Shell’s Customer-to-Cash and SSC Journey An interview with The Hackett Group Siobhan Riggott – Customer-to-Cash and GBS Advisor, The Hackett Group Michal Fic – Global COC Process Excellence Manager, Shell Credit Matters VI – The Deep Dive
Key Findings - The Hackett Group’s GBS study INCREASING STRATEGIC ACCOMPLISHMENT OF GBS GBS OPERATING MODEL DEVELOPMENT CHALLENGES DIGITAL TRANSFORMATION IMPERATIVE CUSTOMER CENTRICITY Source: The Hackett Group’s annual GBS performance study, 2017
Strategic alignment, cost leadership and compliance focus are the main strategic priorities GBS Strategic Objectives,% effective and highly effective in meeting the stated goal ALIGNMENT COMPLIANCE FOCUS COST LEADERSHIP FOCUS SERVICE EXCELLENCE FOCUS AGILITY FOCUS CUSTOMER INTIMACY FOCUS 2014 2015 2016 2017 Source: The Hackett Group’s annual GBS performance study, 2017
Current and expected use of GBS model, by function GBS use for customer service and direct procurement is set to grow fastest in the next 2-3 years Finance 79% 3% Human Resources 52% 13% Indirect Procurement 50% 11% Information Technology 38% 12% Customer Service 29% 14% Direct Procurement 27% 12% Real Estate & Facilities Mgt. 25% 7% Supply Chain Management 25% 5% Legal 16% 8% Environmental, Health & Safety 13% 3% Corporate Communications 12% 2% Marketing 11% 2% 5% Research & Development 6% Sales 6% 3% Government Affairs 5% 2% Current 2-3 years (% growth) Source: The Hackett Group’s annual GBS performance study, 2017
Discussion u What functions are included within the scope of Shell Business Operations? u What is the organizational and geographic scope of Shell Business Operations? u How have the strategic priorities and objectives of Shell Business Operations changed over time?
Finance operating model, conceptual view Corporate Center Corporate Business Partnering Focus: Defines corporate strategy and exercises center Focus: Defines BU strategy and measures stewardship performance § Strategic and Financial Planning & Performance § Planning & Performance Management Management § Business Analysis BU § External Reporting, Tax, Treasury, Mergers & § Tax, Treasury, Acquisitions, Internal Audit § Mergers & Acquisitions, Internal Audit (in autonomous organizations) Centers of Excellence Country/ Entity level (BU) Focus: Supports enterprise-wide stewardship goals Shared Focus : supports localized strategy execution and § Tax Management Services activities retained for compliance reasons § Cash Management § Capital and Risk Management § Business Analysis (focused on sales support) § Compliance Management § External reporting (focused on country/ entity P&L § Cost Accounting and fiduciary responsibilities) Finance Operations Focus: Delivers operational finance services to BUs Cash Disbursements Revenue Cycle General Accounting § Accounts Payable § Credit § Fixed Assets § Customer Billing § Travel & Expenses § Intercompany Accounting § Collections § General Ledger Accounting § Cash Application § Cost Accounting § Dispute Management
Finance operating model, empirical view A significant proportion of O2C fall within the scope of Global Business Services, with top quartile having taken the model further than peer Finance in GBS, organizational model by process (Top quartile) Accounts Payable 91% 5% 5% Travel & Expense 87% 9% 4% Fixed Asset Accounting 83% 8% 8% Intercompany Accounting 82% 8% 9% General Ledger 82% 9% 9% Customer Billing 80% 16% 4% Collections 77% 12% 12% Cash Application 77% 4% 19% Dispute Management 75% 17% 8% Credit 72% 21% 7% Cost Accounting 60% 32% 8% Tax Management 50% 13% 37% Payroll 46% 15% 39% Enterprise Consolidation 46% 9% 45% Treasury Management 46% 7% 48% Compliance Management 43% 22% 35% External Reporting 42% 12% 46% Business Analysis 39% 40% 21% Planning & Performance Management 24% 54% 22% TOTAL 63% 16% 20% GBS BU Corporate Center Source: The Hackett Group’s annual GBS performance study, 2017
Discussion u What does Shell’s Customer-to-Cash look like from a delivery perspective as well as from a governance perspective? u What is the role and accountabilities of the Process Excellence team – is their scope in line with Shell Business Operations or wider than the scope of Shell Business Operations? What frameworks and matrix do Shell use to define their operating model and optimise service u placement? How does the global delivery model vary for the different processes within the scope of Customer-to-Cash? u Could you share examples of some of Shell’s most significant Customer-to-Cash optimisation activities; whether they be in relation to service placement, process design, use of technology and automation?
Customer experience defined “ Customer experience is the sum of all experiences a customer has with a supplier of goods or services, over the duration of ” their relationship with that supplier Wikipedia definition Source: The Hackett Group’s annual GBS performance study, 2017
More mature customer experience management leads to higher customer satisfaction Customer Satisfaction (10 point scale) 5,9 Overall 8,2 6,0 Direct Procurement 8,3 5,2 Indirect Procurement 8,4 5,9 Information Technology (IT) 8,0 6,2 Human Resources (HR) 9,0 6,0 Finance 8,0 Peer World-class Source: The Hackett Group’s annual GBS performance study, 2015
Discussion u How mature is Shell’s Customer-to-Cash organisation in terms of customer experience management? E.g. culture, use of technology, skills and talent, service design etc. u Do Shell Business Operations undertake customer / stakeholder satisfaction surveys on a regular basis? How are the results of the surveys used to drive customer experience improvements?
Half of all GBS have defined a digital transformation strategy, but lack resources and funding to execute Capability levels for aspects of digital transformation in GBS Low Digital transformation resource 14% 47% 33% 6% allocation and funding Low Moderate Digital transformation strategy 10% 26% 53% 11% definition Moderate Understanding of digital Moderate transformation enabling 1% 30% 57% 11% technologies Moderate Moderate Digital transformation initiatives 7% 31% 49% 13% definition Moderate None Low Moderate High Peer World-class Source: The Hackett Group’s annual GBS performance study, 2017
Digital transformation is expected to contribute most to GBS agility and productivity improvement Expected improvement achieved by Digital Transformation in GBS in 2-3 years Moderate Improved GBS agility 13% 24% 54% 9% High Moderate GBS productivity improvement 7% 37% 50% 6% High Moderate Improved management 17% 29% 47% 7% information Moderate 1% Moderate Internal customer experience 7% 40% 44% 7% improvement Moderate Moderate GBS operating cost reduction 13% 47% 34% 6% Moderate External customer experience Moderate 6% 19% 33% 29% 14% improvement Moderate 1% Moderate Profitability improvement 23% 39% 23% 14% Moderate Peer None Low Moderate High Don't know World-class Source: The Hackett Group’s annual GBS performance study, 2017
Discussion u How defined and developed is Shell’s digital transformation strategy from an Customer-to-Cash perspective? u •Could you please share examples of initiatives included in Shell’s Digital Transformation roadmap that will impact (or are already impacting) Customer-to-Cash? u What expectations does Shell have in terms of how digital will contribute in terms of agility and productivity improvements?
Any questions? Siobhan Riggott Michal Fic Customer-to-Cash and Global Global COC Process Excellence Business Services Advisor Manager The Hackett Group Shell sriggott@thehackettgroup.com Michal.Fic@shell.com Thank you
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