6000 words financial shared service big data

Introduction

In today's business world, companies are seeking ways to improve their financial operations while also lowering costs and increasing efficiency. One way to do this is through the use of shared services, which involves consolidating back-office functions such as accounting, payroll, and purchasing into a central location. This can lead to reduced overhead costs, increased standardization, and improved financial reporting.

At the same time, the rise of big data has brought new opportunities for financial shared services. By analyzing data from multiple sources, companies can gain insights into their financial operations and identify areas for improvement. This can include everything from reducing expenses to streamlining processes to identifying new revenue streams.

In this paper, we will explore the intersection of financial shared services and big data. We will begin by discussing the benefits of shared services and how they can be implemented effectively. We will then turn to big data, discussing what it is and how it can be used to improve financial operations. Finally, we will examine some real-world examples of how companies are using shared services and big data to achieve significant cost savings and operational improvements.

Benefits of Financial Shared Services

Financial shared services involve consolidating back-office functions such as accounting, payroll, and purchasing into a central location. This can be done within a single company or across multiple companies within a larger organization. The benefits of financial shared services are numerous.

First, shared services can lead to significant cost savings. By consolidating functions, companies can eliminate redundancies and reduce overhead costs. For example, instead of having multiple accounting departments across different business units, a shared services center can handle all accounting functions for the entire organization. This can lead to savings in salaries, benefits, and other overhead costs.

Second, shared services can lead to increased standardization. By consolidating functions, companies can ensure that processes are consistent across the organization. This can lead to improved quality and efficiency. For example, a shared services center can implement standardized processes for accounts payable, ensuring that invoices are processed in a timely and accurate manner.

Third, shared services can lead to improved financial reporting. By consolidating financial data from across the organization, companies can gain a better understanding of their financial performance. This can lead to improved decision-making and strategic planning. For example, a shared services center can provide detailed financial reports to senior management, enabling them to make informed decisions about resource allocation and investment.

Implementing Financial Shared Services

Implementing financial shared services requires careful planning and execution. The following are some key considerations when implementing shared services:

1. Define the scope of the shared services center. This involves identifying which functions will be consolidated and which will remain decentralized.

2. Identify the location of the shared services center. This involves determining where the shared services center will be located and whether it will be in-house or outsourced.

3. Determine the governance structure. This involves defining the roles and responsibilities of the shared services center, as well as the relationship between the shared services center and the rest of the organization.

4. Develop a service level agreement (SLA). This involves defining the services that will be provided by the shared services center, as well as the performance metrics that will be used to measure its success.

5. Implement IT systems. This involves selecting and implementing IT systems that will support the shared services center. This can include financial management systems, reporting tools, and collaboration software.

6. Develop a change management plan. This involves preparing employees for the transition to shared services and ensuring that they are trained on new processes and systems.

Big Data in Financial Shared Services

Big data refers to the large and complex datasets that are generated by modern businesses. These datasets can include a wide range of information, including financial data, customer data, and operational data. By analyzing these datasets, companies can gain insights into their operations and identify areas for improvement.

In financial shared services, big data can be used in a number of ways. The following are some examples:

1. Identifying cost savings opportunities. By analyzing financial data from across the organization, companies can identify areas where costs can be reduced. For example, they may identify opportunities to consolidate purchasing across business units, or to negotiate better contracts with suppliers.

2. Streamlining processes. By analyzing operational data, companies can identify inefficiencies in their processes and take steps to streamline them. For example, they may identify bottlenecks in the accounts payable process and take steps to automate or simplify it.

3. Improving forecasting. By analyzing financial data, companies can improve their forecasting capabilities. For example, they may use predictive analytics to forecast cash flow or to identify potential revenue opportunities.

4. Identifying new revenue streams. By analyzing customer data, companies can identify new revenue streams. For example, they may identify opportunities to cross-sell or upsell products to existing customers, or to target new markets based on demographic or geographic data.

Real-World Examples

The following are some real-world examples of how companies are using financial shared services and big data to achieve significant cost savings and operational improvements.

1. Procter & Gamble

Procter & Gamble (P&G) is a multinational consumer goods company that operates in over 180 countries. In 2012, P&G implemented a global shared services center for finance, accounting, and other back-office functions. The shared services center is located in Costa Rica and serves all of P&G's business units around the world.

P&G uses big data to improve its financial operations in several ways. For example, it uses predictive analytics to forecast cash flow and to identify potential revenue opportunities. It also uses data analytics to identify cost savings opportunities, such as consolidating purchasing across business units.

As a result of its shared services and big data initiatives, P&G has achieved significant cost savings. For example, it has reduced its accounts payable processing time from 60 days to 15 days, and has reduced its invoice processing costs by 40%.

2. Unilever

Unilever is a multinational consumer goods company that operates in over 190 countries. In 2014, Unilever implemented a global shared services center for finance, accounting, and other back-office functions. The shared services center is located in Bangalore, India and serves all of Unilever's business units around the world.

Unilever uses big data to improve its financial operations in several ways. For example, it uses predictive analytics to forecast cash flow and to identify potential revenue opportunities. It also uses data analytics to identify cost savings opportunities, such as consolidating purchasing across business units.

As a result of its shared services and big data initiatives, Unilever has achieved significant cost savings. For example, it has reduced its accounts payable processing time from 40 days to 14 days, and has reduced its invoice processing costs by 50%.

3. Pfizer

Pfizer is a multinational pharmaceutical company that operates in over 175 countries. In 2008, Pfizer implemented a global shared services center for finance, accounting, and other back-office functions. The shared services center is located in Memphis, Tennessee and serves all of Pfizer's business units around the world.

Pfizer uses big data to improve its financial operations in several ways. For example, it uses predictive analytics to forecast cash flow and to identify potential revenue opportunities. It also uses data analytics to identify cost savings opportunities, such as consolidating purchasing across business units.

As a result of its shared services and big data initiatives, Pfizer has achieved significant cost savings. For example, it has reduced its accounts payable processing time from 40 days to 15 days, and has reduced its invoice processing costs by 30%.

Conclusion

Financial shared services and big data are two powerful tools that can help companies improve their financial operations while also reducing costs and increasing efficiency. By consolidating back-office functions and analyzing data from multiple sources, companies can gain insights into their operations and identify areas for improvement.

The benefits of financial shared services are numerous, including cost savings, increased standardization, and improved financial reporting. Implementing financial shared services requires careful planning and execution, including defining the scope of the shared services center, identifying the location, and developing a service level agreement.

Big data can be used in financial shared services to identify cost savings opportunities, streamline processes, improve forecasting, and identify new revenue streams. Real-world examples from companies such as Procter & Gamble, Unilever, and Pfizer demonstrate the power of financial shared services and big data to achieve significant cost savings and operational improvements