Shared Services as Centres for Excellence:

Beyond Efficiency and Cost Benefits

Oct 22nd 2008

Nigel Coffey

Service Delivery Director

Pfizer GFSS 11

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Shared Services: Not always fun!!!

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Our History

�� In 1997, a financial shared services pilot In 1997, a financial shared services pilot was established in Memphis, Tennessee.was established in Memphis, Tennessee.

�� In 2002, a second financial shared services In 2002, a second financial shared services location was established in Dublin, Ireland, location was established in Dublin, Ireland, to service the European markets.to service the European markets.

�� In 2005, the Business Process Outsource In 2005, the Business Process Outsource project was announced as part of the AtS project was announced as part of the AtS initiative.initiative.

�� In 2006, Genpact was named the Business In 2006, Genpact was named the Business Process Outsource provider and Global Process Outsource provider and Global Financial Shared Services was established.Financial Shared Services was established.

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Where is GFSS?

Americas Shared Services

Location: Memphis, Tennessee, USA

Servicing entire Western Hemisphere

European Shared Services

Location: Dublin, Ireland

Servicing all of Europe, Africa & Middle East

Genpact Processing Center

Location: Delhi, India

Processing Center

Genpact Processing Centers

Locations: Bucharest, Romania;

Dalian, China

Language Centers

Asia Shared Services

Location: Dalian, China

Servicing all of Asia

New York Operations

Location: New York, New York, USA

Operations Headquarters

55

66

230

Permanent

Operations Colleagues

GFSS Europe - Demographics

81%

Previously with a

Multinational

68%

Graduate Degree Educated

40% with an Accounting Qualification

Average Age 29 years old

Gender

Females 53% Males 47%

57% with Second Language

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Nationalities

55% with previous SSC

experience

Turnover14%

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GFSS Focus Areas

Proactive collaboration to add value

Foster engagement and satisfaction

Robust environment around financial operation

Optimize cost, quality and effectiveness/efficiency

Centralization and Standardization

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�� Accelerate transformation across organisation.Accelerate transformation across organisation.

�� Improve quality Improve quality

�� Drivers/facilitators of change.Drivers/facilitators of change.

�� Divisional & Global alignment.Divisional & Global alignment.

�� Rapid response to business changes.Rapid response to business changes.

�� Improved M&A integrationImproved M&A integration

�� InnovationInnovation

�� FlexibilityFlexibility

�� DisciplineDiscipline

�� Credit crunch not all bad!Credit crunch not all bad!

Centralization and Standardization

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�� Standardisation/Robust processesStandardisation/Robust processes

�� Compliance enhanced, policies/application Compliance enhanced, policies/application of same, SOX, FCPA,SOD etcof same, SOX, FCPA,SOD etc

�� Risks reduced e.g. credit and Risks reduced e.g. credit and collections/revenue recognition/VAT.collections/revenue recognition/VAT.

�� Standardised reporting and transparency.Standardised reporting and transparency.

�� Comparability across divisions/markets.Comparability across divisions/markets.

�� Improved governance. Improved governance.

�� Audit coordination.Audit coordination.

Robust environment around financial operation

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�� Expanded staff skill setExpanded staff skill set

�� Migration junkiesMigration junkies

�� Constant challengesConstant challenges

�� High performers shared across businessesHigh performers shared across businesses

�� Centres of excellenceCentres of excellence

�� Process expertsProcess experts

�� MulticulturalMulticultural

Foster engagement and satisfaction

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�� One consistent service delivery to clients.One consistent service delivery to clients.�� Customer Relationship Management (MRL’s)Customer Relationship Management (MRL’s)�� Share best practiceShare best practice�� Single source of information/point of contactSingle source of information/point of contact�� Ongoing Training and supportOngoing Training and support�� Reduce Knowledge Drain when staff leave.Reduce Knowledge Drain when staff leave.�� Align service centre and customer goals.Align service centre and customer goals.�� Accelerate BAU after migration.Accelerate BAU after migration.�� Performance metrics/benchmarking help drive improvementPerformance metrics/benchmarking help drive improvement�� Ability to influence upwards and well as downwards.Ability to influence upwards and well as downwards.�� Expanding scopeExpanding scope�� Balance cost reduction with customer experienceBalance cost reduction with customer experience�� “Voice of the customer”“Voice of the customer”

Proactive collaboration to add value

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Strategic Value of Shared Services: Beyond Cost Savings and Efficiencies

Process

Centralization

• Consolidate Expertise

• Increase Documentation

• Eliminate Duplicate Job Functions

• Leverage Size for Business & Technology Needs

• Allow Business to Focus on More Strategic Needs

Process

Standardization

• Retain Capability to Meet Business Needs

• Streamline Functions

• Enhance Control Environment

• Provide Consistent and Accurate Information

• Strengthen Business Continuity Plan

• Attain Sr. Leadership Support

Best

Practices

Implementation

• Increase Automation

• Utilize Benchmarking

• Deploy Technology

• Implement Process Improvements

• Leverage Multiple Locations

• Realize Cost Savings

• Enhance Customer Focus

• Share Support for Mergers & Acquisitions

• Provide Risk Mitigation

• Demonstrate Financial Policy Adherence

Benefit

Realization

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Challenges Faced

�� Resistance to change.Resistance to change.

�� Lack of trust.Lack of trust.

�� “Perceived” loss of control.“Perceived” loss of control.

�� Different agendas/expectations.Different agendas/expectations.

�� Lack of support from top management.Lack of support from top management.

�� Silo mentality before and after migration.Silo mentality before and after migration.

�� Exposure of performance issues.Exposure of performance issues.

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End-to-end Change Management

SYSTEM MIGRATIONS

Improvement of masterdata quality prior to migrations

INTERFACE IMPROVEMENTS

Reduce ARIBA to Oracle Interface errors in Euro

PURCHASING SYSTEMS

Improve ARIBA procurement coding accuracy for Pfizer Spain

WPO PROCUREMENT

Reduce maverick spend with non preferred vendors in WPO

Germany

AP ACCOUNTING

Increase vendor credit note application in GFSS-A

SUPPLIER MANAGEMENT

Increase discount availed from key vendors in Pfizer Germany

WPO FINANCE

Reduce invoices on hold in WPO Italy

VENDOR CONTACT CENTRE

Reduce supplier enquiries to the BPO contact centre

BPO PROCESSING CENTRE

Reduce invoice processing errors

GFSS-E AP TEAM

Improve the quality of vendor masterdata

GFSS PAYMENTS

Reduce the volume of rejected supplier payments

Building Success in the Purchase to Pay process

P2PP2P

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Think Long term when planning change!

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Questions ?Questions ?Questions ?Questions ?

Thank you for listening