Clive Corscadden & Rajesh Chopra - Shared Services Virtualization
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Clive Corscadden & Rajesh Chopra - Shared Services Virtualization

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Presentation from the 14th Annual North American Shared Services & Outsourcing Week, 2010

Presentation from the 14th Annual North American Shared Services & Outsourcing Week, 2010

To find out more about the 2011 event go to:
www.sharedservicesweek.com

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Clive Corscadden & Rajesh Chopra - Shared Services Virtualization Clive Corscadden & Rajesh Chopra - Shared Services Virtualization Presentation Transcript

  • SHARED SERVICES VIRTUALIZATION: DON’T LET THE SUN GO DOWN ON ME. Clive Corscadden, Partner Rajesh Chopra, Partner March 25, 2010 CSC Proprietary and Confidential
  • What We Heard? • We have further cost optimization challenges to address? • Our business requires agility? • We currently have centralization of our finance functions and are evaluating Shared Services? • We have a current BPO contract coming up for renewal and would like to understand comparative levels of SSO structure/efficiency. • We have been using SSO for a number of years, but would like to understand where to go from here in terms of process, people, & technology efficiencies. • How can SSO be expanded efficiently to add more services? • We are in M&A mode, what should our M&A framework look like? • How to develop processes which can scale based on business/customer requirements? What are your challenges? © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 2
  • Cost Optimization and Business Responsiveness Challenge • With the change in global economic situation, companies are focused on furthering business cost optimization by increasing business operation efficiencies and effectiveness • Shared Services Organizations (SSO) have a track record in reducing business operations cost and enhancing productivity • New locations on the globe are becoming viable locations for captive centers • To enable SSO’s to meet new business needs, there is a need to transform current state SSO’s to a “Virtualized Shared Services Organization” © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 3
  • Shared Service Life Cycle Model SSC Evolution Stages VIRTUALIZATION People, Process, OPTIMIZATION Technology Elasticity VALUE/COST RATIOS People, Process, • Improve business Technology responsiveness through STANDARIZATION Integration scalability and SSO agility • SSO leader reports to CFO/COO Process • Integration of optimized • Global support with CONSOLIDATION Standardization processes, technology, and regional focus organization • Global labor integration and • Balance between SSO & employee rotation outsourcing programs Resources Under • Focused on standardization • SSO leader selected from • Shared services catalog of policies, procedures, and One Organization technology BU’s • Leverage latest technology • Standardized enterprise including Cloud and • Informal Governance Board system Collaboration • Multiple systems in use by • Focused on brining few • Integrated Contact Center • Leveraged SSO/BPO customers processes and technology • Balanced Scorecards model • Customer relationship under one roof • Detailed SLA’s • Balanced scorecards managers identified • Viewed as part of Corporate • Variable Pricing integrated to customer • Some performance centralization • Formal Governance Board strategy reporting • Disparate IT Systems • People, Process, • Performance metrics • Technology metrics • Funded by Corporate Technology metrics available via SSO monitoring • Reactive performance identified to measure SLA’s dashboard management Shared Services Maturity Levels © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 4
  • How Do You Get to a Virtualized SSO? While most of the basic features will remain the same for SSO’s, building Elasticity within people, process, and technology areas are critical for transformation to a virtual SSO Complex Services FP&A, Invoice Analytics, Global Tax People Services, Credit and Collections, Global Process Sourcing, Procurement • Alliance with global BPO • Developing a SSO providers Catalog of Services Commodity Services Invoicing, Billing, Contact Center, • Appointment of global • Standardized global Expenses, HR, IT Help Desk, Property SSC executive reporting business processes Management Payroll, Financial Processing, to COO/CFO General Accounting • Designing SSO • Corporate Employee processes to support SSO Rotation Program Seasonal Marketing and Finance current and future Support, R&D Services, Cloud Services, • Shared Services Center processes Collaboration Services of Excellence (COE) • SSO performance • Establishing a formal measurement SSO governance board Technology • Deployment of global collaboration technology • Use of Cloud computing services (Pay as you go) • Continuous update of latest technology advances to enhance productivity © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 5
