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Enterprise Consolidation:A Transformational ApproachTo simplify complex/disparate enterprise systems that underminebusines...
cognizant 20-20 insights 2reduced cost-to-serve and faster time-to-marketproduces positive ROI when properly scoped anddel...
cognizant 20-20 insights 3tations are communicated and program budgetsare established will greatly improve the chancesof a...
cognizant 20-20 insights 4SuppliersSuuppplieeerssBusiness ProcessesApplication EnablementPeople & OrganizationsTechnology ...
5cognizant 20-20 insightsclients to consider the ECA enhanced methodol-ogy for enterprise transformation programs. AllEC p...
cognizant 20-20 insights 6are engaged right from the start to codevelopthe ECA along with experienced practitionersfrom yo...
cognizant 20-20 insights 7Developing the Business CaseThe business case should follow the formattypically utilized within ...
cognizant 20-20 insights 8Setting Value Driver PrioritiesIncreased Product IntroductionsDecreased Material CostsIncreased ...
cognizant 20-20 insights 9Appendix: The ECA Methodology SnapshotThe following is a summary of the seven-step enterprise co...
About CognizantCognizant (NASDAQ: CTSH) is a leading provider of information technology, consulting, and business process ...
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Enterprise Consolidation: A Transformational Approach

Capitalizing on opportunities presented by enterprise consolidation (EC) - with IT being central - requires organizational transformation as well as careful planning and execution. This paper describes our seven-step enterprise consolidation assessment (ECA) methodology that will ensure success with strategic, tactical and operational change.

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Enterprise Consolidation: A Transformational Approach

  1. 1. Enterprise Consolidation:A Transformational ApproachTo simplify complex/disparate enterprise systems that underminebusiness performance, global companies need a rigorous methodologythat dedicated teams can follow to consolidate systems and createuniform business processes that advance cost reduction and time-to-market acceleration initiatives.Executive SummaryEnterprise consolidation (EC) initiatives areundertaken by multi-divisional firms across theirglobal operations to drive business synergies andbenefits. Companies that have grown throughmerger and acquisition (M&A) are challengedby an inability to harmonize discrete businessunits. Similarly, the lack of a uniform organicgrowth strategy can result in significant ineffi-ciencies within multiple business unit operations,as well as within the underlying technologyenablement layers.This asynchronous state often presents aformidable barrier to further market expansion.For example, companies may find it difficult tomanage their spend with key suppliers as the lackof global inventory visibility precludes effectivestrategic sourcing. In other cases, excessiveoperational costs preclude the justification forentering new markets that are crucial for thecompany’s long-term competitive positioning.Synergies that drive IT cost savings are limited ifthe business operations they support are highlydifferentiated with respect to one another. EC isan effective means of creating harmony across aglobal enterprise, with the primary emphasis ondriving synergies operationally. These synergiesare typically enabled through business processredesign and enterprise system harmonization.In recent years, global manufacturers and dis-tributors have begun significant enterprise trans-formation initiatives to consolidate their prolifer-ated portfolio of IT solutions and infrastructure.The creation of a common global businessoperating model and solution template thatcan be leveraged across the global enterpriseenables the transformation and harmonization ofcritical business processes, along with underlyingbusiness data design and supporting infrastruc-ture. The competitive advantage resulting froma well-executed global harmonization programis substantial; in fact, various companies acrossnumerous industries and regions of the world arealready reaping these benefits. Furthermore, weare seeing an increased number of companiesundertaking EC during periods of slow economicactivity and/or poor internal financial perfor-mance — as the immediate positive impact of• Cognizant 20-20 Insightscognizant 20-20 insights | april 2013
