© 2009 IBM Corporation1
Conversations for a Smarter Planet
© 2009 IBM Corporation
Globally Integrated Enterprises
How Sara Lee is supported by IBM
Henk Kooiker, Application Services, Distribution Sector
IBM Global Services
© 2009 IBM Corporation3
Conversations for a Smarter Planet
Agenda
�Globally Integrated Enterprises
�Sara Lee – the company
�Sara Lee – their challenges
� IBM’s contribution
© 2009 IBM Corporation4
Conversations for a Smarter Planet
Globally integrated enterprises are characterized by free flow of work, standardization, componentization and collaboration
“The Globally Integrated Enterprise is one that is operating seamlessly as a single organic entity by
integrating internal operations horizontally and globally, collaborating with external partners, and
operating at the best location in the world, to maximize value creation from a global point of view” -
Sam Palmisano, Chairman & CEO, IBM
Manages Value in a Specialized Ecosystem
Builds a Specialized Enterprise
Serves Distinct Global Markets
Manages Risk & Control
Leverages Global Assets
Enables Collaboration
Globally Integrated Enterprise
© 2009 IBM Corporation5
Conversations for a Smarter Planet
5
Operating models have historically adapted to market dynamics, and the globally integrated model is becoming dominant
International
• Independent enterprise emerges and
explores overseas markets
• Wide-spread, protective trade
regulations constrain trade
• Free trade, overseas investments, IT
revolution, open standards
• Imported raw materials, domestic
manufacture, and exported
manufactured goods through
international trade
• Replicated HQ organization and
functions in each region
• Manufactured and sold within region
boundaries
• Focuses on optimizing operation
across regional boundaries
• Shift focus from ‘what to make’ to
‘how to make’
• Operations managed at HQ
• Vertically integrated operations
• Regional centers of operations
• Regionally integrated companies
• Globally integrated
• Globally optimized
Multinational Globally Integrated
Driver
Attributes
Configuration
20th Century 21st Century
© 2009 IBM Corporation6
Conversations for a Smarter Planet
Leading companies from many industries are transforming into globally integrated enterprises with much success
Componentized Processes &Consolidated Customer Data
• Consolidated disparate customer records enabling real-time access to customer information. This presents relevant up-sell opportunities increasing revenue and improving customer satisfaction.
• Componentized the dealer interaction process to simplify productsales through a new channel of large dealers. In addition to newsales, the initiative has improved data reliability, reduced costs and extended product reach to end customers.
Globally Integrated Training
• Identified training as a critical competency required to give a consistent customer experience across 1400+ locations
• Created “Smart Service University” which consists of scenario-based electronic training modules available to employees 24x7 and in a self-paced format
• There has been a strong correlation between customer satisfaction and location’s usage of the training and employee adoption has grown from 300K the first year to over 4M.
Globally Integrated Information Systems
• Integrated 15,000 users, 45 countries and 175 legal entities across critical worldwide functions like Finance, HR and supply chain
• Ensures that worldwide management accesses the same trusted source of data & reports. Tight integration with transaction systems ensures that the data and reports are up to date.
• Adopted consistent sets of tools to analyze the data and answer crucial questions around geographies, brands and accounts.
Shared Services & Globally Integrated R&D
• Established global business units with P&L responsibility• Created global shared services that leveraged internal and
external resources to provide quality support at low cost• Transformed R&D to a collaboration network spanning worldwide
locations as well as external partners• Results have been impressive with stock up 50% and non-North
America revenue up 20%
What are other firms doing to globally integrate?
Source: IBM GBS 2008, Chief Learning Officer 2007, Manufacturing Business Technology 2007, Achieving Profitable Growth in Insurance TIBCO 2006
© 2009 IBM Corporation7
Conversations for a Smarter Planet
Sara Lee – overview of brands
© 2009 IBM Corporation8
Conversations for a Smarter Planet
Fragmentation of Sara Lee’s application landscape and support
SAP – FI, CO, PP, MM, WM, PM, QM, SD, CRM, HR, APO, BW, XI, Portals, Basis, Security etc.
COTS – Ariba, Hyperion, JDE, Maximo, Siebel, Manugistics, COGNOS etc.
Custom – Applications using PowerBuilder, VB, Web technologies (Java), EAI, EDI, Oracle DB etc.
271Web Solutions
267Supply Chain
150R&D
883Marketing & Sales
1532Manufacturing
2111IT
338Integration
3413Human Resources
429Finance
2737ERP
117Document Management
4829Business Intelligence
InternationalNorth AmericaCapability areas
Number of applications
Key applications
231 358
© 2009 IBM Corporation9
Conversations for a Smarter Planet
Sara Lee’s IT spend versus the Consumer Products Industry
Sara Lee Compared to CP Industry
AOP 2010
62%
30%
8%
0%
20%
40%
60%
80%
100%
CP Industry Sara Lee
% o
f IT
Sp
en
d f
or
FY
Invest:
Transform
Grow
Run
Gartner - IT Key Metrics Data 2009:, Consumer Products Analysis
?
