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Insurance firm Aon expects to save up to $5 million ($4m) in upgrade costs associated with its on-premise Oracle PeopleSoft financial management software by moving to Workday’s cloud platform.

Aon provides risk management, insurance and reinsurance brokerage, investment banking, human resource solutions and outsourcing services and has a workforce of 71,000 across 120 countries. 

The move to the cloud has allowed its finance teams to meet changing regulatory requirements without the need for costly software upgrades, according to Chris Klimek, VP of global finance and HR technology at Aon.

“In our legacy environment I would have had to spend between $3-5 million to upgrade the software and get in line with regulatory change, without driving any benefit to our users," said Klimek, speaking at the Workday Rising conference in Barcelona yesterday.

"With Workday you are able to receive those updates and also consume them for your business.”

Klimek was sceptical that a painless upgrade cycle could ever exist. However, he said that although “you should not fear [upgrades], you should respect them.”

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It still takes Klimek and his team around 400 hours to add new Workday capabilities, such as predictive analytics for employee retention or dashboards.

In this time the business goes through “planning what new features we may take and all of the regression tests and implementation capabilities”, Klimek said.

Yet this is preferable to the PeopleSoft upgrade cycle said: “It wouldn’t even get us past the initial assessment of an upgrade on a legacy platform in 400 hours.”

Implementation

Instead of rolling out Workday financials as a ‘big bang’ approach - as it did with Workday Human Capital Management (HCM) in 2015 - Aon is taking a three-phased approach.

Where the HCM implementation took eleven months (Klimek says this compares favourably to previous attempts with legacy providers which took three years to get three geographies live) financials is being rolled out over the next three years.

Phase one will see the software go live in Nordics, Netherlands and Luxembourg by January 2017.

Aon will then move on to 30 of its core offices across North America, Latin America, EMEA and the Pacific region for January 2018.

Finally, in 2019 the company will complete the rollout "to some of our more exotic regulatory regimes that exist in Latin America and central and eastern Europe”, Klimek said.

Read next: Avon swaps Oracle PeopleSoft for Workday cloud HR, speeds staff hiring process

Further benefits

Klimek said that it is too early to predict precisely what benefits the financial software will bring to the company, though expectations are high following the success of the HCM deployment.

However, he added that one of the goals of the finance team is to use the cloud platform to create a 'single source of truth' with regards to financial information across its organisation.

“What tipped a lot of our financial folks over the line for financials was the singularity," he said, "so having transactional finance and planning consolidations within one application, which happens to coincide with HR. Today we live in a world where we are pushing data into many systems, so the move to Workday means we won’t be spending the majority of our time reconciling.”

This blend of HR and financial data will help when it comes to planning, so that “we have visibility of possible terminations, open requisitions and we have a higher degree of accuracy across our forecasting and budgeting process”, Klimek said.

Read next: How Anaplan plans to kill off Excel use within the enterprise

Workday also allows the finance teams across Aon to automate some business processes. “With our legacy product it was complex to build business processes, so we had a lot of processes that occurred outside of the technology,” Klimek explained. “With Workday we have been able to bring those processes into the application so what was a largely manual approval process is now all housed within the application.

“We can also attach supporting documents to the approval and retire a significant number of legacy document management tools as well.”

Read next: Rolls-Royce moves global HR into the cloud with Workday

Finally, Aon makes roughly twenty acquisitions a year, and has seen a drastic improvement in this process since switching to Workday. “What we have seen with Workday HR, and what we expect with finance, is the ability to drive a repeatable acquisition process," Klimek explained.

“Using the upload tools Workday has, we have been able to successfully execute our acquisitions in probably about a 75 percent time saving across the HR platform over what we were historically able to do. This helps maintain a sense of agility.”

Move to the cloud

The whole move to Workday is part of a broader effort by the AON CIO John Bruno to become a cloud-first organisation.

Read next: Aon appoints new CIO to increase collaboration and support growth strategy

Klimek explained: “The move to Workday has allowed us to accelerate that across our back office. That allows us to get the right information into the hands of our colleagues to make informed decisions and also happens to help us save some money along the way.”

This also brings serious cost savings to the organisation through unification of tools. “As we move to Workday we are simplifying our application landscape, so we are rationalising systems, rationalising the amount of integrations we have in place and staff needed to administer those capabilities,” he said.