Business services concept and operating model dimensions GBS Roadmap: Driving Value and Performance Joakim Abeleen 28 April 2015
Aug 04, 2015
Business services
concept and
operating model
dimensions
GBS Roadmap: Driving Value and
Performance
Joakim Abeleen
28 April 2015
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has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
What is Global Business Services (GBS)?
An integrated platform to deliver enterprise business services
Drives efficiency and business outcomes
Evolves with the market and company needs
Key Capabilities:
■ Multi-functional business processes
■ Multi-channel service delivery –
outsourced, shared services and
centers of excellence
■ Process ownership and management
■ Common information technology
■ Enterprise-wide governance
2© 2015 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm
has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
GBS is a journey: Five levels of GBS maturity
BUSINESS
SERVICES
MATURITY
• ** Typical Savings with Progressive Maturity
• Companies performing at Levels 4 and 5 typically achieve 3-5% higher ROE
Level 01
FRAGMENTED
Decentralized service
delivery model
Duplicative functions,
processes, and technology
Little central control and
governance over business
support services
Supply driven delivery model
Level 02
SUB-SCALED
Consolidated delivery model
Leverage economies of scale
for highly transactional services
Shared services or outsourcing
typically on a single-function,
regional basis
Supply driven delivery model
Level 03
SCALED
Multi-functional service
delivery model that
operates in siloes
Variation around the
inclusion and level of
processes, technology, and
governance standardization
Transition to demand driven
delivery model
Level 04
INTEGRATED
Enterprise wide multi-
functional transactional and
specialist business service
model
Coordinated processes,
technology, governance,
and multi-channel delivery
for scale and adaptability
Demand driven delivery
model
Level 05
STRATEGIC
Multi-functional, multi-
channel business service
delivery synced end to end
Provides transactional,
expert, and analytic
services
Managed through
integrated, outcome-
oriented governance
Demand driven delivery
model
** Level 1 to 2
15%
** Level 2 to 3
7%
**Level 3 to 4
7%
**Level 4 to 5
3%
**At Level 5
3% Yr-on-Yr
3© 2015 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services.
No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
GBS is enabled and optimized by multiple dimensions
CHANGE AND PROGRAM MANAGEMENTA focused, holistic approach for getting the people and the enterprise ready, willing, and able to fully adopt and sustain changes through targeted strategies promoting understanding, buy-in
and ownership. Change management helps to achieve greater realization of expected benefits, reduce resistance, and mitigate risks that might undermine the value of the initiative
OPERATIONAL EXCELLENCEOn-going focus on problem solving, improvement, and GBS transformation outputs toward delivering high quality, seamless, and consistent business solutions
COMMERCIAL PERSPECTIVE
Customer relationship model defining the way GBS
operates “like a business”, and engages with
customers
DELIVERY AND SOURCING STRATEGY
The defined strategic intent of the GBS
organization, its purpose and relationship to the
overall enterprise
SERVICE PORTFOLIO
Definition of the breadth, depth, geographic
reach of services provided by GBS
TALENT MANAGEMENT
Flexible, integrated enterprise talent management
model designed to attract, retain and engage
resources
ENABLING TECHNOLOGY
Common technology platform across ERP, applications, and
tools to enable standardized services
TAX AND RISK OPTIMIZATION
Monitor and manage change and regulations,
including fiscal, legal, and tax
DATA AND ANALYTICS
Enhanced value through the capture, collection,
analysis and visualization predictive and
prescriptive analytics
PROCESS EXCELLENCE
Deployment of end-to-end service s with
focus on quality, continuous improvement and
innovation
ENTERPRISE SERVICE GOVERNANCE
An integrated way of working to engage with
stakeholders and manage overall service
delivery
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No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
How to define growth
strategies?
M&A
New markets
New products
New businesses
Growth Understand how to
better engage with
customers.
Brand
Loyalty
Customer Acquisition
Product/Svc Strategy
Customer
EngagementHow to make global
operations decisions?
The most effective
operating model?
Operating Strategy
Global Business Svcs.
Shared Services
Global
Operations
Where are
opportunities aligned to
your business?
How to manage
risk/return
BRIC
MEA
Emerging
MarketsHow to manage
uncertainty around
legislative change?
Where to focus?
Government Regulation
Tax Issues
Legislative Where are the
opportunities to reduce
cost without
impairment to the
business?
Balance Growth goals
with cost reduction
Cost
Reduction
Focus on opportunities
in new technology while
leveraging legacy
investments.
Digital Mobile Social
IT Consumerization
Internet of Things Cloud
Technology
Disruption How to focus on the
right data to convert to
knowledge?
Big Data
Analytics
Knowledge to Insight
Data
OverloadHow to retain, empower
and manage this critical
corporate asset?
