Purchase to Pay Automation at Nissan Europe
by Michael Brook, Finance Process Control Leader, Nissan Europe
Nissan Europe is a major subsidiary of the Nissan Motor Company, Ltd and is a key contributor to the company’s objective to achieve global market share of 8% and an 8% increase in operating profit by 2016. In addition to developing and distributing innovative and well-designed vehicles that meet customers’ needs, the company is committed to enhancing its internal processes to increase efficiency whilst also reducing costs wherever possible. This article outlines some of the initiatives that Nissan Europe is undertaking to achieve its financial process efficiency objectives, under the banner of the Finance Breakthrough Project, one of the first components of which has been purchase-to-pay.
The Finance Breakthrough Project
The Nissan Group is organised on a regional basis: Europe; Asia and the Americas. Within the European business, we operate in more than 20 countries. In the past, sales operations in each country have been managed relatively autonomously; in addition, we have three European production facilities in Sunderland, UK, Barcelona, Spain and St Petersburg, Russia. Consequently, the business was largely decentralised, with disparate financial and management reporting.
Over the past ten years, we have gradually increased the degree of centralisation in our European business functions. As our head office reporting requirements have increased, there has been more pressure to standardise formats, processes and policies, which is difficult to achieve in a decentralised environment, particularly as each entity typically had different systems and procedures in place. In addition, we recognised the potential benefits in terms of efficiency, control and rationalisation.
Initially, we made a few attempts to centralise and standardise certain business activities, such as creating a single chart of accounts. However, these initiatives had mixed success. Consequently, we recognised that we needed a more strategically focused project with senior management support in order to standardise our processes, rationalise the use of technology and develop a single, accurate view of our financial activities across the region. This was termed the Finance Breakthrough Project.
The Finance Breakthrough Project is now in the final stages of design. We first evaluated all of our current finance processes in Europe, and we are now completing the design of our ‘to be’ processes at a high level. We will then scope these processes, and the systems that will underpin them, at a more detailed level. One of the first areas on which we have focused is purchase-to-pay (P2P), a key pillar of our Finance Breakthrough Project. We are further ahead with this project than other areas of finance, and our new processes and systems were rolled out as a pilot project in Central & Eastern Europe in the spring of 2013.