hilton case study creating a best in class sso example to ...accounts receivable . 12 hotels...

Hilton Case Study Creating a Best in Class SSO Example to Roll Out Globally

Neil Patmore Senior Regional Director of Finance – Australasia 17th June, 2016

© 2016 Hilton Worldwide Confidential and Proprietary 1

MEASURING

Six Pillars of Finance

CONTROLLING SAFEGUARDING RESOURCING MANAGING GROWING

...........to provide timely and

accurate financial information to be

used as a basis for performance

assessment of the business...........

...........to adhere to Company

policies, procedures and internal

controls in order to promote

efficiency and protect the

business...........

...........to ensure that Statutory,

Taxation and Legal compliance is

maintained thereby protecting the

hotel assets and future profit

streams of the business...........

...........influencing stakeholders

with financial guidance and

commercial direction to actively

drive the performance of the

business...........

...........to lead our partners through

strategic planning and

entrepreneurial activities that

continuously develop the

business...........

...........identifying, attracting,

developing and retaining the right

people in the right place at the right

time to operate the business...........

© 2016 Hilton Worldwide Confidential and Proprietary

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

Measuring Controlling Safeguarding Managing Growing Resourcing

Time Spent by DOF’s

Only 34% of the DOF’s day is spent in the areas of Managing, Growing and

Resourcing the Business


Strategic Direction

To provide a working Environment which improves our DOF’s ability to Partner the Business by

ensuring that they have the capacity to allow them to move further to the Right of the Six Pillars of

Finance thereby providing greater Opportunity to Add Value to the Operation.

Goals


Standardise the transactional processes within the Hotel’s Back Office Function. Centralise and standardise the internal control requirements thereby removing the need of the Hotel DOF’s to monitor or implement any control changes

Remove the transactional paper flow from the business and replicate this in a standard electronic work flow that can be accessed anywhere, anytime, thereby giving the additional benefit of ‘plug and play’ for new Hotels

Build capability and knowledge within the larger available resource thereby creating greater flexibility, coverage and personal development within the Finance Community.

Rev

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Im

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ent

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Key Milestones


Rev

iew

Im

plem

ent

Gro

w 1. Review the current transactional processes across a broad range of hotels for all tasks

completed within the finance environment. 2. Document standard work flows for all tasks and subtasks of the four main transactional

sub-functions being Income Audit, Accounts Receivable, Payroll and Accounts Payable. 3. Work in conjunction with Internal Audit to ensure that the standardised workflows meet the

current control environment as well as ensuring the system flexibility

1. Identify and source a suitable IT system that can accommodate the transactional needs of the business in an electronic format

2. Implement the agreed transactional work flows in an electronic format and ensure flexibility remains to continually review and improve the processes.

3. Identify a suitable storage solution ‘Cloud vs Local’

1. Review current resource and propose future requirements based on the ‘centralised’ requirements.

2. Identify suitable resource from existing Finance Team Members and recruit internally where possible.

3. Implement development plans for Centralised team members to ensure a broad knowledge base is encouraged and exists.


System Alignment – standardised requirements

Income Audit

Accounts Receivable Payroll Accounts

Payable Reporting /

Analysis

HLBFS / Essbase

OnQ AR OnQ Ops Audit

Ricoh / Laserfiche

Birch Street / Check

SUN – General Ledger

Meridian / Preceeda

Kronos / etivity

Document Management System - Doc Matrix


Australian Finance Headcount – 59 FTE (2013)

SYD 12.5 FTE

SEQ 12 FTE

WA 7 FTE

0

NT 10 FTE

FNQ 9 FTE

VIC 8.5 FTE


Current Status of Centralisation & Future Progress

12 Hotels Centralised by Nov 2014

Jan 2014

Jan 2015

Jan 2016

Mar 2016

Jan 2017

Income Audit

Accounts Receivable 12 Hotels Centralised by Nov 2014

Payroll

8 Hotels Centralised by Nov 2015

NT June 2016

Accounts Payable

WA, NT planned for completion by June 2016

7 Hotels Centralised by Jan 2016

CNS, BNE, VIC, WA, NT from Jun to Dec Reporting / General Ledger 1 Hotel Pilot from Nov 2015


Future Australian Finance Headcount – 48 FTE (11 FTE)

SYD 3

FTE

SEQ 3

FTE

WA 2

FTE

NT 2

FTE

FNQ 2

FTE

VIC 2

FTE

34 Income Audit

Accts Receivable

Payroll

Accts Payable

General Ledger


What have we achieved?

To provide a working Environment which improves our DOF’s ability to Partner the Business by

ensuring that they have the capacity to allow them to move further to the Right of the Six Pillars of

Finance thereby providing greater Opportunity to Add Value to the Operation.

Where are we now within Asia Pacific?

Currently, each region has been looking at centralisation strategies separately by country.

Australia – centralised 12 hotels IA, AR, 8 payroll, 7 AP, GL (trial ongoing) New Zealand – currently clustered AR (semi), AP (semi), Payroll (full) Japan – looking to roll out AR, Payroll (std HRIS EOY) and IA China – looking to roll out IA and AR to 3 hotels within Shanghai

Various systems are in place across the estate i.e. OnQ PM or Opera, BirchStreet, Check, HRIS/T&A, SUN There existed a requirement for a more focussed review and implementation process

Country centric shared service model covering all functions (Australia model) Regional hub with specific or specialised tasks (Memphis, FAAST model) Area hub with specific or specialised tasks (RMCC model) Mixed model i.e. onshore + offshore with specific or specialised tasks


Phase 1 – Site visits


Review of Income Audit processes covering OA process, daily tasks, reconciliations, reporting, document approvals – 1 day Review of AR processes covering direct bills, collections, allocations, reconciliations, daily tasks – 1 day Review of AP processes covering invoice processing, method/frequency of disbursements, supplier reconciliations, invoice approvals, PO system integration – 1 day Review of Payroll processes covering payroll processing and disbursements, reconciliations, deductions, statutory requirements – 0.75 day Review of GL processes covering daily tasks, reporting, reconciliations, analysis, tax compliance – 0.75 day Understand Hotel Finance manning structure, task distribution and labour cost for IA, AR, AP, Payroll and GL Review of IT systems, network speed and versions Interaction of each of the functions with operations

Phase 1 – Process Flows


Income Audit

Accounts Receivable

Payroll

Accounts Payable

General Ledger

1.Credit Approval

2.Direct Bill – City Ledger and TA

3.Direct Bill – F&B Coupons/Vouchers 4.Direct Bill – Concessionaires, Commissions

5.C&E Invoices

6.Weddings

7.Rebates

8.Under/Over Charge

9.High Balance Report

10.Advance Deposits

12.Refund of guest deposit/credits

11.Unidentified Deposits

13.Cheque Payments

14.Credit Card Reconciliation

15.Bill queries and CC queries

16.Team Member City Ledger

17.Credit Meeting

18.Bad Debt Provision

19.Payment Allocation

20.Pro-Forma Invoice

Phase 1 – Process Flows Differences


• Same Task • Same Country • Same City • Similar Hotel • Different Process

No of FTE in Hotel Transactional Team

11 vs 7

Take Aways


Don’t assume all your operations are following the same processes. Don’t under-estimate the change management required to ALL areas of the operation.

Do understand what the financial resource requirement in the operationa should look like post implementation.

Hilton Case Study Creating a Best in Class SSO Example to Roll Out Globally

Neil Patmore Senior Regional Director of Finance – Australasia 17th June, 2016

hilton case study creating a best in class sso example to ...accounts receivable . 12 hotels...

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