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Innovatively Managing the Business Process to Create Excellence

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In this session we explored innovation as a key driver in efficiently delivering business process operations and effectively meeting the business objectives and goals. Shyam Kerkar, AVP, TCS

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Innovatively Managing the Business Process to Create Excellence

  1. 1. 2 TCS Public Supplier Process Consumer Data Data DataData Infrastructure Process People Applications People Infrastructure Process People Applications People Infrastructure Process People Applications People Session Focus
  2. 2. 3 TCS Public Analyze Digitize Technology Interfaces Optimize Data Human Application Interface Application - Application Interface Application Performance Process Value Stream Mapping Error Analysis & Prediction Prioritization & Simplicity Analysis Business Data Operations Metrics
  3. 3. Copyright © 2013 Information Services Group, Inc. All Rights Reserved. No part of this document may be reproduced in any form or by any electronic or mechanical means, including information storage and retrieval devices or systems, without prior written permission from Information Services Group, Inc. Innovation & Excellence in Operations Peter Lauer Partner – Head Business Advisory Services North America (BPO) peter.lauer2isg-one.com June 25, 2013 The Journey to Date
  4. 4. © 2013 Information Services Group, Inc. All Rights Reserved 6 Inform Services Provider Research: Tailored research about provider capabilities and industry trends. Mark-to-Market: Leveraging ISG’s 14,000 contract database to gauge market-current contract pricing and terms & conditions Assess Services Benchmarking: Comparing client IT delivery costs to peer costs and provider pricing, and recommending improvement opportunities Process Analysis: Detailed workflow review of IT processes and practices, comparing to industry best practices Design Services Sourcing Strategies: Determining the best mix of sourcing for IT services . . . retained, shared services, and outsourcing based on financial, organizational, and risk considerations. Target Operating Model: Designing the elements of the optimal end state for IT service delivery, and laying out the roadmap to reach the targeted end state. Execute Services Transaction Support: Developing RFPs, managing response process, supporting provider due diligence and selection. Renegotiation: Evaluating the pricing and SLAs of renewing contracts. Transition: Applying ISG’s Transition Framework for successful migration to a new service provider Operate Services Governance Advisory: Standing up the organization and processes for effective oversight of providers, and training client staff to implement and sustain processes. Governance Managed Services: Providing resources and tools to support client’s “commodity” governance processes. IT Consumption Management: Providing insights for optimal cost, compliance, and risk management of IT assets PMO Services: Support of project portfolio management with tools , best practices, and project tracking technologies. *Representative list of ISG services; those most used by ITO clients  800+ professionals  20+ years in business  21 countries  1,000+ clients  75% of Fortune 100  5,000+ engagements Power of One . . . About ISG ISG Brings Deep Experience and Specific Services to Support Clients with their IT and Business Process Strategies
  5. 5. © 2013 Information Services Group, Inc. All Rights Reserved 7 Lots of Issues on the “C” suite Heat Map. Many of these issues have lots of players opining from north to south, east and west. Issues that are on the Desk of “C” Suite Big Data IT Consumerization Green Talent Management Security Business Unit Alignment Business Enabler Vs. Business Inhibitor Self-Funding Models Sustainability & Analytics
  6. 6. © 2013 Information Services Group, Inc. All Rights Reserved 8 WSJ Marketplace in 2012 ► “Innovation” used 33,528 times in quarterly & annual reports last year ► 255 books published in the last 90 days (2012) with the word Innovation in the title ► 43% of surveyed execs state they have a Chief Innovation Officer or similar role ► 28% of business schools use the word in their mission statement ► So. . . What does it mean? ISG had a look at what it means! “You Call That Innovation?” – Word in danger of becoming a business jargon cliché (if it’s not already).
