Save time, reduce risk and improve quality: How online accounting adds value


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Richard Fifield, Head of Outsourcing, Grant Sayer, Head of IT, Tenon Outsourcing

In this session, Tenon Outsourcing share their experience of implementing online accounting solutions and explain the benefits realised using case study examples.

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Save time, reduce risk and improve quality: How online accounting adds value

  1. 1. Save time, reduce risk and improve quality: “How online accounting adds value” TENON OUTSOURCING Presented by Grant Sayer National Operations and Technical Director 14 October 2009
  2. 2. Agenda Introduction Tenon plc Tenon Outsourcing Tenon experience [and wisdom] of delivering online accounting solutions Online solution for accountants [ITIO – “Case Study”] Adding value - Save time, reduce risk and improve quality SALT – “Client Experience” [Video] Conclusions Questions & Answers
  3. 3. Tenon plc Turnover £m PBTA £m Underlying values, year to 30 June: 2004 80.5 6.4 2005 100.5 7.9 AIM Listed (Ticker:TNO) 2006 122.9 10.3 Top 10 accountancy and business services provider 2007 136.7 12.3 2008 160.0 16.0 Over 1800 employees, Over 40 offices 2009 151.0 18.0 Current run rate turnover c£151m Purpose “Top quality financial, taxation and business advice to make our clients more wealthy” Key service lines Business Tax & Advice Business Tax & Audit & Accounts Advice Accounts & Financial Services & Specialist tax Audit Outsourcing Corporate Finance Corporate Finance Outsourcing Turnaround & Recovery Turnaround & Our clients Recovery FS & Specialist Self-made men and women Tax Growing businesses Funders to these businesses 30,000 clients, 10,000 corporates
  4. 4. Geographical reach (UK) 1. Aberdeen 23.Leicester 2. Bacup 24.London Baker Street 3. Basingstoke 25.London Chiltern Street 4. Birmingham 26.London Finsbury Circus 5. Bolton 27.London Tavistock Place 6. Boston 28. Manchester 7. Bournemouth 29.Melton 8. Brighton 30.Middlesbrough 9. Chelmsford 31.Nottingham 10. Chorley 32.Perth 11. Doncaster 33.Portsmouth 12. Edinburgh 34.Preston 13. Glasgow 35.Reading 14. Grangemouth 36.Rochdale 15. Grimsby 37.Sheffield 16. Harrogate 38.Southampton 17. Hull 30.Southend on Sea 18. Inkberrow 40.Sunderland 19. Inverness 41. Wakefield 20. Isle of Man 42. Windsor 21. Kendal 43. Worcester 22. Leeds 44. York
  5. 5. About Tenon Outsourcing Tenon Outsourcing (TO) ranks as one of the leading outsourcing providers outside the “Big 4” and sources Financial and HR solutions for businesses, ranging from owner-manager firms across the UK, through to global corporations. TO offers a unique combination of locally delivered services, backed up by national and international expertise and experience. This capability enables TO to deliver high-quality yet cost-effective solutions. A leading provider of finance, accounting & human resource outsourcing solutions to “entrepreneurial” businesses Range from OMBs to ‘blue chip’, listed and International Mission: to reduce risk, improve performance… at best price Turnover - c£10m, People - 170 Clients - 1600 (c500 “full” outsourcing clients) Hosted accounting systems NOA Award Winner Strategy to build a 20 million business as soon as we can
  6. 6. International Links Strong international links and offering 10 years of experience, helping companies move into Europe 3 brands for dealing with Internationals…. Morison International
  7. 7. Pain in time turns to Wisdom 2005 was about how do we build a ‘proper’ outsourcing business > 4 Building blocks > Excellence of solutions > Excellence of delivery > Excellence of sales and marketing > Excellence of technology – The future was ASP, Hosted, SaaS, in cloud > Benefits > Cost benefit to both us and the client > Efficiency benefit > Risk benefit [Resilience]
  8. 8. The path to wisdom > 2000 – Microsoft Dynamics GP hosted internally > 2006 – SAGE [Hosted with ITIO] > 2006 – SAGE [Proof of Concept] > 2007 – Microsoft [SaaS] in conjunction with SERVO > 2007 – Netsuite Business Partner > 2007 – Online Web Expenses > 2008 – Online Timesheet Pay & Bill > 2009 – Online HR solution > 2009 – Online Payroll services [Self service, ePayslips] > 2009 – Review of e-conomic, Xero, Dynamics AX, Aqilla + others. > 2009 – Franchise, Recruitment, VC, International + other tailored vertical solutions > Year 2010 – More vertical solutions, including unified communications [CRM, Mobile and email]
