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2020 Deloitte Renewable Energy SeminarRenewables for a sustainable future SEPTEMBER 24, 2020
Isabelle Bordas, Partner, Deloitte & Touche LLPPatrick O’Regan, Manager, Deloitte & Touche LLPScott Rehns, Senior Manager, Deloitte & Touche LLP
Digital for finance: Digital
controllership
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 4
Digital Controllership opportunities
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 5
Automation lifecycle Risks occur during automation
development, testing, deployment, and operation
Business processRisks are present as business processes
are changed due to automationRisks are present in the structure,
committees, and roles & responsibilities for managing automation environments
Governance structure
Key components of a digital strategy
62020 Deloitte Renewable Energy Seminar
Future shift from physical to digital
Accounting Finance business partnering Touchless ecosystemFinance as a
service
Operational finance Business Finance Specialized Finance
Area in focus
Manual process
Disparate systems
Decentral ized organizat ion
Bookkeeping mind-set
Integrated systems
Lean processes
Opt ical character
recognit ion
Business partner ing mind-set
RPA and cognit ive
Mobi l i ty
Real -t ime sel f service
Blockchain
Adde
d Va
lue
Activity focus
Hin
dsig
htCo
nduc
t “re
ar-v
iew
m
irror
” as
sess
men
ts
Fore
sight
Und
erst
and
signa
ls to
sh
ape
the
futu
re
Insig
htU
se d
ata
to d
rive
chan
ges
Areas impacted due to digital transformation…
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 7
Intelligent automation spectrum
Robotic Process Automation is now widely adopted as 68% of organizations have begun to implement this technology
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 8
Organizations that typically implement automation across enterprise can potentially realize an estimated 10-30% of operational cost savings YoY
Organizations define automation ROI with a focus on both hard and soft benefits
While automation is often used to help organizations achieve cost reduction targets, organizations are also focusing on:
• Freeing up highly skilled resources to focus on activities that provide more value for the organization and reducing the time they spend on mundane manual tasks
• Increasing capacity and scalability of existing resources to handle current and future fluctuations in workload volume
• Reducing errors and improve controls
• Improving cycle times (speed)
24/7 Operations
x2-20 Operational Speed Turn-around-time and service speed improvement
QualityIncreases quality by reducing human errors and focusing on exceptions
AutomationBenefits
Cost Reduction
Capacity and Scalability
Refocusing Highly-Skilled People
Internal Control
Operational cost reduction through internal and third-party labor spend
Capacity can be rapidly increased without long build-up phase
Non-stop performance –no queues at peak
Employees do not waste capacity for routine tasks
Effective IA implementations can drive to positive ROI oftentimes within 6–18 months
Reducing human errors, easily performed central compliance checks with operational audit trial
Short Payback Period
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 9
What makes a strong automation candidate?
