Gaining Insight into GSK’s Optimized Record to Report Process
GlaxoSmithKline (GSK) is a multinational pharmaceutical company headquartered in Brentford, London. In 2015, GSK became a Trintech customer and later established its Director of R2R Cadency GPO, Babak Naraghi— Trintech’s first-ever Cadency director. Before he stepped into this role, Naraghi gained a wealth of knowledge at GSK and Deloitte. We sat down with him to speak more about GSK’s financial transformation journey.
Trintech: Hi Babak, thank you for taking the time to speak with us today! We want to start by asking if you can tell us about your career progression to date and how you found yourself as the Director of Cadency at GSK?
Babak: I joined the tax department of GSK in 1997 as a tax analyst interested in process, technology and improvement. I eventually took the opportunity to work for Deloitte within their Tax Management Consulting (TMC) where I spent 6-7 years. During my time there, I realized I wanted to gain experience in wider finance and an opportunity arose to return to GSK to look after the Sarbanes Oxley (SOX) control environment which gave me the chance to really understand the whole end-to-end finance process in GSK.
As a result, I became very interested in finding out what goes wrong within our processes and making changes to improve them – which is what attracted me to R2R at GSK. For two years, most of my focus was working on trying to reduce the time required to complete the month-end close process. I was able to take a day-and-a-half out of our month-end calendar by streamlining our month-end activities. Throughout that time, we implemented the manual journal workflow and I was approached to assist with general stabilization and early life support activities, which is where I became close to Trintech and Cadency. Around six months ago, through this work, I had the opportunity to become the Cadency director. What really attracted me to this role was the potential to deploy two further modules of Cadency: Compliance and Close. Close is a very powerful tool to help us take charge and control of the month-end activities, identify bottlenecks and open a lot of opportunity for automation.
Trintech: That’s an interesting path back to GSK! We would love to hear more about GSK’s decision to deploy Cadency globally.
Babak: I wasn’t involved in the very beginning, but the drivers for implementation were to make the process more efficient and to make the activity of the finance person – be that partner or controller – easier. To do that, you need to provide them with the right tools and information.
The Cadency balance sheet reconciliation gives us a single place to view the health of the balance sheet, but we still have a long way to go to optimize our use of that data. Additionally, it takes time to embed and change people’s way of working. The Journal piece was brought in to give visibility and segregation of duty between preparers and approvers, mitigate risks, and standardize the way we add journals into SAP via a very friendly, useful tool.
Trintech: As owner of the R2R process, how would your role and activities differ without Cadency?
Babak: Well, it would take a significant amount of additional time to get the level of information that we can get within Cadency. Prior to deploying the solution, everything had to be done in spreadsheets. To create a dashboard or to get a KPI of how many journals had been done, you would need multiple reports from many SAP systems, figure out where they sat, who approved them, value of journal, etc. and all of this would all be in spreadsheet form. We still utilize spreadsheets based on reports from Cadency, but the benefit is that because of how it is set up, we simply have more information.
In regard to Close, we are in the early stages of month-end calendars each month to close out over 300 entities. Today, these month-end calendars differ for each entity. From this, we can see how many tasks we are carrying out globally and where these are similar but described differently or carried out at different times, for example. Our next step is to standardize these activities, so we have a single global calendar managed through Cadency Close. Cadency Close is still being delivered, but using it gives us a level of granularity which would be hard to manage in a spreadsheet, and we can gather reports on all this data. The true power of Cadency is the insight it provides.
Trintech: Looking at GSK as one of our clients the furthest down the R2R transformation journey, do you have any advice for customers in the beginning stages of their journey?
Babak: Yes! The tool should be seen as an enabler. Every company feels they’re unique and they should do things differently, but at the base of it, in Journal Entry, you have a preparer and an approver – use the tool how it’s designed, and it will help in the long run.
Also, stakeholder engagement is crucial. Users must be utilizing the tool and must understand how the tool is used to enhance their daily work. The way we work is changing and we are slowly moving away from looking at spreadsheets all day, moving to the Cloud, having more visibility & control, having a work/life balance, all of which is supported by us being able to access data from anywhere using these tools.
Trintech: With this new generation of accountants coming into your team, do you see a difference in expectations coming into the workplace and the tools they require?
Babak: Each summer we take on University placement students and every year I am impressed by their knowledge and understanding in regards to how they use technology and how that knowledge is so different to “old school accountants”. They are much savvier in understanding how a tool works and being able to pull data to spot patterns. But I do wonder… how do we ensure your new accountants still understand the fundamental process that these tools automate?
GSK’s financial transformation is just one example of the many that Trintech has helped organizations achieve. To learn more about how Cadency has impacted other companies’ processes, visit our Case Studies page.
Written by: Ashton Mathai