Deutsche Telekom focuses on Standardization: Driver Seat shared by IT Architecture and Business Architecture?

Deutsche Telekom focuses on Standardization: Driver Seat shared by IT Architecture and Business Architecture? Dr. Karsten Schweichhart Vice President Group Enterprise Architecture / Deutsche Telekom AG

Agenda. Why Standardization and Harmonization in Deutsche Telekom One.ERP Success Story in Process Standardization BPM Guidance: Standardized, process-oriented Approach for IT Projects Outlook BPM Lifecycle 2

Deutsche Telekom Group - Profile and Figures. Company Products Facts and Figures Employees Global Group Deutsche Telekom is one of the world s leading service companies in the telecommunications industry represented in more than 30 countries Our strengths Products & services for the fixed network in mobile communications by the Internet and IPTV with ICT solutions By the numbers In 2010, revenue of EUR 62.4 billion EBITDA EUR 19.5 billion Free cash flow EUR 6.5 billion Major factor in success: 247,000 Employees 3

Driver: Transformation of Business Model. From a Hardware based Voice Company to a Software based Multimedia Delivery Company. 4

Key Ambition. One Customer Experience drives Business Process Harmonization. Cost Cutting Effects highly welcome. Key ambition of the NG IT Program NG IT Program Applications One customer experience NG ERP NG NG NG Different Processes/ IT in each country Different customer experiences Cost pressure on countries Lack of flexibility due to complex processes Heterogeneous partner capabilities Infrastructure Office Standardization Dynamic Computing Cross country harmonized/ standardized Processes/IT Improved & unified Customer experience increased service perform. Improved Cost Structure Reduced time-to-market Innovation leadership in individual markets and partnering 5

NG IT Strategy. Simplification 3 3 Harmonization Standardization Consolidation Business Process simplification Harmonized business processes based on best practice Business processes close to SW standards Reduce Product and Process variations Application simplification Develop once use many + Localization 80% standard applications (COTS) Reduce number of applications by 25% within four years Infrastructure simplification Common Infrastructure across DTAG Platform virtualization strategy Consolidate Data Centers 6

Agenda. Why Standardization and Harmonization in Deutsche Telekom One.ERP Success Story in Process Standardization BPM Guidance: Standardized, process-oriented Approach for IT Projects Outlook BPM Lifecycle 7

Approach of One.ERP. As Is Different data models, manual reports Partly manual and individual processes Many ERP systems To Be One common data model, Single Point of Truth for KPIs Standardized Processes One.ERP IT landscape Easier implementation of organizational changes 8

1.1.1 Stammdatenpflege/ KB Buchhaltung Shared Service Buchhaltung Kleine Gesellschaften Buchhaltung Shared Service 1.1.1.1 Neuanlage Kreditorenstammsatz (mit/ohne Bestellbezug) 1.1.1.2 Änderung Kreditorenstammsatz (mit/ohne Bestellbezug) 1.1.1.5 Personalkreditoren -Barauslage- 1.1.3 Wareneingang 1.1 Shared Service Kreditorenbuchhaltung 1.2 Shared Service Debitorenbuchhaltung 1.3 Shared Service Anlagenbuchhaltung 1..1.3.1 Wareneingangsbuchung Materialbeschaffung (SAP) 1.1 Shared Service Kreditorenbuchhaltung 1.1.3.2 Wareneingangsbuchung Materialbeschaffung (Katalogsystem) 1.1.3.3 Wareneingangsbuchung Dienstleistung (evergabe/promp) Einzelabschluss 1.1.4 Rechnungseingang 1.1.4.1 EDI Rechnungseingang MM 1.1.4.2 Webportal 1.1.4.3 EDI FI (Massenprozesse) 1.1.4.4 ERS Rg. mit Bestellbezug (Umsatzsteuerliste: SOLL-Prozess) 1.1.4.5 Eingangsrechnung digitalisieren (frühes Scannen) 1.1.4.6 Little Supplier Invoice (LSI) Konzernabschluss 1.1.5 Rechnungsbearbeitung 1.1.5.1 Verteilung der Rechnungen mit/ ohne Bestellbezug 1.1.5.2 Rechnungsbearbeitung ohne Bestellbezug 1.1.5.3 Rechnungsbuchung mit Bestellbezug (MM) 1.1.5.4 Rechnungsbuchung mit Bestellbezug (MMD) Business and IT: Common Responsability for Standardization. Business IT A Prozess B Ebene Kerngeschäftsprozessebene 1 Hauptprozessebene 2 Teilprozessebene Tätigkeit Aktivität Maske/ Arbeitsschritt 3 4 5 6 Synchronization Business Blueprint DMS Betrieb Test RICEFW, Excel-Print, Role concept Configuration 9

