»ÆÉ«¶ÌÊÓƵ

Streamlining a travel and expense program can serve as an indicator of process simplification, allowing employees to focus on what actually matters. In this podcast, , used SAP »ÆÉ«¶ÌÊÓƵ solutions to implement a Global Business Service program to scale operations across more than 40 countries.

Join us as Marchelle Klippenstein, Vice President of the SAP »ÆÉ«¶ÌÊÓƵ Value Experience Group, and Jorge Monge, travel and expense lead from Smith & Nephew, discuss the success of centralizing and standardizing processes across the world. Read through the dialogue below, then check out our blog post, or enjoy listening to this episode on | | | | or your favorite podcast player.

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Transcript:

Marchelle Klippenstein:

Hi everyone. This is Marchelle Klippenstein, and I am the Senior Director of our Value Consulting organization here at SAP »ÆÉ«¶ÌÊÓƵ. And I'm really excited to introduce our guest speaker or our guest friend here today, Jorge. I'm going to turn it over to Jorge to introduce himself and talk about his role and the company he works for right now. Jorge?

Jorge Monge:

Thank you. Pleasure to be here, Marchelle, and thank you for the opportunity. My name is Jorge Monge. I work for Smith & Nephew, which is a medical devices company, and my role is, mostly, I am... I lead the global T&E processes for the company. Globally, we have over 40 countries in the scope. Yeah.

Marchelle Klippenstein:

Wow, 40 countries in scope, that's crazy. Okay, so-

Jorge Monge:

It is.

Marchelle Klippenstein:

Yeah, that's a lot of volume to manage. I didn't disclose this earlier, but when I was a program manager myself, I was only one country and I was only one US-based retailer, so I can't imagine the complexity that goes with 40 different cultures, 40 different expectations. So we're going to get into some of that here in a little bit, but I want to first ask, the first question I really wanted to get to today was, "When you think about that footprint... We know that there was an expansion push in recent years, just where you are today had obviously a path, so can you give the listeners some perspective on what it meant to tackle 40 countries and expand that footprint in a consistent way?

Jorge Monge:

Of course. Well, I will have to start off by clarifying and providing some additional contextual information. So my organization is part of a GBS organization, which GBS stands for Global Business Services. So the idea behind all of that is mostly about centralizing and standardizing processes in a specific strategic centers across the world. So I work out of the center in Costa Rica, beautiful country by the way. Everyone is welcome to visit, we have very low COVID rates right now. And I think that on that particular regard, operations were mostly centralized. In general terms, I can tell you that, for instance, the US was by far the biggest operation. 80% of our population income and expenditure comes out of the United States, so that was mostly centralized and localized.

With the GBS effort of implementing a global business service center, what happens is that you have to start taking, for instance, the major operation and start to design a model that will be functional across different regions, regulations, and that's quite a challenge. So part of that, one key element of GBS as a whole is just creating a set of, maybe, common language, if I may word it that way, metrics, analytics, KPIs, and things like that. So you have to take something that, in a sense, might have been there for over, maybe, 10 years that is quite organic, and then you take that and you start to think, "How can I modify this so that it fits this vision that I have at this moment," because it's only a vision of that moment, right?

Marchelle Klippenstein:

Right.

Jorge Monge:

So, the first step is just understanding where things are. And maybe I can cover a little bit more as the conversation evolve?

Marchelle Klippenstein:

Yeah. No, so I mean, with GBS... So let me make sure that myself and the audience here understand. So you were part of the standing up of GBS down in Costa Rica, which, PS, I love Costa Rica, I've been there. I went to, I think it's called Tamarindo?

Jorge Monge:

Tamarindo, yeah.

Marchelle Klippenstein:

Tamarindo, and I got to swim with some stingrays or something, it was amazing.

Jorge Monge:

Yeah.

Marchelle Klippenstein:

So, the GBS was a concept that was moved to Costa Rica, and then it was decided that the »ÆÉ«¶ÌÊÓƵ or the employee-initiated spend processes would be moved into that umbrella, right?

Jorge Monge:

Mm-hmm (affirmative).

Marchelle Klippenstein:

And then from there, you had to determine what were the centralized regulations to consider, what were the consistencies that needed to be set in place or established so that you could have those KPIs, and that common language would be understood. Did I make sense of that?

Jorge Monge:

Absolutely. That's entirely accurate. Yeah.

Marchelle Klippenstein:

Awesome. So 80% of your volume coming out of the US, the regulation and the activity there is probably pretty well understood. As that footprint expanded, let's talk about what it meant to understand some of those compliance challenges, let's talk about what it meant to consider some of the cultural, experiential considerations. So which one do you want to start with? Do you want to go with compliance or you want to go with the employees that you were then servicing through GBS?