© 2009 IBM Corporation10
Conversations for a Smarter Planet
Product
An ‘application agenda’ has been the traditional approach to addressing these challenges…BUT
““Approximately 30 percent of the trouble tickets Approximately 30 percent of the trouble tickets
a help desk gets from an ERP system can be a help desk gets from an ERP system can be
traced back to problems with master data. traced back to problems with master data.
When you get into supply chain planning, that When you get into supply chain planning, that
number rises to more than 80 percent.number rises to more than 80 percent.””
Bill SwantonBill Swanton
VP of Research for AMR ResearchVP of Research for AMR Research
© 2009 IBM Corporation11
Conversations for a Smarter Planet
New and more detailed data sources are making market dynamics and shopper behavior more challenging to assess
Consumer Data
Shopper Data
POS Data
RFID Data
CP Company
Consumer Data
Shopper Data
POS Data
RFID Data
CP Company
Take advantage of new sources of data… …Understand consumer behavior at
a deeper level…
…and accelerate the innovation process
Jane Consumer’sMultiple Shopping Behaviors
Jane Consumer’sMultiple Shopping Behaviors
Accelerated and more sustained revenue
Time compression and greater efficiencies
Time to market
Time
$
Accelerated and more sustained revenue
Time compression and greater efficiencies
Time to market
Time
$
ERP CRM PLM BI
© 2009 IBM Corporation12
Conversations for a Smarter Planet
Current and considered initiatives to become smarter and more global
� Integrate external data (customer insights / retail data) into internal product innovation processes
� Defragment Master data management; assignment of business ownership, data management processes and supporting tools
� Corporate standard security and format; data security responsibilities, enterprise-wide authorization/access/security
� Globally integrated Enterprise Performance Management (EPM)
–Cascading Key Performance Indicator (KPI) structure that supports individual BU’s
� Merger & Acquisition – Cookie cutter plan for IT
© 2009 IBM Corporation13
Conversations for a Smarter Planet
Knowledge Transfer in a controlled way ensures business continuity
�Migration Tools
�Client Approved Tollgate
�Knowledge Management
�Remote Knowledge Transfer Tools
© 2009 IBM Corporation14
Conversations for a Smarter Planet
IBM teams onsite with Sara Lee and achieves economies of scale in India
NL, Utrecht
US, Chicago
Pune
Bangalore
Spain
Brazil
© 2009 IBM Corporation15
Conversations for a Smarter Planet
Knowledge Management - Efficiency & Continuous Improvement
Blue Reach & Pelican� Bringing together
SMEs and
Practitioners
� Application owners maintain application information details
Method Web� Bringing IBM
Methods to practitioners
� CMM level 3 to 5 guidance
SAP & CP Industry
Solutions� Global
knowledge sharing
Finance
Information Mgt
Supply Chain
Marketing & Sales
HR
Finance
Information Mgt
Supply Chain
Marketing & Sales
HR
Sara Lee specifics
� Business background per Sara Lee capability area
� Business terminology glossary
� Business process champions
� Innovation workshop� Induction for new
IBM team members� Library for new
Sara Lee employees� Pro-actively advise
Sara Lee on businessimprovements
© 2009 IBM Corporation16
Conversations for a Smarter Planet
� “Building blocks” for developinguser interfaces
– We do not provide finished apps
– Target is User Interface Development Team
� 3 sweet spots
– Graphical Modeling
– Real-time Monitoring
– Data Analysis
� Selling points
– These user interfaces are difficult to build
– We provide customizable building blocks
– We can handle “headaches”
•Huge data sets
•Fast screen redraws
– We bring innovation to the interface
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ILOG – strong in business rules and data presentation
© 2009 IBM Corporation
Questions?
