JDE/ERP Strategy & Roadmap. C r a i g T h i e l e n

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1 JDE/ERP Strategy & Roadmap C r a i g T h i e l e n 2011 Trissential. All Rights Reserved. 1

2 2011 Trissential. All Rights Reserved. 2

3 2011 Trissential. All Rights Reserved. 3

4 Oracle Investment in JDE Past track record of releases (17 in 6 years) Current roadmap to 2018 Upgrade Value Proposition & ROI tool Partner support, tools, training and resources New modules/capabilities Environmental Accounting and Reporting Financial Mgmt Compliance Console Significant enhancement to Tools/Technical Mgmt Apparel & Fulfillment Mgmt Purchase Card Mgmt (World) OBIEE/Fusion Integration/Fusion Applications 2011 Trissential. All Rights Reserved. 4

5 Challenges for JDE Clients When and how often to upgrade? What is the Business Case? Support from Oracle expiring? Do we have a clean house (app portfolio)? Is JDE the right solution? Is IT aligned with the business? Where do we make our investments? What about process improvement? 2011 Trissential. All Rights Reserved. 5

6 Maturity Model Maturity BEST IN CLASS 1. Adoption of Standardized Processes & Systems 2. Global Process Governance 3. Global Visibility to Transactional Data 4. Master Data Governance 5. Automated KPI Reporting Strategic Business Enablement (Business Intelligence, Collaboration, Capability, Flexibility & Agility) FUTURE 1. Standardized Processes & Systems Defined 2. Specialized Global Competency Teams 3. E-Commerce Tools Leveraged 4. Master Data Standards Defined 5. Standardized End-to-End KPI s Operating Excellence (Decision Support, Response Time, Error Rates, Cash Optimization) CURRENT 1. Lack of Standardized Processes & Systems 2. Low adoption of COE s 3. Manual, Paper Based Processes 4. Fragmented Master Data 5. Fragmented KPI s Complexity Reduction (Eliminate, Simplify, Automate, Consolidate, Globalize) Strategy Move Up Maturity Curve Over Time, Toward Best In Class Source: The Hackett Group GBS Report, March Trissential. All Rights Reserved. 6

7 Maturity Model 2011 Trissential. All Rights Reserved. 7

8 Maturity Model Level Business/ Enterprise End IT Alignment Applications Users Infrastructure 1 Core ERP There is a link between business and IT for configuration updates. ERP is not overly customized; core implementation is complete Basic end user training is complete. ERP infrastructure is adequate. 2 Stable ERP 3 CoE Defined 4 CoE Managed 5 CoE Evolving The role of business in ERP evolution is defined. Business has active ownership of business processes. Current KPI is measured. KPI measures and targets are in the system. EPMO directs business process transformation. Business process change is guided by KPI performance and configuration is in the hands of business. ERP is the backbone of enterprise applications. Applications interfacing is complete. The applications portfolio is inventoried. The applications portfolio has been rationalized. The applications portfolio has been optimized. End users fulfill ERP functions without excessive help desk or support. End users receive periodic refresher training End users are trained to business processes and continuous training is in place. End user job performance is linked to business process performance ERP infrastructure is stable. ERP infrastructure is flexible. Apps data is generally synchronized. Enterprise applications infrastructure is flexible. Enterprise applications infrastructure is adaptive to applications changes Trissential. All Rights Reserved. 8

9 Maturity Model 2011 Trissential. All Rights Reserved. 9

10 Maturity Model People/Governance Spectrum of Maturity Site-Led Org Blended Site/ Functional Functional Org Blended Functional/ Process Process Org Process Manual Inconsistent documentation, automation, low standardization Documented with limited automation & standardization Mature trained, automated, with standardization World Class maturity Technology/Tools No ERP platform support. Manual s/w No ERP Std defined. Playbook issues Solved ad hoc Multiple ERP platforms + instances. Playbook plan 1 ERP platform, w/multiple instances Mult playbooks Single instance ERP Std app playbook 2011 Trissential. All Rights Reserved. 10