Capacity Creation
Increases the capacity of business unit measured in time (hours per year)
Process Quality Improvement
Improves reliability and quality of the process; reduces error rate
Cycle Time Improvement
Improves cycle time to complete tasks or processes
Customer Impact
Quantitative and qualitative impacts on GFS end-customers
Other Value Levers
Improvements to other value drivers (e.g., revenue generation, margin improvement, working capital improvement, asset efficiency, reducing audit risk, penalties, better data quality to drive effective decision making, customer complaints)
Data Integrity Degree to which input data is digital, structured, and standardized
Rule-Objectivity Degree to which discrete, non-judgment-based rules govern process completion
Process DeliveryNumber of hand-offs between GFS Business Units or number of hand-offs between different teams/employees
Process Scenarios
Number of exceptions associated with the process or number of ways process execution can error out
Process Simplicity
Number of discrete steps for process completion
Applications Number of applications used by the process
HIGH VALUE HIGH EASE OF IMPLEMENTATION
Low complexity automations are simpler to design, configure, and maintain
High value automations can potentially generate significant value to the business, including:
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 10
Intelligent Automation is helping organizations to realize a more centralized Controllership function that is user-friendly, touchless, and operates in real time – helping to improve operational performance, insightfulness, and risk intelligence across the enterprise
Automation opportunities across the traditional Accounting & Controllership functions
Capture Financial Datato GL
Analytics
ReportingManagement &
Statutory Reporting
• Order to Cash
• Purchase to Pay
• Manage Fixed Assets
• Research & Development
• Manage Inventory
• Plant, Equipment & Facilities
• Human Resources & Payroll
• Manage IT
• General Accounting
Validation
• Reconciliations• Re-Class Entries• IFRS/ International
accounting• Top side entries• Base Erosion & Profit
Shifting
Consolidations
• Intercompany
Eliminations
• Currency Valuation
• Accruals & Prepaids
• Allocations
• Chart of Accounts
Mapping• Fluctuation / Variances• Forecasting• Continuous Monitoring
CONSOLIDATED• Income statement• Balance sheet• Cash flows
Segment Reporting• Management
Discussion & Analysis• Footnotes• Disclosures
Regulatory & Convergence Standards
• IFRS• Revenue Recognition• Cash Flow Reporting
• Lease Accounting• XBRL• Base Erosion & Profit
Shifting
Financial Governance, Policy and Internal Controls
Process Transactions Close and Consolidate Report
GL
GL
GL
GL
GL
GL
Nor
th A
mer
ica,
Asia
-Pac
ific,
Eur
ope,
Afr
ica
&
Mid
dle
East
, Lat
in A
mer
ica
Entity Close
• Asset depreciation
• Revenue accounting
• Currency valuation
• IC Reconciliation
• Allocations
• Accruals
• Manual Postings
“Last Mile” of Finance
Public filingsAnnual
Quarterly MD&A
Earnings
Analyst presentations
Tax & regulatory reporting
Deloitte’s Controllership Continuum
Significant Automation opportunities exist across these core Close,
Consolidate, and Report functions
Accounting & Controllership automation opportunities
Process Area Opportunity
Month-end AccrualsAnalysts gather data from multiple sources, compile and perform calculations and validations on a spreadsheet, and develop accrual adjusting journal entries. Botscan perform the data gathering and accrual calculation activities, particularly for large, cumbersome accruals that are time sensitive during the period-end closeprocess.
Period-end Accounting Close and Consolidation
Analysts manually track and update close tasks list to manage and coordinate close activities. Analysts also manually track entity ledger submissions, perform edit checks and validations, and put data into spreadsheets to load into consolidation solution. Bots can be leveraged to introduce automation into many of the manual close and consolidation activities, including the significant volume of email communications to gather/share data and monitor close activities, providing improved end-to-end process visibility while also executing manual data gathering and calculation activities.
Management Reporting
Analysts gather data together into a spreadsheet or other reporting suites from multiple sources (GL, data warehouses, offline sources), clean data and fix discrepancies, and perform necessary calculations for trending and analysis. They then move data from spreadsheets to presentations complete with analysis and commentary to create periodic management reporting slide decks. Bots can streamline and automate this process, and also execute the overall management reporting process more frequently. There is significant value and opportunity even where Data Lakes and dashboarding tools are currently being utilized.
Intercompany Accounting
Intercompany accounting can be a very complex process, with many manual steps required to reconcile, price, and settle intercompany transactions even whensystems are used to manage intercompany transactions. Bots can be used to drive a more consistent and timely process across Intercompany Pricing,Intercompany Data Management, Transaction Management, Netting & Settlement, and Reconciliation & Elimination.
Account Reconciliation An analyst pulls data from ERP, extracts it into an spreadsheet, and reconciles beginning and ending balances with monthly transaction data to internal (sub-ledger) or external (bank statement) sources. Completed reconciliations are reviewed and approved and uploaded to Account Reconciliation tool. Bots can be used to prepare initial a monthly reconciliation spreadsheets, perform reconciliations, upload to account reconciliation tool, and manage/monitor reconciliation processcompletion.
