COMMENT
Cutting unit costs on the railway is about more than just rolling stock, infrastructure and working practices – for an organisation the size of Network Rail, savings have to be made in the back office, too. Steve Swientozielskyj, head of finance shared services, tells RTM that is just what has been happening – but that the back office is also now having a big impact on front line rail services too.
M
anaging the finances of Railtrack was a difficult business, with much
duplication of processes, unclear chains of responsibility and work located in so many different sites.
Network Rail decided to do things differ- ently almost from the outset, opting for a finance shared services model, where pro- cesses from across traditionally unrelated business areas are centralised and stand- ardised, and ‘sold’ back to the company as a service.
Steve Swientozielskyj, who heads up Net- work Rail’s finance shared service centre in Manchester, had six years of experience at Railtrack – learning how things shouldn’t be done, he jokes – and had to start right at the beginning.
“We had no building, no people, no process – but a lot of guts and determination, that was the starting point.
“We had 42 ways of doing things, and the first driver was we had to have just one way of doing things, and put some financial and corporate discipline on the situation. Part of that was through mandating, where you just had to do things one way. We couldn’t have different terms of trade, payments, the whole plethora of different things you’d have in one organisation; we couldn’t have 42 variations of that.”
At the heart of his success in transform- ing Network Rail’s finance shared services into a world-class operation, with unheard of rates of invoices paid correctly and on- time for one example, was an intensive re- search effort in around 2006-7 to investi- gate, globally, what best practice in finance looked like – and to copy and integrate as much of it as possible. This was a simple concept, harder in practice, but has really borne fruit.
Swientozielskyj said: “It took us a year or two to implement all of that, but it’s meant we’ve been able to do some really clever stuff: automation, workflow management, the elimination of transactions – asking ‘why are we doing this, let’s get rid of it’ – that’s been a vital part of the transformation.”
16 | rail technology magazine Dec/Jan 12 Inside or out?
Shared services units, due to the way they work, often see themselves as somewhat external and apart from the main organisa- tion. This is not the case with Swientoziel- skyj’s team, he says.
“Fundamentally we’re part of Network Rail. We position ourselves to be part of the heart of the organisation. We’ve never seen ourselves as something outside it. We’re a vital cog in the engine; whatever the busi- ness wants to do, or the way it wants to achieve things, we’re part of it. It’s partly a cultural issue. If your back-room opera- tions are recognised as world class, cheaper than India – which we are, which is a bit of a counter-intuitive statement, but it’s true – it helps the brand of Network Rail. It shows the organisation is progressive, doing posi- tive things for the industry, and UK plc.
“Every single supplier in the industry, and
there’s about 16,000 of them, and all their customers, 2,000-plus, are critically de- pendent on us. People don’t notice how good we are: when you hear complaints about Network Rail, you don’t hear anything about payments and backroom operations, which run smoothly. We’ve taken ourselves off the ‘problem page’.
“As a good example, they transferred pro- ject accounting to us. That’s doing account- ing for an £8bn spend. We do the manage- ment accounts for a roughly £6bn spend. You’re not going to transfer that to shared services if you don’t have a degree of confi- dence there.”
This meant, he said, that his team has gradually moved from just “transactional shared services” to “decision-making sup- port”, through project and management accounting, and is now going further.
He said: “It’s happening to a scale and
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