  9. 9. Wisdom > Hosted model is here to stay > Demand is increasing – culture of ‘plug and play’ > We need to remain close to our clients > Clients want choice as to what elements to outsource > Technology is key in driving out cost and streamlining business processors > The price of accounting and other infrastructure is becoming immaterial > Contractual elements remain vague > Bureau licensing > Sharing risk > Liability clauses > Data protection > Pricing and service elements need to be transparent to clients
  10. 10. Wisdom > Technology drives changes in our working practices > Still a resistance to change > Services are increasingly interlinked > Requires skills to connect applications together > We need to offer solutions at different levels, one size does not fit all > Solutions need to be tailored to specific vertical markets and provide an end-to-end solution > Many new entrants [Need resource to evaluate] > Stay strong, be clear on your strategy [Remember, functionality over form]
  11. 11. Wisdom - Restructuring to deliver online services >Consolidation of process centres >National Framework for quality control >Specialisation of tasks and process >Product / vertical market development >Academy training >Sourcing technology partners >Focus on technology and integration >Simple messaging and structured marketing campaigns >Develop channel (eg. REC, BFA)
  12. 12. Wisdom - Simple communication HR •Tenon Employer Protect Web Expenses •Staff Portal Core Service Payroll Timesheet •Self Service •ePayslips Pay & Bill Finance •Sage •E-conomic •Netsuite •Dynamics GP
  13. 13. Wisdom – right partner for the right vertical > Microsoft [Client experience to come] > Our experience of ITIO > ITIO [Sage – smaller client] > Case study by Rob Lambden [Delivering services to accounting practices]
  14. 14. Recap – save time, reduce risk, improve quality, best price “We need to match our offering to the clients needs and ROI requirement” Clients focus: > we must find ways to increase revenues” > “we must continue to control and reduce costs” > “we must identify, understand and reduce risk” > “we must find better ways to support business change” > “we must improve service levels” > “we must get better value from our finance and HR function”
  15. 15. The business case for an Online solution 1. Build base case components - Understand business issues/strategy - Cost today and tomorrow - People - cost, sick, hols etc - Composite skills requirements Strong methodologies (devil in detail) - Technology - Space etc Document processes Compare apples and apples
  16. 16. Working up a business case 2. Highlight barriers and agree solutions 3. Design best technology and delivery solution 4. Specify the services Table of responsibilities 5. Create a pricing model Predictability, variability, scalability Pricing structure Per head/division Volume 6. Final business case prepared 7. All of this culminates in the best solution, with the best service delivery team to back it up.
  17. 17. SALT video > Tenon, Microsoft, Servo – Client case study
  18. 18. SALT – Key messages Started in 2003 – 1st year Turnover = £600k & 8 employees 2009 Turnover = c£2.2m & 25 employees > Owner manager time saved > Access to a breadth of expertise > Systems that grow with you > Big business solution – small business cost > Saving on high cost of investment in accounting systems > Low cost hosting solution – gives security of data > Local & Global – access anywhere in the world > Helps owner manager drive value into the business > A Perfect Partnership!
  19. 19. Conclusion…more or less pain? > We believe online proposition adds value….and so do our clients [eg. SALT] > Time, risk, quality……..quantifiable ROI > The online community will get stronger, broader and cheaper….the differentiator will be those who can glue the applications together > Google, Microsoft, SalesForce, Oracle, SAP, IBM,…will drive change… we really care? > We all need a differentiator……Tenon’s is adding in specific financial [Tax, Financial services and Compliance] outsourcing products into the mix > We all need a friend…..partnerships and alliance are key
  20. 20. Proof Outsourcing ‘can’ be more Cost Efficient Model based on a company with £2m turnover with 10 staff In-house Accounts Costs Outsourcing Costs Bookkeeper / Annual fee (based on £28,000 £25,800 Accountant £2,150 per month) ERS NI (12.8%) £3,584 Pension (3%) £840 Management Time £3,500 Training - systems £350 Plus SSP, SMP, Remote access (1 admin, software, £5,000 £1,250 user) hardware Recruitment costs £7,000 Set up fee** £2,100 (25%)** Total annual savings TOTAL – TOTAL – one off £ 7,000 of £13,524 £2,100 annum per one off TOTAL - ongoing £40,924 pa TOTAL - ongoing £27,400 pa
  21. 21. Questions