  2. 2. cognizant 20-20 insights 2reduced cost-to-serve and faster time-to-marketproduces positive ROI when properly scoped anddelivered.The CIO is expected to provide enterprise-widetechnology support that enables effective androbust business operations in a cost-effectivemanner. Unfortunately, complex and inflex-ible IT enablement is often the most formidablebarrier to overcome and mayeven limit the ability for theenterprise to capture marketshare otherwise within itsreach. Consolidating dis-parate systems that haveproliferated throughout theglobal enterprise during theexecution of routine busi-ness activities is now a highvalue-adding proposition forcompanies seeking to boostbusiness performance andoperational efficiency.In contrast to thesechallenges are the oppor-tunities they produce forcompanies to create competitive advantagethrough focused EC initiatives. A recent McKinseyQuarterly article1noted that IT synergies accountfor a significant amount of the overall value prop-osition for a pending M&A activity, purely fromthe standpoint of operational improvement. Inaddition, if a more efficient assimilation of theprospective business unit is made possible bysimpler and faster IT accommodation, companiesstand to gain in two respects: they achieve fastertime-to-market as well as reduce end-state costsof operation.Figure 1 shows that significant value additionresulting from M&A is directly linked to informa-tion technology benefits realization.The ability for transformation experts toaccurately plan these initiatives quickly dissipateswith the size of the global entity and the numberof moving parts. The effort and risks involved inthe many trade-offs that will occur throughoutthe development of a common business and datamodel, and the corresponding changes requiredto the technology infrastructure, require morethan a cursory understanding of the currentstate within each business/region involved. Thedegree of uncertainty in work-effort estimationfor a Fortune 1000 global manufacturer or dis-tributor about to undertake enterprise-wide con-solidation may exceed 50% — and commonly, inour experience, will exceed 30%. This places anenormous risk onto the transformation planningteam as they attempt to align resources, scopeand timeline into a feasible project plan — with amanageable level of risk to the organization.We find in practice that a dedicated and focuseddue-diligence assessment launched before expec-If a more efficientassimilation of theprospective businessunit is made possibleby simpler and fasterIT accommodation,companies stand togain in two respects:they achieve fastertime-to-market as wellas reduce end-statecosts of operation.Often more than half of the synergies availablein a merger are strongly related to IT.Synergy distribution by industry Examples of synergiesUnrelated to ITIT AloneIT Enabled15% 10%25%35%35%40%40%50%50%HealthCareIndustrial FinancialServices• Lower IT infrastructure costs.• Reduced IT headcount.• Increased volume discounts for IT procurement.• Integrating functional systems reducesfinance & HR costs.• Route optimization lowers logistics costs.• Integrating customer data offers better cross-selling revenue.• Fewer plants, distribution centers andheadquarters reduce facility costs.• Lower financing costs.• Vendor consolidation lowersprocurement costs.Source: McKinsey QuarterlyFigure 1Cost Benefits of M&A-Related Synergies
  3. 3. cognizant 20-20 insights 3tations are communicated and program budgetsare established will greatly improve the chancesof a successful transformation. Our enterpriseconsolidation assessment (ECA) methodology2lays out a simple and effective method to alignthe strategic value drivers across the globalentity and produce an accurate transformationroadmap and benefits realization plan that formsthe basis of a much more realistic business casefor capital appropriation. The ECA is packaged asa 6- to 12-week focused engagement for a smallteam of transformation experts that will producean accurate business case with a high degree ofaccuracy and relevance with respect to the sig-nificant efforts that follow.ECA is a deliverable-focused pre-project initiativethat greatly reduces program risk. Activities andoutput artifacts discussed within the body ofthis writing compose the essential componentsto enable strategic enterprise transformation.The ECA discovery team consists of experts fromour Enterprise Applications Systems Practiceand client representatives. They rely on a largedatabase of industry best practices, and othersimilar tools and accelerators are inherent in thestructured approach to undertake the work. As astand-alone entity, the ECA contributes significantincremental value to this mission-critical initiativeand is generally delivered at a relatively small(estimated at less than 5%) incremental cost.Value Objectives for EnterpriseConsolidation InitiativesEnterprise consolidation is generally undertakeneither to improve operational performance formultidivisional entities, or in response to the pro-liferation of nonuniform business processes, datamanagement services and/or underlying infor-mation technology systems — usually as a resultof M&A.In practice, we generally recognize two distinctlydifferent types of enterprise transformation initia-tives — those that are purely