Jorge Monge:

So maybe we can go and start on with the cultural aspect to it. I think everything starts with the culture first, and once you have created something that actually makes sense and resonates with everyone and there is a common understanding, you can start really working across the lines of compliance and having people understand what major decision makers and stakeholders... Understanding what compliance changes, at some point, needs to be understood and applied so that we can have a successful program and model taking shape globally.

Marchelle Klippenstein:

You're talking that the cultural influence, absolutely then, has an impact on that. The understanding of those employees, what it means to be compliant, what it means to understand policy, you had to consider how to feed that through so that they were part of the solution of tackling governance and compliance challenges. Is that what you're saying?

Jorge Monge:

That is correct. Yeah.

Marchelle Klippenstein:

Cool. I just wanted to make sure I understood. Okay, so keep going. So the cultural influence had compliance factors and other things?

Jorge Monge:

Yeah. So you mostly have to think about how are you going to be portraying and sending a concise message that clarifies things to everyone in the organization. The whole point of globalizing and centralizing operations is that everybody has to speak this common language that I'm referring to. So most of other countries, some of them were using spreadsheets, some of them were using other software pieces. Not everyone was entirely familiar as with »ÆÉ«¶ÌÊÓƵ, so that's part of what we have. And that was part of the challenge, how to, in a way, sell this initiative of centralizing everything under a single platform. And there are many cultural aspects to it. For instance, some people might feel that they are not entirely invested into it, and there might be some trust issues because we have always done things this way, we have always worked this way. I'm used to having my receipts here, piled up, and that's how it works. And I'm used to using this physical archive that... It's been there 30 years, and we're going to keep using it. So things like that, right?

Marchelle Klippenstein:

Right.

Jorge Monge:

And how do I defend myself in the event of an audit? I need to have my receipts here physically, so things like that. And you have to come up with strong arguments that actually are understandable and help you really sell. You become a salesman. At the end of the day, it's like we're working for the same company because I have to really convey a message. And thankfully, »ÆÉ«¶ÌÊÓƵ allows me to really sell that properly. Number one is industry standard. Number two... It's working already in other countries. So for instance, we were going to migrate and their latest migration was Japan-

Marchelle Klippenstein:

Oh, okay.

Jorge Monge:

Yeah. So Japan is a whole different journey, of course, totally different, but one of the key arguments was, "We know there are many other companies in Japan already using it, so why can't we?" So that's part of the conversation that we need to emphasize, and I don't want to skip ahead too much, but I think that one key element to all of this is, maybe, it started to dwell a little bit into the compliance aspect.

Marchelle Klippenstein:

Right. Yeah. Sorry. We can absolutely jump into the concept of compliance and managing that because the expansion put, probably, more layers of compliance on you, or to consider in different business partners you needed to work with. So let's talk about that, let's talk about the meat on the bone of compliance. And which people in the business did you have to really work with to get to feel comfortable and feel protected?

Jorge Monge:

So I think that there are multiple elements to this, in terms of answering your question about who are the... One key thing you need to do is identify stakeholders. In my case, to be super specific, those normally are finance, vice presidents, and controllers as well, controllers and always working hand in hand with compliance officers as well. In my case, the first relationships I developed were with the chief compliance officer. Number one, I wanted to be friends with him, I wanted to make sure that we got his buy-in and support. Number one, you have always to go aligned with legal as well, so we touched base with legal and, last but not least, audit. So those are the three main people that you need to have in your organization. Every organization has compliance, legal, and audit, and you need to be partnered with them and establish this real partnering relationship.

Marchelle Klippenstein:

Would you say that the complexity of this... Was there legal and audit in variety of regions? Did you have to spiderweb that out a little bit and get to know and work with different regional partners, or was it all consolidated as part of GBS maybe?

Jorge Monge:

It is spread all over right now, it's not entirely centralized. The GBS effort aims at centralizing things and having this common language spoken by everyone. At the end of the day, the ultimate target will be the one of everything is centralized under a single system and all services being facilitated out of a single platform.

To give you an example, with Japan, my first conversation was with the controller. We needed to make sure that he understood the benefits of the tool, how can we actually stand against or defend ourselves or, maybe, just provide enough backup for an eventual audit, how do we actually understand regulations that are many particular things that we needed to clarify, and actually saying, "By deploying »ÆÉ«¶ÌÊÓƵ, you are actually in better shape, you have better backup. Well, you will be in a much better position to defend it against an external or internal audit in many cases. At the end of the day, this is how you tackle risks first. And at the same time, it's a tool that allows you to increase user experience and improve it in a significant way, so no longer piling up receipts and things like that." So that part, I think, is an easy sell when it comes to the compliance part and the real deal. That's the real deal.

