ae foyer - value driven transformation

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VALUE DRIVEN BUSINESS TRANSFORMATION

AE Foyer, 2 December 2015

#aefoyer

SPEAKERS

Stefaan BergmansPrincipal Consultant

Regine DhaenePrincipal Consultant

Pieter JaekenPrincipal Consultant

PROGRAMME

Setting the scene

Retail case

Social sector case

Wrap-up

WHAT IS VALUE DRIVENTRANSFORMATION?

Stefaan Bergmans

THE CHALLENGE

Business Opportunities- New channels

- New thinking patterns

- New technologies, digital

Business Threats- Market disruption

- Faster competitors

- Data loss, cyberattacks

Execution Challenges- Complexity

- Inertia

- Unpredictability

WHAT IS VALUE?

• Value is not only ROI

• Depends on the organization

• Strategy is a way to realize Value

• Measurable success criteria

• Examples

ROI TCOProfit

Low cost to serve Share of customer

wallet

WHAT IS VALUE DRIVEN TRANSFORMATION?

Programs/Projects

Enterprise Arch Portfolio Mgmt

Operations

SH

AP

ING

VA

LU

E

Strategy

DE

LIV

ER

ING

VA

LU

E

REQUIRED TALENTS & SKILLS

Strategy

People skills

Domain knowledge

Craftsmanship

Strategic & Business

Management

Listening & empathy

Personal leadership

Culture

Change Mgmt

Engaging

Politics

Conflict Resolution

Enterprise Architecture

PPP Mgmt

Analytics, Insights

Coaching, Mentoring

Maturity Levels

Context

Industry knowledge

Market evolutions

Domain network

Domain tools

Senior Mgmt Buy-in

Strategic insight

Strategic alignment

TARGET GROUP?

ITBusiness

WHO?

Everyone

Enterprise

Architecture

Team

MINDSET?

InvestorImplementator

PRIMARY APPROACH?

WaterfallAgile

FOCUS?

Solutions

Processes

Software

Packages

Objectives &

Benefits

Questions?

RETAIL CASE

Regine Dhaene

STRATEGY DEVELOPMENT

Value to whom?

• Customer, shareholders, …

• New Value

• More Value

• Better Value

Transformation

Value

Shape & model parts to a valuable

offer, product or service

Driven

Strategy describes the choices about

HOW you want to create ‘Value’

CONTEXT

Strategy Development Strategy Execution

• A lot of good ideas

• Velocity, pace of execution• Strategy definition, choices

• Documented, communicated, roadshows

etc.

• Transform the idea’s & choices into actions

• Expectation: the organisation takes over and

rolls out what was communicated

• But that hardly ever happens...

Relatively

Difficult, isn’t it?

Initiate a Group portfolio of +/- 10 programs

Product information, CRM, Finance, HR, Supply

chain, communication, new technical platforms,

e-commerce, information & insights …

Resulting in a Group strategic roadmap

Each program begins to organize & initiate

projects

The organization begins to look as a big complex

construction site

REALITY

Transformation

Value

Driven

WHAT HAPPENED IN BETWEEN?

Organization structures

Culture

People

Business processes

MethodsIT landscape

• Collective focus?

• Scattered actions

• Different paces

Changes

Converged to a point in time:

The right business momentum

NEW BRAND INTRODUCTION

Create more and better Value by:

• Introduction of a new “Brand”

• Phased transition of own brands

towards new Brand

• Improve Product quality at the same

time

Competitive and differentiating strategy in

response to market dynamics

• Phased rollout in product categories, in

time, location, market channels

• Quality improvements on products

• Adjustments in supply chain

• .......

How does this

Brand perform

on the market?

Do we really

create more

and better

value?

Strategy Development

Strategy Execution

A FEW MONTHS LATER…

Strategy Development

Strategy Execution

Aggregated reporting:

• Profit ↑

• Gross margin ↑

Is value creation a fact?

• New Brand available, phased in different product

categories, locations & market channels

• Product quality enhanced (changing ingredients)

• Supplier changes & logistic replenish process

carried out

Everybody happy, new brand is a success!

convinced that all is running smoothly

FEEL GOOD & FIRST SYMPTOMS

Top management gets good news confirmed by reports

A lot of coffee moments later ....

We need to do something!

QA lab Purchasing LogisticsPricing

centerCall center Analysts …

FEEL GOOD & FIRST SYMPTOMS

… but what?

Which approach?

Urgent!

How to bring the news?

“We knew we had to stick our neck above ground level, get mandate, find someone at top level supporting our initiative, ... because this wasn’t planned (resources, budget restrictions).”

UNLEASHING THE VDT APPROACH

Mandate & sponsorship

Small team & multi-disciplinary

Permission “quick & d....”

