1. Enterprise arkitektur – Innovation fra teori til praksis
Nytænkningsprocessen
Case 1: Udvikling af forretnings arkitektur i en service organisation
Case 2: Top-down: Udvikling af applikations arkitektur med udgangspunkt i forretnings strategien
Case 3: Bottom-up: Process optimering på tværs af en stor kompleks organisation 1 1

2. Nytænkningsprocessen
Nytænkning – tre forskellige tilgange:
Top-down: Design med udgangspunkt i strategiske analyser, fx. Porters generiske strategier / Five forces.
Bottom-up: Inkrementelle forbedringer med udgangspunkt i evaluering af eksisterende processer, fx. Via lean / Forbedrede handoffs
Outside-in: Inspiration til kreative løsninger fra lignende organisationer

3. Case 1 Udvikling af forretningsarkitektur i en service organisation3 3

4. Background
GSS was a division in the “Group Operations” organisation with about 300 employees in the following units:
PPM – Premises and Property (physical workspace, desks, chairs, building maintenance, etc)
ISaS – Internal services and support (canteen, cleaning, meeting rooms, switchboard, travel, etc)
Sourcing – supporting outsourcing and procurement throughout the organisation
COS – Office tools (mail, communicator, MS-office, etc)
GSS services were fragmented and didn’t have a “customer” perspective
GSS Target Picture 2013 was initiated in 2010 to set direction for the development of the services provided
Focus was on efficiency and effectiveness of the users, more than efficiency of GSS 4

5. Target Picture - Definition
GSS Target Picture 2013:
A description of a target state for 2013 expressing the GSS vision as a set of service concepts - including objectives, KPI’s and measures - enabling creation of an implementation roadmap for reaching the defined target state
A service concept is a shared understanding of the service provided and received, which encapsulates information about the customer experience and the service outcome.
A service concept summary is a high level description (3-10 lines) of a service concept, indicating customer experience and outcome. 5

6. An example service concept – filled template
Service concept name:
GSS - Meeting facilities and hospitality
Service concept area:
Service to support the daily work
Service Concept driver:
User motivation:
User need to have a meeting
GSS motivation and KPIs:
Limited Amount of user complaints (less than x%)
Utilisation rate never higher than x%
End user survey satisfaction index > x%
Summary Service description:
We ensure that Nordea employees and their external partners are able to meet in well equipped meeting facilities with appropriate services delivered
Service experience – Nordea employee:
Conference centre:
Professional reception and lobby area to meet the visitors
High quality conference centre to meet colleagues and external visitors
Access to support to technical equipment if needed
Refreshments and food available
Meeting room:
Access to different kind of meeting rooms supporting the way of working
Video, round table, lap tops etc available when needed
Refreshments available
Service experience – Nordea management:
N/A
Service outcome - Benefits:
Different meeting places for different needs
Access to all meeting room and to book the services in one place (time)
Standardised meeting rooms
Access to support for all
Service outcome - Emotions:
Functional
Comfortable
Reliable
Easy to use
Service outcome - Values:
You know what you get (standard)
Less time consuming
Easy access to rooms and services
Refreshments available every where if wanted
Tasks included in service concept:
Initiatives needed to implement Service Concept:
Identity need for meeting facilities (number, size, equipment, etc.)
Clarification of roles and responsibilities
Development
Operation
Get mandate outside GSS to take charge
Establish dialogue forum (e.g. Users, HR, IT, etc) 6

7. Input to target service concept definition
Approach to ensure innovation:
Top-down from GSS unit guiding service principles and vision
Bottom-up from AS-IS services
Taking input from users and internal partners
Taking input from best practices and benchmarks 7

8. The Top-down approach
Overall vision: “Great European bank, acknowledged for its people, creating superior value for customers and shareholders”
Group Operations vision: “Becoming customer centric through innovation and productivity improvement”
GSS vision: “We make it possible for our partners to concentrate on their core business”
GSS Guiding principles:
One GSS – no silos
Demand driven
Competent and service minded
Time to market 8

9. The Bottom-up approach
All GSS employees participated via team-meetings to:
Describe As-Is situation
Set team targets
Suggest improvement
Templates and facilitation was provided from project team 9

10. Input from Users/internal partners
Team leaders and managers were encouraged to collect input from their “customers”
This was not coordinated/supported further by the project team 10

11. Benchmarks/best practices
Team leaders and managers were encouraged to investigate benchmarks and best practices from the industry
Project team provided inspiration, e.g. value disciplines:
Operational excellence
Streamlined processes
Cheapest price for specific quality
Example: Ikea
Product leadership
Product development
Bleeding edge products, little price sensitivity
Example: Apple computer, Pixar
Customer intimacy
Customer interaction
Tailor made solutions
Example: Consultancy 11