Marchelle Klippenstein:

Yeah, that's the meat.

Jorge Monge:

Yeah. So that's one of the key elements.

Marchelle Klippenstein:

Yeah. I think one of the pieces, even in my conversations with other customers or even in my own history, it was all about, "Well, how do I process this," or, "How do I check all the boxes and make sure the receipt is there," and then, "This is a financial transaction and we're done." And to your point on all the risk mitigation that goes into this, we... I mean, maybe you agree, or maybe you don't, you can say it. This is a very risky channel of spend, right?

Jorge Monge:

It is.

Marchelle Klippenstein:

Employees have complete control over what they get to decide to spend money on, in a lot of ways, unless you have a preapproval process in place. So the question becomes like, "How much risk is out there?" So if you were thinking now like, "What outcome... Do you feel completely protected? Do your controllers and your audit groups and everybody... Is everyone feeling really solid and good about where you are today? What has been the outcome of this effort for you?

Jorge Monge:

We have been tracking our compliance levels and quality in terms of auditing right now. And we deployed a »ÆÉ«¶ÌÊÓƵ Detect, and this really helped us sell everything in a different way. Back in the day, we used to have manual audit in place, and then we were using »ÆÉ«¶ÌÊÓƵ Audit, which is still performed by humans. And with these utilization trends, AI comes into play as well. And we have been able to satisfactorily deploy »ÆÉ«¶ÌÊÓƵ Detect. In all candor, it is a process that takes time, you have to really... There's so much learning component to it, so you really have to train the tool. Once you get to a nice level where it's properly trained... It is a tool that we're using globally right now and that really has helped us reach that level of trust. And shifting that mentality from, "There is this person, there is this guy who has always been reviewing expense reports manually, and he doesn't miss anything," to come into a point where...I cannot be super specific because I don't think I'm at liberty of sharing these details, but I can tell you that-

Marchelle Klippenstein:

I don't want to know all those details, friend.

Jorge Monge:

Yeah, of course. But we have been able to identify things that no human could have identified because this tool actually Googles it, it looks it up in web searches.

Marchelle Klippenstein:

Yeah, the patterns of-

Jorge Monge:

Yeah. So it's incredible. The fact that we have been able to do that really has been a success story for the company and then for this particular deployment. And artificial intelligence, it's going to continue to be a trend. And when deciding and, in general terms, thinking of designing a model, you have to make sure that it's something that will stay relevant as time passes, and you have to think, maybe, five to 10 years ahead. So we were risky, we were really taking this risk of deploying AI for the very first time. I think we were part of the early adopters, maybe one of the very first »ÆÉ«¶ÌÊÓƵ Detect users. And the fact that we took that chance has proven to be a really good investment, and we have received very good feedback because of that, and our process is very mature because of that.

Marchelle Klippenstein:

Right. So, okay. So with the accuracy coming out of the functional pieces of the platform, and then the big gamble, I guess, or the big bet on future-proofing using technology... I mean, I think it's all landing on an overall leadership trust, outcome for your team, specifically for the people that support this program, but then also knowing that the business is protected globally. But no, I think that you're right on target with that, in terms of what does it mean when you actually accomplish, number one, an expansion at this level, number two, considering all of the cultural components and then the compliance elements that go into that. You land on a program that people trust, you land on a platform or you land on a process that is easy, and the experience makes sense.

I can't imagine if I was still having to use Excel. In fact, I can't use Excel today, even beyond expense reports. So, well, good for you. This is exciting. One of the other questions I had was, "If you could do it all over again, what would you take away, like what were your, let's say, top two learnings from your last two years of this growth opportunity?"

Jorge Monge:

Wow. Okay. I will say number one is to not assume customer needs. There has to be a consistent feedback loop. We didn't go into this in too much detail. I don't think we touched on this point, but we went through two extensive transformations with T&E which where CEO is sponsored, and what we thought would have solved the T&E issue... Everybody in the company used to dread that moment at the end of their travel, right?

Marchelle Klippenstein:

We all did.

Jorge Monge:

It ruined your business trip. Yeah. And we thought we knew how to fix it. Of course, we're going to take this away. And we were thinking, as process owners, really placing ourselves in the user's shoes, so that's the number one thing. We got it wrong the first time. In all candor, we were thinking simplifying this and that will result into increase user effectiveness and experience.

