Proactive Governance Driven
by Data and Analytics
Greater Toronto Airports Authority (GTAA)
John AlexisDirector IT Services
Neo Group
Sandeep SureshHead - Research
sig.org/summit
A presentation by GTAA and Neo Group
PROACTIVE [VENDOR] GOVERNANCE DRIVEN BY DATA AND ANALYTICS
JOHN ALEXIS, Greater Toronto Airports Authority (GTAA)SANDEEP SURESH, NEO GROUP
SIG GLOBAL SUMMIT 2017 FLORIDA
SINGULAR FOCUS ON GLOBAL SOURCING LEVERS
SINCE 1999
BY APPLYING
Neo Intellectual Property
Real-TimeAnalytics
Neo ProvenMethodologies
Neo’s ExperiencedAdvisors
Co-Creation w.Clients
© 1999-2017 Neo Group Inc. Proprietary
GLOBAL
TALENT
AUTOMATION ANALYTICS
PROCESS
OPTIMIZATION
WE HELP ACHIEVE RAPID OUTCOMES
BY ADVICING ON LEVERAGING SOURCING LEVERS
NEO GROUPBEYOND ADVICE TO OUTCOMES
Advice with singular focus on global sourcing levers since 1999Automation | Analytics | Global Talent | Process Optimization
2
Toronto Pearson at a Glance
Canada's Largest Airport
2nd Largest International Airport in North America
41 million Passengers Yearly
Growth to 60 million passengers within the next 10-15
years
120,000 Passengers per Day
1400 Flights per Day
40,000 Employees
Accesses more than 60% of the World via Direct Flights
Regional Economic Impact: 6% of Ontario's GDP
© 1999-2017Neo Group Inc. Proprietary
KEY TOPICS COVERED
5
Governance Models• Types of Governance Models• Traditional Governance Tools• Limitations / Risk / Challenges• Information Areas that are Key to Robust
Governance Framework
Data and Analytics• Evolution and Current Scenario
Analytics for Governance• Leverage analytics to derive objective and
actionable insights
Appendix• About Supply Wisdom• How it Works• Risk Framework and Methodology
SECTION I: TRADITONAL GOVERNANCE APPROACH
© 1999-2017Neo Group Inc. Proprietary
Polling Question # 1
Do you have a structured Governance Framework ?
- Yes
- No
© 1999-2017 Neo Group Inc. Proprietary 7
A GOOD GOVERNANCE
- Establishing policies, continuous monitoring of implementation of those policies
- Not about ‘correct’ decisions, but about the best possible process for making those decisions
© 1999-2017 Neo Group Inc. Proprietary 8
Polling Question # 2
What does your Governance Framework consists of
a) SLA Metrics Only
b) Combination of SLA Metrics and Market Data
© 1999-2017 Neo Group Inc. Proprietary 9
TOOLS IN TRADITIONAL GOVERNANCE
© 1999-2017 Neo Group Inc. Proprietary 10
• Cost management
• Optimum value proposition
FINANCIAL MANAGEMENT
• Partner satisfaction
• Strategic alignment
• Risk management
RELATIONSHIP MANAGEMENT
• Compliance and delivery
• Structure, legal documents
• Dispute settlementCONTRACT
MANAGEMENT
• Service quality
• Performance measurement
• Operational efficiency.
PERFORMANCE MANAGEMENT
TOOLSKPI’s• Score cards• Invoice review• Value proposition
management
• Partner satisfaction reviews• Escalation management• Vendor risk assessment
• Contract triggers• Escalation maps
• Quality review• Vendor SLA reports• Regular operational reports.
BUY-SIDE PERSPECTIVE:
© 1999-2017 Neo Group Inc. Proprietary 11
- What tools and KPIs are used in typical/
traditional governance models?
- How have they been measured historically?
- What was the experience and are there any case
studies that can be shared?
Polling Question # 3
How satisfied are you with the existing Governance Process ?
a) Extremely Dissatisfied
b) Dissatisfied
c) Neither Satisfied Nor Dissatisfied
d) Satisfied
e) Extremely Satisfied
© 1999-2017 Neo Group Inc. Proprietary 12
© 1999-2017 Neo Group Inc. Proprietary 13
Subjective Analysis – Risk Assessment is Ignored
Driven by SLAs and Contractual Agreements
Slow and Poor Communication – Reactive Approach
Lack of Autonomy
Lack of Strategic Management – Inability to Adapt to New Technologies
Focus only on Reduction of Costs
Risk is Judged Based on Supplier- Client Relationship
LIMITATIONS AND RISKS OF TRADITIONAL GOVERNANCE MODEL
BUY-SIDE PERSPECTIVE:
© 1999-2017 Neo Group Inc. Proprietary 14
- What challenges were faced with the traditional approach, and what were the limitations – what was missing?
- How did it impact business outcomes and vendor relations?
- What were the lessons learnt?
