The team from Deloitte knows a significant gap when it sees one, and it saw one. To be honest, though, the company that sought Deloitte’s help wasn’t oblivious to the challenge at hand.
Hertz, the world-renowned car rental firm, required the ability to handle all of today’s latest billing models for its wide variety of national and international car rental scenarios. However, the system through which these transactions were processed was anything but modern and the company knew it.
Deloitte was enlisted to help Hertz in this modernization project, and the options eventually presented were:
- Continue to invest in its existing, decades-old homegrown solution
- Build out customizations for multiple modules in Oracle
- Utilize the unified offerings within the RecVue platform to form an integrated companion solution with Oracle and handle what the ERP could not
The accounting firm concluded – and made the recommendation to Hertz – RecVue’s combination of billing, revenue and partner compensation was far and away the smartest option.
Why, you ask?
- No other solution on the market offered the functionality to address increasingly complex accounting rules, revenue splits and partner compensation needs for this industry
- The system’s design accommodated easy configurability to handle this level of complexity at scale
- The simplification of accomplishing all its needs within a single application outweighed the route of multiple, heavily customized – and constantly maintained – Oracle modules
How Complicated Could It Be?
Another question you might ask: How complicated could a car rental transaction be that complexity is such a singular focus?
Let’s consider just one scenario:
A U.S.-based customer uses an airline website to book a car rental in which the car would be picked up in Rome, Italy, and dropped off in Madrid, Spain. Within this single transaction, the concepts in play include a multi-country intercompany transaction between business units, the Rent-It-Here/Leave-It-There (RIH-LIT) program and partner commission compensation for the airline sourcing portion of the transaction.
The calculations abound:
- Revenue sharing between booking, pickup and dropoff sites
- Currency conversions
- Licensing fees dependent on whether locations are Hertz direct or licensees
- Partner commissions
Now multiply that by 4.5 million times each month, the approximate number of worldwide rental agreements processed by Hertz.
Everything Has a Purpose
That in-house system Hertz had been using to decipher the revenue splits on who pays what to whom for those increasingly common yet complicated RIH-LIT transactions was neither modern nor scalable. And that was no longer feasible for such a critical interface to inform the Oracle Financial Accounting Hub (FAH) on how to map data in the general ledger to different accounts.
Oracle FAH, the accounting transformation engine for its E-Business Suite (EBS), was never designed to handle the revenue sharing rules and calculations or the payments typical of such complex, global transactions.
Once Hertz put RecVue to work to manage the company’s partner commission programs, franchise revenue share rules and intercompany revenue splits, visibility into its millions of rental agreements and commissions transactions increased exponentially.
Not only that, but when you factor in system savings – eliminating more than 15 individual customized systems – Revenue helped Hertz realize a TCO reduction of 40%, saving the company millions.
A Single Pipe
RecVue’s unified system approach helped Hertz save time and reduce errors in place of a prior revenue-sharing solution made up of multiple independent systems in charge of various functions. Consider the difference between a plumbing system made up of multiple, interconnected pipes versus a single, long pipe. Which is more likely to spring a leak when the water starts to flow?
RecVue is proud to continue to partner with Hertz, recognizing the journey of ups and downs the company has experienced in recent years. The firm, which was hit very hard when the COVID pandemic brought travel to a near worldwide halt, filed for bankruptcy early in the pandemic crisis from which it emerged in June of 2021.
Congratulations are the order of the day once more with the recent news of a new IPO in the offing. Hertz signaled such plans with an August report of strong second-quarter financial results, including revenue nearly back to pre-pandemic levels and an operating profit stronger than before the pandemic.
If you would like to learn more about how RecVue’s Order-to-Cash solutions can help your organization’s complex billing processes down the path of consolidation and/or automation, contact us for more information or to schedule a demo.