technology focused(e.g., data center consolidation), and the remain-der which are focused on business operationalimprovement. Although both types will have animpact on both operations and technology func-tions, we stress the appreciation of the very signif-icant differences that are introduced when a con-solidation change imperative is business driven.An example of a technology-driven consolidationprogram commonly undertaken is the reduction ofdata center utilization — and typically the mergingof support functions into a smaller number oflocations. This type of program has minimalimpact on the operations; the effort expendedfor transformation (cloud-based or otherwise) isgenerally limited to technical departments. Thiswhite paper focuses on the types of enterprisetransformation that are business-driven, andthus that have business-based value drivers, andimpact business continuityas well as a host of businessperformance metrics thatare essential to the CFO,COO and CIO.Even a single acquisi-tion made by a stable andefficient enterprise can behighly disruptive, and thespeed and completeness ofassimilation of the acquiredentity generally has signifi-cant financial performanceimpact for the acquirer.M&A prospects are typicallyevaluated along three majordimensions of value impact:• Strategic change: How will the new assets orproducts enable enhanced value generation?• Tactical change: What types of new channelsor IT systems are needed to succeed in newmarkets introduced through acquisition?• Operational change: How will we operate dif-ferently once the new businesses/assets areassimilated?Consolidation of operations and the underlyingenabling technologies typically are evaluated inmacro dimensions, but once a new acquisition isin place, or especially after a number of such takeplace, opportunity for operational improvementthrough resource leverage and shared services istypically explored.A full-service EC transformation program willaddress all three of these value components andwill be executed as a business-critical initiative,with the full and clear support of the highestlevels of the organization. Therefore, the meth-odology that is presented herein considers theopportunities and risks to the company along allthree dimensions.Figure 2 illustrates the dimension we use toevaluate and measure global enterprise systemsharmonization.We find in practicethat a dedicated andfocused due-diligenceassessment launchedbefore expectationsare communicated andprogram budgets areestablished will greatlyimprove the chancesof a successfultransformation.
  4. 4. cognizant 20-20 insights 4SuppliersSuuppplieeerssBusiness ProcessesApplication EnablementPeople & OrganizationsTechnology InfrastructureDevelop Business StrategyIntegrated Business PlanningCore ProcessesEnterprise-WideBackboneForecastingHarmonization ofOrganizational DesignHarmonization of UnderlyingTechnology InfrastructureHarmonization of GlobalEnablement ApplicationsHarmonization of GlobalBusiness ProcessesAlignment withCorporate StrategyDimensions of global enterprise harmonization –Enterprise harmonization follows a cadence starting fromstrategy and ending with physical assets.Develop Productsand ServicesGenerateDemandSatisfyDemandSupportFunctionsMarket MgmtSystemDistribution SystemsOrganizationManufacturing SystemsCustomer RelationshipManagement SystemLeading U.S.-BasedDiversified HealthcareCompany GlobalBusiness StrategyAn important concept that must be fully graspedand clearly agreed upon across the organiza-tion prior to the undertaking of a consolida-tion initiative is that the “end state” will resultin more uniform operations across previouslyautonomous units. This includes job roles, orga-nizational structures and policies, businessprocesses and the relevant business data andthe underlying technologies that support them.The organizational change management effortmay be substantial and often has a determininginfluence over the success of the program.From here, we will examine the impact of EC withregards to tactical and operational value creation.However, due to the clear and critical impacts tothe company’s strategic interests, all of our futurestate concepts and vision alternatives are alignedfirmly in support of the company’s strategicobjectives.Understanding and Establishing theStrategic Program ObjectivesClear and measurable business-orient-ed objectives are established by executivemanagement to drive the direction and prioritiesfor consolidation initiative teams. These teamswill be more effective if they are guided by clearand concise “value themes” that provide anend-state or achievement target. Value themesare ultimately the voice of the business, definingthe criteria for success to the implementationteam. Fulfillment of the objectives stated withinthe value theme should constitute successfultransformation results, and hence will keepmultiple teams