Business Process Outsourcing : increasing the efficiency of financial services

MOSCOW – April 15, 2014 The newspaper the Moscow Times held a  joint conference devoted to the current market of business process outsourcing. Financial executives and top managers of the participating companies presented the tools needed to optimize and improve the effectiveness of the financial processes used in their organizations. Solutions included the use of outsourcing, insourcing, electronic document management and a variety of business automation methods. Two roundtables of experts discussed the peculiarities of working with external providers and EDI outsourcing services.

The participants of the conference were representatives of companies such as Hamilton Data Services Russia and CIS, Boehringer Ingelheim, Trafigura, « The ABC of Taste “, ” Petrolesport », Auchan Russia, as well as BDO Unicon Outsourcing, ACCA, Taxcom, Jensen Group and VIAcode.

Hamilton Data Services General Manager, Victoria Lapteva, presented the possibilities modern technology offers for solving the problems involved with managing peripheral business processes.  (SEE THE PRESENTATION) Peripheral business processes play an important role because of their impact on sales and the fact that they are very often associated with huge costs. Problematic areas surrounding peripheral business processes include the lack of automation, insufficient involvement in ERP and CRM systems and the significant volume of manual operations. HDS offers a suite of cloud-based business solutions. These “Decision Solutions” combine the necessary functionality to streamline and automate business processes, including such fundamental questions as compliance with the rules and policies of the company, localization under local regulations and tax laws . Ample possibilities for parameterization allow companies to customize the application to fit their business needs. The cloud infrastructure provides the advantage of fast and inexpensive implementation and the ability to create a collaborative environment for all employees.

Project Manager and ACCA Association representative in Russia, Natalia Mitkevich, told about the next stage of development in global organizations insourcing – Model GBS (Global Business Services). This new approach involves the creation of a single service center managing business functions and cross-functional processes. The centralized entity can improve efficiency, transparency, and enhance the ability to monitor and control risks.

For some large multinational companies on the path of centralization of services, they can encounter issues arising out of local requirements. For example, for the holding company Trafigura, accounting functions for the subsidiaries of different countries are conducted in a single center in Mumbai (India) . Elena Suslovoj , head of financial and operational control at Trafigura Eurasia,  presented the case of Russian legal entities  and the problem they had of choosing between the SSC and external outsourcing. Given the specifics of the Russian accounting standards , tax and labor laws , formalization of patterns of several documents , the need to maintain documentation in Russian , commitment and signing of paper versions of other methodological differences , it is practically impossible to transmit accounting processes for service in SSC that are outside of our state. As noted Elena Suslov, the outsourcing of these accounting functions to a local provider had a  very clear justification for the head office of the organization.

Additionally, Suslov, has experience as an accountant in a company’s staffing structure, and with the SSC and the outsourcer, and she stressed that most of the problems faced by customers using outsourcing companies are similar to the problems arising in the interaction of business and accounting functions in large organizations. Among them , for example : the need to train staff in the nuances associated with the peculiarities of a particular business and market ; discipline and regulation of processes related to the provision of primary documents from the business .

During the second session, the representative from Taxcom, Vasily Zudin, told about changes in the market of electronic document in Russia over the last year. According to him, the number of companies that are ready to use or have used the electronic exchange of documents has grown significantly and continues to grow. Public authorities have been paying considerable attention to this issue and, if we talk about financial document, the tax authorities are increasingly aware of the convenience of EDI for all sides of the interaction and are often initiated to accelerate its development. Besides, it is no longer just about reducing the cost of paper documents archives and logistics, but rather on the optimization of all processes related to the exchange of documents.

At the same time, with the development of EDI in business there are new problems: large companies, pushing their contractors for electronic document exchange, on the one hand, help to develop the market , on the other hand creates certain difficulties for the contractors. For example , a producer who works with several retail chains often get multiple offers from their partners , requiring the use of different software products and interaction with  various providers of EDI . The representatives from Hamilton Data Services and VIAcode presented various technical possibilities for solving such problems.

Lyudmila Lobasheva , deputy chief accountant at Auchan, spoke about the experience of implementing electronic document. The legal implications were significant for their organization. Lobasheva stressed that recent legislative initiatives in this area – including the introduction of a simplified invoice in electronic format – is a big plus for all market participants, and a step that will encourage suppliers to transition to EDI.