Case Study: Develop Target Operating Model

Client: Global Marketing & Communications Firm

Function: Project Management Department

Project: Develop Target Operating Model

Project Objective

A global marketing & communications organization wanted to consolidate the decentralized finance functions of its separate operating units into finance shared service centers. A key component of this project was to create a target operating model where standard process and procedures would be implemented to align all finance units to.

Challenges

One of the biggest challenges encountered in this project was that there were multiple finance systems in use by the operating units. Moving all the units into 1 finance platform would be a long and costly endeavor that none of the finance heads were willing to invest.

In addition to the infrastructure landscape, each finance unit had their own way of performing the various activities within Finance. Part of this was due to the nature of the business they supported, the local business environment as well as practices picked up along the way. Further augmenting the situation was the varying sizes of each finance team, which meant that roles and responsibilities were blended together to meet the required controls.

 Solution

The project started off with getting agreement on how to proceed with the development of the process maps required for the target operating model (TOM). Decisions were made regarding working on a “systems agnostic” process design. 2 data gathering workshops were set up to identify the processes to be included in the TOM. The first workshop was held with a finance team that was considered a small market as there were concerns raised regarding the capacity of small market teams to comply with audit controls. Representation from each finance team (procure-to-pay, order-to-cash, record-to-report) as well as some of the business unit heads attended the sessions and provided valuable input. The details from the workshop was consolidated onto a set of process maps that identified roles & responsibilities, tasks and timing for all activities that Finance was a part of.

Using these process maps, a second workshop was organized with the same organization but at their regional office. Feedback from this session was captured and reviewed with the process leads to come up with resolutions to apply to the process maps.

After the process maps were updated and have been agreed with the process leads, a series of workshops were set up to go through the process maps and identify variances. The sessions were held in various locations with the different finance units representing the different business lines. The variances were reviewed with the process leads to determine how to align the variance to the process maps.

Various sections of the operating model, such as the organizational structure, roles & responsibilities, analysis templates, change assessment forms, etc were developed as well to support any incoming shared service centre head to kick off setting up the service centre.