Speedy approach: 3-4 months

RETAIL VALUE CHAIN

Macro &

micro

economic

trends

Insights on

performance

Product

Quality

Supplier FIFO

Fased in

time

Price

comparisons

Customer

segmentation

Purchasing –

switch

behaviour

Complains &

customer satisfaction

Happy

Customer

After sales support Contact Center

POS transactions & restocking

Promotion & pricing

Warehousing to retail store distribution

Product procurement

Product development & QA

IT supporting systems

Facilities

HR

Management & governance

Retail Value Chain

What did we learn?

E2E Strategic flow

EXAMPLE: “UNKNOWN POTENTIAL VALUE” (1)

Macro &

micro

economic

trends

What is the relation between customer confidence &

market performance?

Same pattern for our competitors?

Right timing for brand switch surfing on increased

customer confidence?

Right business momentum?


Conclusion:

Timing of brand switch: choosing a more optimal business momentum could have created more value re-enforced by the customer confidence cycle

Multiple M€ and timing adjustments of about 3 months

One competitor understood this very well & adapted their strategy, creating more value


Customer segmentation – in relation with product mix

CannibalismSwitching behavior

Customer segmentation: different groups than the ones we knew of

Looking differently at Customer segmentation (not arbitrary)


Conclusion:

Discovering “floating” customers lost during brand transition AND it seem to be the customers who are not price sensitive!

Cannibalism of strong existing brands

Better understanding the customers, could have created additional several M€

“(UN)KNOWN POTENTIAL LOSS OF VALUE”

Silos-teams going into action at different pace

Silo-information not linked/exchanged between, not integrated

Over-acting project approach for many years:

no feed of strategic data into BI&analytics platform

Known somewhere in the back of our head.... but no time, resources, €, focus, …

BEWARE!

“Fast” approach: insights delivered across organization to act at the right moment

Beware: no permit to forget structural improvements needed, assuring long-term value creation

Still requires disciplined execution!

Value Driven Transformation

Dynamic

Strategic Roadmapat drumbeat of

Business Momentums

Speedy – agile changes (0-6m)Follow process/information flows transversal through the

organization with strategically relevant insights

Legacy

Integrations

Stability

ITIL driven structures

“continuum portfolio”NO x year roadmapping!

Focus, speedy and agile actions:Data identified, accessed, data cleansing

Organizational: awareness & Coaching

Insights built up across the chain & shared

On present technologiesP

OR

TF

OLIO


Plan structural changes:• Project Life cycle method & Funding model

• Running product program: brand

• Running customer program: segmentation

• Running supply chain program: brand switch

process

Requirements – structural changes

TAKEAWAYS

Focus on the value you want to achieve1

Predict your ‘right’ business momentum(s)2

Follow your strategic information flow3

Put together a multi-disciplinary team4

Allow 2 different paces at once (Bi-modal) 5

Questions?

SOCIAL SECTOR CASE“SOC-Y”

Pieter Jaeken

Questions?

WRAP-UP

Stefaan Bergmans

VDT BUILDING BLOCKS

DEFINE VALUE

Success criteria

E2E VALUE CHAIN

DEFINITION

CREATE AGILE

PORTFOLIO

Short vs long term

L

E

A

D

E

R

S

H

I

P

I

N

S

I

G

H

T

S

VDT: SHAPING VALUE

Content

Management

PeopleBusiness

Information/Insights

Application

Technology

Communication

Organizational change

Politics

Culture

Objectives, benefits

Budget, timing

Risk

Quality

Holistic approach


Speedy – agile changes (0-6m)Follow process/information flows transversal through the

organization with strategically relevant insights

Legacy

Integrations

Stability

ITIL driven structures

“continuum portfolio”NO x year roadmapping!


Requirements – structural changesValue

Definition

Agile

Strategic

Portfolio

TAKEAWAYS

Start by precisely defining value. What are your success criteria in terms of measurable value?

1

Value Driven Transformation crosses all departmental and company boundaries

2

Create an agile portfolio: short-term transitions using long-term flagstaffs3

Challenge and (re-)direct projects/programs from a Value Driven Transformation perspective

4

THANK YOU!

Questions?

HISTORY

Gartner EA Hype Cycle

IT, Technology, IT Efficiency

EA Frameworks

Outside-in

EA as driver for investments

Instead of

silos,

duplication, …

Instead of

reinventing the

wheel

Instead of

internal IT

focus

Instead of ivory

tower

Zachman, TOGAF, FEA, NIST,…

Waterfall PPPM

Iterative PPPM

Agile PPPM

Bi-modal PPPM

Instead of

ad hoc

Instead of

long-lasting

Instead of

top-down

Instead of not

adapted to

context


Everyone, culture

instead of only

EA’cts

Integrated PPPM &

EA