  7. 7. © 2013 Information Services Group, Inc. All Rights Reserved 9 Business drivers, investment, organizational alignment and disciplined execution must all exist for innovation to occur. Key finding – the Need for a Climate for Innovation Assessing Technical Innovation Process Innovation Business Innovation Need to Innovat e Ability to Innovate Managing the Innovation Model ► Involves Risk / Requires Investment  Win/win implies that lose/lose is possible  Requires active risk management  Need for a unified operating model ► Requires Change and Discipline  Change management is key  Target measurable and verifiable metrics that bring business value  New learning “how do we do this” ► Occurs Over Time  Provide incentive for long-term mutual benefit rather than the “quick hit”  Improvements in the maturity of the organization & relationship results in an improved ability to innovate
  8. 8. © 2013 Information Services Group, Inc. All Rights Reserved 10 Pace of Learning < Pace of Change2 In today’s market, the pace of change exceeds our pace of learning. The divide is noticeable and increasing at an alarming rate Business Alignment We may end up here Today’s Business Practices We are here Growing Misalignment TechnologyandProcessCapability Clientrequirements Time
  9. 9. © 2013 Information Services Group, Inc. All Rights Reserved 11 Varying models of operational delivery Successful models requires careful consideration of the critical areas noted below to understand the impact to achieving the desired business objectives . Innovative models tend to be over to the right with gain and value sharing between organizations Source? Optimization? Incremental? Transformation? Other? The Strategy may include numerous solution considerations that are aligned to meet the objectives. The new wave • Importance of Software, Platforms, • Labor Automation, • Scalability • Improved efficiencies • Outcome based Processing • Business evolution • Unified operating model
  10. 10. © 2013 Information Services Group, Inc. All Rights Reserved 12 Operating Model Levers There are a number of considerations that relate to key factors when transitioning or operating a particular model. Automation Efficiency Low Risk profile Transparent single operating model HighLow Effectiveness Variable pricing Outcome Based Governance Continued improvement Client Supplier partnership Service level for operating model Gain Share Automation Efficiency Low Risk Profile Transparent single operating model HighLow Effectiveness Variable pricing Outcome Based Governance Continued improvement Client Supplier partnership Service level for operating model Gain Share Automation Efficiency Low Risk Profile Transparent single operating model HighLow Effectiveness Variable pricing Outcome Based Governance Continued improvement Client Supplier partnership Service level for operating model Gain Share 1990- early 2000 Current Innovative Model
  11. 11. © 2013 Information Services Group, Inc. All Rights Reserved 13 Gen 2 CharacteristicsGen 1 Characteristics What is the big deal? Think of the market progression from the left hand side of the chart to the right traditional models more focused on cost cutting though labor arbitrage to Gen 2 which is focused more on Labor Automation and Innovation ► 15%-30% cost take out ► Model is scalable to the extent that you can scale labor ► Custom/complex, legacy :“Your mess for less” ► Access to Low Cost Labor necessary to provide continuous value ► Revenue/Profit correlated to People ► 60%-80% cost take out ► Model is scalable and is largely independent of labor growth ► Transformative – New way of doing business, access to “Rocket Scientists” who can codify manual processes ► Revenue/Profit NOT correlated to People ► Outcome based approach Generation 2 Labor Automation Innovation Generation 1 Traditional Model
  12. 12. © 2013 Information Services Group, Inc. All Rights Reserved 14 Revenue Cycle Accounting & Reporting Corporate Services & Mgmt. Disbursements Tax Planning & Regulatory Financial Planning & Analysis Decision Support * Payroll may report to CFO or HR High EnterpriseValueAdded Basic HighComplexity of Interaction We are becoming more innovative an the bottom of the scale but need to grow more upstream Process Level Perspective: F&A Services Strong retained candidate Possible Sourcing/SSC candidate Strong Automation/sourcing candidate Suitability For Sourcing Functions
  13. 13. © 2013 Information Services Group, Inc. All Rights Reserved 15 The maturity model shows the back office service (F&A, HR, IT etc) in varying states of development. ISG Maturity Model for Target Operating Models Non-existent No strategic operating model or global processes in place Basic Reduce costs distributed services • Consolidate • Economies of scale • Staff Aug related • Everyone for themselves • Enterprise Process maturity LOW Marketplace Reduce costs and improve service quality • Focus on reducing costs • Full governance in place • Chargeback process • Based on metrics and measurement • Harmonization of processes/policy • Global processes created for the enterprise Unified Operating Model Back Office service seen as a single operating model • Collaborative partnerships • Mix of out tasking, sourcing, shared Services • Business units see operations as a single entity • Continuous improvement is life • Service integration maturity • Global processes adopted by business Units Advanced Cost reduction while creates new and improved services. • Analytics led analysis and design for new and improved processes • Focus on Automation • Best of Breed service in each function • Service Integration • Gain share • Value sharing • All parties collaborate to generate new efficiencies and automation • Harmonization of systems • Enterprise and SSC partner to improve enterprise processes World Class Developed strong efficiency, has a high level of automation and focuses on creating working capital • Very strong partnership with multiple supplier/BU teams to create value • Gain and value sharing • Focus on generating working capital • Investing in creating innovation • Strong level of re- investment in the organization • Innovative by nature • Enterprise and SSC partner to create innovation throughout organization Level 5 Level 4 Level 2 Level 0 Level 1 Level 3 As we move up the levels of maturity we see the development on a unified operating mode, harmonization of processes/systems and innovation.