working together to produce theresults required and defined by the business.Figure 3 (on the following page) highlights typicalvalue themes for a branded pharmaceuticalsmanufacturer.The specification of the business objectivesfor the future program can include these valuethemes and together they can be used toestablish expectations and a high-level scope forthe program. These value themes will accompanyeach business process engineering team alongthe course of their detailed blueprinting activities;we recommend they be printed in large bannerform and hung within easy view throughout thedesign workshop phases. Additionally, proposedfuture state process designs and related changeelements should be critiqued against the require-ment to enable attainment of the value themebenefits and changes.Enterprise Consolidation AssessmentFrom here, organizations must discuss the criticaldifferentiating step that enables successfulconsolidation transformation — and the morecomplex the current operational landscape, themore critical it is for decision makers to invest thetime to perform the ECA. We strongly advise ourFigure 2Consolidation Scope & Hierarchy
  5. 5. 5cognizant 20-20 insightsclients to consider the ECA enhanced methodol-ogy for enterprise transformation programs. AllEC programs should include the following deliver-ables:• Current state process design flows — level two(e.g., MRP execution or order entry at pointof sale).• Current state performance metric baseline (e.g.,days of inventory, perfect order percentage,costs of goods sold). Establish process scopeto effect consolidation (define value themes foreach process).• Define the change imperative for each process.• Walk through each business process in scope,in each location required, and define the “as-is”process state — which includes the integrationtouch points with other processes, the manualprocesses, the major causes of quality noncon-formance, bottlenecks, labor hours per workstation, etc.• Develop a visionary level view of the target endstate process and gain buy-in from all stake-holders within those business processes. Thiswill include the major to-be design changes,new procedures to introduce or currentprocedures to change, automation of manualprocedures, target performance metrics, etc.• Alignment of the value themes establishedby senior leadership with the to-be end statevision.• Gap analysis: The efforts required deliveringthe change, including resource training, newIT systems, changes to existing IT systems,changes to policies/procedures, etc.• Alignment of the change requirements withvalue themes to assure that all of the statedstrategic, tactical and operational value driversare addressed appropriately.• Project structural planning and optionsassessment: Analyze any variations that arefeasible for global commonality, operationalstandards, technology standards, etc.• Develop the high-level project plan and imple-mentation roadmap: Validate throughout thebusiness with the key stakeholders.• Develop the bottom-up and top-down businesscase analyses in a format agreeable andacceptable to the CFO.These activities and deliverables will then providethe project planning managers with accurateinsight to develop the project charter, the projectplan and resource onboarding schedules, toselect the best internal resources and allocatethem effectively to the various project roles andin general to complete traditional project prepa-ration phase activities.Understanding the criticality of an effective ECAphase, we recommend that the project managersand key subject matter experts (SMEs) that arelikely to be appointed to the end-to-end programFigure 3Branded Pharmaceuticals Company EC Value ThemesBusinessProcessValue Themes Current State Targeted End StateDirectProcurementProvide global visibilityof purchased goodsdata pertaining to all ofsuppliers.Regional visibility isavailable with a very lowdegree of data integrity;no uniform data standards.Global data availability and access,maximum data integrity — enableseffective strategic sourcingprogram.WarehouseOperationsConvert all new warehouseprocesses and peripheraltechnologies to a uniformstandard and implementa common set ofperformance metrics.Newly acquiredwarehouses utilizedifferent ERP, different3PL, uncommon labelingformats and different pickand pack rules.Reengineered, common businessprocesses, common IT enablement,single consolidated performancemetrics dashboard, common jobroles and organizational structures.Sales ForceAutomationEnable a single sales forceto effectively market andsell all products within theconsolidated portfolio.Legacy company salesforces are equipped to selland support only legacyproduct portfolios.Sales force trained across allproduct lines, single mobile devicetoolset for order and accountmanagement, financial consolidationof all product lines and formerlegacy channels/customers.
