Siemens Answers: Sustainable Future

Is there a smart way for Outsourcing? Istanbul June 1, 2010

Siemens Sanayi ve Ticaret A.

Analyst views for outsourcing The success of Outsourcing/Managed Services will hinge on the right balance of: Cost, Internal Control, and External Contribution

Structure outsourcing contracts that include the ability to shift from cost control and cost takeout toward enhancement and innovation. Shifts in the economy will inevitably occur during a multiyear outsourcing deal.

Outsourcing is not a silver bullet, however it can improve Operational Efficiencies and create New Business Value through II Page 2

01.06.2010

Author

Siemens Answers: Sustainable Future

Today’s Challenges…


Integrated complex projects

Complexity


Coordination with various vendors
High Quality is required


Best of breed technology

Expertise


Partial resources for limited period
Lack of resources in the job market


High investment and activation cost

Financial


Long ROI time
Budget cuts

Siemens Answers: Sustainable Future

Agenda

SieQuence Approach

Tools & Methods

Customer Feedback

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Siemens Answers: Sustainable Future

The SieQuence Approach

Outsourcing is a method to achieve these goals.


Adapt to variable business climates
Focus on core business processes and value chains
Cost reduction and management
Access to advanced skill and capabilities
Speed introduction of new services
Improve quality and access innovative ideas
Mitigate risk from technology change and obsolescence. The SieQuence Approach from Siemens delivers on the promise of outsourcing by realizing value through transformation.

Siemens Answers: Sustainable Future

Finding the Cost – Value Balance

Reduce non-valued IT spending

Continue to invest in and build IT

Cut… cut…cut

Maximize value

$

€

£ s Busine

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€

£

nts e m e r i s R eq u

The strategy: Strike the balance, find the economic common ground by restructuring the IT spend to maximize value Siemens Answers: Sustainable Future

IT Business Value – Efficiency Minimize Consumption and Transaction Economics

Cost Levers

Consumption Economics

Transaction Economics

the number of times a support process needs to be executed

Minimizing the cost of executing a support process

Process-Technology-People Service Desk Remote Management Tools Proactive Management

Process-Technology-People Process Improvement Automation Tools Training / Skills

Innovation and Transformation Relationship Management

Facilitators

Transparency and Control

Services and Operations

Relationship Governance Best Practices and Continuous Improvement Integrated Services and Tiered Delivery

Siemens Answers: Sustainable Future

The SieQuence approach – The Transformational Journey

Operational Transformation

Business

Process & Services Transformation

Transformation

Transformational Journey
Transaction & consumption economics


Automation & workflow management


IT enabled business models


Process & technology consolidation and harmonization


Creation of the virtual infrastructure


Service Oriented Architecture


Process orchestration & optimization.


SaaS integration


Global sourcing
Quality and continuous improvement


Business domain expertise


Demand & Portfolio Management
Business service lifecycle

Siemens Answers: Sustainable Future

The Building Blocks of Effective Outsourcing CUSTOMER

Integrated Outsourcing Approach Portfolio

Management of Outsourcing Engagements

Tiered Delivery (Global & Local) Voronezh

Toronto Chicago – Mason

Cork

Madrid

Mumbai

Vienna Timisoara Istanbul

Service Desk

Desktop Services

Network Services

Data Center

App. Other Services Services


Comprehensive and standard global portfolio

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01.06.2010


Global methodology for management of an outsourcing engagement

Author

Manila

Singapore Munich – Fuerth

Service Desk Desktop & Server Network Application Operation Application Management Professional Services


Globally
Standardized and flexible services

Siemens Answers: Sustainable Future

Agenda

SieQuence Approach

Tools & Methods VCA – Value Comparison Assessment CIW – Customer Innovation Workshop

Customer Feedback

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Siemens Answers: Sustainable Future

VCA - The Value Comparison Assessment

The VCA analyzes
Processes and costs
IT infrastructure
Partnerships and obligations

Costs

The VCA evaluates

Alignment


Customer's IT alignment to the corporate business requirements
Opportunities for service improvement

Benefits

Risks

Flexibility

The VCA determines the best SieQuence approach and transformation roadmap Page 11