  14. 14. © 2013 Information Services Group, Inc. All Rights Reserved 16 Pace of Learning < Pace of Change2 In today’s market, the pace of change exceeds our pace of learning. The divide is noticeable and increasing at an alarming rate Business Alignment Where we may end up Today’s Business Practices Growing Misalignment TechnologyandProcessCapability Clientrequirements Time We need to drive to here New pace of learning
  15. 15. © 2013 Information Services Group, Inc. All Rights Reserved 17 The cycle we to see Review Analyze HarmonizeInnovate Evolve Innovation is a continuous cycle not just a straight line journey Continuous review of the operations “what is working what is not” Analyze the current operation Harmonize policies, processes and systems Innovate. Focus on developing efficiencies, automation and to create working capital Continue to evolve the service over time
  16. 16. © 2013 Information Services Group, Inc. All Rights Reserved 18 “Labor arbitrage or just cost savings is not the goal any more!!” “Back office operations need to be seen as a single entity delivering services to the enterprise” “This means all parties need to collaborate and drive change developing greater efficiencies, automation and creating working capital to re- invest in the organization” “This is the goal of innovation ” Final thoughts!
  17. 17. www.isg-one.com
  18. 18. © 2013 Information Services Group, Inc. All Rights Reserved 20 About ISG
  19. 19. © 2013 Information Services Group, Inc. All Rights Reserved 21 ISG BPO at a Glance What is occurring in the market and where is the market headed? How are we performing, how do we compare, and what are the opportunities for improvements? What is the best way for us to improve and take advantage of opportunities? How do we implement the changes to realize value? How do we sustain the value over time? Client Experience Data Bases and Information Sources Advisory throughout Sourcing Lifecycle  14,000 sourcing contracts for T&Cs and pricing  12,000 benchmark projects, each with 500 to 3,000 data elements  Momentum ™ vertical sourcing research report  Sourcing Prevalence™ research  Provider Dynamic RFI™ used to survey over 100 providers about scale and scope of capabilities  AccessISG™ subscription and custom research  Annual service provider and client conferences
  20. 20. © 2013 Information Services Group, Inc. All Rights Reserved 22 Areas of BPO Expertise  Finance and Accounting  Procurement  Human Resources  Call Centers  Legal Services  Print Services  Facilities Management  Document Management  Insurance-specific processes (policy admin, claims) Specialized Services  Mark-to-Market (M2M) review of contract renegotiation pricing  AccessISG research subscription  Service provider portal  Momentum ™ research reports  Benchmarking  Asset monetization feasibility  City Risk Assessment  Major project health checks  Shared services design  Staff aug to managed services  Vendor management  Consumption and demand management ISG Business Process Outsourcing Experience ISG brings clients over 24 years of sourcing experience across multiple industries and around the globe. We have assisted clients with more than 1,200 BPO engagements, including more than 450 completed transactions. We bring to clients the tools, templates, methodologies, data, and best practices for BPO transactions that are successful and deliver the value that is possible
  21. 21. EDGE: AN INNOVATIVE OPTIMIZATION FRAMEWORK AJITH THOMAS (TCS) & KATHLEEN DOBBELS (NIELSEN) JUNE 25, 2013
  22. 22. Leveraging Technology to Transform Our F&A Organization Presented by: Adrian Robles June 25, 2013
  23. 23. Agenda • Overview of SCI’s Business • Overview of SCI’s Transactional Accounting Department • Our Transformation Journey ▫ Accounts Payable ▫ Contract to Cash ▫ Payroll Services ▫ Trust Operations • Tools & Technology Wish List

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