Expense Efficiency Framework

At the core of an efficiency program is Sponsorship and Leadership to ensure appropriate messaging, roles are clear, targets are aggressive yet attainable, and the program is managed consistently from Top of House.

• Maintain an intense focus on tangible financial results to foster a culture primarily focused on spend as well as savings.
• Relentlessly challenge the status quo, use innovation and fact-based analysis supported by rigorous and disciplined execution to eliminate waste and drive efficiency.
• Ensure business & support function ownership are established with appropriate accountability to achieve their targets.

Maintaining accountability across every business and support function

Assign category and business unit owners where intersections between the two have clear transparency, targets and communication.

Program management

Manage all aspects of the Program’s execution and ensure targeted results are delivered including tracking & validating the status of initiatives; maintain a central database of initiatives.

Improving culture to embed efficiency in the firm’s DNA

Create a culture of excellence & high performance, including exceptional and continually improving efficiency

Often, organizations have ad hoc demand management programs that result in poor communication and coordination between demand and supply decision-makers.  As a result, firms procure incorrect volumes compared against incorrect specifications.

• Embark on a rigorous and structured demand management program to ensure only that which is required is consumed (i.e., move from a culture of “want” to “need”)
• Ensure proper interactions and information sharing between consumers and Procurement to mitigate misaligned purchasing decisions
• Develop procedures to ensure Procurement has a seat at the table as it relates to business strategy and decision making.

A common financial language is necessary where the organization works with a standardized view of financials, targets, and success metrics.  Empower every part of the firm with actionable and accessible data to drive efficiency.

• Build and maintain the proper infrastructure to hold the firm accountable to approved budgets vs overriding plans with periodic reforecasting
• Create a common view and taxonomy of operating financials which dramatically improves cross-department collaboration and communication
• Design actionable analytics and metrics that are distributed across the firm and prevent log jams and bureaucracy in timely distribution of such data
• Managing operations via an FX neutral perspective, where applicable

Detailed budgeting that is not re-forecasted away

Rigorous budgeting taking into account run/exit-rates, new investments, efficiencies and inflation

Business management reporting

Define and design consistent financial management reporting across business units and support functions using a single business vocabulary to allow for improved transparency and effective collaboration.

Analytics and metrics

Empower businesses and support functions with timely, actionable data to drive efficiency, accurately measure financial outcomes, and reliably linking those outcomes to actions

Design and maintain a logical GL structure and hierarchy that aims to improve operational management of expenses.  Systems such as GL, Accounts Payable, and Wire Payments must be synchronized to avoid mis-posting.  Accruals and allocations must be up to date and properly maintained to accurately reflect expenses in each cost center of the organization.

• Revisit GL structure, hierarchy and account structure to improve design to better manage expense base
• Conduct reconciliation of account structure and mapping between GL, AP and Sub-Systems (e.g., Concur, Fieldglass, etc.)
• Review and revise expense accruals and allocations which are often outdated and inaccurate
• Review controls and policies for adds and changes of accounts in GL, AP, etc.
• Overcome technology barriers to sharing and reconciling data across systems.

Ensure GL is designed to support internal management of expenses (vs solely external reporting)

P&Ls of cost centers and businesses provide a detailed and appropriate level of visibility into expenses to better manage the business

Triangulate GL, AP and Sub-Systems

Systems are reconciled in a timely fashion and mapped accurately to prevent incorrect postings between GL, AP and sub-systems.

Accruals and Allocations

Accruals and allocations are based on facts and reflect reality.  Intercompany allocations provide transparency into expenses vs a “single line bill” from support functions

Leverage category systems to harness untapped data and metrics that are often difficult to access and interpret. Eliminate bureaucracy and friction from distributing actionable demand management data to consumers of expense across the firm.

• Every expense category has associated systems to manage costs and workflows. However, valuable metrics and data are not readily available or presented in a manner for consumers of expense to directly manage demand.
• Democratize category subsystems to make data more readily available to the organization.
• Dramatically expand the availability of cost drivers for those closest to the expense to take action on their expense base.

Every category of expense must be managed by an expense expert who is accountable for driving efficiencies across the organization and coordinating with Business Unit Owners (BUO) to drive efficiencies into each business and support function.

• Embark on a rigorous and structured demand management program to ensure only that which is required is consumed (i.e., move from a culture of “want” to “need”
• Ensure proper interactions and information sharing between consumers and Procurement will mitigate misaligned purchasing decisions
• Develop procedures to ensure Procurement has a seat at the table as it relates to business strategy and decision making

Although every company has a unique culture as it relates to expense policies, approvals, and processing, it is critical that the firm ensures a proper balance between controls and unproductive bureaucracy.  If not in balance, unnecessary frustration, wasted time, and negative sentiment of expense management will impact participation of every individual within an organization.