And it really wasn't, so we had to go back to a drawing board and, maybe in three months, we have to redesign everything that we have proposed. And the one key element was really creating those feedback loops and enabling that opportunity to really surveyi your key users, frequent users, and also detractors. I love detractors, even though it sounds crazy, I love them. Those are the guys who really are willing to stand up and say, "You know, this is what you really need to fix," in a very candid way, sometimes...

Marchelle Klippenstein:

Yeah, sometimes you don't want to hear it. Yeah. Sometimes you don't want to hear what they have to say, but to your point... Yeah. Keep going, sorry.

Jorge Monge:

Yeah. So that's the lesson or teaching or lesson number one. I guess, that's the number one. And number two, I will say, I think it's very important to focus on really creating some partnership and establishing yourself as a real partner with your key stakeholders. It's not about, "I want to drive this agenda, and I think this is the way forward," but actually, "This is bringing people with you, we're all in this together. And this is what I think it's going to work out. Are you, are you on the same page? If not, how can I really get you to buy into this and really convey in a message of common benefit?" It's a mutualistic relationship, it's never, "I'm driving this agenda because I want this to look good. No, actually, is this the right solution," and be open to feedback and actually act on that feedback to things that you always need to satisfy customers and the stakeholders.

Those are the ones, so those are my two main lessons learned from here. Why? Because at the beginning, in all honesty and vulnerability, I was really pushing to drive this agenda, and I got this challenge from the CEO himself. New CEO, he wanted to do things differently, more friendly and everything, so I figured, "The CEO tasked us with this particular thing, so let's do it, let's move it. And the CEO said to do so, so let's move." And it's not that way, it's not that easy, you know?

Marchelle Klippenstein:

No.

Jorge Monge:

So yeah. So maybe we rushed a little bit, but yeah.

Marchelle Klippenstein:

Well, sometimes it's like when you get that kind of directive... And that's actually a good thing, that the CEO had a connection to this program. I think that that's important to call out as well, that senior leadership across the business need to understand they're part of your stakeholder community too, right?

Jorge Monge:

Absolutely.

Marchelle Klippenstein:

Not just the group you've mentioned earlier, like the compliance officers or the legal or audit, everybody has some sort of investment into the spend that happens through »ÆÉ«¶ÌÊÓƵ, I think that that's actually a point that we often forget. I mean, treasury, audit, legal, AP, employees, sales, CEO, you name it, all of this spend touches a variety of groups, so I think that's important to remember. But your two lessons strike a cord with me because I've also experienced similar things.

When I stood up »ÆÉ«¶ÌÊÓƵ with my previous role, I didn't really know what I was doing, but I knew that we needed to figure out a way to get better at this management of this kind of spend. And I actually didn't have as much CEO directive, so it was like sometimes you don't have enough and you have to build some motion or some connection there, or you have too much where you're able to just... You take that and you try to run with it, but yet you still have some pieces missing. So I think it's interesting to look at both scenarios. Sometimes our customers or people we work with don't have the buy-in from senior leadership, which can be painful, too.

Jorge Monge:

Oh, absolutely.

Marchelle Klippenstein:

Well, this is exciting, Jorge. I'm thrilled that I was able to spend a little time with you today. I'm sure that there'll be more conversation, but at this point, are there any questions for me, maybe we can turn the tables and you can ask me a question or two?

Jorge Monge:

Well, I'm curious. I'm going to flip the coin now, and I'm going to ask you, "What are your main lessons from directing a program yourself?

Marchelle Klippenstein:

Oh yeah. Gosh. I mean, granted it was 10 years ago, so let's be clear. But I think one thing to remember is that business is business, and employee spend is employee spend, so it was about figuring out the most effective way to manage that. My experience was going from paper to an automated solution. We were pre-Travel so basically, it was like we implemented Expense. And then when Travel integrated with Expense, we re-implemented, and so we went to the T&E platform as a whole. And I mean, change management was probably my number one issue, and it wasn't even so much a cultural thing, global culture. We had cultural challenges within the business itself, and the freedom that they were thinking was being taken away from them, and some of the questioning or some of the judgment that they felt from the visibility into what they were spending money on.

And so we had to really work through a lot of that, those painful pieces, to say, "At the end of the day, the employee experience is number one, or is very important. Controlling spend is very important, making sure we're staying within the compliance and regulations of this spend is critical, but at the same time, we're empowering you to do your job." And that was the piece. Once it clicked that it was all-encompassing, but yet they could still do their job, we were golden and we moved. It was great. We only had one country, there were still a significant population. The spend was only about $40 million, but we ended up transitioning to using »ÆÉ«¶ÌÊÓƵ for a purchasing card activity as well. So we ended up having a significant volume more purchasing-related than travel, and expense-related going through the system, which was a huge benefit to accounts payable.