  • People and Process Elasticity: Shared Services Center of Excellence SSO Center of Excellence organization will monitor and improve the performance of current services while delivering additional processes/services for the business stakeholders High Process Elasticity People Elasticity Reporting People Elasticity •Global Labor market strategy/BPO Alignment Analytics Elasticity Seasonal FP&A Technology Elasticity Support R&D •SSO resource rotational program Marketing Collaboration Sales Transactional Services, Web Programs Hosting Invoicing, Billing, HR Process Elasticity Processing, Payroll, IT Helpdesk •Developing and maintaining on-line Shared Services Catalog Low Complex Services High •Shared Services Performance/Cost Improvement Processes © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 6
  • Technology Elasticity: Cloud Computing Fundamental Elements of Cloud Computing SSO Elasticity SSO Processes Business Needs • Technology elasticity will drive additional complex services within Record to Report Purchase to Pay Order to Cash SSO’s Sales & Marketing Services Services Services Tax & Treasury Reporting & Analytics HR Services Payroll Services Services Software as a Service (SAAS) Platform as a Service (PAAS) • SAAS (Software as a Service): ERP/Reporting & Analytics and Web Business Reporting & CRM/Other Collaboration other software vendors are ERP Software Application Application Analytics SAAS Platforms building cloud offerings for their Platforms Platforms software, including vendors - Salesforce.com, Google, Microsoft, etc. SSO Data Models • PAAS (Platform as a Service): Cloud Data Models Security & Procedures Data Data Retention including messaging, identity Policies/Procedures management, file sharing, Web Applications • IAAS (Infrastructure as a Service): Infrastructure as a Services (IAAS) ability to scale data centers, Storage Provisioning OS Provisioning Network Provisioning CPU Provisioning servers, and storage © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 7
  • CSC Total End-to-End Approach for a Shared Service Center Implementation Program Management Implementation Project Management Improvement Easy Fix High Impact Perform. Audits Processes & Procedures Process Information Technology Quick Hit Continuous Improvement Programs Perform Audits Survey Realization Process Mapping & Service Level Agreement Major Opp Feasibility Studies & Business Case Blueprint Business Service Management Processes & Procedures Baselining Strategy Vision & Operating Organization & Skills Model New Redesign Management & Control Systems Information Technology Location Study Knowledge Transfer Local Redeployment Legal & Fiscal & Social Reengineering Toolkit & Best-Practices Implementation Audits Toolkit Organizational Change & Communication © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 8
  • High Performing Virtualized Shared Services Are Achieved Through a Number of Good Practices … CSC SHARED SERVICES PERFORMANCE FACTORS PERFORMANCE MODEL Leadership Processes • Clarity of SS vision • Elastic processes design & • Clarity of goals & objectives implementation approach • Clarity of priorities • Clarity of roles & responsibilities Leadership • Active Steering Group • Performance targets & process • Use of SS champions metrics • Conflict resolution strategy • Monitoring of process defects • Continuous process improvement People & Culture culture Processes & People & • Quality of staff KPIs Culture • Structured recruitment Technology & Systems v/c • Broad based training • Cloud technology GETTING THE • Structured knowledge transfer • Collaboration technology BASICS • Cross-team working • Underlying technology supports/ RIGHT • High staff morale enables designed processes • Performance & reward • Use of self-service processes • Use of automation tools Technology & SSC • Location & environment • SSC organization dashboard Systems Organization SSC Organization Customer Service Focus • Clarity of reporting lines • Regular interactions with countries Customer • Revised roles for local • Pro-active and joint working Service Focus Finance • Monitoring of phone systems • Local country SS focal points • Calls & query logging • Distinct migration teams • Publication of KPIs • Distinct support functions – • Use of SLAs HR/IT • Customer service training • Communication processes © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 9
  • CSC’s Global SSO Assessment Framework A rigorous, highly quantitative, five-step assessment process is used to determine what processes should be included in the Virtualized Shared Services or BPO Model Shared Services Assessment Process Overview 1 Understand Overall Strategic 2 Identify What is Shareable 3 Categorize Services by Type Context and Customer Needs Delivery Model Service Characteristics Leverage Points Does the Activity Yes Corporate Support CEO’s Center • High volume • Reducing cost through Strategic Needs? • Standard requirements • Centralization Unique Center of Scale • Common across locations, ex.: • Standardization Unique Unique No – • Technology – • Outsourcing Corporate Is It a Core Capability Yes • “Uniform” services: common enterprise Shared for a Business Unit to Embed in systems and practices Shared Services BU/Sector execute its strategy? • Unique • Reducing cost through • Discretionary • Leveraging field staff Common Systems No • Face-to-face across locations and Field • Self-service, ex,: capabilities – • Standardization – • Technology Do Business Units No Eliminate Need This Service? • Low volume • Leveraging expert advice • Often discretionary across the company Yes • Unique service