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 13
Strategy development
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 14
While there are lots of moving parts in running a successful automation initiative, Deloitte has found there are four key aspects of the program that can drive true achievement of transformation through automation.
Transforming through automation
2. Identifying a “healthy” list of processes that are solid
candidates for gaining value from automation
3. Implementing a factory-centric capability for
development (expertise, flexible capacity)
4. Extending from RPA into more advanced digital
capabilities (Cognitive, AI, Blockchain, Data Science, etc.)
1. Running an automation program, not just building
“bots”
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 15
Every automation effort should have a multi-disciplinary journey that focuses on aligning the processes, tools, and people with new ways of technology-enabled working. We recommend tackling this dynamic journey through the combination of a strong program foundation, a scalable technology infrastructure, and a clear roadmap and business case.
Components to launching the automation journey
Stand-Up
PrepareB
A
Core Automation Journey ComponentsStand-up Creation of Automation Program Vision and design principles
High-level operating model
Stakeholder socialization
CoE Design
A
PilotD
Scale & SupportE
Prioritizec
B
C
Pilot Develop and Deploy Design for automation
Build, test, & deploy
Value capture and adoption
CoE RefinementPlan, Support, and Scale
Operate CoE
Execute Ongoing Development Factory
Support & Ongoing Maintenance
Train and Develop Capabilities
E
D
PrioritizeDefinition of the Business Case Process identification & evaluation
Process prioritization
Implementation options
Roadmap and business case
PrepareArchitecture & Infrastructure Vendor selection
Infrastructure and tech readiness
Licensing and solution architecture
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 16
We believe the following guiding principles are critical to help shaping an organization’s automation agenda as you move forward:
Intelligent automation program guiding principles
Select the right operating model for your automation journey
Build the right processes and methodology to ensure consistent delivery
Staff automation CoE with the right skills and involve all relevant stakeholders to ensure success
Identify the right opportunities for automation
Monitor, track, and capture value during the automation journey
Automation program strategy is closely tied to operating model, requiring careful consideration of tradeoffs and scalability
Select the right program operating model for automation journey
17
Function 3
Function 2
Function 1
IA IA
IA Governance
Function 1 Function 2 Function 2
IA Center of Excellence
• Decentralized approach allows groups to fail fast, learn fast and achieve quick wins, at the cost of inefficiency at scale
• Functions identify, design, deploy, and manage highest-value automations
• Function-specific IA Governance and Program Management
• No centralized IA governance, infrastructure, or maintenance support
• Hybrid approach provides the benefits of standardization while still enabling functional ownership of bots
• Functions identify and define highest-value automations while leveraging a shared technical pool for development and support
• IA policies and governance approach standardized across functions
• Effective balance between centralized and decentralized model
• Greatest degree of control
• Functions may identify processes, but CoEtypically manages design, deployment, andmaintenance of automations
• Requires cross functional buy in on prioritization of work rules
• Decreased flexibility to adjust to specific functional needs
• IA guiding principles span multiple functions and infrastructure is shared
F EDERAT ED/ H Y B R I DDEC EN T RAL I Z ED C EN T RAL I Z ED
IA Governance
Function 1
IA
Function 2
IA
Function 3
IA
Often the fastest means of implementingdiscrete, function-specific automations
Lacks scalability required for end-to-end, industrialized automations
Standardization of policy, procedure and and governance.Ability to foster engagement and support of functional areas.
