client industry client need ey value delivered media and ... · developed a detailed gap analysis...
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Steve KatzPrincipalIT Transformation ServicesIselin, NJ+1 732 516 4598 (office)+1 973 809 5813 (mobile)[email protected]
Pete HidalgoSenior ManagerIT Transformation ServicesTampa, FL+1 973 223 5616 (mobile)[email protected]
Client industry Client need EY value delivered
Media and entertainment
A large global media conglomerate needed help establishing ITFM processes and creating an Enterprise Technology service catalog for its newly established IT shared services organization.
► Designed a comprehensive, business-facing IT service catalog that included service performance levels for each service
► Developed a monthly service usage-reporting process and reports for all IT services
► Created an IT-specific chart of accounts to align costs with services
► Built a service-cost model and calculated actual unit service costs
► Designed a service-cost allocation model covering 26 services and 7 business divisions
Advertising A large global advertising firm needed to assess its ITFM process maturity and develop a detailed plan for improvement.
► Determined current and target ITFM maturity levels► Developed a detailed gap analysis ► Created 16 improvement recommendations► Designed a comprehensive ITFM data and system-end state
architecture► Provided an executable and prioritized recommendations
roadmap
Pharmaceutical A large global pharmaceutical company needed to improve IT costtransparency and develop an end-state ITFM data and system architecture.
► Assessed the current state of ITFM processes within its Information Technology Shared Services (ITSS) organization
► Developed unit service-cost model and benchmarked to the market, identifying millions in potential annual savings
► Designed ITFM data and system-end state architecture
Broadcasting An international television broadcast network needed to address its fragmented ITFM processes, lack of cost transparency, no service definition nor usage reporting, and an ineffective cost allocation process.
► Performed a current state cost and operational assessment of existing IT function and ITFM processes
► Designed, developed and supported the launch of a comprehensive IT-service catalog for the newly formed IT shared services organization
► Defined and documented key ITFM processes► Developed an IT service-cost model► Identified significant potential reductions in annual IT operating
costs
Recent EY client success stories
Contacts
IT financial management journeyErnst & Young Perspectives
EY | Assurance | Tax | Transactions | Advisory
About EYEY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.
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ED None
► Increase the value received from IT► Make sure IT is supporting the business strategy► Measure and manage IT appropriately
► Use IT to improve the business► Have a common language for communicating with IT► Make IT a part of the team
► Demonstrate the value IT provides to the business► Secure the resources IT needs to deliver results► Have a place at the executive table ► Have a common language for communicating with business leaders
CEO/CFO
Senior business leaders
CIO/Senior IT leaders
Stakeholders Stakeholder priorities for IT
To overcome many of these challenges, EY has developed the ITFM journey
Current challenges faced by clientsWe often find that there are multiple executive level stakeholders with varying needs and priorities for their IT organizations that must be understood and addressed.
Step 1 Current state assessment
Step 2 Service definition
Step 3 Unit service
costing
Step 4 Metrics and reporting
Step 5 Chargeback model
Step 6 Bill of IT
► Transparency► Cost efficiency► Customer
satisfaction
The EY IT Financial Management (ITFM) journeyEY’s ITFM journey provides a clear and easy-to-follow path to enable the delivery of cost-effective services to the business, improve transparency and increase satisfaction.
