United States

Revamped financial processes mean high-impact improvements for medical care foundation

CASE STUDY  | 

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An industry-leading medical care, quality and information management firm was plagued by multiple disjointed processes in their financial accounting department. The problems stemmed from non-standardized processes, ineffective configuration of their Deltek Costpoint® accounting system and lack of system training.

Manual reporting processes contributed to the problem, leading to an extended month-end close cycle, with hours spent on data validation. Additionally, business units had highly customized reports, making report standardization and rapid report generation difficult or impossible. Inefficient accounting processes and lack of system training resulted in manual workarounds and limited automation. The accounting and reporting structure was overly complex with numerous account, project and organization codes (three to four times industry norms), leading to an increased risk of error. To compound the problem, most of the finance leadership team had fewer than 18 months with the company.

Together, these issues resulted in inconsistent report processing procedures across the business units, immature financial processes, key-person syndrome in many areas and financial reporting that missed the mark for business unit leaders.

Solution

The chief financial officer and controller envisioned a higher performing financial accounting and reporting organization and gained agreement from the executive leadership team on how to close their performance gaps. They asked RSM to partner with them to create sustainable change and improve the efficiency and effectiveness of the financial processes.

Approach

RSM assembled a team experienced in: 1) project management, 2) financial process reengineering, and 3) system and functional knowledge of the accounting system. Combining system experts with financial accounting process design consultants allowed RSM to maximize best practices related to Costpoint’s automated features.

The team used a two-phased approach:

  1. Diagnostic assessment
    The team performed a diagnostic of the system and key processes, and interviewed management and other key personnel to identify and validate performance gaps. Project priorities were restructured based on these findings.
  2. Financial restructure
    The outcomes of the diagnostic and leadership team interviews drove the improvement strategy. Priorities emphasized shortcomings within the financial accounting department, specifically:
    • Simplifying reporting to improve decision-making
      and transparency
    • Streamlining the structure of accounts, projects and organizations within Costpoint
    • Reducing risk and manual data entry by adding
      three Costpoint pre-processors to automate the
      data feed between the accounting, payroll and timekeeping systems
    • Reviewing key financial processes and recommending improvements for executive approval and training additional members of the finance team and the business units

Outcomes

By collaborating with our client, RSM helped deliver:

  • Alignment: Obtained management buy-in regarding project prioritization and the leadership needed to 1) improve the company’s financial accounting process and reporting maturity, and 2) manage and effectively implement changes across multiple departments.
  • Project management: Created a financial restructure project team, cross-business unit task force and project roadmap to guide the project and the resources to success—on time and within budget.
  • Structure: Simplified the financial structure of accounts, organizations and projects by more than 50 percent, which improved the month-end consolidation processes.
  • Automation: Automated the data feed between the accounting, timekeeping and payroll systems, which reduced manual data entry and improved reporting processes.
  • Process efficiencies: Facilitated cross-functional workshops to document inefficiencies and process gaps, quantified the effects of change, documented and proposed future state processes in line with best practices.
  • User knowledge: Increased knowledge of tools, best practices and functionality of the Costpoint system among users through a mix of hands-on training sessions with Costpoint experts and instructor-based workshops. Secondly, reduced “key-person syndrome” through cross-training and updating process documentation.
  • Business analytics: Standardized financial analysts’ processes through reengineering, while creating a collaborative, cross-functional customer focus and reducing manual data-entry. Business unit customers now view analysts as value-added partners.
  • Cash disbursements: In collaboration with the A/P and purchasing teams, documented and streamlined the cash disbursement process by: 1) eliminating unnecessary approvals and check-points, 2) reducing the number of weekly check runs by 60 percent, 3) developing a process to accurately capture vendor terms and use system-generated due dates for invoice payments, and 4) expediting processing by introducing best practices and new corporate purchasing policies.
  • Financial reporting: Identified and catalogued current financial reports, their strengths and weaknesses and requested user-based improvements. Based on best practices, RSM designed new consolidated reporting packages for executive leadership, management and financial analysts. The financial and management reports were systematically produced, meaningful and provided more timely insights to improve decision-making ability. Other benefits included having ‘one version of the truth,’ drill-down capabilities, web-based delivery and a reduced risk of errors.

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