Learning &
Development
Acquisition & Retention
Talent Development
Talent &
Human Capital
Issues facing executives today
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has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
The shift from cost focus to value focus
Although reducing indirect cost still remains the primary reason companies re-evaluate their service delivery models, there has
been increasing focus on value creation and innovation in recent years.
I need to drive down
operating costs
I want end-to-end
process optimization
I want real-time data-
driven insights
I want seamless
integration of acquisitions
I want access to
good quality data
I want cost effective,
flexible services
I want to tackle
emerging markets
I want a seamless
brand experience
I want to drive
product innovation
I want business
agility
Strategic
priorities
6© 2015 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm
has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
Beyond cost savings
Unlock the Power of
Data & Analytics
■ Increase sophistication and
centralize DA (remove duplicate
systems, add tracking where
needed, one ERP system,
process requests faster, ability to
track process breakdown utilizing
analytics, identify missing process
controls)
■ Common platforms and common
processes and capabilities
Mitigate Overall Business Risk &
Ensure Compliance
■ Proactive vs reactive response to
regulatory demands
■ Global repository of regulatory
requirements (tracking, reporting,
and process driven common
response to regulatory mandates)
Achieve Excellence & Consistency
in Customer Experience
■ Ensure consistent experience to
the customer (uniform and
consistent methods and platforms
to respond to customer requests)
■ Utilize VOC and validate using
internal DA information
■ Implement user satisfaction
Indexes
Build Internal Repository of High
Quality Talent
■ Build professionals within GBS
that can be sourced out to the
other business functions and
train/provide services – source of
internal high quality talent
■ Establish a clearer career path for
GBS professionals
■ Leverage skills & build training
Increase Effectiveness
& Ability to Scale
■ Need to be able to provide
effective services, effective
outcomes. i.e., Integrate project
management to deploy lean six
sigma and continuous
improvement and effectiveness of
delivery goes up due to
centralized leadership of the
different functions
Establish a Consistent Brand
Experience
■ Improve competitive position
■ Support consistency of global
brand experience
Enhance Sophistication &
Collaboration
■ Mind shift in terms of
professionalism. GBS
organizations have much higher
level of expectation in terms of it
being a provider of choice, and a
lever for cost competitiveness
■ Share skills and knowledge
across the organization
■ End to end process
standardization for non
standardized products/services
and business units
■ Process owners identification and
accountability
■ Process controls and continues
process improvement
■ Process automation
Drive Process Excellence
7© 2015 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services.
No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
Maturity survey analysis: The Nordics view
Europe includes Nordics (30 Plus companies surveyed)
Europe Nordic
79% over
10k
employees
35% one
ERP
91% Process
OwnersMultiplier
Effect of
Technology
& Talent
75% over
10k
employees
43% one
ERP
93% Process
OwnersMultiplier
Effect of
Technology
& Talent
8© 2015 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services.
No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
Maturity survey analysis: The Nordics view
Remit of GBS owners
Delivery model and Coverage
0% 15% 30% 45% 60%
Operational
Strategic in function
Strategic cross function
Global
European wide
Nordic wide
Country wide
0% 25% 50% 75% 100%
Finance
HR
IS/IT
Procurement & Sourcing
Customer Services
Real Estate
Predominantly run out of nearshore center/s
Predominantly run out of offshore center/s
Predominantly run out of Scandinavia
Run from various sites around the world
■ 50% of organizations started since 2010
■ 44% greater than 250 FTEs in shared services
■ 60% outsource finance and IT
Delivery Model
Functional Coverage
9© 2015 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services.
No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
Maturity survey analysis: The Nordics view
Analytics
0% 10% 20% 30% 40% 50%
GBS is not involved in data and analytics services
GBS is currently planning and building a data and analytics reporting service
GBS delivers basic data and analytics reporting (standard packages) and providesperiodic and ad-hoc analysis for customers
GBS delivers advanced data and analytics reporting and diagnostic analysis, andidentifies future operational reporting proactively based on the frequency and
importance of business needs
Analytics
Process Focus
0% 10% 20% 30% 40%
Business processes are managed solely within functionaldelivery teams, discrete to a function
Fragmented process ownership, but with informal peer-to-peer networking
Process owners exist and manage global process forselect processes, applied in functional silos
Functionally oriented process owners exist to managemost global processes
Global process ownership incorporating both the GBS andnon-GBS portion of an end to end process
10© 2015 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services.
No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
Maturity survey analysis dimensions
Delivery and Sourcing
StrategyLittle or no alignment between GBS and corporate missions,
strategy and planning.
Bi-directional formulation of strategy & planning between GBS,
functional, BU and corporate management
GBS operates on multiple IT systems for each GBS customer.GBS operates on a single instance ERP across enterprise with
standard enabling technologies. Enabling Technology
GBS delivery groups are aligned singularly to functional leadership.
