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Business Needs (Strategy) Successful  Projects Enterprise Analysis Presented by: Saji Madapat, MBA CPIM CSSMBB PMP OPM3 & ...
Presentation Outline <ul><li>• Irrational Exuberance </li></ul><ul><li>• Aftermath </li></ul><ul><li>• Why Enterprise Anal...
SHORT walk in the Memory lane Business in Past Century  –  DOW Jones Eyes
“ En”visioning Tomorrow <ul><li>“ The corporation as we know it,  </li></ul><ul><li>which is now 120 years old,  </li></ul...
Immediate Past -“Irrational Exuberance” <ul><li>In the era of economic boom: </li></ul><ul><li>Exciting new investments an...
The Corporate Ship:  High Tide Inefficiencies Credit
Consequences… <ul><li>Annual  IT application development statistics: </li></ul><ul><li>$250 Billion on 175,000 Projects </...
<ul><li>PMI conducted 5 Global studies: </li></ul><ul><li>involving 30,000+ practitioners  </li></ul><ul><li>including C l...
Why Enterprise Analysis? <ul><li>Significant findings:  </li></ul><ul><li>75% do not believe their organizations are deliv...
Party’s Over. . .   What to do? Automotive Industry Banking Industry Telecom Industry
The Corporate Ship:  Low Tide Inefficiencies Credit
 
 
“ Only when the tide goes out do you discover who's been swimming naked” -Warren Buffett
The Corporate Ship:  Busted! Sell strategic units Layoffs Cut projects Strategic budget cuts Inefficiencies Credit
DUMP??? <ul><li>Strategic Projects </li></ul><ul><li>Core Assets </li></ul><ul><li>Strategic initiatives (R&D) </li></ul><...
The Corporate Ship:  High and Dry STRATEGIC INVESTMENTS  through Enterprise Analysis Inefficiencies Credit
Enterprise Analysis Defined  - BABOK ®  2.0 Version  <ul><li>The business analysis activities necessary to identify a busi...
Business Need (Strategy) Successful  Projects Enterprise Analysis <ul><li>Most Organizations have a Strategies to address ...
Enterprise Analysis  - Activities <ul><li>5.1 Define Business Need </li></ul><ul><li>5.2 Assess Capability Gaps </li></ul>...
“ How would you like to. . .   <ul><li>see your organization weather the recession in excellent financial health . . .” </...
It’s not a dream! It’s a  CHOICE  through Enterprise Analysis
Examples from   “Real Life”
Dedicated to Father of Knowledge Management  (Robert (Bob) H. Buckman) “ Communications is human nature; Knowledge sharing...
Who is. . .  Buckman Laboratories? <ul><li>Provides specialty chemicals and solutions  </li></ul><ul><li>Employs 1300 loya...
5.1 Business Need  - Clouds in the horizon <ul><li>Recession in 2002 </li></ul><ul><li>Paper Industry Consolidation </li><...
5.1 Business Need  - State of Historic Systems  <ul><li>Many Historic System’s were: </li></ul><ul><ul><li>Laboriously Bui...
5.1 Business Need  -  Historic  Business System: <ul><li>Run by a group of feudal Autonomous Managers. </li></ul><ul><li>E...
5.1 Define the Business Need   “Global Enterprise Point” <ul><li>ORP = Organization-wide Re-engineered Process & BS Projec...
5.2  GAP Analysis <ul><li>Reality Want to be </li></ul>Enterprise Business System (BS) Islands One Global Enterprise BS Te...
5.3 Solution Approach Global Business System <ul><li>One Business System for one organization! </li></ul><ul><li>Global Bu...
5.3 Solution Approach  Global   Core Knowledge Enterprise Team <ul><li>Based in Memphis </li></ul><ul><li>Supports the wor...
5.3 Solution Approach  Global Enterprise Infrastructure <ul><li>Business System server based in Memphis & take the advanta...
5.3 Solution Approach  -  Risk Management <ul><li>World Class  Business Continuation plan rollout -developed even before 9...
Buckman’s Global Business System  Global BS Enterprise Team, Solution & Infrastructure Buckman Laboratories, Inc. Memphis,...
- Business System Project Scenario 5.5 Business Case Scenario   Pre EA(USA - 1998)  Post EA Cost of Capital (Fed Rt) Consu...
BA has the Holistic view of an Enterprise to prioritize, select and allocate  limited resources to best accomplish the Org...
If you can believe. . . . <ul><li>When Economy going South, company’s strategy has paid off! </li></ul><ul><li>Revenue Dou...
