1. EPITA IT Markets Basic Finance and Marketing
Lecture #3
Oct 25th 2006
Jean-Noël GORGE

2. Previous week V.I.P. (Very Important Points)

3. 25,0 20,0 15,0 10,0 5,0 0,0 -5,0 PIB L&S Investissement -10,0
+3,5%
+1,8%
0,0
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
-5,0
PIB
L&S
Investissement
-10,0

4. 60's 70's 80's 90's 2000's Cycle phase HW Mature Techno. Emerging
Users
60's
70's
80's
90's
2000's

5. Micros ( Client/Server, ERP)
Towards integration
90's
2000's
Micros ( Client/Server, ERP)
Each layer comes on top, previous layers never disappear !!! (See millenium bug)
80's
Minis & department's IT
(VAR Digital, HP, DG)
70's
Mainframes Cobol 370 CICS etc
60's
Assembler & Co

6. Digital Times Digital Era Industrial Era Networked Organizations
Pulled flows « On demand »
Fast and lean
Information
Immaterial
Digital Era
Chirac
Internet
Industrial Era
Napoléon III
Railways
Mass production, « Pushed » flows
Raw Materials
Heavy « tangible » investments Taylorism/Marxism

7. Industrial times IT challenges
Design/Engineering
Design/Engineering
Solution =
"re-foundation" = ERP
Manufacturing
Problem = Integration
Logistics
Purchasing
Sales
Mktg-Comm
Finance

8. Digital times IT systems
Conception
Fabrication
Logistique
Achats
Ventes
Finance
Mktg-Comm
Need for external integration
Company B
Company A
xxNet
Design/Engineering
Design/Engineering
Need for
Internal
Integration
Manufacturing
Logistics
Purchasing
Sales
Mktg-Comm
Finance

9. Questions ?

10. IT Cycles and Software Services

11. Towards integration
Components
Hours + Hourly Rates +
Time Sheets
60's

12. Software services business basics
Fondement du « business model » dit « un homme, une heure, un euro », ou (1xn) (1xt) (1xp) = Revenues (CA)
N = effectif
T = taux d’activité, rapport entre jours (heures) facturés et jours (heures) facturables, bref le « tace »
P = prix, tarif, tjm

13. Towards integration 60's 70's Components integration Components
Components + Fixed quotes (Specs, Prices, planning
Hours + Hourly Rates +
Time Sheets
60's
70's

14. Towards integration 60's 70's 80's Components integration System
Components + Fixed quotes (Specs, Prices, planning
CI + 1/3rd parties Systems
(minis)
Hours + Hourly Rates +
Time Sheets
60's
70's
80's

15. Towards integration 60's 70's 80's 90's Components
Components integration
System
Integration
Services
Integration
Components + Fixed quotes (Specs, Prices, planning
CI + 1/3rd parties Systems
(minis)
Hours + Hourly Rates +
Time Sheets
Consulting +
Build +    "Run"
60's
70's
80's
90's

16. Towards integration 60's 70's 80's 90's 2000's Components
Components integration
System
Integration
Services
Integration
Business
Integration
Components + Fixed quotes (Specs, Prices, planning
CI + 1/3rd parties Systems
(minis)
Hours + Hourly Rates +
Time Sheets
Consulting +
Build +    "Run"
S I
+ Long term
Deals +
Embedment
60's
70's
80's
90's
2000's

17. « SSII » : a short story 60's 70's 80's 90's 2000's 370's Minis CS
Components
Components integration
System
Integration
Services
Integration
Business
Integration
Components + Fixed quotes (Specs, Prices, planning
CI + 1/3rd parties Systems
(minis)
Hours + Hourly Rates +
Time Sheets
Consulting +
Build +    "Run"
S I
+ Long term
Deals +
Embedment
60's
70's
80's
90's
2000's
Mainframes
370's
Minis CS
Internet

18. Components integration Projects / Deals size (M€)
Towards integration
Components
Components integration
System
Integration
Services
Integration
Business
Integration
Projects / Deals size (M€)
> 50 25 10 2

19. Towards integration Share of prime contractor in
Components
Components integration
System
Integration
Services
Integration
Business
Integration
Share of prime contractor in
project /deal value (%)
100
>80
>50?
>30? ?