Functions are responsible for all aspects of process development,
performance management and
talent management.
GBS serves as an independent operating unit on par with other
Functions/BUs providing output based services to Functions/BUs
based on policy and requirementsEnterprise Governance
Decentralized service delivery model with single function Multi-functional, multi-channel service delivery modelServices Portfolio
GBS provides transaction processing and staff mix and skills reflect
this narrow focus
Broad talent management practices ensure GBS people and
leaders are recognized for their insight, innovation and customer-
orientation. Talent Management
No formal analysis of service supply-demand.
Formal supply-demand of services is used to optimize
consumption and evaluate service sourcing. Formal analytics in
place. Commercial Orientation
Business processes are managed solely within their delivery teams,
which are discrete to a function and/or geography.
Global process ownership incorporating both the GBS and non-
GBS portion of an end to end process. Process Excellence
Information is created and distributed through a combination of static
reporting and limited ad-hoc requests; analysis is performed on as-
needed basis.
Dynamic reporting, with predictive modeling provide users with
prescriptive analysis of real time data from internal and external
sourcesData & Analytics
Absence of organizational flexibility and senior management
ownership
High degree of management buy-in and formal processes for
driving GBS acceptance in the organizationChange Management
Assurance reporting requirements are not included in service
provider contracts, and no coordination occurs with providers on
assurance related matters
Assurance reporting with impact to the organization's financial
reporting, operational, and compliance objectives with due
diligence occurring for new and existing providersRisk and Tax Optimization
Lo
w
Hig
h
1 3 5
11© 2015 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services.
No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
1 3 5
3.92.7
3.62.4
3.0
4.23.1
2.9
3.72.8
3.2 4.0
3.72.6
3.82.9
3.8
Data & Analytics
Lo
w
Enabling Technology
Lo
w
Enterprise
Governance
Lo
w
Talent Management
Lo
w
Process Excellence
Lo
w
Change Management
Lo
w
Services Portfolio
Lo
w
Delivery and Sourcing Strategy
Lo
w
Risk and Tax Optimization
Lo
w
Commercial Orientation
Lo
w
Hig
hH
igh
Hig
hH
igh
Hig
hH
igh
Hig
hH
igh
Hig
hH
igh
2.9
3.6
3.9
Aspirational
LEGEND
Current
Best in class
average
Global average
Maturity survey analysis: The Nordics view
12© 2015 KPMG International Cooperative ("KPMG International"), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm
has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
Roundtable discussions: The 10 Dimensions of GBS
CHANGE AND PROGRAM MANAGEMENT
CASE FOR CHANGE • SPONSORSHIP • RESISTANCE AND BUY IN • COMPETING PRIORITIES • READINESS
ENTERPRISE SERVICE GOVERNANCE
Overall GBS Governance
Cross Channel Service
Agreements
Change Management
Service Delivery Channel
Governance
Outsourcing Portfolio
Management
Performance Management
Collaboration Forums
Issue Management
Financial Management
COMMERCIAL PERSPECTIVE
GBS Brand
Benchmarking
Pricing and
Competitiveness
Customer Relationship
Management
Service Level Transparency
Demand to Deliver
DELIVERY AND SOURCING STRATEGY
Value Drivers
Transformation Agenda
Role of GBS in Business
Strategy
Investment Strategy
Executive Commitment
Alternative Delivery
Mechanisms
SERVICE PORTFOLIO
BU and Geographic Scope
Service Type
Operational Scale
(Historical Trend)
Functional Scale
TALENT MANAGEMENT
Culture
Collaboration
Career Development
Skills Mix
Learning and Development
Global Workforce Planning
Employer of Choice Strategy
Staff Retention
TAX AND RISK OPTIMIZATION
Financial Reporting
Integrity & Compliance
(e.g. SOX)
Data Security and IP Risk
Business
Continuity/Disaster
Recovery Framework
Regulatory Compliance
Cross Channel Integration –
Risk & Compliance
Management
Income Tax Considerations
(e.g. US, state, foreign)
DATA AND ANALYTICS
GBS Involvement and
Capability
Reporting
Information Production
Data and Analytics
Deployment
PROCESS EXCELLENCE
Process Owner
Responsibilities
Service Management
Integration
Process Accountability
Process Standardization
Organizational Structure
Global Process Management
Documentation & Enterprise
Content Management
ENABLING TECHNOLOGY
Technology Platform
IT Innovation
Automation
IT/Business Process
Integration
Thank you
© 2015 KPMG International Cooperative ("KPMG
International"), a Swiss entity. Member firms of the
KPMG network of independent firms are affiliated with
KPMG International. KPMG International provides no
client services. No member firm has any authority to
obligate or bind KPMG International or any other
member firm vis-à-vis third parties, nor does KPMG
International have any such authority to obligate or
bind any member firm. All rights reserved.
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