• Revisit expense policies to ensure that they are current, applicable and appropriate.  Validate the policies are adhered to
• Review approval processes, number of approvers per expense and avoid unnecessary loops and queues
• Streamline on and offboarding procedures
• Implement signature and automation technologies to streamline review and approval processes
• Review Procure to Pay / Requisition to Retire workflows

Expense Policies

Expense policies are critical to maintaining efficiency across the entire organization.  In addition to ensuring policies are appropriate and consistent across the firm, policies should also be benchmarked to competitors.

Expense Approvals

In many firms, the number of approvers even for simply requests is completely inappropriate (e.g., 10 levels of approvals for simply purchases such as office supplies. 

Expense Processing

Are the correct level of user profiles and approval systems in place so such processes as on/offboarding, P2P and R2R are effectively and efficient?

It is critical to measure how the organization is performing vis-a-vis its peers.  In Financial Services, firms measure themselves against metrics such as efficiency ratios.  Sia maintains a database of efficiency ratios across FIs including reported and adjusted (for non-operating costs) views.

• At the highest level, comparing efficiency ratios of similarly situated firms assist to identify the $ gap between our clients and your  most efficient Peers
• We assist to measure gaps and develop/vet efficiency ratio targets that often are externally communicated and monitored.

Overall Assessment

• Determine the current state as it relates to any of the 8 pillars of efficiency management.
• Sia Partners conducts a detailed assessment to identify where areas of improvement exist in terms of governance, expense expertise coverage, reporting, accounting, utilization of expense systems, and other components of the pillars.
• Typically, a three-month assessment will result in specific areas of improvement to ensure the organization has the capabilities and culture to maximize and maintain cost efficiencies.

Pillar Specific Engagements

• Sia Partners can assist with any component of the pillars including category-specific expertise to help identify and execute specific efficiency initiatives. 
• We have seasoned category experts in Real Estate, IT, Contingent Labor, Transaction Costs (in capital markets), Market Data, Legal and more.

Efficiency Driven Solutions

• Leveraging Sia Partners’ experience in numerous efficiency-related solutions, we can address specific opportunities to reduce costs while maintaining effectiveness and productivity.

In addition to addressing category-specific efficiency opportunities and organizational competency in efficiency management, Sia Partners provides numerous efficiency and productivity programs across a vast array of disciplines.

“Tooth to tail” business activity validation

From the front to the back office to support functions, we validate exactly what activities take place to support a business and identify functions, jobs and activities that are no longer required to support the business and its strategy.

Robotic process automation (RPA)

Sia Partners' expertise in identifying RPA-appropriate workflows and implementing RPA will improve productivity and release resources to more value-add activities.

Procurement optimization

Sia Partners Procurement experts complement current Procurement teams to help benchmark suppliers, drive vendor negotiations and better incorporate demand.

Data management optimization

Bad data leads to bad decisions. Sia Partners Data Management experts can identify ways to leverage better data processing to make smarter business decisions.

Workforce strategy

Sia Partners has extensive experience in resource & location implementations across numerous domains and Leverage Sia’s partnership with outsourcing provider FTP to provide an end-to-end R&L solution.

Call center optimization

Within the Contact Center and Client Service Practice we perform an extensive front-to-back assessment of your current state contact center inclusive of each function within the contact centers along with the processes behind recruiting people, KPI's and metrics, staffing assessment, financial assessment, quality assurance programs, technology, infrastructure, training, etc.

Technology infrastructure optimization

Sia Partners’ expert capabilities extend to the technology infrastructure and can improve efficiency of IT systems, consolidate entity-wide IT efforts and remove redundancies. Sia can help identify the right technology to invest in and remove dependency on legacy / obsolete systems.

Authorization for expenditure transformation

Through process design, business process management, and automation, we can simplify your workflows, accelerate creation & approval time, and improve budget forecast accuracy.

Operations & straight through processing

Sia Partners’ process optimization capabilities can help integrate APIs and automate KPI tracking. Sia is experienced in re-assessing business lines and entity-wide structure in order to eliminate unnecessary tasks and streamline entity-wide workflow processes.

Billing assessment

Identify and prevent lost revenue via an end-to-end forensic review and re-engineering of billing processing, accounting and management.  Streamline billing systems, improve straight-through processing and eliminate manual errors leading to accurate billing and improved client satisfaction.