Sourcing & Governance Dagens Industri Strategisk IT Sheraton Hotel Carl Rönnerstam KPMG Stockholm

Transcription

1 Sourcing & Governance Dagens Industri Strategisk IT Sheraton Hotel Carl Rönnerstam KPMG Stockholm

2 Carl Rönnerstam Head of IT Strategy & Transformation KPMG Advisory Sweden Consulting Telephone

3 KPMG Advisory Core Propositions Value creation and minimization of risk from M&A, integration and separation. KPMG can help companies enhance revenue and implement sustainable cost reductions. KPMG can help improve the effectiveness and efficiency of the finance function and generate real insights to deliver additional value to the business. TRANSACTIONS & RESTRUCTURING Providing support to ensure availability, efficiency and confidentiality in information systems by translating operational knowledge into IT knowledge. Guidance on the most appropriate strategies for: Creating and implementing Shared Service Centers Outsourcing/offshoring of IT services Ensuring implementation of effective controls RISK & COMPLIANCE Forensic KPMG can support companies in adapting to and addressing the consequences of new regulatory standards, including FATCA IFRS Optimization of operational activities by identifying improvement opportunities and contributing with experience on implementation. Improvement of business performance management and utilization of technology to support governance and control.

4 Provider Performance & Satisfaction Study Drivers Cost savings 78% 72% 67% Access to skills 49% 46% 42% Quality improvement 29% 44% 36% Financial flexibility 19% 17% 27% Time to market 6% 17% 25% Change agent 13%

5 Provider Performance & Satisfaction Study Governance How would you qualify the overall skills/competencies of your organisation to manage your outsource providers? 8% 2% 43% 47% Do you agree that your service provider has an efficient and effective governance model. 80% 76% 74% 72% 70% 70% 69% 68% 68% 64% 64% 63% 63% 63% 63% 61% 60% 59% 58% 57% 57% 54% 54% Medelvärde 65%

6 Relationship is key to success

7 Demand & Supply The platform for successful IT organizations is based upon the understanding of the core of demand management and supply management. Demand Mgmt doing the right things Supply Mgmt doing the things right How do we understand to focus both on doing things right, and also doing the right things?

8 Demand & Supply Framework Verksamhet Demand Supply IT-leverans EFFECTIVENESS göra rätt saker EFFICIENCY göra saker rätt Varför? Vad? Affärsprocesser Funktionalitet Krav Hur? Vem? Applikationer Infrastruktur IT-lösningar

9 KPMG Sourcing Lifecycle STRATEGY SOLUTION IMPLEMENTATION G OPTIMIZATION GOVERNANCE

10 KPMG Sourcing Lifecycle Sourcing Strategy Service Delivery Model Sourcing Assessment Governance scan/survey Opportunity Analysis and Business Case Internal Improvements Shared Services - Captive centre Outsourcing Offshore InSourcing Negotiation & Contracting Governance Service Delivery Business Alignment Diagnostic and Benchmark Renegotiation Support Contract Review Performance & Satisfaction Measurement Transition Transformation Change Project Interim

11 Strategy Do you know why to do what? Sourcing conversations usually starts with IT. The problem is, it often ends there, too. Sourcing is a major game changer. How would you like to transform your business by taking advantage of sourcing and governance?

12 Strategy Methodology Define baseline Sourcing strategy Reasons Business focus (core / non core) Improve quality Actual sourcing experiences Standardize service delivery Increase financial flexibility Cost reduction Sourcing objectives Maximize financial flexibility Reduction of operational IT focus and increase focus on actual ICT demand Get access to more innovative and more advanced service concepts 2 Service towers and preferred delivery options D1 D2 D3 T T T D1 D2 D3 T T T D1 D2 D3 T T T Preferred sourcing model Service tower A: Housing + Hosting C: Work place services D: Specific Business Applications: SAP E: Specific Business Applications: SAAS Detail strategy - Selection approach - Governance and retained organisation - Impact & risks - Business Case Preferred delivery option Outsourcing Outsourcing Share service Center No changes Implementation plan Risks and attention points Feasibility in terms of changing the organization Impact for every country has to be detailed Preferred location has to be determined Complex demand / supply organization Results Baseline (financial and operational) Market insight Sourcing model (scope, service towers and delivery options) Vendor model Governance impact Implementation plan Business case Input for: Selection process Detailed Shared Services implementation plan Transition / Transformation plan Benefits monitoring

13 Too Late to Wait Organization How does a successful retained organization look like? How big organization is needed to execute necessary governance? How do I transform my retained IT organization to effectively support a modern sourcing landscape?

