Transcript Title on 3 lines max. 40 pt Arial Bold, white

Transforming
Strategic Partnership
Governance using
Tools and
Automation
Constanze Nuesperling
VP, Partnerships & Performance
Management
2
Agenda
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Presentation of UCB
• Some facts and figures
Tool for managing outsourcing partnerships
•
•
•
•
Why is a tool important?
Key components of tools
Tangible business benefit
Learning and best-practices
Q&A
3
UCB: A patient-centric biopharma leader
Focusing on severe diseases in
Immunology and the Central Nervous System
Key facts and figures:
■ FY 2013 revenue: €3 411 million
■ FY 2013 rEBITDA: € 689 million
■ More than 8 500 employees globally
■ Operations in close to 40 countries
■ R&D Spend: ~25% of revenue
■ Listed on Euronext
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Evolution of Outsourcing Governance at UCB
2008
Relationship
Focus
Service
providers
functionally
managed,
specific to
each
outsourcing
deal
Outsourcing
Project team
put into place
to facilitate
further
outsourcing
along the
whole value
chain
1) Reporting line to CFO
2009
Partnerships
Department,
created1), to
foster UCB’s
strategy for
elimination or
meaningful
partnering of non
core activities
Partnerships unit
offering multigovernance tool
and performance
tracking to other
UCB functions as
a service
2010 – 2013
Community
of Interest,
initiated by
Partnerships
team
Platform for
exchanging
insights/
learnings
from key
outsourcing
partnerships
Limited
formal
organisation
and structure
2014 +
Business
Partnering
Practice (CoE)
UCB-wide
community to
foster best
practice and
maximise value
from all types of
partnerships
Guidance is
optional in some
areas (e.g.
change
mgt/communications) and
mandatory in
others (e.g. tool
selection, risk
management)
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Agenda
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Presentation of UCB
• Some facts and figures
• Our Vision
Tool for managing outsourcing partnerships
•
•
•
•
Why is a tool important?
Key components of tools
Tangible business benefit
Learning and best-practices
Q&A
UCB`s
strategies
Title, 17line
max
Be decisive about what activities and capabilities are core to reaching UCB’s strategies, focus on
these and eliminate rigorously or partner efficiently non-core activities and capabilities to
allow reallocation of resources towards UCB’s core activities.
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Key Challenges in UCB’s Partnership Governance –
Broad spectrum of partnering
Asset
integration
Acquisitions (*)
Management Complexity
Joint Ventures
Strategic Alliances
Strategic Outsourcing Partnership
Business Process Outsourcing
Preferred/Strategic Provider
Vendor Contract (*)
Asset
exchange
Collaborative Involvement
(*) = Out of Scope
Key Challenges in UCB Outsourcing Governance
Managing 20+
Strategic
Partnerships
Dealing with
high data
complexity
• Partnerships along the whole value chain represent ca. 35%
of UCB’s spend
• Tool supports the partnership governance process for
multiple types of partnerships, different business units,
countries and delivery centres
• Creates transparency on performance across multiple
partnerships
• Allows cross partnership comparison for key performance
metrics
• Stimulates continuous improvement
• Monitoring complex performance and financial data (service
credits and earnbacks, milestones, forecasting, end-to-end KPIs)
• UCB and the partners refer to “one version of the truth”
• Facilitates integration of internal and external data
• Data storage in a tool reduces UCB’s dependency on specific
people managing the engagement
8
Key criteria for evaluating outsourcing governance
tools – V 2.0
Provision of required services
• Robust contract value and business case tracking capability
• Flexible service level tracking, incl. Service credits and earn back
• Ability to track cross-partnership metrics and build dashboard
• Potential for additional services (e.g. further contracts)
• User friendliness (both internally and for partners)
Partnership & Agility
• Fit with existing systems, e.g. SAP?
• Modern, web-based layout
• Flexibility and customisability of the tool
• Proactivity in suggesting solutions and solving issues
• Response time to queries
• Degree of business acumen on support team
Pricing
• Based on the functionalities/application only?
• Additional services required, such as setting up new contracts and managed governance?
• Fixed price contract or volume related (e.g. number of contracts, users)?
• Helpdesk requirements (24/7)?