Coordination challenges and resource requirements from functions
Scalability enables Industrialized IA, but also suitable for addressing discrete automation plays
Often involves additional investmentrequiring high value creation
IAO
PER
AT
ING
M
OD
E L
PR
OG
RA
M
STR
ATE
GY
IM
PA
CT
Analyze Implement OperateEstablish IA Strategy, Identify Processes, and
Define Operating Model
Determine roadmap of
processes in Establish
Determine alignment with IA
software operational operating
vendor(s) excellence model
Design Architecture, Build Automations, Test for Accuracy, and Initiate Hypercare
Implement Scale developmentsinitial process
Monitor and Report on Bots Metrics, Establish Transition Plan, and Implement Improvements
Review andenhance operating OptimizeIA
model to througheffectively manage monitoring IA
at scale
Mobilizeorganization
Establish IA strategy in coordination with operationaland technology initiatives
Define governance and operating model
Select vendor(s) to meet IA aspirations acrossthe Automation & AI spectrum (RPA, IA, AI)
Select the right processes that deliver business case value
Recognize steep learning curve from pilot phase
Scale implementations in an exponential manner
Measure outcomes vs. original business cases and challenge pipeline of processes
Capitalize on the insights IA is providing (digital exhaust)
Embrace agile methodologies and recognize R&IA is meant to be more nimble than traditional technology
Continued business and technologycoordination at alllevels
Address change management impactand opportunities
Organizations generally approach their IA programs over a three-phase journey (Analyze, Implement, and Operate) to develop program capabilities and establish effective processes and methodologies across the end-to-end IA lifecycle
Establish suitable processes and methodology to ensure consistent delivery
18
AnalyzeEstablish IA Strategy, Identify Processes, and
Define Operating Model
ImplementDesign Architecture, Build Automations, Test for
Accuracy, and Initiate Hypercare
OperateMonitor and Report on Bots Metrics, Establish Transition Plan, and Implement Improvements
Staffing CoEs with the right skills and involving critical stakeholders to ensure success
Identifying and staffing the right roles is imperative for the success of an automation program.
Auto
mat
ion
Life
cycl
eEx
ecut
ion
Role
sPr
ogra
m E
nabl
ersa
ndRo
les
• Demand and Intake Lead • Automation Architect
• Automation Developer/Lead
• Automation Analyst
• Automation Tester
• PM and Value Tracking Lead
• Operate/Service Manager
• Automation Controller
• Automation Support
Strategy and ProgramManagement
Program Director PM and Value Tracking Analyst
Technology Management
Vendor Management Lead Infrastructure Lead Infrastructure License Analyst
Risk, Compliance, and Standards
19
Automation Tech Lead Risk and Compliance Lead Information Security Lead
Org and Change Management
HR Lead Change, Training, and Comm. Analyst
Identify the right opportunities for automation
20
As automation ideas surface, a systematic approach toward opportunity evaluation, prioritization, and selection is critical
Identifying IA Process Opportunities Steps of Execution
Process for IA Implementation
Step 3: Prioritize based on Business Case Framework
Step 2: Apply Suitability Criteria Framework
Step 1: Identify Potential Process Candidates (large
volume)
Step 1
Gather process information and assess initial process candidates for IA adoption
Process owners identify initial set of processes – this will include:- Optimal processes, candidate processes, and outliers
Collect information about identified processes and relevant system information
Conduct working sessions with process owners to understand key process metrics
Step 2
Prioritize processes based on Suitability and Business Case Framework
Shortlist processes by adopting Suitability Assessment framework
Apply IA Business Case framework to categorize processes as automation candidates
Regroup with process owners and align on selection criteria and prioritized processes
Step 3
Redesign prioritized processes and socialize results
Conduct workshops to review and redesign process candidates for IA adoption
Document process future-state and recommendedenhancements
Socialize benefit (value and savings) according to business case
SupplyChainMDM
HRFinance
Monitor, track, and capture value during the automation journey
21
Post deployment of automation, it is imperative to have a process in place to monitor and sustain them to ensure ongoing benefit realization and tracking
Automation Maintenance
Process Insights& Improvement
Bot Stabilization and MonitoringSchedule automation processes in the production environment and ensureexceptions are routedappropriately
Automation SupportNon-discretionary maintenance of automationsincluding the resolution of incidents (“break-fix”maintenance) and incident management
