The Journey to High Performance. Transforming Accenture s IT Services

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1 The Journey to High Performance Transforming Accenture s IT Services

2 Like many of the clients it serves, Accenture's internal information technology (IT) function supports a large, global workforce, with all the challenges that task entails. Enabling more than 129,000 people in 48 countries to work anytime, anywhere, is no easy feat. Accenture requires a vast array of productivity, collaboration and support technologies to help the company achieve high performance. That challenge puts IT at the heart of delivering innovative business processes and superior knowledge worker productivity. The important role IT plays in driving business success is supported by Accenture's ongoing research into the characteristics of highperformance businesses. These research results reveal that top companies treat IT as a strategic asset. Accenture does this too. As a result, the company has transformed the way its people work to deliver value to clients and to run their own business.

3 The business challenge The journey to high-performance IT began in the late 1990's, when Accenture prepared to separate from its former parent company and had to create its own IT organization. Accenture began by replicating the legacy systems of the parent company. Because the company had formerly operated more as autonomous geographic units, a multitude of systems had sprung up on a wide variety of technical platforms and no longer supported the ability to operate as a single, global company. Becoming a publicly traded company in 2001 placed additional requirements on the company's systems, such as the need for a more integrated financial management structure and the need to comply with new accounting and reporting standards, among other changes. By 2002, Accenture had evolved further. Its business model was more diverse, encompassing a set of multiple services ranging from technology to business consulting to outsourcing. The company was expanding rapidly, entering new markets and enhancing its global delivery approach. Each new market and location required IT support. New joint ventures and affiliate companies needed to be supported by common systems. To reflect its new business model and more efficiently and effectively serve its clients, Accenture also introduced a number of distinct workforces with different IT requirements. At the same time, Accenture foresaw a shift in the global business environment toward greater mobility and collaboration. Mobility became increasingly important so that employees could work flexibly from their office, home or client premises and while on the move. All of these mobility patterns needed to be supported by the latest technology solutions. Highly mobile employees also required a robust messaging and collaboration platform so they could communicate with colleagues and clients independent of geographic proximity. Finally, Accenture wanted to reap the benefits of greater efficiency by driving down infrastructure costs, managing service levels more productively and improving internal employee satisfaction. With these goals in mind, a new vision became clear: a single, global IT platform, running on a single operating system that provided anytime, anywhere access to common applications. Additionally, a single, global technology platform for finance, human resources and opportunity management would consolidate hundreds of legacy applications around the world and drive an integrated approach to decision making. Applications would be rationalized and standardized, simplifying the environment and reducing maintenance and support costs. The majority of Accenture's application development, delivery and maintenance would be centralized and global, and the delivery of infrastructure services would be outsourced. Overall IT planning, strategy, management and governance would be the collective responsibility of the CIO Organization and the IT Steering Committee, comprised of the operational leaders within Accenture, who are involved in all critical IT decisions and work closely to ensure that IT is aligned with the company's mission-critical priorities. This approach, it turns out, is reflected in the findings from Accenture's ongoing research into the role of IT in driving high performance. According to the research results, high-performance businesses rationalize, simplify and standardize IT to manage total cost of ownership and enhance productivity. Further, these top companies achieve ever-higher levels of performance by focusing on five critical areas when it comes to managing and delivering IT solutions: infrastructure, integration, information, innovation and industrialization. In addressing its myriad technology challenges, Accenture would, in effect, be putting its own research findings to the test. 3