requirements, ex.: Center of – Expertise – Does Service • “Custom” services: business unit- Demonstrate Shared specific product, customer, geography Economies of Scale Services and sales channel Across Bus? Field COE COS 4 Decide Delivery Approach 5 Summarize Shared Services Organization Potential Outsourcing Delivery Approach Decentralize Opportunities Centers of Centers of “Field” Outsource Completely to Eliminate Scale Expertise Divisions Define • CBI (internal consulting) performance No Yes requirements • Corporate IS No • SHEA (Safety, Health, Environmental) • Corporate Planning • Facilities Services Requires Yes SSO PPT Yes More Yes Decision Yes Yes Variable Can offload specialized cost effective • Engineering Availability? Criteria? workload? peak? knowledge? SSO? • Finance • Hospitality • Human Resources No No No No • Legal • Pension Fund Investment SSO (in-source/BPO) • Security Services Sourcing Benefits: • Savings • Service improvement Illustrative: (performed at detailed activity level) • Focus on strategic © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 10
  • Leading SSO Practice Model Leading Virtualized Shared Service models incorporate each of the following components to ensure alignment with Corporate Strategy Strategy Governance Structure Foundational Items: – Business Processes – Service Level Agreements – Management tools & information – Customer Relationship Management – ABC costing – Chargeback approach Performance Management Technology Products & Services Business Case © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 11
  • Case Study: Aerospace & Defense Shared Services Strategy & Design Client Profile Project Summary • Aerospace and Defense company • The Shared Services strategy and design project was • $11.7 Baillion in 2008 Revenue conducted simultaneously with a CSC led SAP global implementation and upgrade • 42,000 employees • The Shared Services project focused on: Client Situation – Developing the vision and strategy for a global organization, covering the following functional areas: The client had made investments in a Shared Services • Finance (G/L, A/P, Credit & Collection, A/R, Fixed Assets, Organization but had not yet realized the full benefits. Project Accounting), Cash & Treasury Mgmt, Supply Chain, Indirect Procurement, HR and IT The Client needed to: – Recommending site locations and the use of existing • Develop a global strategy for delivering support services facilities • Identify the specific functions and activities to be included – Designing specific processes to be included in the within a Shared Service model in terms of Centers of Centers based on CSC’s best practices Scale and Excellence – Detailed business case • Confirm use of existing sites or choose new sites for their Centers Client Results • Optimize their processes as part of the move to Shared Services • CSC delivered a comprehensive plan that solidified the vision and developed the strategy to create a unified, global Shared Services Organization. • CSC also produced detailed future state process maps for the functional processes that will be handed by the Shared Service Centers. © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 12
  • Case Study: SSO Process Optimization Client Profile Client Results • Hospitality Company • $95M+ in overall savings from IT Support Cost • $20 Billion+ in 2004 Revenue Reduction and Backoffice headcount reduction • 50,000+ employees • Month end close reduced from 15-16 days down to 5 days • Moved from thousands of disparate instances to a Client Situation single consolidated Oracle ERP instance to centralize Financial processes and IT capabilities • Client sites had mostly individual financial and HR systems with no consolidation • Reduced/”sun setted” IT TCO as the project removed multiple interfaces, ERP’s and legacy applications • This made effective enterprise management of HR and Finance processes exceptionally inefficient and costly • Provided “one version” of the truth for the organization • Reporting was via multiple systems to pull together monthly management reporting • Delivered global standard common processes underpinned by common master data • TCO was high due to the mosaic of systems • Developed a Financial & HR Shared Service model to support the organization Project Summary • Project involved consolidation of thousands of individual custom hotel financial packages, Oracle instances and data marts onto one common instance • 18 month project overall – covering visioning / strategy, through Blueprinting, Realization and finally Rollout phase © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 13
  • CSC’s Key Contacts • Clive Corscadden Experienced consultants Partner Cell: 508.615.8982 Focused on delivering business value … quickly Email: ccorscadden@csc.com Possess entire end-to-end solution capabilities • Rajesh Chopra Demonstrated and proven methodologies, Partner tools and techniques Cell: 512.773.1155 Email: rchopra7@csc.com Specific solution sets for varying client and industry needs • Steve Lynch Thought leaders and understanding of best practices Principal Cell: 719.650.3853 Collaborative work style, fosters effective knowledge Email: slynch21@csc.com transfer © 2010 Computer Sciences Corporation 4/1/2010 BE10_0103 14
  • Shared Services Virtualization THANK YOU CSC Proprietary and Confidential