Any Questions?  Carrot and sticks or Tomato’s to : Saji Madapat [email_address]
Saji K. Madapat CPIM, CIPPM, PMP, CSSMBB http://www.linkedin.com/in/goodtogreat  -  [email_address]   Mobile: 001-214-454-...
PARKING LOT
Post Enterprise Analysis Execution Approaches Process Improvement System Implementation “ To Be” “ As Is”
Traditional Methodology Process Improvement System Implementation TRADITIONAL  PATH
Technical Methodology Process Improvement System Implementation TECHNICAL  PATH
Enterprise Analysis Methodology Compact path Process Improvement System Implementation Comprehensive
Guide to the Business Analysis Body of Knowledge® (BABOK® Guide) Version 2.0
<ul><li>Bridges -   organizational strategy and projects. </li></ul><ul><li>Credibility and visibility   of PM & BA profes...
“ Dump the Weight” <ul><li>Employee layoffs are routine . . . </li></ul><ul><li>Budgets are cut to the bone . . . </li></u...
Dig More about  GBS & ORP? <ul><li>Please Visit </li></ul><ul><ul><li>“ The Mystery of Irrational Exuberance to Fast & Fur...
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Importance of Enterprise Analysis

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Buckman Case Study Presented it to Greater Memphis Area Chapter of the IIBA

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Importance of Enterprise Analysis

  1. 1. Business Needs (Strategy) Successful Projects Enterprise Analysis Presented by: Saji Madapat, MBA CPIM CSSMBB PMP OPM3 & PPM Team Member June 23, 2009 Greater Memphis Area Chapter of the IIBA Importance of Enterprise Analysis – Focus on Strategic Value in Today’s Economic Tsunami
  2. 2. Presentation Outline <ul><li>• Irrational Exuberance </li></ul><ul><li>• Aftermath </li></ul><ul><li>• Why Enterprise Analysis? </li></ul><ul><li>• Enterprise Analysis Defined - BABOK® 2.0 </li></ul><ul><li>• Examples from “Real Life” – Case Study on Buckman Laboratories International Inc. </li></ul><ul><li>• Q & A </li></ul><ul><li>PARKING LOT: </li></ul><ul><li>Enterprise Analysis Execution Approaches </li></ul><ul><li>• What is in Enterprise Analysis for my organization? </li></ul>
  3. 3. SHORT walk in the Memory lane Business in Past Century – DOW Jones Eyes
  4. 4. “ En”visioning Tomorrow <ul><li>“ The corporation as we know it, </li></ul><ul><li>which is now 120 years old, </li></ul><ul><li>Is not likely to Survive the </li></ul><ul><li>next 25 years. </li></ul><ul><li>Legally & Financially, Yes, </li></ul><ul><li>But not Structurally & Economically.” </li></ul><ul><li>-Peter Drucker, </li></ul><ul><li>Business 2.0, August 2002 </li></ul>
  5. 5. Immediate Past -“Irrational Exuberance” <ul><li>In the era of economic boom: </li></ul><ul><li>Exciting new investments and acquisitions! </li></ul><ul><li>BIG PERKS! </li></ul><ul><li>“ Creative Accounting” (book cooking) </li></ul>
  6. 6. The Corporate Ship: High Tide Inefficiencies Credit
  7. 7. Consequences… <ul><li>Annual IT application development statistics: </li></ul><ul><li>$250 Billion on 175,000 Projects </li></ul><ul><li>31% will be cancelled </li></ul><ul><li>53% will cost 189% of original estimates. </li></ul><ul><li>only 52% of required features and functions. </li></ul><ul><li>Time overruns 82% </li></ul><ul><li>$55 Billion dollars project waste </li></ul>Source: The Standish Group CHAOS Report 2003
  8. 8. <ul><li>PMI conducted 5 Global studies: </li></ul><ul><li>involving 30,000+ practitioners </li></ul><ul><li>including C level executives </li></ul><ul><li>In their business environment: </li></ul><ul><li>Desired project results were seldom achieved </li></ul><ul><li>Project evaluation often not linked to business value </li></ul><ul><li>Despite selection criteria, & processes in place to align projects to strategy, projects still failed </li></ul>Why Enterprise Analysis?
