The pandemic has changed organizations’ attitudes towards the need for change, greatly increasing their emphasis on adopting new digital process models and digital transformation. Partly this is driven by the need to enhance their transactional efficiency and effectiveness rapidly, but at least equally importantly, it has brought a much greater requirement for real-time information and analytics to drive the business. All these pressures are keenly felt within the finance department.

WNS introduces Quote-to-Sustain

In response, WNS has looked to reinvent order-to-cash in the form of Quote-to-Sustain. Some of the issues that WNS is aiming to address with its Quote-to-Sustain offering include:

• Improving billing timeliness and accuracy by improving the integration and consistency of data between quotations, digital contracts, order management & fulfillment, and billing systems
• Maximizing revenue by releasing credit holds for good customers
• Protecting the enterprise with more dynamic credit control than periodic credit review
• Improving collections by cleansing master data in real-time.

In addition to delivering enhanced end-to-end visibility, stakeholder experience, and analytics, WNS has also reimagined its Quote-to-Sustain service to deliver greater variability in F&A process costs as business volumes fluctuate and become more unpredictable as a result of the pandemic. Its new Quote-to-Sustain offering bundles technology and services and allows clients to “pay by the drink”.

Specifically, the goal is for clients to remain cash neutral and, subject to some volume commitment, to pay only for transactions, with a decrease in costs emerging from year two onwards. WNS funds all change management.

Quote-to-Sustain modules

The Quote-to-Sustain module structure is:

• Quote-to-Order: consisting of unified master data, cognitive credit, digital contracts, and smart orders
• Bill-to-Cash: consisting of integrated billing, intelligent collections, predictive dispute management, touchless cash applications, and predictive deduction management
• Report-to-Sustain: consisting of digital dashboards, botified queries, analytics-as-a-service, and revenue assurance.

Each of these modules takes the form of a system of engagement sitting on top of the client’s existing ERP systems and systems of record.

In this respect, the use of unified master data is important in bringing together the various commercial and financial elements from multiple databases to ensure accuracy, for example, in billing the right person and identifying the appropriate person for each type of query. The unified master data aims to be a single source of the truth using data authentication from external sources and providing an element of real-time data cleansing.

WNS’ cognitive credit offering aims to take credit management beyond the periodic review of credit bureau reports and base its recommendations for credit eligibility on its own analyses of financial ratios, customer behavior (including any changes in payment pattern), and news triggers from external sources. WNS believes this approach to be particularly effective in addressing credit management within small businesses. The service incorporates technology from HighRadius and Emagia.

WNS’ digital contracts and smart orders modules utilize its Skense and Agilius platforms to combine and analyze data from various sources and integrate quotations, orders, contracts, and billing to reduce the errors that typically arise between disparate sources of information.

WNS’ Revenue Assurance and Analytics modules include some industry-specific modules to monitor and minimize revenue dilution, using analytics for improved collections and to reduce revenue losses arising from upstream process errors.

Quote-to-Sustain adoption plan

WNS has always approached F&A from a sector-specific viewpoint. Having developed all the modules within Quote-to-Sustain, WNS is now in the process of integrating this capability with its industry-specific processes in line with client demand. Powered by an exclusive partnership with EvoluteIQ, WNS’ domain-led hyperautomation platform suite is designed to accelerate the adoption of process automation and drive enterprise-wide digital transformation. The sectors WNS will focus on are the ones where it has already developed industry-specific expertise and IP and include airlines, travel agencies, trucking, shipping & logistics, insurance, telecom, media, CPG, manufacturing, and utilities.

Nonetheless, the initial clients of WNS Quote-to-Sustain have typically started by purchasing a single module such as cognitive credit & collections, and WNS expects a typical sequence of deployment to be cognitive credit & collections, followed by unified master data, followed by revenue assurance.

WNS has already applied its cognitive credit, touchless cash applications, botified queries, and analytics-as-a-service modules of Quote-to-Sustain for a media client. This company’s cash application process was automated but only achieved a 75% auto-match rate due to delays in the receipt of remittance advice notes. WNS deployed touchless cash apps via EIPP (electronic invoice presentment and payments) to achieve an auto-match rate of 88% and introduced intelligent chatbots and predictive disputes management to reduce the time for resolution significantly. The chatbots resolve most disputes without human intervention, with all trade promotion issues resolved through chatbots.

Overall, the media company has achieved a potential $38m uplift in free cash flow by optimizing payments from late-paying customers and an 11% reduction in bad debts by improving late-stage collection.

In addition to this modular approach being taken with mid-sized organizations, WNS is also targeting start-ups, where the company is in discussion with some organizations for the entire suite of end-to-end services.

Conclusion

Many existing F&A operations have incorporated best-of-breed point solutions and subsequently applied RPA in support of point automations. However, these organizations are often still using disparate data sources and have not fully reimagined their F&A processes into an integrated framework using a single source of the truth and analytics for improved operational and business intelligence. WNS’ Quote to Sustain offering aims to provide this reimagined finance model and help organizations become more agile and analytical in their approach to order-to-cash.

