Optimal Mix of a Global Captive Shared Services and Outsourcing Solution Smart companies are including outsourcing as part of their global delivery strategy, but the problem remains of what and how to transition. Lift & Shift, a strategy beloved by many, has significant shortfalls as this case study points out. Get tips on how to avoid making expensive mistakes.

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A CASE STUDY ON FINANCE SERVICE
DELIVERY MODEL: OPTIMAL MIX OF A
GLOBAL CAPTIVE SHARED SERVICES AND
OUTSOURCING SOLUTION
© Chazey Partners 2014
Case
Study
Series

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Robert has over 20 years of experience in Finance, Shared Services
and Technology implementations. He has managed multiple shared
services transformation projects and has held multiple roles
managing shared services operations in the U.S., U.K. and in multiple
locations in India. Prior to his recent assignments, he was the Vice
President of Finance for Pinkerton Consulting.
Prior to Pinkerton, Robert was the Vice President of Global
Operations Finance for Travelport Limited, with responsibilities
including the management of company’s Indian Shared Service
Center, global corporate travel and North American payroll
operations.
He is well suited to developing transformation activities, but is
comfortable focusing on daily operational issues, managing staff at
all levels and ensuring a high level of customer service.
Robert holds an MBA with dual concentrations in Finance and
Information Technology from Auburn University.
Robert Towle
Regional Director, East Coast, US
Chazey Partners
“This company learned the hard way that Lift & Shift is not
an optimal strategy. For its Americas transition, we were able
to offer support, both in optimizing processes pre-offshoring,
and in smoothing the transition to an outsourcing partner. It
was gratifying to compare the improved results to previous
transitions”
Robert Towle - Project Leader

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This company is a recognized leader in the field of
education. Chazey Partners conducted an appraisal
of sourcing options for the company to help identify
an optimal services delivery model for the Finance
function. The resulting solution was a mix of global
captive Shared Services as well as Outsourcing.
Thecompany’sFinanceorganizationengagedChazey
Partners to provide project management for the
transition of the Americas Order-to-Cash (O2C) and
Procure-to-Pay (P2P) processes as part of the second
phase of a Finance restructuring project. The vision
for this restructuring was not just to relocate existing
activities, but also to identify, integrate and optimize
entire end-to-end processes, improving service and
performance, and reducing cost. The goal was to
make processes more consistent globally, to continue
to replace manual work with automation, and to
effectively manage the outsourcing contract. The
business requirement was to assure that the project
was successfully delivered to the agreed schedule,
with minimal disruption to key stakeholders.
Today, the company delivers the transactional
elements of the O2C P2P processes from an
outsourced center in Asia, while maintaining decision
support and high-level accounting within the
company.
Outsourcing Evaluated
The outsourcing relationship began several years
ago, as part of an evaluation that Chazey performed
to ascertain the possible options to maintain financial
control, yet lower costs, to support and enable the
company to grow in its key areas of focus. Once
outsourcing was identified as a positive solution,
potential outsourcers were evaluated. The company
waslookingforaworld-class,experiencedpartnerbut
wanted to benefit from the labor arbitrage available
in a less expensive, developing location. The decision
was made to rollout the new service delivery model in
three main regions of the world: EMEA, Asia-Pacific
and the Americas.
Challenges
Change Management proved far more significant
than the company had expected. The strong backlash
from staff, when they found they were no longer
able to “go upstairs” and work with their accounting
colleagues, was unexpected. In addition, there were
issues with maintaining reconciliations in the same
formatthatstaffhadbeenusedto.Anotherfactorwas
that some positions were eliminated when the work
transitioned, and as a result there was only minimal
overlap between the new service provider and the
previous staff. This caused some problems in terms of
transitioning knowledge, among other things.
Chazey Partners Case Study Series | 3