Enhancements and ChangesManagement of the automation hosting platform including installation, configuration, and testing of releases andlicenses
Automation Software MaintenanceStandard processes and methods for efficient handling of all changes to reduce the impact of change-related incidents
Functional Process SupportEvaluation of business rules logic,assess process designs, and review scalability and performance of digital workforce, regardless of volume levels
Reporting & InsightsReport and visual dashboards generation utilizing data output from automations to improve business outcomes andautomation performance
Digital Process EnhancementCognitive capabilities identification in process improvement for upstream and downstream enhancements impactedby automations
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 22
In our experience, companies that focus on bot development alone are often unable to achieve the results they seek; true value and impact are driven by defining the right operating model and effectively managing the process, operations, and employees that are tied to the automation
It’s not just about bot development
Barrier to Realizing
Value
Value
Improved Quality & Accuracy
Resource Shift To Higher Value Work
Efficiency
Automation
Governance
Building a Business Case Ongoing Support
Operating Model
Change Management
Key Decisions, Impacts, & Considerations
Bot Development
Only Approach
Leading Practice Approach to IA
Programs
Automation
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 24
Governance model and framework
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 25
2
Governance decision domain overviewEach governing body owns decision rights over specific governance domains
AUTOMATION GOVERNANCE
DOMAINS
Strategy & Program
Management
Intake & Prioritization
Org & Change
Management
Operations & Business Needs
Implementation
Risk, Compliance & Standards
Technology Management
Steering Committee
Service Management
Deployment Management
Executive Sponsor(s)
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 26
Automation (CoE) governance frameworkThe CoE should have a robust governance structure to address the financial and operational risks.
Robotics Governance Framework
1 Adherence to Risk, Compliance and Regulatory Boundaries Ensure assessment and deployment of bots adheres to risk and compliance limits
Conduct reviews and chart impact of bot deployment and necessary controls for monitoring
4 Bot Integration & Data Handling Maintain client confidentiality through data protection, and
privacy incident management
CI protocols as leading practices during and after RPA program
2 Define & Enforce Policies, Procedures and Controls Define comprehensive policies at global business & function-
specific levels
Operationalize policies into procedural documents to support the RPA program rollout
Document technical standards for security architecture & deployment
5 Maintenance and Upgrade Cycles As processes change due to regulation, introduction of new
systems, etc., the bots need to be maintained and reprogrammed
A mechanism should be put in place to ensure changes are monitored proactively and change management processes are followed
3 Active Trigger Monitoring & Reporting Define a monitoring structure for the portfolio of bots that are to be
deployed
Setup triggers to alert deviated bot behavior along with performance indicators and reporting processes
2020 Deloitte Renewable Energy SeminarCopyright © 2020 Deloitte Development LLC. All rights reserved. 28
Connect with us
Isabelle BordasPartnerDeloitte & Touche [email protected]
Patrick O’ReganManagerDeloitte & Touche [email protected]
Scott RehnsSenior ManagerDeloitte & Touche [email protected]
This communication contains general information only, and none of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms or their related entities (collectively, the “Deloitte organization”) is, by means of this communication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser.
No representations, warranties or undertakings (express or implied) are given as to the accuracy or completeness of the information in this communication, and none of DTTL, its member firms, related entities, employees or agents shall be liable or responsible for any loss or damage whatsoever arising directly or indirectly in connection with any person relying on this communication. DTTL and each of its member firms, and their related entities, are legally separate and independent entities.
About DeloitteDeloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities (collectively, the “Deloitte organization”). DTTL (also referred to as “Deloitte Global”) and each of its member firms and related entities are legally separate and independent entities, which cannot obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each other. DTTL does not provide services to clients. Please see www.deloitte.com/about to learn more.
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