Ste
p 1
of y
our
ITFM
jour
ney
is t
o un
ders
tand
whe
re
you
are
and
whe
re y
ou
need
to
go
Collect data, conduct interview and perform benchmarking
1. Data collection and analysis
Analyze gaps, assess maturity and identify savings opportunities
2. Assessment
Value High
Deta
il an
d Co
mpl
exity
Low
High
1Cost
Center
Defe
ndin
g co
stAd
ding
val
ue
2 Commodity
3Utility
4Advisor
5Business Partner
Sample deliverables
High
Bene
fits
and
Tran
spar
ency
Low
High
1 Overhead Allocation
2Flat Fee
3 Consumption
Based
4Incentive Based
5Service Based
6 External Pricing
7Value Based
Pricing
Implementation Complexity
# IT Category Observations Gap Gap
Severity
20 IT FinanceIT finance processes are performed on an informal basis with limited documentation
• Inconsistent processes lead to negative outcomes, such as not identifying expense items
Medium
21 IT Finance Capex budget updates are not done on a real time basis
• Updated budget reports are not readily available which negatively impact cost management
Medium
22 IT Finance All IT spend is not centrally managed by GroupM WW IT
• No consolidated view of IT expenses can hamper effective cost management
Medium
23 IT FinanceApptio is not being utilized to perform service costing and chargeback
• Not realizing the full benefits of the Apptio platform to understand and effectively manage costs
Medium
24 IT FinanceFinancial systems are not connected between the US and UK organizations
• No consolidated view of IT costs leads to inefficiencies in data analysis for management decisions
Medium
25 IT Finance There is limited use and reporting of IT financial metrics
• A lack of metrics can lead hinder good management decisions Medium
Gap analysis
4.2%
5.5%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
Industry Average GroupM
► The pie chart below represents 90% of the OPEX expenses included in the “Personnel” category.
► largest personnel expenses are:► Staff Salaries► Employers Social Taxes► Travel Staff salaries
Employers social taxes
Travel
Inter-company time of staff
Short-term incentive bonus
Inter-company personalcosts rechargesPensions - definedcontribution schemes
Total = $XM
Benchmark report
Low Medium High
Low
Mediu
mHi
gh
Comp
lexity
Priority
Low
High
Value of Initiative
15
1 14
12
13
9
3
11
8
5
2
10
716
6
4
2014Jan Feb Mar Apr May Jun
1. Establish ITFM group
2. Develop IT service catalog
3. Create CMDB in ServiceNow – in progress by GroupM
4. Implement time tracking in ServiceNow
5. Design an IT chart of accounts
6. Design & implement IT Service Costing in Apptio
Roadmap
# IT Category* Recommendation Description Priority Complexity Duration (Months)
Potential Annual Savings
Value Index
Client Resource Reqmts.
1 IT FinanceEstablish an IT Financial Management
group with well defined and documented roles and processes
H L 1.5 NA 95% 2
2 IT Services Develop a business facing IT service catalog H M 2 NA 93% 3
3 IT Services Implement a CMDB in ServiceNow H H 5 NA 86% 3
4 IT Services
Implement a standard time tracking process for all of WWIT employee's time using ServiceNow, which will also track
time for each service.
H M 3 NA 94% 3
* Note: IT category is based on departmental responsibility
4 16Core Issues Identified Recommendations
$4.2 - $7.8MM
Apptio• Service Costing• Bill of IT & Datalink
ServiceNow• Time Reporting• CMDB Configuration
and Asset Management
Increase Tool Utilization
Lack of service cost transparency
• No service catalog• No consumption reporting• Service costs not known• Minimal chargeback
Process Immaturity• Lack of documentation• Absence of metrics /
measurement and reporting
Low Degree of Automation • Spreadsheet based• Manual processes• Disparate systems
Lack of IT financial data accuracy & clarity
• Costs not aligned with services
Core Issues Identified How will EY help you get there? The Benefits
• Improved customer satisfaction via well defined services
• Transparency into costs and consumption
• Increased efficiency through better resource management and standardized processes
• Lower costs via more efficient service consumption, which can be redeployed to fund improvement initiatives
• TEM & Chargeback provide increased visibility in IT expenses driving efficiencies
Collaborative team with deep expertise in ITFM and PM
Executable roadmap with detailed recommendations
Leading practice architecture, templates and accelerators
Annual Savings
Recommendations
Develop recommendations and roadmap for improvement
3. Develop recommendations
Step 1: ITFM assessment overviewEY’s eight-week approach provides clear objectives, activities and practical recommendations that can be rapidly implemented.
Benefits realized from Step 1► Understand the IT cost baseline, benchmark position and ITFM process maturity levels► Identify actionable savings opportunities ► Have detailed recommendations and an executable roadmap for improvement
Why EY► EY’s collaborative culture, experience and depth of knowledge in ITFM
uniquely positions us to help today’s IT organizations overcome their ITFM challenges.
► EY has a proven approach with a long track record of success.
► We have the ability to seamlessly integrate with client teams to get the work done with minimal disruptions.