Technology as an Enabler for Global Shared Services
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Technology as an Enabler for Global Shared Services Leveraging Strategic Automation and Business Intelligence Tools
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Leveraging strategic automation and business intelligence tools
Transcript of Technology as an Enabler for Global Shared Services
Technology as an Enabler for Global Shared Services
Leveraging Strategic Automation and Business Intelligence Tools
Who is Nationwide Insurance?
www.nationwide.comWebsite36,000Employees#124 in FORTUNE 500Rankings$22.62 billionRevenueFinancial ServicesIndustry
Columbus, OHHeadquarters1926Founded
Private Mutual CompanyType
www.nationwide.comWebsite36,000Employees#124 in FORTUNE 500Rankings$22.62 billionRevenueFinancial ServicesIndustry
Columbus, OHHeadquarters1926Founded
Private Mutual CompanyType
Fiscal 2008 results
What is Going on in Shared Services
Convergence Tipping Point
3
Becoming critical to every business!
Can you RAED TihS?i cdnoult blveiee taht I cluod aulaclty uesdnatdrd waht I was rdanieg. The phaonmneal pweor of the hmuan mnid aoccdrnig to a rscheeachr at Cmabrige Uinervtisy, it dseno’t mtaetr in waht oerdr the ltteres in a wrod are, the olny iproamtnt tihng is that the frsit and lsat ltteer be in the rghit pclae. The rset can be a taotl mses and you can siltl raed it whotuit a pboerlm. Tihs is bcuseae the huamn mnid deos not raed ervey lteter by istlef, but the wrod as a wlohe. Azanmig huh? Yaeh and I awlyas tghuhot slpeling was ipmorantt!
Telling Stories
Source: XKCD.com 5
What is the Shared Services Promise
6
Are you Delivering on Your Promise
Telling a Good Story
I know what I know I don’t know what I know
I know what I don’t know I don’t know what I don’t know
3 4
2 1
KN
OW
DO
N’T
KN
OW
KNOW9
DON’T KNOW
Telling the Shared Services Story
Who is the Audience
CustomersSuppliers
SuppliersSuppliers
What is the TCO
for each service?
What is the unit cost
of each service?
How are my
vendors
performing?
How much
am I using?
Are costs
within budget?
How can we be
more cost
efficient?
How well are the
services
performing?
What are more
cost-effective
alternatives?
BU
TheBusiness
of Shared Services
BUBU
Shared ServicesManagement
Customers
Customers
11
Talking about Shared Services Value Proposition
WHO you talk to matters
What you talk about matters
How you present the analytics matters
12
Talking about Shared Services Value Proposition
13
WHO1. Determine the right
level in the organization for making key decisions about investments
2. Find an advocate you trust and who trusts you
3. Remember, before the business trusted you, they trusted someone else
WHAT1. Bring ideas that will
improve their business, help them gain insight, or help them deliver on a business goal
2. Bring your listening ears. The better you understand their business issues, the better you can align your analysis to meet their needs
3. Remember, not everyone wants to admit they don’t understand their role in shared services costs
HOW1. Understand what DATA
you have
2. Combine different DATA elements to create INFORMATION about the environment you are discussing
3. Complete the ANALYSIS of the INFORMATION so you can provide INTELLIGENCE about your industry and its intersection with the Shared Services industry
Agency Environment
Network Connectivity$3,687,964
63%
HW / SW / Maint
$429,264 7%
Server Support$1,057,770
18%
Windows$23,800 1%
Dist. Storage$238,922
4%
Web$427,988
7% •Top 20 applications consume 50% of the total Infrastructure resources ($54m of $108m YTD – April)
•Excludes FTE and non-IT products
2,531,999
3,417,2513,197,856
3,036,913
564,715
1,234,827
2,534,411
3,039,013
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
10,000,000
2007 2008 2009 2010
8261 ‐ Server Storage Tier 4
8155 ‐ Server Storage Tier 2
8153 ‐ Open Systems Backup
8152 ‐ Server Storage Tier 1
$10,630,345
$12,947,281
$10,806,194
$6,841,558
$1,676,977
$3,287,604 $4,671,427
$3,734,340
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
2007 2008 2009 2010
8261 ‐ Server Storage Tier 4
8155 ‐ Server Storage Tier 2
8153 ‐ Open Systems Backup
8152 ‐ Server Storage Tier 1
Did You Know
•Tier 2 storage volume has increased from 11% to 33% of the total distributed storage billable volume since 2007
•Distributed storage charges to the business units have decreased 11% since 2007, even though billable volumes have increased 80%
•Distributed storage rates on average have decreased over 50% since 2007
•On an equal volume basis, the business unit expense for distributed storage would be $11.8m higher than 2007 without the introduction of tiered storage products and year over year reductions in unit cost.