© 1999-2017 Neo Group Inc. Proprietary
Supplier Information
Areas
Financial Metrics
Service Maturity
Governance
Talent
InfrastructureClient
Partnership / Alliance
Thought Leadership
Legal, Compliance &
Reputation
• Margin Pressure • Growth Challenges• Financial Health
• Geographical Footprint• Service / Vertical Line
Performance
• Senior-level exits
• Team Restructuring
• M&A• Malpractice
• Attrition Rates• Learning &
Development• Skillsets
• New Delivery Centers• Physical / Information
Security Certifications
CRITICAL AREAS FOR ROBUST GOVERNANCE FRAMEWORK
• New Client Wins• Client Losses• C-SAT scores
• Development and strengthening of capabilities through partnerships
• Representation in Global Events
• Patent Filing
• Lien & Settlements• Non-compliance• Employee
Satisfaction
SECTION II: DATA ANALYTICS
© 2016 Neo Group Inc. Proprietary
MOST USABLE DATA GO UNATTENDED
© 1999-2017 Neo Group Inc. Proprietary 17
DATA GENERATED AT FASTER PHASE
*a unit of information equal to one sextillion (1021) or, strictly, 270 bytes.
0
10
20
30
40
50
60
2012 2013 2015 2016 2020(f)
Stored Data - Zettabytes
0
5
10
15
20
25
30
35
40
2009 2011 2015 2020(f)
Growth of Global Data – Zettabytes*
• Cost of data storage has consistently declined• New sources/channels of data collection/analysis have been created
50 x
THE STORY AT PRESENT
© 1999-2017 Neo Group Inc. Proprietary 18
122 130.1
187203
2015 2016 2019(f) 2020(f)
Global Revenues: Big Data and Business Analytics (US$ B)
Banking13%
Discrete Manufacturing
12%
Process Manufacturing
8%
Federal/ Central Govt8%
Professional Services
7%
Others52%
Industry-wise Market Share: 2016
• Global revenues of Big Data and Business Analytics expected to grow at a CAGR of 11.7% between 2016-20
• Total market revenues forecast to reach US$ 203 B by 2020
• Faster adoption of data and analytics
solutions as enterprises realize benefits of data-driven insights
• Banking sector leads with highest spending
BUY-SIDE PERSPECTIVE:
© 1999-2017 Neo Group Inc. Proprietary 19
- How does the buy-side use and consume data analytics?
- What benefits do buy-side organizations see with leveraging data analytics?
- What are the buy-side challenges and limitations in wide-spread usage of data analytics?
SECTION III: ANALYTICS FOR GOVERNANCE
© 2016 Neo Group Inc. Proprietary
ACTIONABLE INSIGHTS DERIVED THROUGH ANALYTICS
© 1999-2017 Neo Group Inc. Proprietary 21
System of insight will redefine
business in next 5 – 7 years
Measurable shift expected from
product-driven to insights-driven
services
Demand to surge for personalized and actionable
customer insights
Outcome of Big Data Analytics Drives New Governance Model
Descriptive Analysis
Diagnostic Analysis
Predictive Analysis
Prescriptive AnalysisWhat
Happened ?
Why did it Happen?
What will Happen?
How can we make it Happen?
Determine probable future outcome using statistical techniquesLooks at past
performance and
historical data to
look for the reasons
behind past
success or failure
Suggest actionsto benefit from the predictions
Advance analytics
which examines
data or content to
answer the
question “Why did
it happen?”
WHY DOES THIRD PARTY OVERSIGHT NEED DATA ?
© 1999-2017 Neo Group Inc. Proprietary 22
Clearer Insights with Visualization
Smarter Decision Making
Better Forecasting
Uncovering Hidden Risks and Opportunities
Rapid Response to Changing Supply Chain Dynamics and Evolving Risks
CASE STUDY - GLOBAL 100 BANK
© 1999-2017 Neo Group Inc. Proprietary 23
Two Assessment levels
• Internal : Contract Metrics
• External : Financial Metrics and Negative News
• Monitoring of multiple VMS tools
• Review Cycles : 12 to 24 months
Implemented Ongoing Risk Monitoring
Analytical Tool for 135 critical vendors
Real Time Monitoring
360 view combined contract and relationship metrics with market data on vendor location and industry
Expert guidance and recommendations
CASE STUDY –GREATER TORONTO AIRPORTS
AUTHORITY
© 2016 Neo Group Inc. Proprietary
Business objectives are met when vendors deliver on their obligations
Credits/penalties are accurately captured and unnecessary fees are avoided
Proactively managing risk ensures mitigation plans are in place
Closely monitored performance assures improvement of service delivery
Well-managed relationships lead to more favorable outcomes
24
Challenge#1 – Actually Manage / Govern our Vendor Ecosystem
Manage, monitor & report vendor performance, spend & risk
Collaborate with stakeholders to jointly manage vendor relationships • Services Partner is responsible for
business outcomes• GTAA remains accountable
Structured Interactions• Documented, On-Record• Action Owners• Timelines/Targets
Basis for Scorecard Reporting • Contract Performance• Risk• Financials
25
Challenge #2 – Consistently Focus on Vendor / Stakeholder
Governance
Vendor Management Vendor Governance
Information
Decisions
Managed
Services
Audit / Compliance
Finance
Procurement /Sourcing
Legal
Vendor Management and Governance (VM&G) Framework
Contract Manager
RelationshipManager
Vendor Management Office
VM Support & Administration
VM&G workflows orchestrate how key stakeholders will work together.