4 A series of strategic decisions The network is the Internet Armed with the vision, Accenture set about turning it into reality. The first step was to re-architect a new network. During 2000 and 2001, Accenture designed and implemented a network that leveraged the internet. "Today, our network is essentially the Internet," says Frank B. Modruson, chief information officer. Accenture was one of the first companies to leverage the scale and cost efficiencies of the Internet, an innovative approach that laid the groundwork for the transformation that followed. A single Microsoft platform The second strategic decision was to deploy a single platform worldwide, a three-year process that also rationalized and standardized a variety of systems and applications. Though simple in concept, a single platform had rarely been delivered worldwide, let alone for a company as large as Accenture. But the rewards were worth the effort. "Migrating to a global platform gives us greater flexibility and costeffectiveness," Modruson explains. "We can focus all our development and delivery efforts on one platform and roll out new versions easily." The choice of technology provider was critical. Accenture sought an advanced, Web-enabled solution that could be delivered throughout the enterprise, from hosting to the desktop. Microsoft was the logical choice. As a long-time alliance partner, Microsoft had a deep understanding of Accenture and the ability to deliver a complete solution. "Microsoft has the ability to provide an end-to-end, top-to-bottom set of products and services, built upon a market-leading, robust and flexible platform," Modruson observes. Once the decision was made, Accenture moved swiftly to make the transition to a Microsoft environment. Accenture relied on the IT organization's strong Microsoft infrastructure skills and also joined forces with Avanade, a joint venture between Accenture and Microsoft, to extend the capabilities of its existing team by providing deep Microsoft platform expertise. Transitioning to the Microsoft platform involved changing two fundamental elements and collaboration tools. Accenture planned a three-year staged migration, beginning in The first step involved altering maildependent applications to function equally well with the current system and Microsoft Exchange. This cleared the way for step two the rapid migration of nearly 80,000 users in 48 counties to a Microsoft Exchange Server messaging and collaboration platform using Microsoft Outlook. At the height of the nine-month rollout, up to 1,000 users were transferred per day in one of the largest and fastest e- mail migrations ever completed. The company also installed an capability that allows employees on the go to manage their through mobile devices equipped with Microsoft Exchange Mobility. A blended Accenture and Avanade team designed the new Exchange 2000 messaging infrastructure, the routing infrastructure and perimeter security. The security solution uses Microsoft Internet Security and Acceleration Server to manage access to the new infrastructure. The successful migration paved the way for Accenture to launch a centralized knowledge management repository to replace the previous one. Again leveraging Avanade's messaging and application migration assets, Accenture used the Microsoft SharePoint platform to build a new knowledge management system that eliminated more than 66 percent of existing Web pages. By streamlining data, creating a single repository, improving the search capability and creating dynamic content capabilities, the company allows employees to find content more quickly and spend more time on client-facing activities. With the mission-critical applications in place, Accenture could quickly roll out two more applications that work on the Microsoft platform. MyScheduling, built on a.net architecture, is a fast and flexible tool that has reduced the time to staff assignments by 68 percent and the cost by 50 percent. The Accenture Rapid Transition Suite, an application built in collaboration with Accenture Labs, is a powerful combination of proven methods, processes and approaches that drive the successful startup of outsourced service delivery for our clients. The suite also includes automated knowledge transfer tools that facilitate fast, efficient information sharing across remote locations. SAP on Microsoft The third innovation was to implement one instance of an SAP system using Microsoft enterprise technology. This implementation better integrates Accenture's core business functions, such as finance and human resources, in a Microsoft environment and reduces the company's technology costs. The decommissioning of old financial applications alone saved Accenture more than US$12 million. The first SAP-on-Microsoft implementation was an ambitious undertaking to replace more than 200 different finance applications around 4

5 the world with integrated SAP modules. Accenture implemented the SAP R/3 and Business Warehouse applications, converting operations in all 48 countries at one time. Key modules included Financial Accounting, Controlling, Enterprise Controlling Sales & Distribution, Project System and Business Warehouse. "Migrating to a global platform gives us greater flexibility and cost-effectiveness. We can focus all our development and delivery efforts on one platform and roll out new versions easily." Subsequently, Accenture transitioned human resource systems to the same SAP platform, completing the integration of its financial and HR systems and data. With SAP Financials and HR, the company has a global enterprise resource planning solution that integrates 450 applications into a single instance. As a result, Accenture can improve decision making and conduct higher-value analysis and planning. Accenture also will leverage SAP for its opportunity management business processes. 5

