How we reduced month-end turnaround time from 5 days to 2 days
For most firms, outsourcing is merely a strategy to cut costs and improve operational efficiency. However, the most overlooked aspect of outsourcing is that it gives companies access to a highly-talented set of individuals and ensures industry best practices. At Sundaram Business Services, we cater to bookkeeping services such as Accounts Receivable, Accounts Payable, Bank recon and VAT computation. But when we receive a job from our client, we view it as more than just a transactional task and strive to go beyond the minimum requirement to add value to our clients.
Here’s how we helped our client reduce their month-end process turnaround time from 5 days to 2:
We operate an extended office model with the finance team at the property which primarily consists of the Director and the Assistant Director of Finance. They are in charge of handling approvals, strategic initiatives and a dedicated business process outsourced team of 20+ working out of India that handles all transactional work including payables, credit control, income, audit, month-end activities and monitoring the accessing systems of the property in a secure manner.
Our 8 years of engagement with the client in Sydney commenced with our transitional team conducting due diligence on a property in the Maldives and creating a knowledge repository of the finance and accounting processes. We conducted the same process in Sydney without visiting the property in person.
Our client is an upscale 5-star property based in Sydney with a global presence in over 1000 hotels around the world. Sundaram Business Services offers the client numerous services that can be broken down between:
1. Reservation, which includes:
- Sorting and validation of bookings
- Data analysis
- Document management
- Query management
2. Chief Financial Officer services, which includes:
- Accounts Payable
- Accounts Receivable
- Income audit
The problems faced by the client:
The client faced a number of problems with regards to their operations and the ability to complete processes in a timely and efficient manner. Following a summary of the key challenges they faced:
1. Managing existing vendors
The client faced a number of problems in running the business. They were unable to manage their existing vendors and coordinate with them on a daily basis to source the best deal while ensuring that there were no delays in customer service.
2. Month-end close
The month-end close is an important task for the finance function and moreover, finalising the budget and the comparison of budgeted vs. actual figures can only be completed once the books have been closed. The delays in the month-end close affected the budget process as well.
When starting the reservation process for the client which included the components of wholesale, online booking, online travel agent, calls and deposit cheques, SBS noticed that there was a huge backlog in the Wholesale emails and this was affecting the day-to-day reservation process for the client.
Value added by Sundaram Business Services:
Once we had a clear understanding of the problems faced by the company, SBS went above and beyond the regular scope of work to ensure that the client’s processes were optimised and the team worked in a productive manner to complete the work on time.
1. Seamless management of remote vendors
The client had a hard time managing their 1500 vendors across the board from different parts of the world. SBS created an efficient process to manage all the vendors, allowing the client to focus on the core objectives of the business- building relationships with customers and other key players.
2. Reduction of book closure from 5 to 2 days:
The client faced issues with the month-end process which delayed the post-completion tasks such as budget comparisons. To overcome this problem, SBS worked towards reducing the book closure from 5 days to 2 days. They also maintained the credit recovery score at under 2% for the ageing bucket of 90+ days.
3. Cleared backlog of emails
The client had a huge backlog of emails, especially in their wholesale department. SBS put in additional effort to clear out the pending emails while maintaining high standards of customer service.
4. Built relationships with customers
Effective management of the bookers can have a significant impact on the hotel booking process. We developed and maintained a healthy relationship with the bookers because we understand that their requirements are key to maintaining a good relationship with the customers. SBS managed 300 bookers and over 100,000 bookings in a year for the client.
5. Decreased TAT by 50%
We understand that the customer’s needs always come first and aim to implement the client’s processes around this. We improved the process of addressing the client’s needs and ensured that the turnaround time was down to a consistent 24 hours. Prior to this, the time ranged from 2 days to a week depending on the flow of work.
6. Improvisation of processes
Metrics are important for every business as they help measure the success rate. We created efficient processes centred around certain metrics for visibility and seamless communication within the organisation. We implemented standard operating procedures and FMEA (Failure Mode and Effects Analysis), this is a Six Sigma-based structured approach for discovering potential failures.
7. Round-the-clock support
As always, we put our customer’s needs first and are very flexible with providing ‘after hours’ support along with a dedicated team in charge of managing the incoming audit functions of the property.
The client was very happy with the services provided. We put in place efficient processes and systems to successfully reduce our client’s month-end process turnaround time which helped improve overall productivity while putting the client at the centre.
To learn more about Sundaram Business Services and how we can support your organisation, visit sundarambizserv.com.