BP extends 'exemplar' finance BPO deal with Accenture

Oil giant extends its 21-year old finance and accouting engagement with Accenture, described by the LSE as an "enduring examplar"

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BP extends exemplar finance BPO deal with Accenture

Accenture has signed a new multi-year deal to provide oil giant BP with outsourced finance and accounting services.

The deal extends a 20-year plus partnership between the two companies that has been described as an "enduring examplar" of long term outsourcing engagements. 

The new contract will see BP standardise many of its finance and accounting processes, specifically "record to report, order to cash, procure-to-pay and production revenue accounting service", on Accenture's BPO and technology services.

“BP sees this partnership with Accenture as an important milestone in driving standardisation in our finance and accounting processes by consolidating our F&A service providers,” said Brian Puffer, group controller at BP. Accenture's services will compliment BP's "captive" business process delivery centres around the world.

Earlier this year, Professors Leslie Wilcocks and Mary Lacity of the LSE's Outsourcing Unit, wrote a research paper looking at BP's partnership with Accenture.

The engagement began in 1991, when Accenture set up a shared services centre in Aberdeen to provide BP departments with finance and accounting processes and SAP development services.

This was BP's first outsourcing deal, but according to its CFO in 2002,  it may be the "most successful deal that BP has ever done – in any function, anywhere. And that's deeply laden with irony, because your first one out of the box is the one you‟d expect to be where you‟d make all your mistakes. But we got it right, and it has been a tremendous success.” 

By 2007, Accenture was providing BP with F&A services from four global locations: Aberdeen, Houston, Bangalore and Shanghai. Three years later, "F&A outsourcing, led by Accenture, was based primarily at Bangalore, but also operated out of Aberdeen, Stavanger, Krakow, Istanbul, Athens, and Buenos Aires". By then, BP was also operating five captive centres.

BP's challenge in managing this diverse sourcing environment, Wilcoks and Lacity wrote, "was to lead centralisation, standardisation, and integration by migrating additional scope of work from all the BP businesses ... to the captive business service centers or outsourcing service providers."

"Our research has shown that centralisation, standarisation and optimisation are the most power transformation levers for achieving efficienct back-offices," they wrote.  

They write that having an 'incumbent' outsourcing provider, in this case Accenture, has allowed BP to drive this standardisation through outsourcing.
 
“BP is a very decentralised organisation," the paper quotes an unnamed BP director as saying. "One of the problems with decentralisation is that we probably make life more difficult from the standpoint of missing opportunities to standardise the way we do things across the organisation. 

"Accenture, sitting where they do, supporting us in some key activities across many, many business units obviously have a great view and a great visibility to lots of these opportunities where we are inherently doing things inefficiently," they said.

"One of the things we should be looking for from them in terms of value is that sort of insight and some suggestions of ways to continuously improve and standardize the things we do."