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Another significant challenge involved staffing levels.
Because the transition for the Americas marked
the third phase, it became very clear to staff that
their positions would be eliminated. As a result, the
majority of the staff left the company before the
transition, and were replaced by temporary workers.
This negatively impacted the transition.
The company should have been more proactive
in informing workers of plans, and providing “stay
bonuses”orseverancepackagestoencouragestaffto
stay on through the transition. The lack of proactive
communication was a core problem, resulting in
costly delays.
Transition Roadmap and Processes
The transition road map involved developing the
project plan, building the processes (including on-site
training and off-site), deployment (which included
several weeks of “shadow production”) and stabilizing
of the new processes.
In the first two rollout phases (EMEA and Asia-
Pacific), the company elected for “lift and shift”
despite the recommendation of Chazey to evaluate
and improve processes before outsourcing to a third-
party. For the third phase (the Americas), in response
to learnings from earlier rollouts, several
discrete process improvements were made in
parallel during the transition, which resulted in
better processes being performed by the third-party
outsourcer.
Leveraging Skilled Third Party Resources
When Chazey joined the project in June of 2009,
we The company chose to bring in a third party
consultant for the third transition phase, because the
first two phases has been issue-prone. In addition,
the negative
reputation of the transition meant that there was
strong resistance from the Americas. The company
was looking for supportive resources with experience
in Shared Services transition as the primary skill. It
was crucially important that the partnering firm had
staff with strong operational experience.
Chazey provided value from day one, because they
offered a standard transition model for Shared
Services that was immediately put into place.
Additionally, given that the majority of the remaining
inhouse staff were temporary, Chazey was able
to deploy their operational experience to provide
day-to-day management duties, where and when
necessary.

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Lessons Learned
The primary advice we were able to offer was to not
necessarily go with the lowest priced model. There is
usually a reason for the price being lower, whether
due to a lower cost location or inexperienced
management. Instead, explore the options and look
for experience, not just in the outsourced provider,
but also within that particular location. An important
step we advise is to capture early cost savings and
efficiencies by performing process improvement
before shifting locations. This will improve the
outsourcing experience and allow a company to
capture the cost savings themselves.
Results: Successes & Challenges
The new service delivery model is now working
more efficiently than was the case in the past. The
biggest successes have included the transition of
processes from three regions into one; and the
harmonization and best practice processes that are
now being implemented.
On the other hand, some ongoing concerns include
the distance between the company and the provider,
as well as occasional communication issues. One
unexpected challenge is the fact that it has been more
difficult than anticipated to maintain a fully staffed
shift to work Americas time, as the outsourced
location works on an opposite time zone.

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Phil Searle CEO & Founder
Chazey Partners
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philsearle@chazeypartners.com
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Chazey Partners
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davidosullivan@chazeypartners.com
Grant Farrell Managing Director United States
Chazey Partners
+1 862 812 7851
grantfarrell@chazeypartners.com
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Chazey Partners
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estebancarril@chazeypartners.com
Chas Moore Managing Director, Canada
Chazey Partners
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chasmoore@chazeypartners.com
Anirvan Sen Managing Director, Asia, Middle East and Africa
Chazey Partners
+31 649133170 / +65 85143766
anirvansen@chazeypartners.com
Janey Jux Head of Public Sector Practice EMEA
Chazey Partners
+ 44 (0)800 6440649
janeyjux@chazeypartners.com
Christina Exarchou Head of HR Practice EMEA
Chazey Partners
+30 6944 525622
christinaexarchou@chazeypartners.com
Emer O’Kelly Regional Director Europe
Chazey Partners
+44 (0) 7703 647 360
emerokelly@chazeypartners.com
Robert Towle Regional Director East Coast USA
Chazey Partners
+1 862 812 7851
roberttowle@chazeypartners.com
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Chazey Partners is a professional management advisory business that is committed to adding significant value
to our clients through a partnership approach. We bring together a unique wealth of expertise and real life
experience in Business Transformation, Shared Services & Outsourcing, and Technology Enablement. We
pride ourselves in having built, operated and turned around some of the world’s most highly commended and
ground-breaking Shared Services Organizations, and for implementing many highly successful multi-sourced
(shared services and outsourced) delivery solutions. Over the last 20 years, we have delivered numerous
programmes globally, in the US, Canada, UK, Continental Europe, Ireland, India, Eastern Europe, South America,
Singapore, Australia, China, Middle-East and Africa. Our experience covers both Private and Public Sectors,
providing expertise in a wide spectrum of business functions, including Finance, HR, IT, and Procurement.
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