations etc. The second type is of course a more in-house shared services centre model.
I think in the future majority shared services will be of third-party model because in-house shared services are built for more specific reasons such as confidentiality where companies look to protect their data and are more comfortable in processing these data in-house as opposed to a third party. However, as enterprises grow in size, they generally look to leverage from a third party shared service and the third party service providers are also gearing towards increasing their data security and confidentiality.
The future shared services will increasingly adopt emerging technologies like process digitization, robotics and artificial intelligence. While these technologies have been around for some years now, enterprises are waiting for these technologies to be in the system for years and see their performance and then take a safe bet to go all in.
In terms of services, future shared services will look into getting into a centre of excellence model, for example, if there are FP&A processes that needs a shared service, enterprises will have to make sure to build internal capability in terms of experts being present to conduct projects, audits and ensure compliance through their specialization.
What are shared service organizations doing to deliver game changing performance from their shared services? Is there any change in terms of preparedness that you’re seeing now versus say five years back?
In terms of what shared services are trying to deliver, it more or less depends on what is the priority of the organization. In my experiences with organizations I have worked with I have seen them working in a “Lift and Shift” model where the work to be done was lifted and shifted back to an offshore location within a shared service, start operating, countering any issues along the way and gradually settling down at a certain point of time.
Now, organizations have started to become prepared with respect to their shared services operations. The primary role of any shared service is to make sure that the organization achieves cost benefit via centralization in addition to bringing value addition to the processes.
The big change is the assessment of the processes carried out within the shared service and analysing whether automation might be required to better perform these processes. The other change in terms of preparedness has been that organizations are now looking at various options in terms of third party experts which was not the case before.
How do you believe digital has enabled shared service organizations to deliver improved business impact? Could you please detail with some examples?
Digital in my opinion is a very broad term and I think usage of digital tools has really had a great business impact. If you go 5-10 years back, it was Microsoft excel which was really used enterprise wide but over a period of time business intelligence tools such as Yellowfin has really helped us minimize the amount of manual work through excel. There are tools that cater to a specific functional automation, example there are tools that can provide a digitized working platform for calculating Sales Commissions that provide information to the business real-time and helps the Sales team to plan much better to achieve their targets. Another area in the Payables process where tools like, Edge Connect has automated expense reimbursement for employees helping save valuable time for them.
How do people within shared services need to be reskilled to get ready for the future? What should enterprises be doing about it?
Within shared services, every employee needs to have additional skills apart from their core responsibilities. For example, for an accountant, it is now not enough only to know his/ her responsibilities but also have skills on for example ERP and other digital applications. Resources in accounts payable need to look at technologies like OCR and its utility for the payables function and resources like reporting analysts should utilize reporting tools to make their jobs easier. The more the ERPs become complex to support the function, the more is the need for the employees to get reskilled to update and add value to their skills.
The reskilling needs to happen in accordance with the pace with which developments are happening in the digital world. For example, an accountant today must know how to build RPA bots in order to automate his/her manual processes and engage in more value-added tasks.
As I mentioned earlier as well, becoming digital ready is a journey and many organizations are gradually getting there. Organizations need to adapt well and be digital ready in terms of their processes and businesses for the future.