Results of One.ERP until 2011. Results Finance Procurement HR SCM PSL Cross functions Language: English ARIS / SAP Solution Manager Rollout Package Degree of standardization more than 80%. Development of a group-wide ERP data model and process for maintenance. More than100 project guidelines established Group-wide ERP IT Architecture developed. Enterprise-wide portal concept developed. All planned approvals carried out, incl. the ICS test. One.ERP International Community established. 10

Agenda. Why Standardization and Harmonization in Deutsche Telekom One.ERP Success Story in Process Standardization BPM Guidance: Standardized, process-oriented Approach for IT Projects Outlook BPM Lifecycle 11

How we did it: A process-oriented Approach for NG IT Projects - A Story in 7 Acts. As-Is Situation Independent flows 2 3 Standardized procedure Frameworks & Guidelines Differently structured documentations Undocumented Know How Template approach 4 5 BPM Guidance Reference processes Business use cases To-Be Structure 6 7 E2E Process 1 Detailed processes with standardized - Roles - KPIs, capabilities, data, - Degree of standardization - Templates for internat. rollout ARIS project repository 12

Act 1: E2E Processes bridge Sub Processes, Projects and Systems. E2E processes 1 Illustrative example Processes Application CRM ERP Billing ERP Project NG NG One.ERP NG One.ERP Interfaces need to be addressed across projects: Process interfaces Services Data exchange 13

Depth of Definition Guidelines defined Guidelines defined Guidelines defined Act 2: BPM Guidance in Business Process oriented IT Implementation Projects. Standardized procedure 2 Business IT Project Preparation Conceptual Design Technical Design Build & Test Migration Phase Go-Live BPM Guidance Objective is the support of all project phases by BPM Governance. Focus is on the phases Conceptual Design and Technical Design, as they play the biggest part in business process modeling. 14

Act 3: Template Approach ensures the Consideration of Business Process Standards in NatCos. Template approach 3 System Template Roll Out NatCo n Conceptual Design Technical Design Build & Test Roll Out NatCo 1 Activities (extract): Scope definition Process priorization Design to-be processes Activities (extract): Technical process design Data & interface design Technical specification of capabilities Activities (extract): System configuration Perform tests Activities (extract): Analyse & design processes System configuration Perform tests Enduser training Adjustment with NatCos Adjustment with NatCos Adjustment with NatCos Process Simplification regarding reference processes Process Simplification regarding global processes 15

Act 4: Frameworks & Guidelines. A common Standard for Process and Capability Documentation is a Prerequisite for Business Process Standardization and Harmonization. Process Framework Components Frameworks & Guidelines 4 Process Framework Components in Detail TM-Forum Business Process Framework Telekom Process Architecture (TPA) ProuD Process Model DTAG Business Capabilities Guideline for Process Design and Process Mapping 16

T... CC/ CSP Shop CRM Billing External External DB Organizational elements &.... Sales Telemarketing Shop Sales Amdocs CRM Amdocs Convergent Billing External Configure Product via CC/ CSP Shop Manage Change Ownership Request via CSP Shop Migrate Pre to Post Pay Channel via CC/CSP Shop Manage Customer/ Account Data via SS Customer Search contact BSS.605199 Search contact SYS BSS.607639 Determine if contact already created BSS.607804 Present search results SYS BSS.607161 Yes No Select existing contact BSS.606864 Present contact details SYS BSS.608183 Capture additional account details NEW.829439 Capture account details NEW.829444 Acquire Customer Data SYS Gather contact & account details BSS.607823 Capture contact and account details BSS.605385 SYS Determine customer type BSS.606572 SubProcess: Address Validation Pre Paid Post Paid Create address(s) BSS.605040 Create customer BSS.607540 SYS Create contact/ account (if required) NEW.829454 SYS SYS Request credit class evaluation BSS.605684 Request credit class evaluation SYS BSS.606418 Perform credit vetting BSS.607430 Credit Evaluation Capture credit class BSS.605761 SubProcess: Web User Registration via CC/ CSP Shop SYS Negotiate Contract Terms via CC/ CSP Shop Manage Change Ownership Request via CSP Shop Migrate Pre to Post Pay Channel via CC/CSP Shop Act 5: Reference processes. Reference Processes and Procedures as an Input to design Business Processes. TPA SAP Amdocs Reference processes 5 ST-ICO* 1 CES* 3 Business Process Framework Create Customer via CC/ CSP Shop Procedure BPM Guidance Procedure ASAP Procedure ASOM* 2 * 1 Standard Implementation Content * 2 Amdocs Scenario Optimization Modeling * 3 Customer Experience Systems 17