Jorge Monge:

Yeah, it's a whole different world.

Marchelle Klippenstein:

A whole different world. Yeah.

Jorge Monge:

Yeah. We use it for P-Card as well. And a follow up question... Is that two questions?

Marchelle Klippenstein:

Yeah.

Jorge Monge:

So yeah. So the fact that you're saying it was 10 years ago allows you to have a different perspective now. So I'm not going to ask you to disclose any information about SAP »ÆÉ«¶ÌÊÓƵ, but at the end of the day, I want to know, "How do you see the industry evolving in the next five years? Because you have this perspective 10 years, now, what do you see in the future?"

Marchelle Klippenstein:

Well, of course, we all know the global situation is going to change how people travel, let's just... The elephant in the room on that one. I think where we're going to head, at least for five years, is... Obviously, recovery is going to be top of mind for everyone, this and a global camaraderie around that. COVID and this whole situation didn't impact just one country or just a single population, it affected the globe. And I think that our programs that we manage in our customers, as you say you call them, the employees and the companies are going to have to have that mindset. We're going to have to think about what's best for our people, what's best for the impact on the globe, how do we contribute to the recovery effort across the business.

And it seems weird to connect it to T&E, but we're mobilizing employees, we really are. That's what this solution does, it mobilizes employees to do their job and to contribute to the revenue of the business and the process of the business. So to me, the next five years looks like a lot of control around dollars and cents and making sure it makes sense to spend that money. It's also going to be about protecting employees and protecting people, we've got to bring a human element back into this. Great processes streamlined to the fullest and all the buy-in in the world doesn't change the fact that you still have to protect the person. So I think the next five years looks a little bit more humane. I think it looks a little bit more flexible, and we're going to need technologies that help with that flexibility. That's my thoughts.

Jorge Monge:

I will add acceleration, right?

Marchelle Klippenstein:

Good point.

Jorge Monge:

We were pushed in a way that you have to create great changes in very little time. And we realized that things that we never thought were possible now are totally possible, so maybe that has the most rate of something. And we should expect changes to happen faster and people to be pushed a little bit more because we have proven that it's possible. So yeah.

Marchelle Klippenstein:

No, that was a good point of acceleration. There's no time to waste, and you don't need as much time as you thought, right?

Jorge Monge:

Mm-hmm (affirmative). Yeah. No, I just wanted to say, at the end of the day, T&E is something that touches everyone in the company. So it's one of those tools that allow you to send a common message, and I think that's where the simplification effort inspired by our CEO was, with the intention of conveying the message of the new way of doing things and the new culture that he wanted to install in the company... So I think that's what I like about T&E at the end of the day, you get to make a difference in people's life, and something that... It's dreaded normally, and you make it friendly and simple, so that gives people, maybe, humanity again.

Marchelle Klippenstein:

Yeah, that's true. Yeah, I liked that, the idea that this is a feeder to other simplification efforts across the business or, at least, an example of what's possible to simplify and allow your employees to focus on what actually matters. So this was awesome, Jorge. Thank you so much for your time. I'm excited for, potentially, another conversation in the near future.

Jorge Monge:

Absolutely.

Marchelle Klippenstein:

Wish you the best for the holidays, and we'll talk again soon.

Jorge Monge:

And to you as well, thank you. It's been a pleasure to share time with you, Marchelle.

Marchelle Klippenstein:

Awesome. Thank you.

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Learn more about the Smith & Nephew innovation story:

Part 1:?How Smith & Nephew struck a balance between employee experience and compliance?

Part 2:?How Smith & Nephew increased spend accuracy

Part 3:?How Smith & Nephew streamlined executive spend management decision

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Jorge Monge joined Smith and Nephew as the Global Travel and Expense Manager in 2018. With over 14 years of experience in Shared Services, Jorge has held several IT and finance-related leadership roles in CI, Business development (BPO), T&E, Finance, Business Analytics, Migrations, IT Operations (Service Management) and IT Hosting Leadership (Site Manager). Jorge has devoted most of his career to Life Sciences companies, including GlaxoSmithKline. At Smith and Nephew, Jorge played a key role by leading the T&E Transformation project, a global simplification initiative which returned over 20K productivity hours benefiting over 9000 employees globally, the project won the GBS giants Award in all categories.

Jorge is also an avid meditation practitioner and has DJ-ed at several Techno music festivals in Europe (prior to the global pandemic). Follow him on .

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