Siemens Answers: Sustainable Future

VCA - IT Challenges Business Needs

IT impacts/ Change

Extended

Extended

Focus on

Gain efficiency

Support

Users & Dealers Support

Service Availability

IT needs “growth without growing” Be ready

Operations

Processes

Functions

Be aligned

Processes

business project IT Proactiveness in Service Delivery

for new IT scenarios

to business needs

Infrastructure

IT Service Management People Governance

People

Organization

Daily activity fulfill people time

IT weakness Lack of

Processes not documented

SLA, service scalability Siemens Answers: Sustainable Future

VCA - Process Overview

1. Review Business Objectives

5. Develop Roadmap
High level like-for-like solution
SLA modeling
Cost reduction
Integrate IT Business Value objectives

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6. Report Results
VCA Assessment Summary
Executive Presentation

2. Understand VCA Objectives
Determine areas needing improvement
Establish IT value targets

3. Assess Current Environment
Collect current support cost
Evaluate current support model

4. Identify Potential Opportunities
Increase IT value alignment
Cost reduction
Efficiency & productivity gains

Siemens Answers: Sustainable Future

VCA Process Timeline The VCA process has the following phases

Outputs

Activities

Phases

One Week

Preparation

Three Weeks

Three Weeks

Information Processing & Evaluation

Information Gathering

One Week

Presentation & Acceptance

• Introduction

• Project Kick-Off

• Compile Data

• Present Findings

• Process Overview

• Initial Interviews

• Verify completeness

• Define Next Steps

• Scope Definition

• Data Gathering: - Deliver questionnaires - Return questionnaires - Validate answers

• Check plausibility

• Agree to Proceed

• Site visits

• Gap analysis

• Non-Disclosure Agreement (NDA)

• Questionnaires Completed

•• Raise additional /verify Develop questions Recommendations

• Customer Management Meeting

• Validation Process Completed

• Scope and Scale Definition

• Agree to Proceed

• Timelines • Account Overview

• Close Project

• Check assumptions • Benchmark data

• Next Steps defined

• Develop Roadmap • Create Final Presentation

• Prepare for Kickoff (time schedules: only indications may take less or more depending on complexity)

Siemens Answers: Sustainable Future

VCA Success - References Global Medical Equipment Manufacturer

Building Products Manufacturer

Global Soft Drink Manufacturer & Distributor


Beginning relationship
SVP


Beginning relationship
CIO


Beginning relationship
CIO


Size: 5,000 Seats


Size: 7,000 Seats


Size – 6,500 Seats


VCA Result:


VCA Result:


VCA Result:


13% Savings over 3 Years
Action:
SieQ S1
3 Year
$3.8M TCV for DT alone
Services expanded to include HD


$3.5M Annual Savings
Action:
Expanded to S2
5 year
$40M TCV


$5.8M Savings in Y1
Action:
SieQ S1
Services have continued to expand
Now Global

Siemens Answers: Sustainable Future

CIW – Customer Innovation Workshop Structured, Innovative, Transformational Repeatable process

Implement and Manage via dedicated team

6

Identify and prioritize business objectives

1

Progressive Value Generation

Build a roadmap to achieve desired state

5

Develop vision of the desired state of operations

2

Isolate enabling technologies & services Unite the future vision with realities of the business

3

4 Steps 1-3 Identify Value

Steps 4-5 Create Value

Steps 6 Release Value Siemens Answers: Sustainable Future

CIW – Method (What goes in…) Innovation Method Millipede

User Devices GRID

Device Service Connect M-RAM

Personal Knowledge Networks

User Interfaces

Galileo

MS-Longhorn

MS-Longhorn Translation Services Voice Services RFID Content Services DIA UPnP Information Visualization

HAMR Millipede GRID

Datacenter

Distributed Policy Based Network Computing dyn. IT-Services Shared Datacenter Utility Computing Services Administrative Serv. Holographic Storage For SOA Autonomic Computing Global Load Balancing

