Governance of Outsourcing Contracts

Transcription

1 Governance of Outsourcing Contracts Magnus K. Jacobsen, Group IT, Danske Bank 5 September 2014

2 Overview: Danske Bank has a strong Nordic franchise Facts 3.7 million customers 352 branches* 15 countries 18,914 full-time employees Business units Personal Banking Business Banking Corporates & Institutions Danica Pension Danske Capital For divestment Non-core (Ireland & Conduits) Ireland 4% Northern Ireland Danske Bank market share** Norway 5% Denmark 20% 27% Sweden 5% Finland 10% Latvia 2% Estonia 7% Lithuania 6% * Excluding agricultural centres in Denmark. **Market share by lending 2

3 Key Areas covered today 1. Why spend time on governance of Outsourcing Agreements? 2. Which primary areas of activity should be prioritised Internal Processes External Governance Tracking and Follow-up 3. Take Aways 3

4 Managing Outsourcing Relationships requires excellence in many disciplines Performance Management Service Management (ITIL) Governance Contract Management Financial Management 4

5 Why should we spend time on Governance of Outsourcing Agreements? Governance is a key-driver for achieving the expected results Avoid value leakage Get what you pay for Tracking and followup Internal Processes External Governance Governance starts on the inside and ends on the outside 5

6 Key Components when working with Governance of Outsourcing Internal Processes Internal processes so you know what you do Tracking and followup Tracking and Follow-up so you know what they do (and don t) External Governance External Governance so you help your suppliers understand what you want them to do 6

7 The Governance is operationalised in Processes that are anchored within the organisation Performance Management 1 Enterprise Technology Architecture 18 Service Performance Mgmt SRs 20 Service Performance Mgmt Ops 21 Risk Management Operations 23 Service Measurement 24 Service Reporting 26 Service level Management 29 Information Security Management 30 IT Service Continuity Management 41 Service and Problem Escalation Governance 3 Customer Satisfaction Survey Mgmt 5 Governance-plan controls & report 6 Risk, Regulatory & Tax Compliance 7 Workplace Services 8 Communications Management 17 Performance Improvement (CPI) 22 Service Portfolio Management 49 Service Provider Audit 50 Governance Library Financial Management 2 (Demand) Forecasting Management 4 Project Spend Pool Management 9 Invoice Management 10 Performance Credits, Earnbacks 11 Financial Analysis & Planning 12 Procurement Oversight 13 Contract Pricing Adjustments 14 Value Leakage Mitigation 15 Chargeback Contract Management 16 Benchmarking 45 Contract Administration 46 Contract Change Management 47 Contract Issue Management 48 Dispute Resolution Service Management (ITIL based) 19 Service Request (for project) 25 Technical Service Catalogue 27 Availability Management 28 Capacity Management 31 (Operational) Change Management 32 Release and Deployment Mgmt 33 Transition Planning & Support 34 Service Knowledge Management 35 Service Validation & Testing Mgmt 36 Evaluation Management 37 Service Asset & Configuration 38 Standard Service Request 39 Ops Technical Mgmt Helpdesk 39 Ops Technical Mgmt Mainframe 39 Ops Technical Mgmt Midrange 39 Ops Technical Mgmt EUC 39 Ops Technical Mgmt Network 40 Access Management 42 Event Management 43 Incident Management 44 Problem Management 7

8 The Processes are documented thoroughly and are owned by different parts of the organisation 8

9 The Processes are documented thoroughly and are owned by different parts of the organisation 9

10 Key Components when working with Governance of Outsourcing Internal Processes Internal processes so you know what you do Tracking and followup Tracking and Follow-up so you know what they do (and don t) External Governance External Governance so you help your suppliers understand what you want them to do 10

11 Strong coherence between Agreement and Governance is needed Contract Deliverables Service Requests Agreement Follow-up Nice & Shiny Report 11

12 Number of deliverables Tracking of Deliverables & Obligations... Followed up by prioritization Kontinuerlig and opfølgning governance på leverancer og forpligtelser DRAFT Deliverables status; August Response rate NN NN deliverables were to be reviewed during the pilot Responded in due time 25% 67% No response NN NN NN Not delivered 1 Delivered with issues 0 Delivered under review 2 Accepted & closed 6 No reply from SME 8 59 Not requested occur- Not red Status not tracked To be deleted Total Delayed response 8% NN NN NN Number of D&Os up for review 39 12

13 Key Components when working with Governance of Outsourcing Internal Processes Internal processes so you know what you do Tracking and followup Tracking and Follow-up so you know what they do (and don t) External Governance External Governance so you help your suppliers understand what you want them to do 13

14 Strategical, Tactical, Functional and Operational level Strive to Empower and solve issues at the lowest possible level 14

15 Key Components when working with Governance of Outsourcing Goals & Objectives Mandate & Scope Escalation Path Rules of Engagement Governance Library 15

16 The External Governance model must be able to handle issues that arise in a well understood and documented way Receive reports Prepare Agree topics and presentation Meet Follow up Agree actions and decisions Escalate Minutes Governance Plan Site with all information 16

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18 Holiday in Namibia? 18

19 It takes more than you expect to Govern! Organisational Reporting Supplier Technical Mental 19

20 Everybody has to know what to do Processes Role & Responsibility Prioritisation Processes Role & Responsibility Prioritisation 20

21 Final Questions? 21

22 Contact Details... feel free to call Planning, Negotiation and Management of complex Outsourcing Arrangements Integration of banks and achievement of Synergies International experience with Programme Managment, Negotiations and M&A Magnus Krøjgaard Jacobsen Danske Bank A/S Holmens Kanal 2 12 DK 1092 Kbh. K 22