Harsco's Financial Strategy is Built to Last

Harsco's Financial Strategy is Built to Last

Standardizing financial processes has helped Harsco integrate a complex organization.

Harsco Infrastructure, a provider of scaffolding, shoring and forming equipment, is a key supplier to a number of major building projects worldwide, including such structures as the new baseball stadium for the Miami Marlins and the Spinnaker Tower in Portsmouth, U.K. While the complexity of such enormous construction projects is obvious, equally complex is the challenge of integrating financial planning and analysis (FP&A) capabilities throughout all of Harsco, a $3 billion conglomerate that, in addition to the infrastructure division, also includes metals, minerals, rail and industrial divisions.

According to Andreas Rothe, CFO of Harsco Infrastructure, the challenges he and his fellow finance executives face fall into three groups: structure, systems and processes. The complexity of Harsco's corporate structure includes multiple subsidiaries, local statutory reporting requirements and different accounting standards. Add to that, the various divisions all work off different IT systems, including ERP, sales and operations planning, and finance. Plus, the CFOs all have to satisfy the demands of their "customers," which include local, divisional and corporate managers; investors; treasury and tax; and their own departments.

For Harsco Infrastructure, complexity comes in many forms, whether it be providing materials used in the construction of the new Marlins Park in Miami, or in the integration of common financial practices across disparate divisions.
"Each of the divisions has very different industries and key performance metrics, with various competitors, different geographies and market drivers for each division," Rothe notes, "but we're still just one company." The key to cutting through all of that complexity in a globally decentralized environment, he says, is to standardize FP&A.

"Start by focusing on creating commonalities," he says, such as identifying what is already the same across the divisions or, in some cases, across countries. Then identify what could be the same, as well as areas where the work could be offshored. Harsco, for instance, uses shared service centers and offshores some FP&A work to India and Costa Rica.

Standardization is also the key to having efficient IT systems, Rothe adds, with the goals of achieving consistency, efficiency and transparency:

  • Consistency in reporting, definitions, accounting standards and deliverables
  • Efficiency in allowing FP&A processes to piggyback on accounting processes; FP&A does not need to wait until the books are closed
  • Full transparency, even across countries.
See Also:
Six Sigma in the Finance Department
2012 Outlook: Cash is Abundant, but Optimism in Short Supply
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