12. The Result About 20 service concepts
About 50 projects organised in 10 initiatives
Example service concept and resulting project: Employee Lifecycle Management:
Previously, a manager needed to contact 20+ units to get a new employee started (access cards, mobile, desk, PC, welcome flowers, …)
Service concept goal: one interface 12

13. Case 2 Top-down: Udvikling af applikations arkitektur med udgangspunkt i forretnings strategien13 13

14. The IT-strategy pitfall
Each unit may have thought through their IT requirements. But an apparently well-aligned Business- and IT-strategy may in reality be a collection of individual functional strategies with no coordinated prioritisation 14
Source: CSC Perspectives – Business and I/T fusion

15. GSS business strategies and priorities
The GSS IT strategy is driven by the GSS business strategy as defined by the GSS Target Picture 2013 and its derived business development initiatives
Thus, from the business side the GSS IT strategy takes input from:
GSS vision and Guiding Principles
GSS Target Picture 2013 Service Concepts
GSS Target Picture Initiatives (business development projects) 15

16. IT-Strategy tools - Fusion Tree (strategic view partly filled in)
Required Business Capabilities
Guiding service principles
Service concepts
Required IT Capabilities
Applications
Technology/ Architecture
Meeting facill & hospitality
Organisation
One GSS – no silos
Travel
Physical deliveries
Vison
We help our partners concentrate on their core business
Demand driven
Switchboard
Buy and payment
Competent & service mnd
Catering
Application Quality
Missing
Good
Fair
Poor
Archive
GSS SPOC
Time to market …
Strategic View
Left-to-Right
As-Is IT View
Right-to-Left 16

17. IT-Strategy tools - Application portfolio assessment matrix
4R Model
High
Reassess
Can we increase business value?
Renew
How to maintain this condition?
Technical Condition
Retire
Don’t Bother
Redevelop
What is the most cost-effective approach ?
Low
LOW
Low
High
Business Value
LOW 17
Source: CSC Perspectives – Business and I/T fusion

18. IT-Strategy tools - Value disciplines impact on IT
Alignment of the IT operating model with the enterprise’s value discipline is key to effectively exploiting the power of information technology
Value discipline
Type
IT impact
Operational excellence
Best total cost
Standardized, efficient, cost-effective systems
Product leadership
Best product
Creative use of technology to accelerate and support product development efforts, while other functions are treated as secondary processes requiring limited IT investment
Customer intimacy
Best total solution
Flexible but simple, standardised IT applications that can be reconfigured to meet individual customer needs 18

19. Case 3 Bottom-up: NNCR - Process optimering på tværs af en stor kompleks organisation19 19

20. New Normal Cost Reduction (NNCR) 2013 initiative - Objectives
Identify significant Group-wide cost reductions with full impact in 2013, by end of March 2012.
Cost reductions must be on top of reductions included in Q RFF, and each Business Area & Group Function (BA/GF) includes the additional cost reductions in their RFF as part of the Q RFF process. 20

21. A non-compensation cost baseline constituted a fact-based guide for discussions
Total 2010
Other expenses1
1,906EURm A
Facility services B
Premises C
Personnel
services & ben. D IT E
Marketing & Information F
Professional services
193EURm
308EURm
131EURm
763EURm
233EURm
278EURm X X X X
Postal services
Rent
Travel X
Production,
NP (IBM) X A1 B1 C1 D1 E1
Information
systems F1
Business &
Project cons.
Office material & expenses B2
Repair & Maintenance C2
Training & Conferences D2
Production,
Other A2 E2
Advertising & Marketing F2
Transportation
of cash A3
Cleaning B3
Utilities C3
Leased cars D3
IT consultants E3
Meetings &
Events F3
Temporary employees A4
Catering B4
Other3 C4
Other5 D4
Software E4
Sponsorship F4
Financial
supervision7
Security D5
Communication E5
Membership
fees A5 F5
Insurance A6
Newspapers & Literature D6
Other4 E6
Gifts &
Donations F6
Auditing & accounting A7
Waste handling2 E7
Market research F7
Collection & Collateral E8
Other6 F8
Legal advice F9
Other admin8
F10
Other admin, Hypotek Sweden 21

22. Scope and structure of NNCR discussions
All non-FTE costs are in scope:
BA costs that are managed by GO
Direct BA costs 1 2
GO managed costs
Direct BA costs A
Premises 1 2 B
Facility Services C
Personnel Services & Benefits
Discussion structured
around a number of
defined cost categories D IT E
Marketing & Information F
Professional Services 22