  9. 9. Why Enterprise Analysis? <ul><li>Significant findings: </li></ul><ul><li>75% do not believe their organizations are delivering the projects necessary to achieve organizational strategies! </li></ul>
  10. 10. Party’s Over. . . What to do? Automotive Industry Banking Industry Telecom Industry
  11. 11. The Corporate Ship: Low Tide Inefficiencies Credit
  12. 14. “ Only when the tide goes out do you discover who's been swimming naked” -Warren Buffett
  13. 15. The Corporate Ship: Busted! Sell strategic units Layoffs Cut projects Strategic budget cuts Inefficiencies Credit
  14. 16. DUMP??? <ul><li>Strategic Projects </li></ul><ul><li>Core Assets </li></ul><ul><li>Strategic initiatives (R&D) </li></ul><ul><li>Vendors </li></ul><ul><li>Knowledge Capital -Employees </li></ul>OR . . .
  15. 17. The Corporate Ship: High and Dry STRATEGIC INVESTMENTS through Enterprise Analysis Inefficiencies Credit
  16. 18. Enterprise Analysis Defined - BABOK ® 2.0 Version <ul><li>The business analysis activities necessary to identify a business need, problem, or opportunity, define the nature of a solution that meets that need, and justify the investment necessary to deliver that solution. Enterprise analysis outputs provide context to requirements analysis and to solution identification for a given initiative or for long-term planning. Enterprise analysis is often the starting point for initiating a new project… </li></ul><ul><li>-A Guide to the Business Analysis Body of Knowledge® (BABOK® Guide)Version 2.0 </li></ul>
  17. 19. Business Need (Strategy) Successful Projects Enterprise Analysis <ul><li>Most Organizations have a Strategies to address the Business Need </li></ul><ul><li>Enterprise Analysis Bridges the gap between </li></ul><ul><li>Business Need & Successful Projects </li></ul><ul><li>The PMBOK ® & BABOK® Guide enables you to successfully accomplish projects </li></ul>
  18. 20. Enterprise Analysis - Activities <ul><li>5.1 Define Business Need </li></ul><ul><li>5.2 Assess Capability Gaps </li></ul><ul><li>5.3 Determine Solution Approach </li></ul><ul><li>5.4 Define Solution Scope </li></ul><ul><li>5.5 Define Business Case </li></ul>
  19. 21. “ How would you like to. . . <ul><li>see your organization weather the recession in excellent financial health . . .” </li></ul><ul><li>with increased sales . . .” </li></ul><ul><li>an improved competitive position . . .” </li></ul><ul><li>and enhanced employee loyalty?” </li></ul><ul><li>How would you like to see costs for business system projects drop by over 70%? </li></ul>
  20. 22. It’s not a dream! It’s a CHOICE through Enterprise Analysis
  21. 23. Examples from “Real Life”
  22. 24. Dedicated to Father of Knowledge Management (Robert (Bob) H. Buckman) “ Communications is human nature; Knowledge sharing is human nurture!”*
  23. 25. Who is. . . Buckman Laboratories? <ul><li>Provides specialty chemicals and solutions </li></ul><ul><li>Employs 1300 loyal associates (no layoffs since its inception in 1945 till I left (2008 Jan)) </li></ul><ul><li>Global operations (90+ countries) </li></ul><ul><li>Speaks more than 15 languages! </li></ul>
  24. 26. 5.1 Business Need - Clouds in the horizon <ul><li>Recession in 2002 </li></ul><ul><li>Paper Industry Consolidation </li></ul><ul><li>Commoditization of Specialty Chemicals </li></ul><ul><li>Raw Material Price hikes </li></ul><ul><li>Transportation Costs hikes </li></ul><ul><li>Global Competition </li></ul><ul><li>Regulatory Requirements </li></ul><ul><li>Inability to meet the existing Business System Platforms </li></ul>
  25. 27. 5.1 Business Need - State of Historic Systems <ul><li>Many Historic System’s were: </li></ul><ul><ul><li>Laboriously Built </li></ul></ul><ul><ul><li>48 Systems cannot talk each other </li></ul></ul><ul><ul><li>Inadequately Equipped/Handicapped </li></ul></ul><ul><ul><li>Painfully Maintained </li></ul></ul><ul><ul><li>Almost NEVER used </li></ul></ul>Absence of Enterprise Analysis
  26. 28. 5.1 Business Need - Historic Business System: <ul><li>Run by a group of feudal Autonomous Managers. </li></ul><ul><li>Each Organization sets its own objectives and business processes, using its own System. </li></ul><ul><li>RESULT: </li></ul><ul><li>Fragmented data, lack of visibility, impossible to co-ordinate Organization as a whole. </li></ul>