Organizations starting on RPA are initially faced with the challenges of understanding RPA tools and approaches and typically lack the internal skills necessary to undertake automation initiatives. Once these skills have been acquired, RPA is then often applied in a piecemeal fashion, with each use case considered by a governance committee on its own merits. However, once a number of deployments have been achieved, organizations then look to scale their automation initiatives across the finance function and are confronted by the sheer complexity, and impossibility, of managing the scaling of automation while maintaining a ‘piecemeal’ approach. At this point, organizations realize they need to modify their approach to automation and adopt a guiding framework and target operating model if they are to scale automation successfully across their finance & accounting processes.

In response to these needs, Capgemini has introduced its Digital Global Enterprise Model (D-GEM to assist organizations in scaling automation across processes such as finance & accounting more rapidly and effectively.

Introducing D-GEM

The basic premise behind D-GEM is that organizations need both a vision and a detailed roadmap if they are to scale their application of automation successfully. Capgemini is taking an automation-first approach to solutioning, with the client vision initially developed in “Five Senses of Intelligent Automation” workshops. Here, Capgemini runs workshops for clients to demo the various technologies and the possibilities from automation, and to establish their new target operating model taking into account:

• The key outcomes sought within finance & accounting under the new target operating model. For example, key outcomes sought could be reduced DSO, increased working capital, and reduced close days
• How the existing processes could be configured and connected better using “five senses”:
  • Act (RPA)
  • Think (analytics)
  • Remember (knowledge base)
  • Watch (machine vision & machine learning)
  • Talk (chatbot technology).

However, while the vision, goals, and technology are important, implementing this target operating model at scale requires an understanding of the underlying blueprint, and here Capgemini has developed D-GEM as the “practitioners’ guidebook, a repository showing (e.g., for finance & accounting) what can be achieved and how to achieve it at a granular level (process level 4).

D-GEM essentially aims to provide the blueprint to support the use of automation and deliver the transformation. It is now being widely used within Capgemini and is being made available not just to the company’s BPO clients but for wider application by non-BPO clients within their SSCs and GBS organizations.

From GEM to D-GEM

Capgemini’s original GEM (Global Enterprise Model) was used for solutioning and driving transformation within BPO clients prior to the advent of intelligent automation technologies. Its transformation focus was on improving the end-to-end process and eliminating exceptions. It aimed to introduce best-in-class processes while optimizing the location mix and improving domain competencies and reflected the need to drive standardization and lean processes to deliver efficiency.

While the focus of D-GEM remains the introduction of “best-in-class” processes, best-in-class has now been updated to take into account Intelligent Automation technologies, and the transformation focus has changed to the application of automation to facilitate best-in-class. For example, industrialization of the inputs needs to be taken into account at an early stage if downstream processes are to be automated at scale. Alongside the efficiency focus on eliminating waste, it also looks to use technology to improve the user experience. For instance, rather than eliminating non-standard reporting as has often been a focus in the past, deployment of reporting tools and services on top of standardized inputs and data can enhance the user experience by allowing them to produce their own one-off reports based on consistent and accurate information.

D-GEM provides a portal for practitioners using the same seven levers as GEM, namely:

• Grade Mix
• Location Mix
• Competencies
• Digital Global Process Model
• Technology
• Pricing and Cost Allocations
• Governance.

However, the emphasis within each of these levers has now changed, as explained in the following sections.

Role of the Manager Changes from Managing Throughput to Eliminating Exceptions

Within Grade Mix, Capgemini evaluates the impact of automation on the grade mix, including how to increase the manager’s span of control by adding bots as well as people, how to use knowledge to increase the capability at different grades, and how to optimize the team structure.

Under D-GEM, the role of the manager fundamentally changes. With the emphasis on automation-first, the primary role of the manager is now to assist the team in eliminating exceptions rather than managing the throughput of team members. Essentially, managers now need to focus on changing the way invoices are processed rather than managing the processing of invoices.

The needs of the agents also change as the profile of work changes with increased levels of task automation. Typically, agents now need to have a level of knowledge that will enable them to act as problem-solvers and trainers of bots. Millennials typically have great problem-solving skills, and Capgemini is using Transversal and the process knowledge base within D-GEM to skill people up faster and ensure Process Champions are growing within each delivery team, so knowledge management tools have a key role to play in ensuring that knowledge is effectively dispersed and able junior team members can expand their responsibility more quickly.

The required changes in competency are key considerations within digital transformations, and it is important to understand how the competencies of particular roles or grades change in response to automation and how to ensure that the workforce knows how automation can enrich and automate their capabilities.

The resulting team structure is often portrayed as a diamond. However, Capgemini believes it is important not to end up with a top-heavy organization as a result of process automation. The basic pyramid structure doesn’t necessarily change, but the team now includes an army of robots, so while the span of managers will typically be largely unchanged in terms of personnel, they are now additionally managing bots. In addition, tools such as Capgemini’s “prompt” facilitate the management of teams across multiple locations.

Within Location Mix, as well as evaluating that the right processes are in the right locations and how the increased role of automation impacts the location mix, it is now important to consider how much work can be transitioned to a Virtual Delivery Center.