6 Driving best practices Throughout the multi-year process, Accenture relied on pioneering best practices to implement a successful IT transformation. "We aim to practice what we preach," Modruson explains. "High performance begins inside Accenture. Our goal is to drive new concepts, metrics and management processes within the company to ensure that we are our own best practice." As an example, outsourcing was a key element of the transformation, allowing the CIO Organization to extend its capabilities, standardize delivery and drive rapid, cost-effective implementation. Accenture sources business application development and maintenance to the Accenture Global Delivery Network, a network of global sourcing resources. In addition, Accenture outsourced the delivery of infrastructure services and messaging and collaboration products to Accenture Technology Infrastructure Services. This strategic sourcing model enables IT leadership to focus on driving innovation into the organization, managing critical programs and strategically managing vendors. Another critical element of the transformation involves how users think about IT. The CIO Organization has empowered users to "serve themselves." This direct access to IT products and services boosts productivity and puts control in the hands of the employees. If employees need to set up a team website, for example, they no longer work through an IT "middleman." They simply complete an online request form and are sent a link to a newly created site. This automated process has cut site provisioning time of team sites from eight hours to about 15 minutes and gives customers the satisfaction of easily helping themselves. Similarly, the company has automated and provided self-service access to many other IT services, such as password reset and technology assistance, significantly reducing the number of help desk calls and inperson support required. The CIO Organization also introduced another best practice a managed services approach which creates the right suite of IT products and services for each customer segment, rather than the traditional one-size-fits-all model. IT staff collaborate with each customer organization to define the right services and service levels. Encompassing both infrastructure and business application offerings, this managed services approach has enabled Accenture to realize substantial cost savings while maintaining and often enhancing service levels. "High performance begins inside Accenture. Our goal is to drive new concepts, metrics and management processes within the company to ensure that we are our own best practice." 6

7 High performance delivered In the process of transforming Accenture's IT, "We focus on putting the 'I' in 'IT," Modruson notes. "Now it's about 'information.' Today we have the systems that enable our employees to access, create and analyze real information that the business can use to succeed." During a time when the number of employees increased by 64 percent (from 75,000 to 129,000) and revenue increased by 36 percent from ($11.44 billion to $15.55 billion), the IT spend as a percent of revenue fell by 50 percent, and the IT spend in dollars decreased by 30 percent. Global applications shrank from 600 to 300, and multiple technology platforms were reduced to one. IT business sponsor satisfaction rose from 3.2 out of 5.0 to 3.9 out of 5.0 (scores above 4.0 are rarely achieved). Accenture's IT transformation has garnered positive recognition within the industry. In a leading industry benchmark of the world's largest IT organizations, Accenture ranked the best in three key measurements: lowest IT expense as a percentage of net revenue, lowest IT workforce as a percentage of headcount and lowest IT expense per employee. The Accenture CIO Organization rates as a high performer according to Accenture's High Performance IT Diagnostic of the more than 450 organizations surveyed, only 12 percent achieved this top category. InformationWeek magazine ranks Accenture as having the 36th most innovative IT organization out of 500 North American companies. "Clearly, total value extends beyond financial considerations," Modruson notes. "Stronger and better IT capabilities help facilitate Accenture's drive to become a high-performance business and deliver superior client services and solutions around the world. Equally important, our leadingedge capabilities and world-class practices provide solid evidence that we can help our clients achieve high performance as well."

8 About Accenture Accenture is a global management consulting, technology services and outsourcing company. Committed to delivering innovation, Accenture collaborates with its clients to help them become high-performance businesses and governments. With deep industry and business process expertise, broad global resources and a proven track record, Accenture can mobilize the right people, skills and technologies to help clients improve their performance. With more than 129,000 people in 48 countries, the company generated net revenues of US$15.55 billion for the fiscal year ended Aug. 31, Its home page is About Avanade Avanade is the leading technology integrator specializing in the Microsoft enterprise platform. Our people help customers around the world maximize their IT investment and create comprehensive solutions that drive business results. Additional information can be found at About Microsoft Founded in 1975, Microsoft (Nasdaq "MSFT") is the worldwide leader in software, services and solutions that help people and businesses realize their full potential. Copyright 2006 Accenture All rights reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

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