Collinson Grant helped managers to restructure the business and improve results
Founded in 1981, Northgate plc has grown organically and by acquisition to reach the FTSE 250. With more than 60,000 vehicles for hire, and depots all over the country, it commands the market. The directors asked us to help change the structure; to increase productivity; and to boost profitability. We had 12 months to transform the business model and merge twenty regional companies into one centralised structure with a new IT system.
The previous structure encouraged the regional managers to run their businesses independently – and in competition with each other. This led to variation in processes, duplication, hand-offs, unnecessary administration, and inconsistent and inaccurate data. The new approach was to create a single business, One Northgate, with consistent, centralised processes and a standard operating system to promote efficiency and improve service to customers.
Collinson Grant was engaged to manage a project to review and upgrade the integrity of data as part of creating a Financial Shared Service Centre (FSSC). Thorough plans for the FSSC had been drawn up and covered all the crucial elements. However, queries were running at 3,000 per month, which for 80,000 invoices represented a rate of 3.75%. The best companies might expect between 1% and 1.5%.
Our principal tasks were:
- to quantify transactional volumes and implement work and process redesign. This led to the creation of standard policies, forms and frameworks with clear terminology
- to apply consistent processes, cleansing the data and making better use of the IT system. This removed manual workarounds and billing processes were automated
- to complete a Responsible, Accountable, Consulted and Informed (RACI) matrix to clarify local and central roles and responsibilities. User rights were defined and training documentation created to mitigate loss of local knowledge
- to create reports, measures and targets for improvement.
During the seven-month implementation, the centralisation realised an equivalent net headcount reduction of 30 Full Time Equivalents (FTEs). About half of this was a cost saving, the other half released capacity for further process improvements. The number of queries fell by 50%, to about 1,500 per month, and they were resolved much more quickly.