  27. 29. 5.1 Define the Business Need “Global Enterprise Point” <ul><li>ORP = Organization-wide Re-engineered Process & BS Project Portfolio Management : </li></ul><ul><li>One Flexible Global Business System </li></ul><ul><li>One Global Core Knowledge Project Team </li></ul><ul><li>One Global Infrastructure </li></ul><ul><li>Project Portfolio Management & Outsourcing non-core Business Processes. </li></ul>
  28. 30. 5.2 GAP Analysis <ul><li>Reality Want to be </li></ul>Enterprise Business System (BS) Islands One Global Enterprise BS Team Islands One Global Enterprise BS Infrastructure Islands One Global BS Risk Management ??? One Global Integration and Consolidation Hell One BS
  29. 31. 5.3 Solution Approach Global Business System <ul><li>One Business System for one organization! </li></ul><ul><li>Global Buckman BS Model through ERP – BaaN </li></ul><ul><li>In Sixteen nations around the globe </li></ul><ul><li>Global Consolidation & Business Performance Reporting (Hyperion) </li></ul>
  30. 32. 5.3 Solution Approach Global Core Knowledge Enterprise Team <ul><li>Based in Memphis </li></ul><ul><li>Supports the worldwide Buckman organization. </li></ul><ul><li>Responsible for: </li></ul><ul><ul><li>developing a Global Enterprise Business Model </li></ul></ul><ul><ul><li>implementation, </li></ul></ul><ul><ul><li>support and optimization </li></ul></ul>
  31. 33. 5.3 Solution Approach Global Enterprise Infrastructure <ul><li>Business System server based in Memphis & take the advantage of Time Zone differences by sharing: </li></ul><ul><ul><li>Concurrent Licenses </li></ul></ul><ul><ul><li>Support Infrastructure </li></ul></ul><ul><ul><li>Specialized Professionals. </li></ul></ul>
  32. 34. 5.3 Solution Approach - Risk Management <ul><li>World Class Business Continuation plan rollout -developed even before 9/11. </li></ul><ul><li>In case of Disaster, all IT operations will shift to Philadelphia. </li></ul>
  33. 35. Buckman’s Global Business System Global BS Enterprise Team, Solution & Infrastructure Buckman Laboratories, Inc. Memphis, Tennessee, U.S.A. Buckman Laboratories, Inc. Cadet, Missouri, U.S.A. Buckman Laboratories, S.A. DE C.V. Cuernavaca, Mexico Buckman Laboratories LTDA Campinas, Brazil Laboratories Buckman S.A. Buenos Aires, Argentina Buckman Laboratories (PTY.) LTD. Hammarsdale, South Africa Buckman Laboratories PTE LTD Singapore Buckman Laboratories,K.K. Tokyo, Japan Buckman Laboratories PTY. LTD. Wagga Wagga, Australia Buckman Laboratories,LTD. Auckland, New Zealand Buckman Laboratories Italiana,S.r.l., LTD. Milano, Italy Buckman Laboratories Quimica, LDA Parede, Portugal Buckman Laboratories, S.A.M. Principaute de Monaco Buckman Laboratories, Iberica Barcelona, Spain Buckman Laboratories, S.A. Ghent, Belgium Buckman Laboratories,Gesellschaft Vienna, Austria Buckman Laboratories Gmbh Bad Homburg v.d.H.,Germany BaaN & Hyperion Buckman Laboratories,. Shanghai, China 5.4 Scope
  34. 36. - Business System Project Scenario 5.5 Business Case Scenario Pre EA(USA - 1998) Post EA Cost of Capital (Fed Rt) Consultancy Expenses Hardware/software Project Duration Support, Maint., Optimization Implementation Team Customization Percent of Business Practices in Business System post-impl Bonus Systems Business Continuity Plans Probability of Success pre-impl Global Business System Global Consolidation & Reporting 7-8% +$3 M +$0.5 M 1.5 Years Consultants Heaven Inexperienced Heavy 70% Nil Nil 20-40% 48 systems* No >1-3% Nil Nil 4 months Internal resources Experts Minimal 95% Hyperion etc.* Fully equipped 99% One system* Yes
  35. 37. BA has the Holistic view of an Enterprise to prioritize, select and allocate limited resources to best accomplish the Organizational Objectives
  36. 38. If you can believe. . . . <ul><li>When Economy going South, company’s strategy has paid off! </li></ul><ul><li>Revenue Doubled in its 60 year history - from about $300 Million to $550Million between 1999 to 2008 </li></ul><ul><li>Cost of IT expenditure reduced from over 8% to ~2% </li></ul><ul><li>Six Consecutive—Most Admired Knowledge Enterprise – ahead of other Global Hall of Fame members - GE, British Petroleum, HP, and Xerox. </li></ul>
