The Xceptor Blog

Reconciliations: Build the business case for change

29 April 2021

2 minutes read time

Reconciliations is a mature function, long accepting of its place as a costly, yet necessary part of the trade lifecycle that is set to only achieve incremental change. Fortunately, there is appetite for transformational, or just plain more, change in the recs world and a strong business case can be made.


Forrester TEI study of Xceptor

Let’s start with some numbers a recent Forrester TEI study came up with. Forrester’s TEI study is a widely accepted industry standard methodology that provides a cost and benefit analysis framework around the use of a particular technology, and demonstrates the business flexibility and associated risk.

The example numbers are based on real-life examples from Xceptor customers with between two and more than ten years of experience using various components of the Xceptor platform. Forrester created a composite organisation of a typical Xceptor client, Deagon Capital, to illustrate the quantifiable benefits and costs of investing in Xceptor. Based on characteristics of the interviewed customers, Deagon Capital is a global financial institution with a 50,000-strong workforce and 500 employees working in the global operations team.


Quantified benefits of Xceptor

Improved trade reconciliation productivity (£1,535,394). Prior to using Xceptor, an average employee in the trade reconciliation team spent about 50% of their time engaged in manual work to support the front office. With the use of Xceptor, these employees can build their own reconciliation workflows without heavy reliance on the IT team. Overall, the composite achieves a productivity gain of 30% with reduction in manual work.

Costing savings due to retirement of legacy solutions (£1,259,609). With the adoption of Xceptor, Deagon Capital retires two legacy solutions, yielding cost savings of nearly £1.3 million at present value.


Unquantified benefits of Xceptor

The interviewed organisations experienced the following benefits:

Enhanced employee experience (EX). The deployment of Xceptor involves doing away with manual, time-consuming processes or the use of complicated and non-user-friendly systems, improving EX of both the trade operations team and the IT team and enabling upskilling to focus on higher-value work.

Improved cross-team collaboration. The no-code capability of the Xceptor platform means that the trade operations and IT teams can develop or modify trade operations applications in a more collaborative and agile working model.

Increased process transparency and operational control. The creation and maintenance of automation and digitization processes in one single platform provide an oversight of the multiple trade operations processes running in the organizations.

These numbers are of course different depending on the size of your organisation, the scale of the project, as well as the appetite for the scale of change. Our team has an in-depth ROI calculator which can rapidly build out some numbers more pertinent to your business case.


Embracing change: choose your approach to reconciliation

Only a shift in mindset will bring about transformational change in reconciliations. An approach that prevails across the industry is to tinker with existing processes to optimise what is already in place, perhaps achieving some incremental automation. That’s been understandable, particularly in recent times, but now is time to step back and make a difference to the function and how it operates and automates.

The boldest move would be to take a data control approach. When, where and how does my data touch the trade cycle? How can I minimise reconciliations throughout the whole lifecycle by focussing on the data right at the start of the process and also reimagine that process, so I leverage data automation throughout? Xceptor’s platform fixes the data at the outset, ensuring any reconciliation steps needed are simplified. After all, fragmented data sitting across all sorts of systems and spreadsheets is still a key cause for low automation.

Still transformational and less incremental, is to do a business process review and focus on process optimisation and harmonisation. What often stops reconciliation automation in its tracks is not the ‘standard’ recs but that last 20% that require subject matter expertise to interpret. Moving to a no-code environment such as Xceptor not only enables such business users to configure the solution in an audited environment but also decreases key man risk.

The key to all of this is change. By embracing an enterprise data automation platform that has both a powerful data engine and broad process digitisation capabilities under one roof, firms can move at their own pace. Be it transformation with a data control and quality approach across the full transaction lifecycle or incremental improvements, both can bring tangible business rewards that will empower the people in your teams to deliver higher value output.