14 Organization Methodology A B C D PHASE As-is Analysis & Strategy High level Organisation & Process Design Detailed Organisation & Continued Process Design Preparation of Implementation Mapping current situation on Demand Supply Model EQ Develop to-be organisation based on role clustering High level process design for remaining processes Define final organisation including functions STEPS 2 Strategy definition for business case and new organisation 5 Select relevant process chains 9 Role-function mapping: function descriptions 12 Implementation plan Design principles High level process design Define products and RACI mapping per product/roles 7 Define organisation incl functions and sizing Go/no go decision Benchmark database input

15 Organization Example Beställarorganisation Verksamhet Demand & Supply IT-leverans Affärsenhet/Avdelning Affärsenhet/Avdelning Decentral Governance Decentral Governance Central Governance Intern IT-leverans Extern IT-leverans

16 Organization Benchmarking Utgifter för Demand Mgt + Supply Mgt som % av total IT - utgift B % A % X miljoner Y miljoner Total IT - utgift

17 Organization Benchmarking Business Demand Supply IT Delivery Strategiskt Alla roller inom Demand och Supply Taktiskt X - Y % Taktiskt och operativt supply management Operativt Cirka Z %

18 Organization Example Processes Verksamhet Demand Supply IT-leverans Strategic Strategic Planning Business Governance Strategy & policies Portfolio management & architecture Annual planning cycle Organisation development & human resource management Security, compliancy & quality management Tactical Change & Innovation Control Project portfolio management Requirements, project & change management Release, test & transition management Finance Contracts & service agreements Service level management Operational Operational Control Support Operations & operational control

19 Benchmarking Do you really gain the full value? Price SLA Satisfaction Performance How do you understand if your current delivery gives you enough competitive advantage?

20 CEO Business director Process owner Business process Manager Information owner Application owner End user Key user Data administrator CIO Information strategy Application portfolio Service portfolio Vendor (portfolio) analyst manager manager manager Enterprise architect Business process Information architect IT landscape architect architect Auditor Information security Risk & compliance officer officer Quality officer IT director Solution architect Security & compliance officer Manager Demand manager Supply manager Delivery manager Project portfolio Program manager manager Project sourcing Business consultant Business project manager IT project manager manager Business process Information analyst Application/ infra Solution designer Solution engineer designer consultant Meta data manager Test manager Test coordinator Solution test manager Solution tester Change manager Release manager Deployment manager Business service Contract manager IT purchaser Contract delivery manager manager Service manager Service level Manager Service delivery manager IT controller Asset manager Administrative support Functional support Data quality analyst Service coordinator IT process manager Application engineer Service desk agent Systems engineer Database administrator Governance & Sourcing Advisory Target Operating Models Processmodell Rollmodell Demand&Supply Ansvar Transparent Target Operating Model Ihopkopplade demand-supplyprocesser Tydlig referensmodell för roller Tydliga roller och ansvar Vi designar tydliga TOM-strukturer genom hela värdekedjan för att säkerställa transparens från demand till supply. Vi etablerar ihopkopplade demandsupplyprocesser för att säkerställa väl fungerande processer från strategisk till taktisk nivå. Business Demand management Supply management IT Delivery Vi introducerar en tydlig och väl definierad rollmodell för att analysera roller i er organisation och för att stödja er i designen av framtida organisationen. Business Demand management Supply management IT Delivery Vi kopplar ihop demand-supplyorganisationen, processer och roller i en sammanfattande och direkt användbar RACImatris, vilken tydliggör ansvar för varje roll i varje process. Strategy & policies Strategic planning Portfolio management & architecture Strategic Annual planning cycle Organization development & human resource management Business governance Security, compliancy & quality management Tactical Project portfolio management Requirements, project & change management Release, test & transition management Finance Change & innovation Contracts & service agreements Service level management control Operational Support Operations & operational control Operational control Organisationsstrukturer Processdesign Governanceutvärderingar Effektivitet Lean, Six Sigma Tydlig organisationsstruktur Vi etablerar en ( retained ) organisationsstruktur som är logisk, genomförbar och relevant med avseende på komplexitet och IT-budget. Skalbara processflöden Vi designar och implementerar varje processflöde på en detaljerad nivå så att organisationens anpassas till respektive processteg. Transparens i storlek, roller och förmågor Vi benchmarkar och utvärderar roller och förmågor inom demand-supplyorganisationen och levererar ett business case för möjliga förändringar. Addera värde till processer Vi kan öka effektivitet och addera värde till processer i enlighet med t ex Lean och Six Sigma och motsvarande. Spend on Demand mgt + Supply mgt as a % of total IT spend 24% 12% Value Add Analysis In order to eliminate waste it must be identified Categorize all activities within a process into the following types: Value added Business Value added Non-Value added (Waste) Often times value added activities represent a small fraction of the total process Non-Value added activities (Waste) should be eliminated immediately. Non-Value Added (Waste) Activity Category Definition/Characteristics Value adding activity Activities that directly add value Something a customer will pay for Adds form, feature or function Value adding activities Non-value adding Enables competitive advantage (increase customer satisfaction, faster delivery, reduced price. 25 MiO 75 MiO Total IT spend Business Value Added Maintenance activities and unavoidable waste Legal/Financial reporting requirements Regulatory requirements. Non-Value Added (Waste) Activities that are unnecessary and should be eliminated and/or simplified (lean out) The seven types of Lean Waste see next slide.

21 Qualified Glocal Research

22 Key Take-Aways It is never too late to establish best practice Inadequate governance erodes sourcing value heavily. Learn how to realize the value of your sourcing It is essential to focus on the what and not the how. The demand and supply framework puts it together. Ensure goal alignment with your provider There is a risk to not deliver on the intent of the deal. Track and measure internal satisfaction Keeping an open dialogue and obtaining regular feedback from internal clients is key to managing expectations. Determine your organization s level of trust Do whatever necessary to maintain or regain trust toward your provider to avoid diminishing value.

23 Carl Rönnerstam Head of IT Strategy & Transformation KPMG Advisory Sweden Consulting Telephone