11 Measuring improvement Standardization Scale GBU s Standardized 1-3 GBU s Standardized Single GBU Standards Within GBU No Standardization Planning and Issue PO Standardization Maturity Material Receipt 1.0 P-050 P-060 P P-110 P-120 P-070 P-080 Accounts Payable Maturity Scale World Class, Best Practices model Mature, trained, highly auto, measured, high perf orming Documented, consistent, with basic auto Basic level of process consistency, non-auto Ad hoc, manual process = Site specific Maturity limits P-050 Create Purchase Req. P-060 Purchase goods P-090 Consignment Stock P-110- MRO P-120 Toll Mfg P-070 Receive Materials P-080 Manage Payables 2011 Trissential. All Rights Reserved. 11

12 Measuring Improvement Process: Ashland Anoka Delavan Glendale Han Park Herental Lausanne Reynosa Sanford Straubenhardt World Class Purchasing Kanban Card Scanned Keyed Scanned Scanned Scanned Scanned N/A Keyed/ Scanned Scanned Scanned Scanned Purchase Orders Manual Manual Manual Manual Manual Manual Manual Manual Electronic Manual Electronic Price Changes Manual Manual Manual Manual Manual Manual Electronic Manual Manual Manual Electronic Order Acknowledgements Not Required Not Required Not Required Not Required Not Required N/A Not Required Not Required Not Required Not Required Electronic Advance Ship Notice Not Required Not Required Not Required Not Required Not Required N/A Not Required Not Required Not Required Not Required Electronic Receiving Goods Receipt Manual Manual Manual Manual Manual Manual Manual Manual Manual Manual Scanned Accounts Payable Invoice Receipt Manual Manual Manual Manual Manual Manual Manual Manual Manual Manual Electronic Invoice Exceptions Metafile Manual Esker Manual Manual Manual Manual Manual Ultimus Manual Electronic Vouchers Manual Manual Manual Manual Manual Manual Manual Manual Manual Manual Electronic Vendor Self-Service Not offered Not offered Not offered Not offered Not offered Not offered Not offered Not offered Not offered Not offered Portal Fax/ are considered manual processes By inventory, Pentair is a non-top performer vs. World Class processes 2011 Trissential. All Rights Reserved. 12

13 Future State Current State Measuring Improvement P Paper Purchasing PO Sent Acknowledg e/po verified ASN/PO verified Packing slip keyed in ERP P Invoice keyed in ERP P 3-Way Match Acknowledg e printed P ASN printed P Invoice printed Supplier PO Receive d PO printed PO keyed into ERP P Acknowledg e sent ASN sent Product shipped Invoice sent P P P Purchasing Supplier PO posted to portal PO loaded into ERP Manual Process Acknowledg e/po verified electronicall y Acknowledg e posted to portal ASN/PO verified 2011 Trissential. All Rights Reserved. 13 ASN sent Product received using RF Product shipped Electronic Process P Invoice loaded into ERP Invoice posted 3-Way Match Electronic transactions reduce paper & # transactions for Pentair and our suppliers

14 Typical Key Drivers Ask the question, why change? Opportunities for cost reduction (process, people, technology) Opportunities to improve and standardize technology Opportunities for process improvement Agreed upon and standardized metrics Improved and clearer alignment to business Become more proactive, less reactive Reduce organizational risk Enable more advanced solutions 2011 Trissential. All Rights Reserved. 14

15 Improvement Roadmaps A tool of alignment to the business Allows for planning, budgeting and prioritization Gives a sense of direction and decision making Shows a sense of sequence & schedule 2011 Trissential. All Rights Reserved. 15

16 Roadmap Sample Program Launch Executive Review & Feedback Build Team, Org Comm., and Business Case Foundational GCTs Scope & Plan Deploy Measure & Refine Transformative GCTs Scope & Plan Deploy Measure & Refine Align to Foundational GCTs 8/1/11 10/1/11 1/1/12 6/1/12 1/1/13 1/1/14 1/1/15 Leadership Activities CFO Summit Exec Present Business Case Developmen t $ PMO Enterprise Apps Roadmap & GCT Approval Port Mgmt Gov. & People Cross Team Coord Training, Tools, Automation App Stds App. Port LCM/Consolidation Execution App COE s P2P Review GCT Review BPA I2I Review GCT EA Consolidation Complete Training.Process Stds Tech Execution Gov & Oversight Training.Process Stds Tech.. Etc. New GCT s Defined Review BPA Review GCT Training.Process Etc. Bus Process Assess v2 Site Visit Capture AS IS, Std & Mat. Identify GCT Potential Existing GCT s Continuous Improvement Integrate to PMO & GCT Standardize & Mature Training Other End-to-End Processes IT Infrastructure, Strategic Sourcing, Collections (Get Paid), PIMS, NPS 2011 Trissential. All Rights Reserved. 16

