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© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved. 1
Strategy For Driving and Adhering to Global Standardisation.
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Topics
• Introduction• Challenges• Evolution• Standardisation• Remote Management• Results• What we learned along the way• Q&A
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Centralised Best Practices with Regional Application
One of the largest oilfield services companies, (#3) Weatherford operates out of around 1,400 locations in more than 100 countries and employs around 50,000 people worldwide.
Global approach to credit & collections with regional application.
A team of 140 Order to Cash, credit & collections professionals distributed regionally. Includes outsourced
Regional CollectionsRegional OTCCentre of excellence CreditBusiness Process OwnerDedicated Getpaid Expert
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Challenges
• Dysfunctional Team
• Dated Business Processes and Tools
• Strained Business Relationships
• No Standardization
• No Visibility
• No Automation and Integration
• No Accountability
• No hope
© 2012 Weatherford. All rights reserved.© Weatherford 2014. All rights reserved.© Weatherford 2014. All rights reserved.
Evolution
• Optimise process
• Standardise
• Automate
• Annual review of process and Getpaid
• Eliminate NVA
• Track Meaningful metrics
• OTC merged with C&C
• Best practises leveraged
• Remote management tools honed
• Birth of OTC
• Revise C&C structure
• Improve skillset of team
• Build relationships and mend fences
• Gain credibility by getting results
• Provide visibility
• Educate
• Education roadshows continue
• Audits to ensure tools are being used
PERFORMOPTIMIZEACTIONANALYZEImproveChange Image
Evaluate & Implement
5
Optimise first before you automate
Be Prepared for Resistance
© 2012 Weatherford. All rights reserved.© Weatherford 2014. All rights reserved.© Weatherford 2014. All rights reserved.© Weatherford 2014. All rights reserved.
6
Evolution
• Optimise process
• Standardise
• Automate
• Annual review of process & Getpaid
• Eliminate NVA
• Track meaningful metrics
• OTC merged with C&C
• Best practises leveraged
• Remote management tools honed
• Birth of OTC
• Revise C&C structure
• Improve skillset of team
• Build relationships and mend fences.
• Gain credibility by getting results
• Provide visibility
• Educate
• Education roadshows continue
• Audits to ensure tools are being used
PERFORMOPTIMIZEImproveChange Image
Improve Visibility &
Drive Improvement
ACTIONANALYZE
Refine
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Eliminating Non Value Add
7
As of 2/2010 only 34% of the time was spent on Value-Added Activities.
With the rollout of the Value-Added Time Blocker, 65.13% of the time is now spend on Value-Added Activities
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Leading v Lagging Metrics
• Lagging indicators measure the outcomes at the end of a time period. For example DSO
• Leading Indicators – are activities that predict the outcomes (that is lagging indicators) For example promise to pays, contacts made etc
• Combination of the two make for more rounded reporting
8
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Is DSO Dead?
9
• Prevention of Sales
• Is it the True Measurementof Collections Effectiveness?
• Changing the Way the Organisation Views Collections Effectiveness
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Past Due DSO & Collections Efficiency
• Past Due DSO Calculation: Is a method by which Accounts Receivables that are aged over 30 days are divided by 1 day DSO.
• This increases the focus on what part of the DSO may be collectable by the C&C organization by focusing on receivables that have been billed and outstanding for over 30 days.
• Stability & predictability = sustainability
• CE is current month past due divided by prior months billing
10
© 2012 Weatherford. All rights reserved.© Weatherford 2014. All rights reserved.© Weatherford 2014. All rights reserved.
Evolution
• Optimise process
• Standardise
• Automate
• Integrate
• Annual review of process and Getpaid
• Eliminate NVA
• Track meaningful metrics
• OTC merge with C&C
• Best practises leveraged
• Remote Management tools honed
• Birth of OTC
• Revise C&C structure
• Improve skillset of team
• Build relationships and mend fences.
• Gain credibility by getting results
• Provide visibility
• Educate
• Education roadshows continue
• Audits to ensure tools are being used
ImproveChange Image
ContinuousImprovement
ACTIONANALYZE
RepeatPERFORMOPTIMIZE
11
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Managing Remotely
12
• Standardisation
• Procedures
• Tool Kit
• Sticking to the Plan
• Communication
• Travel
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Standardisation Benefits
• Easier to train
• Easier to repeat
• Easier to measure
• Maximise Results
• Consider barriers such as regional laws
13
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Standard Operating Procedures (SOPS)
14
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Tool Kit
15
• Cash Collected Analysis
• End of Day Activities
• Broken Promises
• Dispute Management
• Audit
We created a managers guide providing detailed instructions on what to look for and what to do
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Cash Collected Analysis
16
• Cash Targets Are not Linear
• Use Historic Data To Establish Pattern
• Communicate to Wide Audience
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
End of Day Activities
17
• Region Managers make sure that their teams have completed all their follow up activities by end of day.
• Good way of making sure that the application is being used correctly and that we are covering all accounts
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Broken Promises
18
• Defined as promises to pay on specific invoices on specific date but no payment was made.
• Useful for monitoring the collector’s performance- broken PTPS not followed up- No escalation at customer level-PTP did not comply with our SOP- Poor Notes
• At Customer Level- Pattern of broken promises- Change in payment trend- Failure to communicate
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Results
• PDDSO improved 12 days from baseline
• CE improved 11% points from baseline
• No Headcount Increase Despite Increase in Sales
• Improved Target Setting
• Easier to Reward Based on Performance
• Data to Make Informed Decisions
• “Success to the Successful”
19
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
What we Learned Along the Way
• Optimise Process before Automation
• Brains Before Tools – use data to help make decisions
• No Shortcuts – no solutioning
• Chose the right metrics
• Get the right people
• IT Support
• Resistance
• Groundhog Day
• Travel is not optional
• Its not easy but stick with it20
© 2012 Weatherford. All rights reserved.© 2012 Weatherford. All rights reserved.
Q&A
21