  6. 6. cognizant 20-20 insights 6are engaged right from the start to codevelopthe ECA along with experienced practitionersfrom your systems integration (SI) community.Again, it should be noted that SIs with businessprocess and industry expertise are likely bettercandidates to execute effective enterprise trans-formation initiatives for the reasons mentionedearlier. Other than with transformation initiativesthat are purely technical (e.g., data center con-solidation), partnering with a systems integratorwith business performance and relevant industryexpertise is advised.The Business Case: A Recent ExampleMany of our clients have found that without con-solidation and simplification of operations theirintended objectives from M&A were unattainable.Specifically, companies often invest in parallelproducts within their industry (e.g., medicaldevices) to augment their core product portfolio(e.g., pharmaceuticals), but may find that theycannot support the order fulfillment require-ments or material purchasing needs for thenew entities because the existing organizationsdiffer significantly either in functional operation,locations, automation levels or other inherenciesthat affect assimilation.The following ECA case study highlights the areasof benefit for both business and technologyparameters. Figure 4 reveals the businessbenefits achieved by a $10 billion U.S.-based mul-tinational that grew through multiple rounds ofM&A and worked with us to successfully consoli-date its enterprise systems.The Seven Steps for ECA SuccessOur seven-step ECA development methodol-ogy defines the scope and effort involved in anEC transformation project that enables a morerealistic business case to be developed andpresented for program funding. These activitiesare executed within or prior to the project prepa-ration phase. Figure 5 (on next page) depicts ourseven-step methodology. (See the Appendix foradditional detail.)The duration and resource requirements for eachof these seven steps may vary depending on theindividual initiative size and complexity, but thiseight-week sequence embedded in our method-ology is representative of successfully executedpast assessments. ECA activities generally take aconsistent directional course independent of thestrategic drivers behind the change imperative.Note: Individual costs cited have been modified for privacy, but the total cost (internal and external) to our clientfor this 16-month project was in the range of $60 million; it was completed on time and under budget.Figure 4Potential Benefits Projections — 2013-2019IT Cost Avoidance (in Mn U.S.$)Total over 7 years $79.9Hosting (Data Center) $3.8License/Maintenance $13.0Internal IT Support Staff $20.1ApplicationEnhancement/Break-Fix$7.9Planned IT Cap-Ex $34.3Training $0.8Business Benefits (in Mn U.S.$)Total over 7 years $81.1Reduced InventoryDays of Supply*$3.8Reduced InventoryCarrying Cost$1.2Reduced Days ofSales Outstanding$2.4Reduced Manufacturing Cost $7.0Reduced Direct MaterialCost — Strategic Sourcing$1.9Reduced Indirect MaterialCost — Strategic Sourcing$1.1Process Efficiencies (in Mn U.S.$)Total over 7 years $36.0Reduce IT Costs $2.6Productivity — SupplyChain Planning$0.5Finance Operations $2.2Productivity —Period-End Close$1.0Efficiency — GeneralAccounting$1.7Efficiency — InventoryAccounting$0.4Productivity —Reporting Analysis$0.1Productivity — Procurement $0.1Conservative: $80M;Likely: $120M;Optimistic: $160M*One-Time benefit — 100% in 2014• Unless otherwise stated, figures are annualized.• Used average of benefits improvement ranges.• Recurring benefits realization ramp-up assumption: No benefits assumed in 2013. 50% in 2014. 75% in 2015. 100% thereafter.
  7. 7. cognizant 20-20 insights 7Developing the Business CaseThe business case should follow the formattypically utilized within the senior managementcircles, and ideally will be developed by informedand influential senior managers as well as byexperienced senior members of the SI partnerthat will support the ultimate program.We recommend that those practitioners engagedin the creation of the value proposition andbusiness case details are also responsible fordelivering them. When those responsible todeliver realized benefits are the same as thosewho project these target benefits, we find a morerealistic and attainable value proposition results.The primary classes of deliverables for the ECAbusiness case for enterprise consolidation shouldinclude the following:• Clear definition of the macro level scopeelements.• Timeline and implementation roadmap withpilot and regional cutover dates approved bythe business.• Mitigation plans for the major risks and contin-gency plans for any risk to business continuity.• Technical infrastructure costs.• Software license costs.• Software maintenance costs.• Internal project delivery resource labor costs.• Backfill costs for internal resources.• Training costs for backfill staff.• Training costs for project team members.• External spend for systems integrators, withcontingency.• Ongoing costs for support and maintenance,including total cost of ownership analyses.• Costs incurred to organization if program doesnot proceed.• Costs for organizational change managementinitiatives that enable successful transforma-tion.• BI and analytics costs.• Benefits to organization from each processstream.• Cost avoidance.