This presentation provides an overview of some of the B2B related challenges facing a divested company. Please look out for my other presentation on SlideShare which discusses how GXS Expert Outsourcing can help to address some of these challenges.
2. Introduction The global economy has recently been through a significant period of change Companies in all industry sectors are streamlining their businesses to raise much needed capital Divesting operations allows companies to rethink their corporate strategies Divestitures provide the ideal opportunity for companies to re-evaluate IT and B2B strategies and re-focus on core competencies
3. Divesting an Operation can be ComplexIt will impact all areas of a business... Global Office Locations Divested Operation IT and B2B Infrastructure ERP CRM ERP CRM Manufacturing Plants Distribution Network Retail Network
4. Which B2B Direction Do You Take? Following the divestiture of a company, there are three possible directions a company could take for managing their future B2B requirements: Continue to use existing B2B platform Implement and manage a brand new B2B platform Outsource the management of the entire B2B platform to a trusted partner Use Existing B2B Platform? Implement New B2B Platform? Outsource B2B?
5. Typical B2B Activities Following Divestiture Document Mapping – potentially hundreds of document maps will need to be transferred from the parent company to the newly divested operation ERP Integration – ERP integrations from the parent company will have to be re-established in the new operation Trading Partner Management – trading partners will need to be managed during and after the divestiture has taken place Global B2B Support – Loss of support from a parent organisation means that global B2B support services will have to be provided to maintain global trading capabilities Legacy Platform Upgrade – could provide the ideal opportunity to introduce new B2B technologies to the divested operation
6. Document Mapping Following divestiture, companies have one of three options with respect to document maps Transfer Existing Maps Transfer & Modify Maps Develop New Maps These options will mean significant disruption for the divested operation
7. ERP Integration ERP platforms can be difficult to integrate to a divested B2B platform Personnel with ERP related skills may reside with the parent company The divested operation may need support to manage global instances of an ERP platform Separation from the parent company seen as an opportunity to develop a fully integrated ERP/ B2B platform for the first time
8. Community Management Following divestiture it is important to maintain continuity with trading partner relationships The divested operation will need to work out a strategy for managing trading partners in different locations around the world Trading partners will require ongoing training, development and support with the divested operation’s new B2B platform
9. Global B2B Support Providing global B2B support for all users across an extended enterprise can often be the most difficult area to manage following divestiture For global operations, 24x7 multi-lingual support will be required across multiple time zones The divested operation will need to manage regional document, connectivity and industry specific B2B standards around the world
10. Technology / Legacy Upgrade Following divestiture, companies may see this as an ideal opportunity to upgrade from legacy B2B platforms and technologies Upgrading to new technologies allows the divested operation to develop a flexible B2B platform that can grow as the company grows Provides opportunity to develop a more robust B2B platform with increased availability/reliability
The global economy has recently emerged from an unprecedented period of change, with many companies being forced to sell off parts of their business and in some cases entire companies in order to raise much needed capital. Under previous ownership by the parent company, the divested operation may not of had the management support or financial backing to make any structural changes to their operation. Divestitures provide the ideal opportunity for companies to re-evaluate IT and B2B strategies and re-focus on their core competencies
Divesting an operation can be complex, especially if the proposed divested operation is fully integrated to the parent company’s business processes, B2B and IT infrastructures. The divested operation will not only have to look at how they will seamlessly remove offices, manufacturing plants and perhaps distribution / retail networks but they will have to work out how to extract core business and IT systems such as ERP, CRM and B2B systems. Quite often the parent company will allow the divested operation to take a copy of IT systems, often referred to as clone and go but they will stipulate that the divested operation will have to be self sufficient within a 6 to 12 month time frame. In some cases the divested operation could face penalties if they are not off of the parent company’s systems within the so called transition period. So there is an incentive here for the divested operation to be up and running as quickly as possible.
Following the divestiture of a company, there are three possible directions a company could take for managing their future B2B requirements:They could continue to use existing B2B platform – for many divested operations this would probably be the easiest option for them to go for. However the complex nature of extracting the B2B platform from the parent company and continuing to manage trading partner relationships etc, all within a fixed transition period of possibly 12 months can make this a difficult option to follow.They could introduce a brand new platform or adopt platform from new owner – the divested operation could decide to adopt the B2B platform from their new owner or they could go ahead and implement a totally new B2B platform by themselves. Either of these options will mean severe disruption to the divested operation’s business processes and trading partner relationships.They could outsource the management of the entire B2B platform to a trusted partner – during a divestiture, a company should be focussing on core competencies and ensuring that business processes are operating smoothly during the transition period. Outsourcing the management of a B2B infrastructure, including the ongoing management of trading partner relationships should be seriously considered by the divested operation.
This slide highlights the main B2B activities that will have to be managed during a divestiture. This list was compiled through reviewing a number of divestiture related Managed Services deals that GXS has won over the past few years. Even though each of these is equally as important to many companies, document mapping is often the most common area that companies look to outsource, mainly due to the fact that B2B or mapping skills will likely remain within the parent company following a divestiture process. Document Mapping – potentially hundreds of document maps will need to be transferred from the parent company to the newly divested operation ERP Integration – ERP integrations from the parent company will have to be re-established in the new operation Trading Partner Management – trading partners will need to be managed during and after the divestiture has taken place Global B2B Support – Loss of support from a parent organisation means that global B2B support services will have to be provided to maintain global trading capabilities Legacy Platform Upgrade – could provide the ideal opportunity to introduce new B2B technologies to the divested operation
Following divestiture, companies have one of three options with respect to document maps and as explained on the previous slide, it is highly probable that mapping skills will remain within the parent company rather than the divested operation. Transfer Existing Maps – To migrate the existing maps from the parent company into the divested operation ‘as is’ Transfer & Modify Maps – To migrate the existing maps from the parent company and modify maps as required to suit the divested operation’s new business processes Develop New Maps – The divested operation may decide to take the opportunity to start from a clean sheet and develop totally new maps. This provides an opportunity to consolidate and streamline B2B processes Either option will mean significant disruption for the divested operation
ERP platforms can be difficult to manage and integrate to a divested operation’s B2B platform. Once again, personnel with ERP related skills may remain within the parent company’s IT group The divested operation may need support to manage the integration of global ERP instances to their B2B platform The divested operation may see separation from the parent company as an opportunity to develop a fully integrated ERP/ B2B platform for the first time
Following divestiture it is important to maintain continuity with trading partner relationships. Suppliers will want to be re-assured that support and relationships will be maintained during a divestment process The divested operation will need to work out a strategy for managing trading partners in different locations around the world If the divested operation introduces a new B2B strategy then this will have to be communicated to the trading partner community. Trading partners may need to use new communication protocols or document standards as part of the new B2B infrastructure. Trading partners will require ongoing training, development and support with the divested operation’s new B2B platform
Providing global B2B support for all users across an extended enterprise can often be the most difficult area to manage following divestiture For global operations, 24x7 multi-lingual support will be required across multiple time zones The divested operation will need to manage regional document, connectivity and industry specific B2B standards around the world Providing support for new B2B processes or EDI document types needs to be managed effectively to avoid disruptions across the extended enterprise
Following divestiture, companies may see this as an ideal opportunity to upgrade from legacy B2B platforms and technologies Upgrading to new technologies allows the divested operation to develop a flexible B2B platform that can grow as the company grows It provides an opportunity to develop a more robust B2B platform with increased availability and reliability Divested operations will be looking to introduce new B2B technologies to realise significant operational efficiencies across the extended enterprise
