Business Process Management Strategy And Shared Services By Umang Vohra Chief Financial Officer Dr. Reddy's Laboratories

1. Business Process Management Strategy
And
Shared Services

2. Our experience and learning with Shared Services – Strategic insights
• Three broad but different phases of thinking and priorities – Phase 1 is really about
standardization and the need to avoid duplication. Phase 2 is about becoming leaner ,
adopting best practices, and productivity. Phase 3 is really about asking the tough
questions around Core and Non Core Capability.
• Phase 3 is the most daunting , yet the most strategic. “Never outsource your future “-
Clayton Christensen – “ How to Measure your Life “. Examples abound from semi
conductors to PC’s. The definition of “Future “ is driven by Capability .
• Core Capability needs to be Market beating, Relevant to the customer , and a Core part
of your business cash accretion. They must be Institutional and pass the 3 R test-
Relevant, Repeatable, Replicable .
• Invest and double down /outshine on Core capabilities. Partner and Scale Non core
capabilities. Ask whether anyone else can do this better than you constantly ?
• Finance must play a large role in shaping this thinking and lead from the front.

3. Global Business Services (GBS) set up - centralized India P2P processes
HC-20
MAR 2004
2004-05 Moved India OTC, and EST(Employee Services) to GBS
Set up Travel & Hospitality desk under GBS
Created US-F&A Back office
2009-10 Set up R2R & Treasury Back Office within GBS
Created Europe Back office
2010-11
e SCM evaluation
Implemented several best practices (Mail Room,
Input Control, VOC surveys, dashboards,
knowledge management etc )
Added LDR and SOD Management to GBS
2011-12
Redefined our strategy
Service Partner Identified
HC-150
Our SSC has been the back bone of our BPM strategy

4. R&D
Manufacturing
Engineering
S
U
P
P
O
R
T
S
E
M
I
C
O
R
E
C
O
R
E
Clinical
Research
Clinical Trials
Sales &
Mkt
Strategic Support Functions*
Distribution
*F&A, HR, IT, SCM - As Core
Support to Business
Finance & Accounts
IT
HR
Procurement
Legal
Real Estate
FunctionsSpread
Spin Off – Third Party
Evolving F&A SSC
Centralization
Shared Services
CostReductionvs.Base
10%
35%
20% Co-sourcing
SSCasaBusiness….IndustryView
CoreSupport
Augment &
Consolidate
Consolidate /
Spin Off
Invest Outshine
1 2
34
Capability & Maturity
BusinessCritical
HighLow
StrategicApproach
Process
maturity
Business
Criticality
Sensitivity
Linked to
Current OS
Portfolio
Cost save
potential/
Business Case
Aligned with
the strategic
objective
Change
Impact
Parameters for
considering
Augmentation/
Consolidation
and Spin off
DecisionCriteria
Strategic context

5. • Retain core functions and outsource non core to partners for whom this is core
• Make our processes more robust, efficient and disciplined by having access to
operational best practice through new technology, tools and techniques
• The partner would bring global practices and opportunities to interact with
experts
• The employees would get:
• Higher Opportunities of Career Growth
• Multi Skilling or specialisation based on preference and performance
• Job Rotation Opportunities
• To be a part of global organization in terms of clients
• Cost savings as an incidental benefit!
Bring New geographies like Russia, Germany and Mexico under the Umbrella
Core / Non Core Focus
Hybrid Model as an integral part of our BPM strategy

6. 2014
Q3/Q4
2014
Q1/Q2
2013
Q3/Q4
2012
Q3/Q4
2012
Q1/Q2
2011 2013
Q1/Q2
2015
Q3/Q4
2015
Q1/Q2
Review Decision Design & Implement Delivery
F&A
Phase -2
MIS, Germany & Russia
Accounting
HR
IT
Procurement
F&A
Phase -1
P2P, R2R OTC,
ES
- Parameters
- Potential
- Consolidation /
Outsource
Outsource
-RFP Management
- Solutioning
- LOI
- Due Diligence
- MSA
- Transition
-Service Level
- BAU
Consolidation - Process Design
- Baseline Metrics
- De/Re Skilling
- Transition
9 - 12Months
4 - 6 Months
2 Months 4-6 weeks
PhasingofImplementation
Service Partner Selection
Legal
High level road map with focus on value realisation

7. - Build Global Sourcing Services to drive implementation of future strategy
-Transition
Way forward
Head-GSS
Head-Service
Delivery
Head-
Relationship &
Vendor
Management
Head-
Capabilities
and Expansion
- Focus on Customer Experience and Strategic Value
Involvement, Alignment, Transparency, Processing Visibility, Trust Building,
Demonstrating Value

8. Thank You