Secret No.7: BeTenacious

It Helps to Have the Skin of a Rhino – don’t Be Defeated by ERP and Re-Engineering Complications

Péter VillányiAvis Group Business Support Centre18th March 2009

Agenda

• Avis - Background

• Avis – Shared Service Centre History

• Financial Systems Transformation

• The Next Generation

2

Avis – BackgroundAvis Europe is a leading car rental

company in EMEA and Asia

Avis Europe• 8 million rentals annually• 14 corporate countries with 1,800 locations• Licensee network across 94 countries with

1,200 locations• Combined annual revenue €2.1bn• Around 18% market share in Europe

(includes Budget 3%)

Budget Europe• Coverage across 63 countries in 800

locations• Combined revenue of €450m

3

• Opened call centres in 2000 (Manchester, Barcelona)

• Opened Business Support Centre, in Budapest, for finance and administrative services in January 2004:

– Scope: Accounts Receivables and Payables, Financial Accounting, Customer Services, Databases, IT

– Markets: UK, Germany, France, Spain, Italy, Netherlands, Austria, Switzerland, Belgium, Portugal

– Headcount: currently 340

– ERP: none – access to country legacy systems and CODA

Avis : Shared Service Centre History

4

The Keys to Implementation Success – classic list

• Top Management Support – 93%

• Recruitment in the SSC – 70%

• Change management mentality during project - 66%

• Early & Effective communication to affected persons – 57%

• Gaining Quick Wins – 40%

Source – The Hackett Group, ‘Fourth Annual European Shared Services Organization Study 2005’

5

Solutions to Reality – Customer Focus

Organizational Buy-In

Scope

Managing customers of the centre

Corporate strategy, with C-level sponsorship, or if in doubt mandate it!

Absolute clarity from start, included in signed off strategy

Clear Customer Relationship Model, include pricing and issue escalation!

6

Solutions to Reality – Operations / Process FocusBusiness systems or

processes suitable to a SSC approach (ERP)

Planning – program linked, communicated & achievable across total business

Transition approach correct

Getting quality at the right mark

Process re-engineering required specifically to address document exchange – ERP nice, but not essential

Comes back to business strategy – this solves most things, but still requires right talent

Many ways to do this across different cost perspectives – in the SSC or in country, or mix. Need to be flexible! PMO & methodology vital

Simple / clever processes essential – success then in KT and People, supported by effective customer relationship model

7

Solutions to Reality – People IssuesSSC & location skills /

experience

Manage attrition

Change / Project Management resource

Recruitment

Reward & Motivation

Essential to have right start up experience for a SSC (not just a finance operation), same for location. Buy-in carefully!

Reflects success in other areas: scope, reward, management and vision

Enabler to establish the SSC, but also the change in business. Buy-in carefully!

Success driven by project methodology – timing, roles, mechanics

Survey + skills based, plus career management

8

Solutions to Reality – Financial Issue

Issue:– Business Case in place / achievable

(Hackett Survey: 15% of SSC survey respondents expect > 40% cost saving, 34% > 20%, 34% expect saving > 11%)

Solution:• Ensuring the business case is do-able – customers, business,

systems, volume driven • Managing hidden costs of implementation• Controlling the business case• Benefit realization program starts very early

9

Final Conclusions on SSC implementationSSC Opportunity assessment

Business case

Organization Buy-in

Planning, CRM, Transition, Key People, Communication

Recruitment, Reward, Quality

Quality Management, Attrition, Benefit Realization

10

New system solutions

• Flexibility vs. standardisation

• One system cannot deliver best practice on all processes

• Process by process approach– Financial and Supplier processes– Customer supporting processes

11

Financial Processes - Reality check

• Achieved efficiencies when first set up

• Finance system was outdated and unsupported

• Needed to move systems to achieve more efficiencies

• Requirement for up to date technology

12

Objectives of the project

Aim to drive further efficiencies through the organisation with new finance system:

• Reduced processing costs & errors• Meets local country requirements• Integration with local business systems• Standardisation• Easy to use• Improved efficiency, less cost

13

Evaluation

Key criteria for new finance system:

• Not ERP

• Single instance

• Capability to support local countries

• Latest technology but proven

14

Evaluation

Chose Financials from CODA

• Latest ‘Neon’ release• Proven international capabilities• e-Procurement• Process control

15

The Roll-out

• Live Oct 2007– Germany, Portugal

• Live Jan 2008– UK, Holland, Belgium, Luxembourg

• March/April 2008– Austria, Switzerland, France

• May 2008– Italy, Spain, European HQ (~40 entities)– Inter-company processes

• Strong functional support for a year

16

Roadmap for the Next Generation initiatives

BSC(current status)

BSC(current status)

BSC Next Generation

Program

BSC Next Generation

ProgramNext Generation

BSCNext Generation

BSC

• Is not just about the BSC• Improve process and

services E2E• Combined effort by BSC

and countries• Provide a basis for

expanding BSC services• Build competence for

continuous service improvement

• Increase Partner Satisfaction both in the countries and in the BSC

• Benefit from labour cost arbitrage

• Transfer additional service and volumes

• Centre of Competence for continuously improving service quality and increase service efficiency

• Efficient , harmonized and effectively managed E2E processes

17

Overview of the Next Generation projects• Improve Avis capability to collect outstanding debt more quickly

and reduce cash flow and interest on paymentsReceivable Project

• Increase efficiency by an automated workflow• Improve Customer Satisfaction by improving quality of data

DatabaseProject

• enhancements to the current CODA versionCODA Phase IIFAC Project

• enhancements to the current CODA versionCODA Phase IIP2P Project

• End to end view of back office processes. Using RACI charts at startegic, tactical and operational levels

Roles & Responsibility

• Define the job requirements of all key process roles, identify training needs and deliver training more effectively and efficiently

Training and Skilled Res.

• Standard framework for process mapping and procedure documentation

Process Management

Process Improvem

ent Projects

Enabling Initiatives

• Using Lean Six Sigma tools to define process quality goals• Set up quality KPIs

Quality System & KPIs

18