Aggregatedorder Top Down customer Bottom Sub-order1to Up n Handle Customer Request via CC Negotiate Sales via CC/ CSP Shop Configure Mobile Product via CC/ CSP Shop Customer Interface Management Selling New Customer Existing Customer Create Customer via CC/CSP Shop Negotiate Contract Terms via CC/ CSP Shop Order Handling Bill Payments & Receivables Management Negotiate Order Completion via CC Retention & Loyalty Manage Customer Satisfaction via CC/ CSP Shop Order Handling Service Configuration & Activation Order Decomposition Resource Provisioning Connect Mobile Product Delivery Notifications Handle Customer Request via CC Negotiate Sales via CC/ CSP Shop Configure Mobile Product via CC/ CSP Shop Customer Interface Management Selling New Customer Existing Customer Create Customer via CC/CSP Shop Negotiate Contract Terms via CC/ CSP Shop Order Handling Bill Payments & Receivables Management Negotiate Order Completion via CC Retention & Loyalty Manage Customer Satisfaction via CC/ CSP Shop Order Handling Service Configuration & Activation Order Decomposition Resource Provisioning Connect Mobile Product Delivery Notifications Act 6: Integration Business Use Cases in process-centric Approach. Deriving Business Use Cases on E2E Process. Telekom Process Architecture Process-centric approach Process-centric & Business Use Cases Business use cases 6 0 Business view Business view 1 2 3 4 E2E process view Customer Orders a Product - Mobile via CC Business Use Cases 5 Customer Orders a Product - Mobile via CC Vendor specific reference processes Implementation view Implementation view Standardized process Standardized process & variants 18

Business processes Product Life Cycle Mgmt. Service & Resource Lifecycle Mgmt. Billing Strategic Management CRM Service Management Resource Management Partner Mgmt. Supply Mgnt. Production Act 7: International Process Repository (IPR). This Environment delivers a ARIS Repository with needed Information's for each NG IT Project. ARIS project Frameworks repository 7 Processes of the customer domain Processes of the product domain etom/tmf Order to cash Termination to prevention/closing invoice Customer-to- Request to information Customer Request to change processes Incident to solution (C2C) Complaint to solution Usage to cash Processes of the network and factory domain Control and support processes TPA Business Capabilities GDM Business Entities IPR Guidelines ARIS project repository Process Template Concept Modeling Guideline Vendor specific reference processes 19

Bottom Sub -order Up 1to n Generalization Aggregated Top Down order customer Method in 7 Acts used in next Standardization Projects. Example: Adapted Process Concept (compare Act 6). Telekom Process Architecture 0 1 Process Core business process level 1 TPA / etom Building Structure Usage-to-payment Business Processes (use cases) Business use cases Amdocs Reference Processes 6 2 3 Main process level 2 Charging Specialization 4 5 Sub process level Process step 3 4 Perfom Rating Collect UDRs Business use case: Usage Rating for Postpaid Post Paid Customer Consumes a Service Mediate Offline Records Vendor specific reference processes Services 5 Perform File Acquisition Screens 6 20

Agenda. Why Standardization and Harmonization in Deutsche Telekom One.ERP Success Story in Process Standardization BPM Guidance: Standardized, process-oriented Approach for IT Projects Outlook BPM Lifecycle 21

Overall View BPM Lifecylce: 2 Phases live in Projects, 2 Phases piloted in Laboratory. Define & Assemble Execute & Control Method in 7 Acts Piloted in Laboratory BPM Guidance as a standardized approach established: Next Steps to establish the whole BPM lifecycle: Early commitment of the Business with the results. Structured and committed requirements along the business processes. Process model serves as a binding basis (template) for roll out in countries. Control Define Execute Assemble Objectives: Piloting an integrated tool chain in the laboratory Agility layer for E2E processes Monitor process performance (e.g. CEP * ) Analyze process and service performance according to KPIs * CEP = Complex Event Processing 22

Deutsche Telekom focuses on Standardization: Driver Seat shared by IT Architecture and Business Architecture? The early involvement of the business Transparency by common process design Common criteria for measurement of standardization Translation between business process view and COTS standardization view Early involvement of the national companies C support Do s Method as a dogma Don ts Unaligned methodical decisions of single projects IT has the lead in the early phases (conceptual design) Extensive tool discussions YES! On the long and exhausting way to go to project's success, it is strongly recommended that Business Architecture and IT Architecture share the driver seat in an aligned manner. We will never drive alone! 23