26
Challenge #3 – Understand our Operating Framework
28
Obligation
Tracking
Obligation
Compliance
Contract
Interpretation
Document
Change Management
Obligation Extraction
Change Order or
Contract
Amendment
Governance
2 3 4
5
7
8
6
Issue
Management
Document
Repository
1
?
Challenge #4 – Institute a Framework
29
Challenge #5 – Centralize Data & Implement Tools
Need to be agile in today’s ever-changing business
environment
Need to be flexible, given rapid advancements in technology,
infrastructure and services
Need to build trusted, mutually beneficial partnerships with
vendorsWE
ME
29
Outcome #1 - Achieve our Goals
© 1999-2017 Neo Group Inc. Proprietary 31
Enterprises Will Become More Data-Focused
Spending On Cloud-Based Analytic and Big Data Solutions
Will Surge
Predictive and Prescriptive
Analytics Will Gain Traction
• Emphasis on data security to regain momentum
• Disruptive technologies such as Internet of Things (IoT) will drive the surge in structured/unstructured data
• News ways/technologies to analyse data will emerge
• Evolution of “Best Practices” surrounding data
• Potential shortage of professionals skilled in data/analytics oriented technologies
WHAT IS IN STORE
USA 129 Newbury St., Suite 400
Boston, MA 02116, USA
www.neogroup.com
AMSTERDAM, NETHERLANDS
BANGALORE, INDIA
BOGOTA, COLOMBIA
GUADALAJARA, MEXICO
LONDON, UK
NEW YORK, USA
SAO PAULO, BRAZIL
SILICON VALLEY, USA
SYDNEY, AUSTRALIA
JOHN ALEXIS
Director of IT Services
SANDEEP SURESH
Head- Research
www.NeoGroup.com
www.SupplyWisdom.com
© 1999-2017 Neo Group Inc. Proprietary
THANK YOU!
APPENDIX
© 2016 Neo Group Inc. Proprietary
DATA AND ANALYTICS: SUPPLY WISDOM
© 1999-2017 Neo Group Inc. Proprietary 34
REAL-TIME
GLOBAL
CONTINUOUS
PROVEN
• LEVERAGES PROVEN RISK FRAMEWORK developed by globally recognized experts on proven methodologies and co-created with our clients
• AGGREGATES DATA & APPLIES ANALYTICS in real-time to over 300+ risk elements to assess and alert changes in risks
• ADDS GUIDANCE to deliver key insights as well as trend analysis of risk across suppliers and locations
• CONTINUOUS & REAL-TIME MONITORING enables
faster action with an operations perspective
• CLOUD-BASED DELIVERY eases and automates the process for risk monitoring
CLIENT CO-CREATED PROPRIETARY RISK FRAMEWORK*MOST COMPREHENSIVE IN THE INDUSTRY SINCE 2014
SUPPLIERRISKS
FINANCIAL CLIENTS PEOPLEALLIANCES &
PARTNERSHIPS
SERVICECAPABILITY
GOVERNANCE INFRASTRUCTURE THOUGHT
LEADERSHIP
CITYRISKS
MACRO-ECONOMIC FINANCIAL BUSINESS INFRASTRUCTURE
GEO-POLITICAL LEGAL SCALABILITY QUALITY OF LIFE
COUNTRYRISKS
MACRO-ECONOMIC FINANCIAL BUSINESS INFRASTRUCTURE
GEO-POLITICAL LEGAL SCALABILITY QUALITY OF LIFE
* Patent Pending
Risk Categories
COMPLIANCE &
REGULATORY
SUPPLY WISDOM RISK FRAMEWORK SAMPLE SUPPLIER RISK
METRICS
FINANCIAL
• Key investment, ratios balance sheet,
liquidity, profitability, and
revenue/revenue diversity metrics
CLIENTS
• Acquisition, retention/flight,
concentration, and satisfaction
PEOPLE
• Attrition (overall attrition for the
quarter), new hires, productivity,
utilization, and employee development
& training measures
COMPLIANCE & REGULATORY
• Notices, Actions, Incidents
SERVICE CAPABILITY
• Key talent pool size, quality
certifications, specialized certifications,
operating model, service & vertical
lines, and geographical metrics
10 - Point Standard Risk Rating Scale
Moderate Extreme HighLow
4.0 8.0 100 6.0
35
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JOHN ALEXISDirector of IT Services
SANDEEP SURESHHead- Research
www.NeoGroup.com
www.SupplyWisdom.com