© 2009 IBM Corporation18
Conversations for a Smarter Planet
Over a period of 6-8 weeks the GIE assessment explores each of the six competency areas to identify and prioritize opportunities
1.Ensure the firm2.Ensure a clear assessment3.Build innovation 4.Contribute actively
Manage Value in an Ecosystem of Increasingly Specialized entities
1.Assess ecosystem2.Secure adequate3.Develop corporate 4.Identify and mitigate
Manage Risk & Control
1. Develop a collaboration2. Collaborate internally3. Collaborate internally4. Provide a supportive
Enable Collaboration
1. Organize around2. Exploit componentization3. Understand and manage4. Identify and manage
Build a Specialized Enterprise
1.Use global 2.Explore niche 3.Develop deep 4.Leverage a global
Serve Distinct Global Markets
1.Define holistic 2.Identify best 3.Develop and institutionalize4.Manage global
Leverage Global Assets
Key PracticesChallenges Competencies
Tap the Power of
Globalization
Forge Strategy for
Componentization
Deliver Unique Value
1. Review Challenges and Competencies
2A. Review Practice
description
2C. Assess Practice
capabilities and
maturity level
2D. Identify Competence maturity and
goals for each Competency area
3. Prioritize GIE Focus Areas
across all Competencies
& develop business case
GIE Competencies
and Practices
� Tools and technology
� Processes enable
� Continuous improve
� New processes
� Processes standard
� Processes centrally
� Processes document
� Standardization
� Processes vary
� Processes are not well
Practice 4: Manage global resources
� Methods systems of
� Global value
� Global values are
� Global values
� Global values have
� Staff are aware
� Starting to develop
� Employees seeking
� Company-wide
� Company relies on
Practice 3: Common values
� Classification criteria
� Taxonomy is published
� Catalog of capabilities
� Processes are in place
� Taxonomy of skills
� Systems are in place
� Starting to develop
� Evidence� Manual
� Taxonomy of required
� Varying definitions
Practice 2: best of breed
� Organization is sought
� Organization has
� Delineation
� Set of � Opportunity
� Organization begins to
� A dedicated
�No standard criteria
� Individual
Practice 1: holistic criteria
Level 5: World Class
Level 4: Mature
Level 3: Capable
Level 2: Aware
Level 1: Ad Hoc
Practice Capabilities and Maturity
2B. Identify current Practice
capabilities
Level 1
Ad Hoc
Level 2
Aware
Level 3
Capable
Level 4
Mature
Level 5
World-Class
X
Manage Risk and
Control
Manage Value in
Ecosystem
Enable Collaboration
Build a
Specialized Ent.
Serve Distinct
Global Markets
Leverage Global
Assets
Maturity Level
Competencies
X
X
X
X
X
GoalGoal
GoalGoal
GoalGoal
GoalGoal
GoalGoal
GoalGoal
GIE Competency Maturity &
Goals Framework
© 2009 IBM Corporation19
Conversations for a Smarter Planet
Tough Economy requires
managing within constraints,
increasing resources efficiency
Rich internet applications require
increasing visualization, graphics
and dashboards
Convergence of
Business Intelligence,
BPM and BRMS
Enterprises need more
agility to adapt to volatile
markets
Most ERP’s and SCM
require optimization design
and planning tools for
improved efficiency &
productivity
Sources: IBM, Forrester, Fortune.com, Gartner, IDC, Summit Strategies
SOA increasingly requires
Rules to manage Decision Services
Regulatory Requirements
(e.g. Sox & Basel 2) driving
greater focus on business
decision making
Marketplace Dynamics
19
© 2009 IBM Corporation20
Conversations for a Smarter Planet
An Evolutionary Model for Information MaturityB
usin
ess V
alu
e o
f In
form
ati
on
Information Management Capabilities
• Data: All relevant internal and external information seamless and shared. Additional sources easily added
• Integration: Virtualized Information Services
• Applications: Dynamic Application Assembly
• Infrastructure: Dynamically, re-configurable; Sense & Respond
• Flexible, adaptive business environments across enterprise and extraprise
• Enablement of strategic business innovation• Optimization of Business performance and
operations• Strategic insight
• Data: Seamless & shared; Information separated from process; Full integration of structured and unstructured
• Integration: Information Available as a Service• Applications: Process Integration via Services; in line
bus apps• Infrastructure: Resilient SOA; Technology Neutral
• Role-based, work environments commonplace• Fully embedded capabilities within workflow,
processes & systems• Information-enabled Process innovation • Enhanced Business Process & Operations
Management• Foresight, predictive analytics
• Data: Standards based, structured & some unstructured• Integration: Integration of silos; Virtualization of Information• Applications: Services-based• Infrastructure: Component/Emerging SOA, Platform Specific
• Introduction of contextual, role-based, work environments
• Enhanced levels of automation• Enhancement of existing processes and applications • Integrated business performance management• Single version of truth• Insight thru analytics, real-time
• Data: Structured content; organized• Integration: Some integration; silos still remain• Applications: Component-based applications• Infrastructure: Layered Architecture, Platform
Specific
• Basic search, query, reporting and analytics
• Some automation• Disparate work environments• Limited enterprise visibility• Multiple versions of the truth
• Data: Structured content, static• Integration: Disjointed, Siloed, non-integrated
solutions• Applications: Stand alone modules; application-
dependent• Infrastructure: Monolithic, Platform Specific
• Basic reporting & spreadsheet- based
• Manual, ad hoc dependence• Information overload • No version of truth• Hindsight based
Information as a Competitive Differentiator
Information to Enable Innovation
Information as a Strategic Asset
Information to Manage the
Business
Data to Run the Business
1
2
3
4
5