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The Innovation Mandate that Every O2C GPO Needs to Address in 2022

What you’ll learn


  • Evolution of Shared Services from Cost Optimization Centers to Global Innovation Centers
  • The Emergence of Global Innovation Centers that Generate Business Value
  • Key Automation Technologies Driving the Future of O2C GBS

This information is curated With Experts From :

This Information is curated With Experts From uber

Evolution of Shared Services from Cost Optimization Centers to Global Innovation Centers

Evolution of Shared Service Centers to Global Innovation Centers

Challenges with Traditional Shared Services

  1. SSCs Working in a Siloed Environment

Traditionally, F&A SSCs have worked in a siloed environment with separate business objectives and processes, restricting the exchange of information. But today, businesses are using SSCs to achieve cost and operational efficiencies for managing back-end F&A or O2C processes related to customer payment processing, billing, credits, and collections.

  1. More Focused on Standardization of Ongoing Process 

O2C SSCs mainly handled targeted tasks and were not adding value to the core business. There was less focus on process innovation, automation of workflows, and generating real-time insights. The main activities only included standardization of the ongoing processes, leading to the commoditization of business processes, impacting business growth.

The Emergence of Global Business Services

GBS Model Acts as a Centralized Organization Handling End-To-End Operations 

In the SSC model, the shared services center is a separate entity that has emerged from the core organization and is responsible for providing services to its local business units. The GBS model sets up a global, integrated, and centralized organization that provides comprehensive and complex end-to-end processes. 

The Emergence of Global Innovation Centers that Generate Real Business Value

Powerhouse for Strategic Business Functions

  1. GICs Enable Intercommunication Between Processes

A GBS that could enable intercommunication between processes could generate real-time insights for business leaders. This resulted in the inception of global innovation centers (GICs), which provide an environment where processes no longer work in silos and a technologically advanced workforce and can proactively identify roadblocks.

  1. Extensive Support to Decision Makers and Supports Overall Strategy

Decision-makers such as A/R executives need support for tasks such as reducing process cost, managing cash flow, maintaining customer relationships, improving visibility on payment disputes, and providing foresight on credit and payment risk customers. All this becomes possible through a centralized service delivery like GICs.

Adoption of Automation to Drive the Future of O2C GBS

Leveraging Technology to Provide Globally Scalable Solutions

  1. Adopting Technology to Enable Innovation

Technology has the potential to offer customized solutions for specific processes or sub-processes. For instance, it can be used to run a real-time cash application process and bring the processes at par with any other process in an organization.

Adoption of technology in order to cash led to the innovation of GBS centers

GBS acts as a catalyst in the overall digital transformation of a business, assisting them in establishing new operations and enhancing existing ones. But the transformation also increases interaction among the processes, both in volume and complexity. This is where automation tools are needed to reduce the cost of labor and make intelligent decisions.

  1. AI-Driven Automation to Add value to the Process 

45% of global GBS leaders foresee an increase in GBS focus on digital experience and AI-driven automation. Service delivery should be cost-effective, customer-focused, and efficient in a shared accounting services framework. Innovative solutions adopted by shared services leverage technology to provide scalable and repeatable solutions.

Leveraging automation for utilizing resources

Automation of A/R operations brings enhanced visibility across processes and contributes to improvement. The accounting processes facilitate resource efficiencies that can be channeled towards business development initiatives. GBS centers deal with limited service areas such as account payables and receivables as more transactions are automated.

Key Technologies Used in O2C Processes

Disruptive technologies can drive the future of the O2C process

  1. Artificial Intelligence (AI) and Machine Learning (ML): AI and ML techniques facilitate automated aggregation and processing of invoices, emails, and contracts, thereby significantly reducing manual effort. However, the critical application and value addition comes from the insights it can generate with its analysis, which supports data-driven decision-making.

For example, self-learning algorithms predict payment dates and identify the risk of non-payment/Integrating this information across processes leads to gaining relevant business insights.
Future-ready businesses adopt practices that combine human and machine intelligence, leveraging modular data and technology with scalable processes to improve the operational efficiency of the workforce.

  1. Real-time access to customer information: Provides scalability and an environment for better operational integration across processes.  It also helps in business decisions by providing real-time data such as customer credit information, credit score, payment behavior, payment history, and the validity of deductions claimed.                                        
  2. Business intelligence services: Analyzing data and providing actionable insights impact the ability of teams to make strategic decisions about customers. It also enables A/R leaders to provide senior management with 360-degree visibility into the receivables’ performance.

Conclusion

Conclusion

Digitization of A/R operations brings enhanced visibility across processes and contributes to their improvements by enabling the continuous benchmarking needed for achieving a best-in-class system. GBS executives are tasked with multiple responsibilities in order to stay abreast of their market competitors and to leverage cutting-edge technology to elevate A/R teams in the CFO’s office.

GBS executives should be looking forward to evolving their shared services from a cost-optimization center to a global innovation center.Read the eBook linked below to understand the best practices for GBS leaders to build their tech stack and go about executing a successful digital transformation project.


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