er A Presentation ems Shared Services at IKEA - PwC 96-04 HR/Development Manager ITT Flygt •...
Transcript of er A Presentation ems Shared Services at IKEA - PwC 96-04 HR/Development Manager ITT Flygt •...
©In
ter
IKEA
Syste
ms
B.V
.2013
Presentation Shared Services at IKEAPwC's CXO conference, Copenhagen 15th of April.
1
• Background• IKEA in a nutshell• Looking back• Re do• Where are we now?• Road ahead
STORY LINE
2Finance Managers Meeting 19 March 2015
• 96-04 HR/Development Manager ITT Flygt
• 05-07 HR Director Kährs
• 07-09 HR Director Gunnebo Industries
• 09-12 HR Operations Manager IKEA Sweden
• 12- Business Navigator Global Shared Services (Identify and evaluate business opportunities)
Me + Shared Services
• >80 000 suppliers/Indirect material
• 500 co-workers (Shanghai/Poznan)
• 217 000 Travel & Expense Claims
• Addressed spend handled over BEUR 3
• 25 served countries
• 70 000 co-workers paid from GSS
Me/Karl-Johan Kallenberg
Global Shared Services
Go-live:
• SSC Poznan in 2011
• SSC Shanghai in 2009
Go-live & scope
STARTING UP
Scope:
• HR
Payroll
Personnel Administration
• Finance:
P2P Handling Indirect Invoices
Post Travel Expense Claims handling
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Global Shared ServicesActing Leif Johansson
GSS Business NavigationKarl-Johan Kallenberg
GSS Operations& SSC PoznanJon Parton
Organization Shared Services
GSS organizationHow we organize us
Our roleto create outstanding value in terms of cost and quality, to create capacity for growth, and to add administrative competence to IKEA
IKEA in a nutshell
The IKEA vision
“To create a better everyday life for the many people.”
The IKEA vision
Our business idea
“To offer a wide range of well-designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them.”
designDemocratic
Low price
Inter IKEA Group 1 800 co-workers
IKEA Group147 000 co-workers
IKANO Group3 500 co-workers
"I decided that the stock market was not an option for IKEA. I knew that only a long–term perspective could secure our growth plans."
Ingvar Kamprad, Senior Advisor & Founder
Kamprad founded three independent company groups with different owners
Operations in 42 markets
59%of production takes
place in Europe
1.5Billion visits to
IKEA.com
315IKEA Group stores
located in 27
countries*
*We had 315 stores in 27 markets as of August 31, 2014
716Million store visits
1002Home furnishing
suppliers in 51 countries
NORTH
AMERICAStores
IKEA Industry
production unit
51
1
EUROPEStores
IKEA Industry
production
units
222
36
RUSSIAStores
IKEA Industry
production
units
14
5
ASIAStores
IKEA Industry
production
units
23
2
5
AUSTRALIAStores
• Net income €3.3 billion
• Total tax more than €1.5 billion
• Invested €1.7 billion in our business
“Our guiding principles, like earning money before we spend it, give us financial strength and the unique opportunity to take a long-term perspective and make investments using our own resources.”
Alistair Davidson, CFO
Profits give us resources to grow
Other facts & figures - Today
OUR CO-WORKERS
SSC POZ
• Average age 30
• Women/men 79%/21%
• Foreigners 40
• Nationalities 16
• Languages 21
• Interns 11
SSC SHA
• Average age 28
• Women/men 86%/14%
• Foreigners5
• Nationalities 5
• Languages10
• Interns31
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LOOKINGBACK
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©In
ter
IKEA
Syste
ms
B.V
.2015
Initial organizational set up
Business Services
Multiple functions across the business
Innovation/partner
Cross processes efficiency
Market prices
Ownership of systems
Process owner
Strategic value
High integration
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Learnings
–Ownership and management support
–Why? Lack of buy-in/resistance
–No baseline
–Involvement local units (Shadow staff )
–Time lag in implementation (Transition approach)
–Not standardized and harmonized IT, processes and policies
–Pricing of services/visibility of costs
–Financing of build up
–One size fits all
–Organization in place/Green field
©In
ter
IKEA
Syste
ms
B.V
.2015
FROM BUSINESS SERVICESTO SHARED SERVICES
Business Services
Multiple functions across the business
Innovation/partner
Cross processes efficiency
Market prices
Ownership of systems
Process owner
Strategic value
High integration
Shared Services
Two functions in scope
Transactional tasks
Cost savings
Cost plus
User
Doer
Tactical value
Low integration
Country Councils
Purpose
Secure efficiency and quality of services. Another
purpose is to secure that any issues and
problems are addressed and taken care of on an
operational level.