Process & Technology Roadmaps Remain Important

Within Digital Global Process Model, D-GEM provides a roadmap for best-practice processes powered by automation with integrated control and performance measures. Capgemini firmly believes that if an organization is looking to transform and automate at scale, then it is important to apply ESOAR (eliminate, standardize, optimize, automate, and then apply RPA and other intelligent automation technologies) first, not just RPA.

Finance & accounting processes haven’t massively changed in terms of the key steps, but D-GEM now includes a repository for each process, based on ESOAR, which shows which steps can be eliminated, what can be standardized, how to optimize, how to automate, how to robotize, and how to add value.

Within the Technology lever, D-GEM then provides a framework for identifying suitable technologies and future-proofing technology. It also indicates what technologies could potentially be applied to each process tower, showing a “five senses” perspective. For example, Capgemini is now undertaking some pilots applying blockchain to intercompany accounting to create an internal network. Elsewhere, for one German organization, Capgemini has applied Tradeshift and RPA on top of the organization’s ERP to achieve straight-through processing.

In addition, as would be expected, D-GEM includes an RPA catalog, listing the available artifacts by process, together with the expected benefits from each artifact, which greatly facilitates the integration of RPA into best practices.

Governance is also a critical part of transformation, and the Governance lever within D-GEM suggests appropriate structures to drive transformation, what KPIs should be used to drive performance, and how roles in the governance model change in the new digital environment.

Summary

Overall, D-GEM has taken Capgemini’s Global Enterprise Model and updated it to address the world of digital transformation, applying automation-first principles. While process best practice remains key, best practice is now driven by a “five senses” perspective and how AI can be applied in an interconnected fashion across processes such as finance and accounting.

For example, within F&A BPS, Hewlett Packard Enterprise (HPE) is investing in a tool to assess the automation potential of organizations’ finance & accounting processes, which is being built into HPE’s FIT (Framework for Innovation & Transformation) framework, and HPE is now developing automation and digitization assessments and roadmaps at the front-end of F&A BPS contracts.

In its targeting of F&A BPS, HPE is becoming more sector specific and incorporating metrics specific to target sectors within FIT, starting with the telecoms and oil & gas sectors.

HPE is also becoming more business metric focused in its approach to F&A BPS and highlighting that the benefits of automation extend way beyond process cost take-out. Cash acceleration and cash utilization are major areas of focus for HPE within F&A BPS. In particular, HPE is stressing that the benefits of source-to-pay automation go beyond halving the S2P headcount and start to open the door to profit improvement opportunities through dynamic discounting. HPE formerly used to advise its clients on negotiating longer payment terms with their suppliers; the company has now changed its focus to encouraging its clients to negotiate early payment discounts and automate/digitize their P2P processes to achieve rapid approval of purchase invoices so that they can optimize their early discounts against these invoices. In many cases, the purchase invoice approval process has been too slow and the knowledge of potential discounts too inaccessible to take advantage of what could amount to a profit improvement opportunity equal to up to 2% of total goods purchased. For example, HPE estimates that the HP GBS organization has saved $2.7bn in early payment discounts over the past three years by taking this approach.

Accordingly, HPE has established a center of excellence for automation in F&A, and is beginning to encourage use of data pdf technology to reduce the need for OCR or manual rekeying of invoices. The company has a number of pilots in this area.

In terms of robotics, the company is currently using UiPath and Blue Prism, the latter particularly for connecting with ERP software, and Redwood for support for R2R and month-end close, and has built-up a library of ~750 accelerators. The company is also extensively using PDF Cloud, and its own Vertica software. HPE’s Business Process Analytics Tool (BPAT) is based on Vertica, which is used to provide an F&A dashboard covering both an executive view of KPIs and drill-downs into service performance.

For example, within P2P, HPE is aiming to digitize F&A processes by:

• Reducing use of paper and scanning through use of PDF data capture and its partnerships with Tungsten and Tradeshift
• Further automation of invoice data entry and processing using RPA
• Identifying further opportunities for automation via BPAT.

Overall HPE is increasingly seeking to place automation strategy and vision at the forefront of F&A process design, with automation and digitization leading the way in identifying possibilities for straight-through processing. Indeed, based on HPE’s F&A services transformation journey diagram, the company expects ~60% of future F&A BPS productivity improvements to be driven by automation and 40% to be driven by process change and staff reallocation & best-shoring.

Contrary to some expectations, RPA is only one automation component. In HPE’s automation journey in F&A BPS, RPA is expected to deliver around a quarter of the total productivity benefits to be achieved from automation, with a whole range of tools and platforms contributing around 75% of the automation benefits to be achieved.

As usual, one of the major challenges over the past year has been in training the company’s solution architects in thinking digital and identifying benefits beyond those previously achievable. As HPE suggested, many of the existing F&A process benchmarks may need to be rewritten over the next 12-months.

F&A BPS is arguably the most mature of all the BPS services. However, with real-time analytics increasingly identifying the opportunities, RPA lowering the barriers to process improvement, and organizations increasingly willing to automate, F&A BPS is now off on a new journey that promises a step change in productivity. Automation plays to the strengths of HPE, and F&A digitization is an area where the company is intending to strongly invest and compete.