Accenture had a long history of reporting two types of services: consulting and outsourcing. As Accenture’s business continued to grow and new technologies emerged, the company recognized they were evolving and further differentiating themselves in the market. "We realized that our business was becoming much more sophisticated, and we actually did more than just consulting and outsourcing," McClure explains. They needed to capitalize on this diversification to maximize the value potential.
Accenture decided to further differentiate by creating Accenture Strategy, Accenture Consulting, Accenture Technology, Accenture Operations, and Accenture Digital. Rowland was instrumental in helping the company understand the unique characteristics of each business dimension. As CFO, he knew that each dimension had a unique economic profile and had to be “fit for purpose” to optimize margin and profitability. “It was clear that each of these new areas had different competitors in the market, as well as different price points, cost structures and investment strategies,” McClure explains.
Rowland led a massive change effort to ensure that everyone in the company understood this new “fit for purpose” model. His finance organization was on the front line and ready to support the transformation. They drove change on many fronts—from new internal metrics to different commercial models and investment strategies. "Our CFO was a key driver of these efforts," McClure says.
Accenture’s differentiation strategy also required them to reassess how they were investing capital. “This is probably one of the biggest changes … what it means to invest for disruption,” says McClure. They needed to invest, not only in the new service areas like digital, security, cloud and analytics, but also in talent to ensure they had the right skills and capabilities to deliver these new services. Rowland took a hard look at their capital allocation strategy to ensure they could free up capital while continuing to deliver margin expansion, one of their key shareholder value commitments. Investors had to understand Accenture’s investment strategy given it was new territory. It was imperative that Accenture articulated this shift to investors, who knew that Accenture had historically been an “asset-lite” services company with very limited debt.
A key component of the company’s investment strategy was a significant increase in ventures and acquisitions (V&A). Accenture has become a “serial acquirer,” moving from just a few acquisitions in previous years to now spending over $1.5 billion this year. Rowland had to ensure his finance team and the rest of the organization were ready to handle the wide range of challenges that came with the increase in V&A activity.
For the strategy to be successful, the team had to lean heavily on its fourth pillar and create a clear narrative for each stakeholder audience so that employees, investors and clients were on board.