ILM

Applications

Personal Web

Publishing Shared Appl. Services MVS/AS400 Software Agents Desktop to go Websphere .net 3D Graphic UI 64 Bit Business Continuity Resource Virtualization Content addressed Storage J2EE Semantic Networks Transponder Personal Web SOA Shared Platforms Voice XML OLED BS2000 on Demand Instant Messaging Expertise Location Portals Personal Translation Services (voice) Knowledge Pad Netweaver MAID Grid Service Self Healing H.264/AVC autom. Speech Systems SOAP Biometric Backup Virtualization (voice server entry) Smart Display Bus. Proc. Mgmt. Authentication Security Managed Server/Storage Mobile Portal Managed Web Networks Web Services Software Agents Linux WorkplaceSmart on Demand Biometric GMPLS Phones Call Tracking Web Agents Authentication Knowledge Management Semantic Netw. Shared DMS Conferencing VoIP/WiFi Open Source Apl. OADM TCPA E-CDN Federated ID Sales & Field UMTS Shared Webhosting Software Agents IPv6 W-LAN Force Automation UMS 4gN Security Consultancy Seamless XML Single Sign On EaH UWB SSL-VPN 802.1x VoIP SIP AdHoc WiFi Authentication BT-2 PoC WPA Services TLS Gallileo PAN EDGE Bluetooth HW Encryption today IPv6 AES WiMax I-MSP Applet Certificates 2004 Quantum ENUM Anti-SPAM Cryptology Unified Messaging EofM © 2004 Siemens Business Services ORS IM

The Innovation Radar™ Innovation Roadmaps™ 2006

2008

2010

2006

Technology

Innovation Manager

Media Hosting Service

CDN

Service

2008

2010

New Products / Services


Market Siemens innovation capability
Build Credibility and Trust

Experts
Market Siemens products and services
Showcase possible opportunities

Local / Country Specific input

Sales & Country
Country specific input
Respect regional culture

Siemens Answers: Sustainable Future

CIW – Method (…and what comes out) Strategic feedback

Drivers

Techno -logy

Services

„Personal Computing Capacity“

to Innovation Mgmt.

The Innovation Manager takes the

M ajor change of two paradigms: new advanced User Interface and Web-Services integrate back office. Networked Application & Computing Resources New M etaphors for Computing & Interaction Convergence of Desktop and M obile Infrastructure From the Desktop T o true M obility

2004

2006

M anaged Mobile Device Linux Desktop

Mobile M edia Access Unified Back-Office

2008

2010

Time

Voice I/O Services Intra Grids

Device > Service Connect

M obile Devices Open Source / Linux

Mobile Broad Band Fast mobile HW

Web Services 64 Bit SM P OSs

Data-Network Integration Grid Com puting

Low Cost Mobile Devices W-L AN Hype

Mobile M edia Demand PC like M obile Devices

Cheap Computing Power Virtualization

Demand for computing from the Grid


customer feedback puts it into the Radar
lobbies for service change requests at Roadmap updates with service mgmt. & Industry GGs

© 2004 Siemens Business Services ORS IM, Duncan McNutt

Innovation feedback to Experts

The experts take up
Early customer feedback on their products / services
Pilot or early adopter customer offerings

Local / Country Specific output

Sales & Country gets
Opportunity list and scope expansion
Improved standing and customer respect

Siemens Answers: Sustainable Future

Scope for the Two Work Streams Business • Outcomes IT organizations

Empower Competitiveness

• Siemens will prepare a Service Outsourced customized data collection
Cost Reduction document to be distributed to the
Improved Governance relevant IT groups


Variable Cost/Consumption
Gain Sharing
Enhanced User Experience
Improved Performance
Continuous Service Improvement


Improved Service Performance\

Operating Model


Low Cost
Low Risk


Innovation Program & Roadmaps


Service Automation


Focused Six Sigma Methods & Tools


Core Service Functions

• Data Collection Areas
Enhanced Governance Model • Service Desk – Level 1 and 2 • Site Services (Field Services) – Level 2

Engagement and Transition

Consulting

Transition

• Develop a target operating model and transformation roadmap for the desired set of objectives.


Effective Knowledge Management


Best Practice Delivery Processes

Current Operating Model


Cloud Compute Models

Strategic Portfolio •
Manage the Planning use of the Siemens Customer
Innovation Portfolio Consolidation & Harmonization Workshop tools and processes.