20. Integration : Competition
Components
Components integration
System
Integration
Services
Integration
Business
Integration
Ernst & Young
Cap Gemini…………. Bossard …..
EDS + AT Kearney
Andersen Consulting …. Accenture
IBM

21. Competitive fight Components Components integration System Integration
Services
Integration
Business
Integration
Cost / Prices
Free Lances / Temps Remote selling «Commodity» Closeness
Added Value
Customer’s
Core
Business
Difficulties Dilemma

22. Strategies’ convergence
Editors
Outsourcing
Microsoft Oracle
SAP
EDS
ADP
First Data ATOS
Cap Gemini Accenture
IBM
Bull HP
SSII
B I
Manufacturers
Each group builds on its own components, but
all seam to move towards BI

23. Business Integration
Components
Components
Integration
System
Integration
Services
Integration
Business
Integration
Services Share (CBR) permanent
Actions
365/7/24 Sharing risks & gains
In the « digital World » If we stop, our clients stop =>
60's
70's
80's
90's
2000's

24. SSII in the 2000’s
Business Integration :
1° What is our (monthly, quarterly...) share of each customer expenditure in C+B+R ? How do we get maximum coverage ?
2° Which strategic functions or information are outsourced to us by each customer ?
3° How do we control (defend) and expand our services share for each customer ?
4° How do we manage not to be substituted in our core offerings ?
5° Offering every possible service, not producing all of them
6° What is our position in each customer’s Galaxy ?

25. C B R Services portfolio
CHANGE
Enterprise Effectiveness
Enterprise Program Management
BUILD (projets)
(M&A, Spin Off, ...)
Break through
Business
Architecture
Evolution
Users Support
& Training
Components
Integration
Package
Upgrades
First Build
Roll Out
New Modules,
New Functions
RUN
Entreprise Applications Management
System-Management , Entreprise infrastructures
User Support (Call Center / level 1)

26. HR and Critical factors
Profit sources
60's Programmers
70's AP Cobol
80's Graduates
90's Consultants
2000’s « Information workers »
Strategic skills & know how
Recruiting, retaining
Project management
Tools, alliances (VAR…)
Methodology, global vision
CRM, KM

27. Another look at Services Segmentation in IT consulting
Strategy
Technologies
Processes
H R

28. In the following slides, companies names may be erroneous
M&A, LBOs, Names Changes etc.

29. From Strategy to Operations
We will run it for you ! = Business Integration
What to do ? = Strategy
How to do it ? = Consulting
We will make it for you ! = Services Integration
Technologies
Processes
H R

30. Group (or family) 1 Anglo-Saxons Strategists :
McKinsey, Bain, BCG, AT Kearney Booz Allen, Braxton
Mercer Management Consulting
Strategy
French Strategists :
Mars & Co, OC& C, Statorg, Telesis...
Technologies
Processes
H R

31. Group (or family) 2
French generalists : Eurogroup, Quadran, Algoe Cegos, l'ex Eurequip, Solving Orgaconseil, SV & GM ...
Strategy
Former accountants
or auditors PWC Developpements, Ernst & Young Entrepren.
Ineum PMO, KPMG Fidorga
Technologies
Processes
H R

32. Group (or family) 3 IT integrators: Accenture, CSC IBM Consulting, EDS
Cap Gemini : (Skill conseils + Bossard + Gemini + Ernst) CSC + KPMG Atos Consultants
Steria consultants
Sopra Consultants- Mega
Unilog Consultants
Oracle Consulting SAP Consulting
Microsoft Consulting Services
Strategy
Technologies
Processes
H R

33. Group (or family) 4
HR specialists PA Consulting, William M. Mercer, Hay Management, DDI, Bernard Juilhet,
Bernard Brunhes, Cemis, Francis Vidal,
HGC, IDRH, Insep, Atefo, Quaternaire
Herbemont César, Altedia
Stratégie
Technologies
Processes
R H

34. Growth factors Steady growth Technology breaktroughs and «waves»
Globalisation
Privatisations
M&A
Competition
Strategy
Regular, « soft » growth
Cost cutting
(Re) Organisation
Procedures Coaching
Processes
Technologies
H R

35. Questions ?