Software / communications
Helping Vonage drive a finance evolution across the business
Oracle Cloud ERP
Founded in 2001, Vonage was a pioneer in the Voice over IP (VoIP) industry with a focus on residential customers. As the VoIP market became more competitive, they knew their business model needed to evolve and broaden in order to grow. The company invested in technology development and embarked on an aggressive strategic acquisition strategy over a six year period commencing in 2013 to expand its portfolio of products and services. From 2013 - 2019, Vonage acquired nine companies globally, and evolved from being a purely residential player in voice over internet protocol (VOIP), to a leading provider of business cloud communications including unified communications, contact centers and communications APIs built on a unified, flexible integrated platform. Through Vonage Communications Platform (VCP), Vonage enables businesses to transform how they communicate and operate from the office or anywhere, providing enormous flexibility and enabling business continuity, remote work and remote delivery of services, which are now essential for organizations of all sizes.
The company invested heavily in R&D spending during this period (top quartile for their market sector) resulting in 37% Y/Y revenue growth for its Business Segment in FY’19, extending the Company’s continued commitment to market leadership.
From a revenue growth perspective, that’s the good news. The challenge for Vonage was that all of the acquired companies operated with their own financial infrastructure and processes. This was a complex problem that required a significant amount of manual intervention to transact, account for and consolidate the internal and external product reporting required to run the business and meet public company reporting requirements. Vonage knew it needed a standardized finance operations structure that could keep pace with business development and the impending evolution.
Standardizing system design and processes
Vonage decided to standardize on Oracle Cloud ERP. The Company was already familiar with Oracle, and the ERP offering was top-rated and aligned with how Vonage needed to transform globally and gain as much efficiency as possible. Vonage launched the program by gaining internal agreement on a consolidated functional design with a view toward optimization and cost reduction. The Company’s objectives were to bring various global workflows together into a common set of processes that could be automated where possible while reducing the costs associated with finance. As part of PwC’s Finance Transformation Integrated Solution, Vonage used a PwC prototyping framework and modeling system to architect and demonstrate redesigned processes. This was a user experience based, iterative process, where together, Vonage and PwC dynamically refined the technology, finance processes and organizational model in multiple cycles. Vonage was able to leverage PwC capabilities across the firm to address technology, finance process, organization, controls and tax challenges to drive towards a robust design.
Two seamless new acquisitions
In Q1 2018, Vonage began implementing, testing and rolling out Oracle’s full suite of financial and procurement products globally across more than 16 countries and 36 legal entities. As part of this, Vonage standardized its financial processes and reporting globally, integrating four different businesses. As PwC was helping Vonage standardize their processes, Vonage made two additional major acquisitions within two months and the integration of the financial processes was seamless and straightforward due to the new design and Vonage’s cloud-based application solution.
PwC’s Finance Transformation Integrated Solution helped Vonage create the systems, processes, infrastructure, skills and flexibility necessary to operate efficiently on a global basis. Vonage is now also able to quickly integrate newly-acquired businesses, accelerating back office cost synergies and increasing value for shareholders.
The benefits to Vonage so far, include:
Controller & Principal Accounting Officer, Vonage