23. Assessment framework based on 7 parameters
Attractiveness score for each parameter
Parameter
Description
Low
Medium
High
Savings
potential
Preliminary estimate of savings potential for 2013 run-rate, understanding cost base, flexibility and savings potential
Below 1 EURm
1-10 EURm
Above 10 EURm
Level of investment required
Level of financial investments or resources required to implement the change
Large investments (>5 EURm) and/or man-hour resources (>1000)
Medium investments(<5 EURm) and/or man-hour resources (<1000)
Small investments(<500 EURk) and/or man-hour resources (<100) 1
Skills and competencies required
Required competencies and skill set present in the organisation to execute the change
No internal competences to execute the project available
Some internal competences to execute project available
All internal competences to execute project available
Time to impact
Expected time frame from decision to pursue initiative till savings is realized and recognized in P&L
12+ months
6-12 months
1-6 months
Stakeholder complexity
The amount of people involved
from different departments
Many stakeholders involved from different organisational units
Some stakeholders involved from few different parts of the organisation
Few stakeholders involved within same organisational unit
Transparency on
cost and driver
The extend to which the costs and cost drivers can be easily understood by the 'receiving business area', i.e. actual transparency in cost category
Limited visibility into the costs and drivers of those
Some visibility into the costs and drivers of those
High visibility into the costs and drivers of those
Transparency on consequence and complexity
The extend to which the consequence and complexity of implementing potential solutions within a cost category is well understood
Limited transparency to the consequences and complexity
Some transparency to the consequences and complexity
High transparency to the consequences and complexity
If possible, actual savings potential range – if not then;
If possible,, investments required – if not then;
If possible, actual time at which project is complete
1. Savings potential defined as 2013 actual earning impact 23

24. Transparency and fact base (as-is) Substantiate and prioritise
Detailed idea-to-business-case process for each idea Overview of key objectives, activities and deliverables
January 17
(Latest)
End of February
(Latest)
March 10
Mobilise
Solution development
Consoli-dation
Each idea
2 weeks
3 weeks
1 week
Teaming and Planning A
Transparency and fact base (as-is)
Proposal generation B
Substantiate and prioritise
Decide and Approve C
To identify and prioritize ideas for which to complete a high level business plan
Set team for chosen projects
Ensure team alignment on idea scope, ambition and key activities
To establish a detailed overview of spend and cost drivers
Substantiate preliminary savings estimates
To analyze possible solutions and estimate savings potential of those solutions
Prioritize list of opportunities/scenarios
Draft High level Business Case
To ensure buy-in from all relevant stakeholders and formal approval from sponsors
Consolidate all approved initiatives and prepare GEM presentation
Objectives
Outlining cost structure through spend cube
Idea generation workshops to identify potential ideas
Preliminary deep dives in relevant cost categories
Evaluate Nordea performance via external BCG benchmarks
Workshop with key stakeholders to evaluate gross list of ideas
Confirm required resources have been allocated to team
Prepare and conduct kick-off workshop with project team
Detailed planning of key activities for solution development phase A1
Establish data requirements to create transparency and send data request
Analyze relevant cost categories to identify
Cost receivers/users
Primary cost drivers
Meeting to understand base line and relevant drivers
When relevant
Conduct supply market
analysis
Collect and review
contracts
Conduct internal benchmarks A4
Collect user requirements and suggestions (interviews)
Develop gross list of potential savings scenarios
Assess saving scenarios on
Impact
Investment
Timing B1
Further substantiate the quantification of savings potential by BA
Conduct prioritisation workshop and decide on most feasible solution
Determine RFF implications for relevant BAs
Write High-Level Business Case B4
Conduct approval meeting with all decision making stakeholders
Implement final iterations
to business case C1
Task Force to consolidate portfolio of business cases into final proposal for GEM
Task Force to drive preparation of GEM update materials
Alignment process with BAs and within Task Force
Receive sign-off of GEM update materials by Torsten H. Jorgensen A2 B2 A5 B5 C2 B3 A3 B6
Activities A6 B7 1 2 3 4 5 6
Idea assessment
Team structure and governance
Description
Idea attractiveness
Activity plan for solution development phase
Detailed fact base incl. types, receivers, and drivers of costs.
Validated idea assessment including target cost savings split per impacted BA
Gross list of savings scenarios assessed on impact, investment and timing
Draft High Level Business Case
Final High-level Business Case
GEM presentation of recommended savings initiatives
Key Deliverables
January 17
(Latest)
January 24
January 31
February 8
February 15
February29
Deadline
Key deliverable
(see next page) x
Deliverable to be sent to Task Force mailbox at noon on delivery date – Signed off by Sponsor 24

25. The result
About 10 initiatives yielding significant yearly savings across the organisation 25