• Soft benefits to the organization from eachprocess stream.• List of standards and assumptions.The business case is then presented withevaluated and agreed upon benefit opportuni-ties and estimates performed at the conservative,likely and optimistic levels. From these componentanalyses a project payback period, present valueand ROI can be formulated.An annual schedule of cash flows along with animpact on earnings considering depreciation,segmented into capital and expense accompanya benefit realization annual schedule. As statedearlier, alignment between an enterprise con-solidation transformation initiative and thecompany’s financial strategic objectives mustbe clear throughout. Achievement targets andpriorities for future state operating performanceestablished at the value driver level within thestrategic plan should motivate the benefit realiza-tion objectives for the EC program (see Figure 6on next page).121 2 3 4 5 6 7 81 Strategic Alignment2Current State Business Technology Assessment3 End State High Level Visioning4 Gap Analysis — Business Operations5Gap Analysis —Technology Enablement6 Iron Triangle Assessment7Business CaseDevelopment ApprovalWeeksFigure 5Seven-Step EC Preparation Methodology
  8. 8. cognizant 20-20 insights 8Setting Value Driver PrioritiesIncreased Product IntroductionsDecreased Material CostsIncreased Manufacturing Capacity UtilizationDecreased Warehouse CostsDecreased Transportation CostsDecreased Procurement CostsDecreased Customer Service CostsDecreased Planning CostsDecreased Finance CostsDecreased Existing Maintenance CostsDecreased Existing Software CostsDecreased Days Sales OutstandingIncreased Days Payable OutstandingIncreased RevenuesGROSS MARGINDecreased Manufacturing CostsINCOMEIMPACTDecreased Distribution CostsOPERATING EXPENSES Decreased Operations Costs(Shared Services/Process Efficiency)VALUEDecreased IT CostsWORKING CAPITAL(Cash Cycle) Decreased Inventory OutstandingDecreased Accounts OutstandingCAPITALIMPACTTAXIncreased Tax EfficienciesFigure 6Moving ForwardEC projects enable the harmonization ofpreviously nonuniform business operations,including processes, data design, organizationaldesign and technology enablement. The changeimperative that gives rise to EC can be strictlytechnology-based (e.g., hardware standardiza-tion), but more typically is driven by needs fromthe business. Merger and acquisition activitiesare major drivers for enterprise software consoli-dation initiatives.The challenges in accurately scoping and planningan EC program increase nonlinearly with thenumber of regions and business units involved.In most cases, capital appropriations and projectbudgets are very difficult to estimate withoutan assessment period of due diligence anddiscovery. Our ECA provides the necessary clarityand insight to supplement the traditional projectpreparation phase with due diligence discoveryactivities and the associated output deliverables.The result is a significantly improved businesscase that contains accurate and balanced projectscope, resource loading requirements and afeasible timeline that can be met with much lowerrisk to the organization, compared with standardproject preparation.Enterprise consolidation initiatives that are sup-plemented with an ECA contain more realisticbusiness benefit realization targets as well asmore accurate and realistic project budgets. Theestablishment of an accurate iron triangle projectposition (resources, scope and time balanceversus risks) is more difficult without the duediligence exacted through the ECA.Quick Take• Business benefits compiled annually byprocess area/region.• Internal costs.• External costs.• Business case template for executivemanagement.• Capital appropriation request.• Presentation materials for: Steering committee/executivemanagement. Divisional management. Internal stakeholders.Business Case Development:Key Artifacts
  9. 9. cognizant 20-20 insights 9Appendix: The ECA Methodology SnapshotThe following is a summary of the seven-step enterprise consolidation assessment methodol-ogy employed prior to the launch of the design phase of the transformation program:Step Objectives Key Artifacts1. StrategicAlignment• Assure adherence to the corporate business strategies.• Define value drivers and value themes for use in defining anddesigning end state operations.• Business drivers and objectives.• Relevant business pain points.• Guiding principles and design themes for the futureconsolidation initiative.• Business improvement objectives.2. Current StateBusiness andTechnologyAssessments• Document the current state process flows.• Capture the current strengths, weaknesses, opportunities andthreats (SWOT analysis).• Define process performance metrics and benchmark currentstate performance levels.• Compare performance levels to industry benchmarks.• Define and document the technology infrastructure andoperational protocols.• Current state process flows — subprocess level —e.g., manage inbound receipts, order managementagainst blanket contracts.• Current state functions and capabilities, unique andrequired, of localities/regions/business units.• Current state solutions in place/customization ofthose solutions.• Application architecture by location/business unit.• Business data flow diagram by location/businessunit.