17 Roadmap Sample Phase 1 (Upgrade) Build Foundation 1) Upgrade to JDE E % web enabled Improved ease of use Improved access to data Improved support, funct, security, scalability Improved basic workflow Data clean up/archive 2) Upgrade hardware platforms for standards, TCO and future growth 3) System failover 4) Refresher & Net/Change JDE training 5) Improvements to PR, HR, CAM, Fin, CRM 6) HR Performance Mgmt. 7) Evaluate CTC, rsc assign, lien waiver, IT Phase 2 Improve & Extend 1) HR Employee & Manager Self Service 2) Extensive workflow & automation 3) Online Benefits & Open Enrollment 4) Job site usage for HR 5) Applicant Tracking 6) Competency Mgmt 7) Resource Assignments 8) CAM improvements 9) Evaluate QA, Field project mgmt, budgeting, legal 10) CTC improvements 11) BI, Dashboards, Analytics, OBIEE Phase 3 Expand, Innovate, Iterate 1) Expense Mgmt. 2) Sourcing Improvements 3) Inventory Management, requisitions, receiving 4) Portal Usage 5) Quality Assurance 6) Budgeting/Modeling 7) Evaluate 2-3 improvmts 8) Validation of EA strategy & re-plan EA roadmap 9) Barcoding/DC 10) Legal/Contract Mgmt 11) OBIEE Refinement 2011 Trissential. All Rights Reserved. 17

18 Roadmap Sample Strategy: Consolidated business process model Business Integration Plan & Supply Chain Integrate through leveraging, simplifying and standardizing business processes on a common ERP Bus. Integration Plan Supply Chain Recommendations Develop ERP Business Case and Approvals Roadmap & ERP Capital $ Technology Architecture Business Integration & ERP Project E-business Tactical Enhancements Hyperion Data Whse Arch. Plan Demantra OTM Tech. Deploy Assess Ext./Term. 2 yr Contract Yr1: $665,000 Yr2: $695,000 Scope, Plan, Requirements, Design, Build, Deliver E1 v9.x? Go Liv e Ext./Term. 1 st 1yr Extension $720,000 Stabilize Phase - II Go Live Ext./Term. 2 nd 1yr Extension $750,000 Stabilize Other ERP/E1 Initiatives World 2010, Prepay Declining Freeze JDE Release Schedule: World A7.3 Support E1 8.9 Support Wave B Wave C E1 Upgrade v9.0 v9.1 v9.2 Premier Support Through 2013 (upgrades, fixes, phone, tax, legal & regulatory) Premier-9/08 tax & reglatory-9/09 Sustaining Support (upgrades, preexisting fixes, phone) Indefinite 2011 Trissential. All Rights Reserved. 18

19 How to make change Key Drivers Issues Risks Opportunities Benefits Plan & Mobilize Assess Current State (Baseline) Vision & Strategy Blueprint (Roadmap and Recommendations) Software/ Process Evaluation & POC Wave 1... N Design and Implementation For each Phase in the process: Determine the core objectives that must be meet before moving forward Assess what data exists and validate that data (i.e. how good is the data) Identify gaps between existing data and the core objectives Develop a plan to resolve those gaps Execute the plan Validate results and obtain sign-off 2011 Trissential. All Rights Reserved. 19

20 Things to consider Current application portfolio & architecture Level of IT spend on Maintenance vs. Improvement Business process maturity Risk tolerance (SW/HW support, Reg & Industry Compliance, Bus Continuity, competitive edge) Tolerance to new models (SaaS, Outsourcing, managed services, Cloud Computing, Mobile/Social) Internal skills Level of investment (TCO, ROI, NPV, BCA, etc) Technology standards and consolidation 2011 Trissential. All Rights Reserved. 20

21 Takeaways Having an ERP Strategy & roadmap is essential Always start with business alignment Use one or more maturity models to measure against Assess, measure & improve. Repeat Trissential. All Rights Reserved. 21

22 2011 Trissential. All Rights Reserved. 22

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