Global Delivery Backbone

•
Outsourcing Consolidate and validate the collected ROI data
Value Levers Identified
Transition Plan

IT service •
Business-aligned Provide facilitation and subject of matter Operation
Improved Business Performance expertise to ensure to the creation of a customer target operating model Service Oriented Architecture describing the desired state
of operations Target
Process Optimization for consolidated service desk and endOperating user computing services
Process Management

Model

• Siemens will conduct a kick-off Global Service Deliverythe data meeting to explain collection methods, goals, and Interim timelines.Rapid Transition Business Case

Future Mode


Applied Innovation

Optimized Delivery Model

• Facilitate and collect IT services operational data

Dimensions of Value

Evolve Performance Drive Efficiency

Customer Innovation Workshop – Focused Outcomes Target Operating Model

VCA - Data Collection

Transformation

Operational

Service Desk

• Lifecycle Management Services • Service Request Management IT Rationalization

• Provide a supporting document that Service details the critical elements of the Target Operating Model.

Scope

Business

Service & Process Global Delivery

Application Roadmap

Customer Innovation Workshop

Lifecycle Services

Consolidate & Harmonize

Business Process Management

• Print Management Transaction Avoidance

Service Request Mgmt

Business Domain Expertise

Siemens Answers: Sustainable Future

Project Timeline - Summary

Value Comparison Assessment

Customer Innovation Workshop

• Quantitative analysis performed of current scope of work • Qualitative review of services and capabilities to identify best practices • Facilitated discussion of areas of focus and desired outcomes.

Target Operating Model • Resulting output of data gathering and CIW workshop • Articulate quickly the desired state of operations • Tool to build consensus on stated direction

Requirements Documentation • Translate agreed upon TOM to set of attributes and requirements • Move to common industry lexicon of terms and descriptions

Document Delivery • Review overall document content • Ensure readiness for external distribution and consumption • Document Delivery and Sign-Off

• Harmonize the requirements across MB businesses.

Siemens Answers: Sustainable Future

References Challenges: In-sourced • Outsourced • Considering Outsourcing Cost Constraints • M&A • Personnel Issues Manufacturing: 27,500 users – VCA, Global State One, Mason, Manila and Toronto SD, Global PMO, Workplace Services, CIW and QCI. TCV-$125M

Financial Services 29,000 users – VCA, State One, Manila SD, Workplace Services w/CSS, CIW and QCI. TCV-$30M

Financial Services: 2500 users – VCA, State One, Mason SD, Workplace Services w/CSS & MCS, QCI. TCV-$19.5M

Siemens Answers: Sustainable Future

Agenda

SieQuence Approach

Tools & Methods

Customer Feedback

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Siemens Answers: Sustainable Future

Borusan Ba arı Hikayesi

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01.06.2010

Author

Siemens Answers: Sustainable Future

Borusan Gereksinimler

Siemens Answers: Sustainable Future

Borusan Merkezi Service Desk Öncesi

Hizmet kalitesinde farklılık, hizmet veren ki ilere bağımlılık, gibi nedenlerden dolayı tüm mü terilerimizi aynı anda memnun etmek zordu. Siemens Answers: Sustainable Future

Borusan Yeni Yapı Kazanımlar

Siemens Answers: Sustainable Future

Borusan Merkezi Service Desk Sonrası

Siemens Answers: Sustainable Future

Borusan Grup Proje Değerlendirme

Siemens 30 ki ilik Proje ve saha ekibiyle Borusan ’a destek vermektedir.

Siemens ile kurduğumuz yeni yapıda çalı anlarımıza sektör ve coğrafya bağımsız, 7 gün 24 saat destek alma imkanı sağlanmı tır.

Borusan – Siemens i birlikteliği katma değerli diğer hizmetlerin de eklenmesi ile büyümektedir.

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01.06.2010

Author

Siemens Answers: Sustainable Future

Thank you for your attention

Tuncay Margılıç Group Manager SIS Global Operations

E-mail: [email protected]

Siemens Sanayi ve Ticaret A.