• Technology infrastructure diagram by location/business unit.3. Create the HighLevel Vision forthe End State(Business andTechnology)• Create a business model that fulfills the strategic, tacticaland operational objectives of the organization — including thestated value themes.• Define the underlying technology enablement layer anddata standards that would accompany the above, identify allfeasible options within the time horizon of the solution.• Globally common business model (at the level two ofprocess decomposition).• Conceptual level two process flows for each processlist of key performance indicators that determineeffective operations.• Baseline performance metrics.• Conceptual technology landscape.• Conceptual business data flow diagram.4. Gap Analyses— BusinessOperations5. Gap Analyses— TechnologyEnablement• Compare the end state conceptual process vision to thecurrent state.• Compare the end state technology enablement vision to thecurrent state.• Define and prioritize each of the process and technology gaps.• Define business requirements to fulfill the gaps.• Define technology requirements to fulfill the gaps.• Level three subprocess-activity level commonalitymatrix — by SBU/region — fitment to the baselinereference model.• Future state global process commonality matrix.• Initialized requirements traceability matrix.• Initialized master development object list.6. Iron TriangleAnalysis• Define the process scope master list — BPML.• Create a high level project plan and implementation roadmap.• Resource load the project timeline — including OCM initiatives.• Define the order of magnitude estimates.• Assess major risks and determine feasible deploymentoptions.• Define the skills set job descriptions for all roles required forthe program.• Define program risk at all phases of the initiative lifecycle.• Assign owners to manage program risk.• Define mitigation plans.• Define triggers and monitoring protocols.• Define risk response plans.• Assimilate risk management into the core projectmanagement approach.• Scope definition — eight critical dimensions.• Implementation roadmap options.• Resource requirements.• Risk monitor — identifying inherent risk.• Risk management approach.• Risk management duties within the appropriate jobdescriptions of team leaders and PMs.• Risk management plan.• Issues management plan.7. Developing theBusiness Case• Define the change imperative.• Define the business benefit realization targets.• Assess program return on investment.• Establish resource levels and priorities for expenditure anddelivery focus.• Formalize executive mandate and engage departmentalleadership.• Provide the basis for funding of the program.• Mitigate risk.• Business benefits compiled by process/region.• Internal costs.• External costs.• Business case template for executive management.• Capital appropriation request.• Presentation materials for: Steering committee/executive management. Divisional management. Internal stakeholders.
  10. 10. About CognizantCognizant (NASDAQ: CTSH) is a leading provider of information technology, consulting, and business process out-sourcing services, dedicated to helping the world’s leading companies build stronger businesses. Headquartered inTeaneck, New Jersey (U.S.), Cognizant combines a passion for client satisfaction, technology innovation, deep industryand business process expertise, and a global, collaborative workforce that embodies the future of work. With over 50delivery centers worldwide and approximately 156,700 employees as of December 31, 2012, Cognizant is a member ofthe NASDAQ-100, the SP 500, the Forbes Global 2000, and the Fortune 500 and is ranked among the top performingand fastest growing companies in the world. Visit us online at www.cognizant.com or follow us on Twitter: Cognizant.World Headquarters500 Frank W. Burr Blvd.Teaneck, NJ 07666 USAPhone: +1 201 801 0233Fax: +1 201 801 0243Toll Free: +1 888 937 3277Email: inquiry@cognizant.comEuropean Headquarters1 Kingdom StreetPaddington CentralLondon W2 6BDPhone: +44 (0) 20 7297 7600Fax: +44 (0) 20 7121 0102Email: infouk@cognizant.comIndia Operations Headquarters#5/535, Old Mahabalipuram RoadOkkiyam Pettai, ThoraipakkamChennai, 600 096 IndiaPhone: +91 (0) 44 4209 6000Fax: +91 (0) 44 4209 6060Email: inquiryindia@cognizant.com­­© Copyright 2013, Cognizant. All rights reserved. No part of this document may be reproduced, stored in a retrieval system, transmitted in any form or by anymeans, electronic, mechanical, photocopying, recording, or otherwise, without the express written permission from Cognizant. The information contained herein issubject to change without notice. All other trademarks mentioned herein are the property of their respective owners.About the AuthorWilliam Lasko is a Partner within Cognizant’s Enterprise Application Services Practice, responsible forthe planning and delivery of global transformation initiatives for Fortune 500 clients worldwide. Williamhas over 20 years of enterprise transformation business consulting experience and holds an M.B.A. fromCarnegie Mellon University. He can be reached at William.Lasko@cognizant.com.Footnotes1 H. Sarrazin and A. West, “Understanding the Strategic Value of IT in MA,” McKinsey Co., McKinseyQuarterly, January 2011.2 H. Webb and B. Lasko, “The Cognizant Methodology for Enterprise Consolidation Assessment,” CognizantTechnology Solutions, Inc., February 2013.

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