Roles and responsibilities
• Representing the interests in the country
• Risk management
• Resolving customer service issues, and follow-up quality and price of service delivery
• Providing proposal of improvements, gathering future needs and adaptation of services,
• Ensuring there is sufficient and appropriate resources, quality of service levels, lead times, etc.
• Ensuring that expectations of services are consistent with agreed service levels
• Ensuring compliance with local law and regulations, including IKEA policies
• Escalate issues when needed.
Shared Services Finance/ HR
Operations CouncilsPurpose
Provide direction on how to implement and
use shared services and how to plan and
utilize recourses in the best way for IKEA.
Roles and responsibilities
• Reviewing, validating and identifying opportunities to extend the scope within functional frame (Finance/ HR)
• Securing business readiness for implementation
• Identify and manage strategic risks within the functional scope;
• Provide advice and make recommendations regarding the Services Scope
• Act on reviews and escalations from the Country Councils and process councils
• Escalate issues when needed.
Shared Services Steering Committee
Purpose
To provide strategic directions and monitor the
performance of Group Shared Services (GSS)
Deliveries across IKEA Group.
Roles and responsibilities
• Providing leadership across the IKEA Group during the implementation and ongoing operation of the Shared Services in each country
• Identifying opportunities to extend the scope of Shared Services
• Securing that local countries’ management are ready together with their local organization for implementation and future cooperation with Group Shared Services
• Identifying and managing strategic risks
• Reviewing and validating the performance of Group Shared Services, investments, development projects, budget and forecast deviations.
80% of issues typically resolved at this stage 98% of issues typically resolved at this stage Only a few exceptions
Governance structure
STEERING OUR OPERATIONS
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WHERE ARE WE
NOW
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Best valueFY18-20
Business excellenceFY15-17
Basics in place
FY12-14
Build upFY08-11
How we do developStage model
We are here
• Payment processing
– For SSC POZ from March 2015
• Business Support – from FY16
Finance Services:
• Accounts Payable (AP) – not full scope
(exception PL & CN – full scope)
• Vendor Master Data (VMD)
• Travel Expense Processing (TEC)
• Bank transfers (for CN & PL only)
• Bank statements (for CN & PL only)
• Sales reconciliation (for CN & PL only)
• Fresco (SHA only)
• Compass (SHA only)
HR Services:
• Personal administration
• Payroll
• HR Systems Support
GSS SCOPE
• Single Point of Contact - 1st and 2nd level
• Recruitment services (SSC SHA)
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Increase/Review the scope
Finance
Accounts Payable
Travel expense
Vendor master data
General ledger accounting
Sales reconcilation
Reporting
Accounts receivables
Reconciliation Intercompany /Bank
Payment service
Finance system support
Human Resources
Payroll
PA
GV support
HR system support
Reports
Recruitment service
Time Keeping
Mobility
Compensation and benefit adm
Training adm
Pension and savings adm
Exit administration
Administration support
OthersPossible services
Not in scope today
Purchase order adm
Compliance administration
Scanning and verification
Customer service
Property/tenent adm
Risk assesment and ensurance
Travel administration
Service delivered
Partially delivered
Proposedto be in scope
Not delivered
ScopeScope and value proposition
ROAD AHEAD
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Stage Build up Basics in place Business excellence
Best value
Geograpichal scope Local unit Regional Regional Global
Degree ofautomation
Limited Limited Medium Maximum
Degree of value add Transactional Transactional Transactional Transactional + Advisory
Functional scope One 2 Functions 2-3 Functions Multi Function
Degree of integration Little sharing Medium sharing Sharing of infrastructure
Full integration
Governance Function Function Multifunction Multifunction
Continiousimprovements
Ad hoc Ad hoc Toolkit in place Integrated in daily operation
Process ownership Informal Informal In place E2E
Service management Ad hoc Ad hoc In place Consistent
Client interaction Scattered Scattered Mixed Overall interfaces
Systems Multiple Many Less One ERP
Sourcing Adhoc Adhoc Consolidated Strategic
People development Countryspecific
Country Specific Functional specific
Global SSC curricilum
Locations Multiple Many Less Global with local touch
Next steps
TO TAKE HOME
The why, dont underestimate cultural impact
Proven solutions
Management
Support
Start small
dream big
26Finance Managers Meeting 19 March 2015
15-Apr-15 Finance BSC 27
Home is the most important place in the world
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THANK YOU!
Group Shared Services 28Group Shared Services