Accenture Benchmarking Solutions From Insight to Action

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Implemented by skilled professionals and supported by proven assets, Accenture Benchmarking Solutions helps companies quickly perform an objective assessment of the cost and performance of their finance function, identify and quantify improvement opportunities, and build the foundation for sustained high performance. The importance of benchmarking The finance function is a specialized and valuable resource that is critical to the success of any organization. Accenture’s ongoing research into the characteristics of high-performance businesses has found that high performers exceed their peers in the ability to develop distinctive capabilities within their finance function to create a competitive advantage. Accenture research has also demonstrated that leading finance organizations do three things very well to achieve and maintain their leadership position. They: • Regularly identify the gaps between today’s finance capabilities and those necessary to be competitive in the future. • Strive to be leaders in those capabilities that are most important given the needs of their business. • Pursue improvements via formal, structured change programs. In other words, leading finance organizations identify the areas of most need within the finance function—and areas where they can have the most impact on the business—and structure a change program to help ensure that the company gets the most out of scarce finance resources. In many organizations, however, the finance function struggles to meet those high standards with cost and performance varying widely. Finance cost as a percentage of revenue can easily be two or three times higher for one company compared to another. Similar disparities exist in terms of the performance of finance functions. Many companies are unaware of how their cost and performance compares to that of their peers, especially high performers. Without an accurate assessment of the current state of the finance function, change programs are too often a hit-or-miss series of disparate initiatives that fail to deliver a sound return on investment.
Figure 1: Benchmarking answers critical questions and builds the foundation for improvement How much do I truly spend to deliver finance services? How is finance time spread across various finance processes? How effective is my finance organization at delivering value? How does my organization compare to others? What are the drivers/root causes of cost and performance? Where are the biggest opportunity areas? What is the value of closing the gaps? This need for a clear understanding of the current capabilities of the finance function is why benchmarking is a critical component of any finance transformation program. What is finance benchmarking? Benchmarking is the process whereby an organization captures specific data related to its costs and performance, and then compares this cost and performance data externally to a composite average of other companies. The benchmarking process can also be used internally: Organizations operating in several countries, or with multiple operating units and divisions, can compare cost and performance metrics across those different entities. A top performer often emerges internally whose practices can then be adopted and leveraged across the enterprise. This combination of internal and external benchmarking helps to identify the most important gaps between an organization’s current state and where it wants to be, helping to create both a road map and a business case for change. (See Figure 1.) Benchmarking can also generate the rigorous cost and performance baseline necessary to effectively track progress on that road map over time in terms of cost reductions and performance improvements. Ultimately, benchmarking helps organizations put in place a rigorous and continuous improvement process to bring out higher levels of performance across the organization. If one is to use benchmarking to drive high performance through the finance function, however, numbers alone are not enough. No database of information will churn out a ready-made prescription for a company’s unique set of circumstances. The quantitative dimension of benchmarking must be supplemented by a qualitative analysis informed by a deep understanding of finance function leading practices All cost components, processes and organization entities. Process based view of activities and costs to supplement the organization view. Quality, accuracy, cycle time, and positive impact on the business. Cost and performance – in total, by process, and by region. Organization model, process design, technology usage, and data structures. Specific processes, regions, business units, and/or cost components. Quantified cost reduction and performance improvement opportunities. and how they can be applied given the company’s industry, strategic goals and constraints. Providing that combination of quantitative and qualitative analysis through advanced benchmarking capabilities that can generate insights and drive high performance is the distinctive advantage of Accenture Benchmarking Solutions. 2
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Accenture Benchmarking Solutions From Insight to Action

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