Distributed Storage Billable Volume in GB’s
Distributed Storage Chargeback
$2.93 $2.81
$2.18
$1.45
$0.00
$1.00
$2.00
$3.00
$4.00
2007 2008 2009 2010
Avg Rate/GB ‐ Distributed Storage
Avg/GB
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
Jan …
Feb …
Mar …
Apr …
May …
Jun … Jul …
Aug …
Sep …
Oct …
Nov …
Dec …
Jan …
Feb …
Mar …
Apr …
May …
Jun … Jul …
Aug …
Sep …
Oct …
Nov …
Dec …
Jan …
Feb …
Mar …
8102 ‐Mainframe (CPU)
8103 ‐Mainframe (CPU) Development Non‐Prime
8104 ‐Mainframe (CPU) Specialty Engine
TOTAL $'s
‐
1,000
2,000
3,000
4,000
5,000
6,000
Jan …
Feb …
Mar …
Apr …
May …
Jun … Jul …
Aug
…
Sep …
Oct …
Nov
…
Dec
…
Jan …
Feb …
Mar …
Apr …
May …
Jun … Jul …
Aug
…
Sep …
Oct …
Nov
…
Dec
…
Jan …
Feb …
Mar …
8102 ‐Mainframe (CPU)
8103 ‐Mainframe (CPU) Development Non‐Prime
8104 ‐Mainframe (CPU) Specialty Engine
TOTAL HOURS
160% Increase in processing hours since Jan 2008
ECIF Mainframe Processing Analysis
Jan 2008 – March 2010
•Implementation of zIIP technology in June of 2008 has lowered ECIF’s average mainframe processing rate from $171/hr to $122/hr – a 29% reduction
•Monthly savings of $200k -$2.4m annually
•Total processing hours have increased 160%
•Total processing expense has increased 96%
$100
$120
$140
$160
$180
Jan 2008
Feb 2008
Mar 2008
Apr 2008
May 2008
Jun 2008
Jul 2008
Aug 2008
Sep 2008
Oct 2008
Nov 2008
Dec 2008
Jan 2009
Feb 2009
Mar 2009
Apr 2009
May 2009
Jun 2009
Jul 2009
Aug 2009
Sep 2009
Oct 2009
Nov 2009
Dec 2009
Jan 2010
Feb 2010
Mar 2010
29% Reduction in Mainframe Processing Cost/Hr Since January 2008
Cost/Hr
zIIP technology
$171/hr $122/hr
Did You Know?•Top 20 applications/chargeable disb. codes account for 83% of total mainframe usage.
•Billing-NBP Prod Support usage is 14% of total mainframe usage
•ECIF usage YTD March is 46% higher than Q1 2009
•Mainframe processing savings realized by retiring Compass application is $45,000/mth
•Business units can save over $1m per year by moving 1,000 hours of processing from prime to non-prime.
•ECIF accounts for 62% of all zIIP usage
•ECIF YTD savings associated with zIIP processing is over $500k, $2m on an annual basis
$0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000
Application
$96,857
$58,249
$24,084
$16,342 $13,548 $12,853
Mainframe Non‐Prime ‐ YTD March
Auto Prod Support ‐NAPS
Life Sys‐Individual Annuity Applications
ECIF Hardware and Software
Catalyst Hardware Software
Auto Production Support ‐ SA Auto
Billing ‐ NBP Prod Support
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
Application
$2,235,832
$1,323,021 $1,077,924
$924,708 $883,078 $872,548
Mainframe Prime ‐ YTD March
Billing ‐ NBP Prod Support
ECIF Hardware and Software
CLMS Vendor Management Host
Auto Production Support ‐ SA Auto
Commercial PCIO Prod Support
Auto Prod Support ‐NAPS
$0 $50,000
$100,000 $150,000 $200,000 $250,000 $300,000 $350,000
$400,000 $450,000
Application
$444,009
$32,418 $30,474 $24,234 $23,856 $22,368
Mainframe zIIP ‐ YTD March
ECIF Hardware and Software
CLMS Vendor Management Host
DSEI ‐Mobius
Auto Production Support ‐ SA Auto
Property Prod Support ‐ SA Property
DW Infrastructure ‐Mainframe
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2007 2008 2009 2010
Windows virtualized server volumes have increased from 30% to 60% of the total Windows install base since 2007, saving LOB's over $400k/mth
VM Ware Virtual Server ‐ Tier 3
VM Ware Virtual Server ‐ Tier 2
Shared Windows Server Support
Windows Server Support ‐ Tier 3
Windows Server Support ‐ Tier 2
Windows Server Support ‐ Tier 1
Field Server Support
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2007 2008 2009 2010
Windows 2007 ‐ 2010 Physical vs. Virtual Server Mix
Virtual
Physical
With Virtualization
2007 2008 2009 2010 Plan 2010 Plan
Field Server Support 1,354,850$ 1,280,370$ 972,405$ 777,630$ 777,630$
Windows Server Support - Tier 1 598,850$ 817,075$ 808,955$ 636,405$ 636,405$
Windows Server Support - Tier 2 12,636,100$ 14,387,100$ 15,298,300$ 18,598,000$ 6,100,450$
Windows Server Support - Tier 3 461,775$ 526,635$ 1,148,445$ 1,063,845$ 143,820$
Shared Windows Server Support 428,995$ 495,880$ 557,865$ 565,705$ 565,705$
VM Ware Virtual Server - Tier 2 8,380,710$
VM Ware Virtual Server - Tier 3 626,400$
TOTALS: 15,480,570$ 17,509,068$ 18,787,979$ 21,643,595$ 17,231,120$
($4,412,475)Does not include hardware savings
Virtualization vs. Non‐Virtualization Financial Comparison
Server charges w/o virtualization
Intelligent Analytics tell you Something
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MB/ID Storage
$150,000
$450,000
$750,000
$750,000
$300,000
$1,050,000
$600,000
$900,000
$1,050,000
Collaboration storage per ID has increased 250% since Q1 2007
Intelligent Analytics tell you Something
20
Mainframe ProcessingMainframe Processing Personal Computing SupportPersonal Computing Support
Visibility into the product expense components is used to determine unit cost reduction targets and validate allocations.
Presenter Information
www.nationwide.com
21