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10
Key components of tools for an effective partnership
governance program
Essential ‘must have’ components of Partnership Governance Application
Financial
Management
Consumption
Management
Performance
Management
Secondary ‘nice to have’ components
Invoice Workflow
Deliverables and
Obligations
Risk Management
Contract
Management
Dashboard and
Reporting
UCB selected Enlighta as tool platform to enable effective partnership
governance – Enlighta provides a comprehensive, scalable, and adaptable platform for
governance and automation of supplier management processes
Supplier Management – General Information, Contacts, Ratings, Capabilities, Diversity
Supplier Risk Management – Risk Categories & Weights, Inherent, Assessed and Residual Risk, Risk Scorecards
Contract
Performance
• Contract Repository
• Contract Search
• Change Requests
• Contract Issues
• Interpretations
• Service Requests
• Audits and Findings
• Service Levels
• Mgmt. Dashboards
• Metric Reports
• Deliverables &
Obligations
• Supplier Balanced
Scorecard
Financials
• Invoice Approvals
• Disputed Charges
• Performance Credits
• Resource
Consumption and
Forecast
• Spend Actuals,
Budget and Forecast
Relationship
• Governance Issues
• Engagement Level
(Meetings, Action
Items)
• Supplier Assessment
• Ideation
Role-based Secure Access, Configurable Processes, Batch & Excel Import, Email Alerts
Key components of tools for an effective partnership
governance program – performance management
SLAs Met and Missed across Partner Contracts
Supplier Input
Online, Excel
Service Level Scorecard for Partner Contract Performance
Contracts, SLAs
Metrics Database
csv ASCII Files, Web API
Automated Feeds
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Key components of tools for an effective partnership
governance program – demand & consumption
management
Actuals versus Target and Variance by Contract,
Supplier, Tower, Category, Region and Country
Resource Units for Service Towers
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Key components for an effective partnership
governance program
Team
TEAM
• Outsourcing and
Partnership professionals
• Business Acumen
• Application administrators
TOOL
• Accurate reporting and
dashboards
• Availability
• User-friendliness
Tool
Process
PROCESS
• Governance guidelines
• Governance meeting
• Relationship management
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Value creation from partnership management
KPMG study: how value leakage can erode
partnership benefits
Invoice
and credit
errors
Reduction/
Redeployment
of governance Consumption
staff
management Unnecessary
change
orders
2% – 10%
Value
[COST REDUCTION]
5% – 15%
Value
[COST AVOIDANCE]
Unrealized
Potential
Low
adoption
rates
Failure to
innovate
17-40%
Loss
10% – 15%
Value
[VALUE CREATION]
Total Potential
Value in
Business Case
Realized
Value
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Value Creation from partnership management
Value leakage can erode deal benefits
Invoice
and
credit
errors
Reduction/
Redeployment of
governance staff
Consumption
management
Unnecessary
change
orders
Unrealized
Potential
17-40%
Loss
Low adoption rates
Failure to innovate
2% – 10%
Value
[COST REDUCTION]
5% – 15%
Value
[COST AVOIDANCE]
10% – 15%
Value
[VALUE CREATION]
Total Potential
Value in Business
Case
These elements are
shared with the
Business.
The Partnerships &
Performance team
value creation is
evaluated between
3% & 5% 1) of the
managed spend
Realized Value
Annual EBIT loss impact/
cost avoidance of € … m.
Managed by Partnerships & Performance Mgt. via Tool,,
Governance Model and Contract Compliance application
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Tangible business benefit derived from adoption of
tools
Additional benefits:
• Ensure contractual terms and conditions are met (financial and
consumption management)
• Provide closer monitoring of Partners Performance leading to business
satisfaction and achievement of outsourcing goals
• Facilitates development of continuous improvement plans
• Enforce relationship management by sharing same platform, language
and metrics
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Learning and best-practices in implementation and
roll-out of the tool
Our Best Practices (recommendations) for implementation:
• Start with the fundamentals, Financial, Consumption and Performance and
leave other modules for a second wave of implementation
• Involve the Business to understand what is key for them, as application
administrator or outsourcing professional, you might miss important
requirements of the Business
• Document your requirements and ensure they are understood by your
application provider. Validate the business analysis skills of the project
manager of the provider.
• Allow sufficient time for testing. Better to go to production later with good
quality
19
Questions?
Thanks!
21
Key components for an effective partnership
governance program
The Team of Outsourcing Professionals acting on the governance application is
composed of different profiles:
Partnerships & Performance Mgt.
Department
Head of Partnerships
& Performance Mgt.,
P
Strategic
Cross-Partnership
a
Plans
analytics
r
t
Cross-contract
Business Analysts,
n
analysis, corrective
Cross-Partnerships
e
and improvement
analysts
r
plans
s
Application
Operational KPI’s, detailed by
administrators, Data
Service Category, Resource
Analysts
Units, Country,…
Business Functions
Business Sponsors,
Department Heads
Functional
Partnership
engagement leads
Business Analysts,
Contract managers
P
a
r
t
n
e
r
s
Constanze NUESPERLING
UCB
• Constanze has been with UCB for 6 years and is holding the post of VP Partnerships
& Performance Mgt.
• She is co-leading the Business Partnering Practice, a UCB-wide community to foster
best practice and maximise value from all types of partnerships
• Her unit is supporting UCB’s strategic outsourcing partnerships with business case
building, performance management (financials and KPIs) and deployment of Enlighta
• Prior to UCB, Constanze worked for Pitney Bowes Europe in the area of BPO
Finance, transitioning back office activities to the provider centres, creating the
governance model and managing post-go-live efficiency enhancements
• During the first eight years of her career, she worked as a management consultant
for A.T.Kearney and Accenture, with a focus on Shared Services & Outsourcing