  37. 39. Any Questions? Carrot and sticks or Tomato’s to : Saji Madapat [email_address]
  38. 40. Saji K. Madapat CPIM, CIPPM, PMP, CSSMBB http://www.linkedin.com/in/goodtogreat - [email_address] Mobile: 001-214-454-7254 Saji made significant contribution to PMI’s various strategic initiatives including global standard Books on Portfolio & Program Management Standards, OPM3, PMBOK® Guide and PMCD Framework. As an Advisor- Portfolio Management Office, Saji played an instrumental role in setting up Portfolio Management office by mapping organization strategies and balance score card of $5B FedEx Freight corporation to its IT & Non IT projects & programs throughout the organization. Saji was featured in Gartner Global PPM Summit 2008 as an executive BOD room member and published & presented over 30 papers globally including on PPM and OPM3. Saji had the project portfolio responsibility for Global Business Systems (ERP&BI) in 20 countries in North & South America, Europe, Africa and Asia Pacific of Buckman (a globally Most Admired Knowledge Enterprise -6 time MAKE award winner). Saji also associated with Bearing Point (KPMG), Ernst & Young (Cap Gemini), Arthur Anderson, BaaN (Vanenburg) Business System and CroweChizek on various strategic projects. Saji’s experience includes Project Feasibility Studies, Appraisals, Industry & Company Analysis and Strategic Financial Planning. Saji has a Masters from PMI’s Leadership Institute. He served as a PMI Component Mentor in PMI’s most crucial region (Asia) and prior to that three terms as VP, Finance PMI Memphis TN Chapter. He also served as a Judge of PMI's 2004, 2005 & 2007 Project of the Year (POY). Saji is currently serving his 2nd term in PMI Code of Ethics Implementation Advisory Committee (CIAC) - a committee of the PMI global Board, advising on Ethics strategies.
  39. 41. PARKING LOT
  40. 42. Post Enterprise Analysis Execution Approaches Process Improvement System Implementation “ To Be” “ As Is”
  41. 43. Traditional Methodology Process Improvement System Implementation TRADITIONAL PATH
  42. 44. Technical Methodology Process Improvement System Implementation TECHNICAL PATH
  43. 45. Enterprise Analysis Methodology Compact path Process Improvement System Implementation Comprehensive
  44. 46. Guide to the Business Analysis Body of Knowledge® (BABOK® Guide) Version 2.0
  45. 47. <ul><li>Bridges - organizational strategy and projects. </li></ul><ul><li>Credibility and visibility of PM & BA profession . </li></ul><ul><li>Analyze maturity of different parts of the organization </li></ul><ul><li>EA is a balancing act. Balancing resources against organizational needs - operations (on-going efforts to “keep the lights on), tactical and strategic needs. </li></ul>What is in EA for my organization?
  46. 48. “ Dump the Weight” <ul><li>Employee layoffs are routine . . . </li></ul><ul><li>Budgets are cut to the bone . . . </li></ul><ul><li>Strategic projects are cancelled . . . </li></ul><ul><li>BUT the BUSINESS NEEDS aren’t touched! </li></ul>
  47. 49. Dig More about GBS & ORP? <ul><li>Please Visit </li></ul><ul><ul><li>“ The Mystery of Irrational Exuberance to Fast & Furious” Journal Of Research Findings Of ERP Systems And Enterprise Resource Management , June 2002. </li></ul></ul><ul><ul><li>“ Excelling in A Recession Driven Economy – Project Portfolio Management and Business System Investment ”: “ Milestone ”, Project Management Institute, Memphis, April 2002 issue . http://www.pmimemphis.org/files/milestone_0302.pdf </li></ul></ul><ul><ul><li>&quot; Organization-wide Re-Engineered Process (ORP) -RIP to ERP: Buckman’s Holistic Approach ,” Journal Of Research Findings Of ERP Systems And Enterprise Resource Management , June 2001. (Later published on CIBRES.COM as featured paper http://www.cibres.com/articles/20011001-rip to orp.htm.) </li></ul></ul><ul><ul><li>&quot;In the Whirlpool ERP Horror Stories: The Classic Buckman Success Story ,” Journal Of Research Findings Of ERP Systems And Enterprise Resource Management , January 2001. (Later published on CIBRES.COM as featured paper http://www.cibres.com/articles/20010501 .) </li></ul></ul>

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