Finance on the right track
ICTRA, short for ICT for Rail, is a division of the NMBS/SNCB Group (Belgian Railways). Nathalie Demeere, Finance Transformation Manager at Deloitte, explains how in 2008-2009 ICTRA embarked on a substantial finance transformation programme to improve its business performance management, so when she did the Executive Master Class in Controllership at Vlerick, she chose this as the subject of her in-company project and dissertation.
Operating as a shared services centre, ICTRA provides ICT and telecommunications services to the rest of the SNCB Group. The increasing liberalisation of the transport sector puts pressure on the SNCB to continually improve its efficiency. And although ICTRA is a preferred supplier to the Group’s business units, it is not immune to this pressure.
Nathalie Demeere: “Its perceived efficiency left a lot to be desired. The business units questioned ICTRA’s services as well as its transfer pricing mechanism.”
What were the challenges?
To become a respected and trusted business partner, ICTRA launched a finance transformation programme that would address the major challenges they faced. “Some of the issues they wanted to tackle included the lack of alignment between the business and the IT shared service centre, unclear and inadequate costing models, a cumbersome and inefficient budgeting process, simplistic and inadequate costing models, a financially immature organisation, and unclear roles and responsibilities,” explains Nathalie.
The programme was led by ICTRA Finance (CFO) with the close involvement of the CIO.
Transformation to success
While the programme focused on the increased alignment between business and finance, the product/service catalogue, the service costing and transfer pricing mechanism, and redesign of the planning & budgeting process, it also addressed other areas of performance management: ICTRA aligned its services with the strategic requirements of the business, established service definitions and service-level agreements to meet business performance targets and developed better monitoring and reporting tools. It also changed its organisational structure, software systems and data architecture to support its new processes.
“Improved efficiency, quality and transparency” is the result of this integrated approach, according to Nathalie. “And thanks to clear-cut roles and responsibilities, there’s an increased sense of ownership and accountability. ICTRA has become a more financially mature organisation.”
The finance transformation went hand in hand with a structured change management (directly – through the change management programme – and indirectly – by choosing the right management accounting control systems & rules). It was instrumental in this change process, by fostering the adoption of new management practices. Looking back, Nathalie believes this is why the transformation has also led to a radical cultural change. “This change wasn’t forced, which has definitely contributed to the success of the programme. In the process, the finance and operational IT teams have developed a strong relationship of mutual trust, working together as one professional team. As a result, ICTRA has gained credibility with the business units of SNCB.” Although the transformation is still ongoing, Nathalie believes that a solid base has been laid.