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Business and Systems Aligned. Business Empowered. TM BearingPoint IT Strategy Evolution through 3-Year Planning Cycles AuthorChas M. White, MS EVP & Corporate CTO Date12 January 2006 Business and Systems Aligned. Business Empowered. TM Note: All data in this report has been released into the public domain by BE at various industry conferences and vendor/partner events.
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1 © All Right Reserved – BearingPoint 2003 BE IT Strategy – 3-Year Planning Cycles Planning & Design Separation & Migration Consolidation & Integration Optimization 2002-2005 – Re-branded as BearingPoint; creation of BE computing environment completed and migration of entities under TSA’s begins; longest TSA is US (4yrs); operating costs reduced due to eliminating redundancy 2001 – KPMG Consulting executes IPO and announces separation from KPMG LLP firms; adopts Greenfield & Outsourcing strategy 2005-2008 – IT focus shifts from separation activity to engagement team support and cost reduction focus shifts from IT operating costs to risk management and corporate SG&A reductions 2003-2006 – Global applications launched by IT (HR, CRM, APS/ACCPAC, EIB); savings realized from network and applications integration; MPLS & IPT value demonstrated; savings harvest continues; Separations complete
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2 © All Right Reserved – BearingPoint 2003 2001 Planning & Design Business Requirements Separate from LLP environments as they represent a loose federation of national practices with no corporate architecture or infrastructure (e.g., inter-company accounting, engagement management, multi-currency support, etc.); they are islands – no ‘best fit’ solution available Accomplish separations in a timeframe consistent with taking economic advantage of the national Termination of Services Agreements (TSA) Optimize IT for the mobile user – move costs out of offices Must be a ‘one company’ enterprise solution (apps and desktop) Assume English language as core but accommodate presentation in eight identified ‘native tongue’ languages Reduce aggregated IT operating costs 17% (against 2001 costs & joint KPMG/KPMG Consulting Gartner study) Design Parameters Adopted Architect network scalability and cost modeling to support 40,000 users Anticipate rapid growth through acquisitions in first three years Web enable all corporate applications and adopt MUI strategy Build cost model on ‘consumption based’ services ERP solutions should have single code base but dual instances ‘Maintain the Brain, Outsource the Brawn’ leveraged services model Must remain compliant with LLP Security requirements while on their networks and applications
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3 © All Right Reserved – BearingPoint 2003 2002 – 2005 Separation & Migration Defined MPLS as the WAN protocol in order to accommodate significant network reconfigurations resulting from acquisition activity, mitigate point- to-point latency, support adoption of VoIP and lower data transfer costs Outsourced messaging to HP due to acceptability with the solution we had implemented at KPMG International – a necessary interconnect point for various LLP entities (adopted.com,.net, and.biz naming convention) Established ‘A’ & ‘B’ network architecture to remain compliant with LLP full separation security requirements while permitting minimal BE support to users still in an LLP environment Began migrations to new BE computing environment – terminating most TSA’s with the first year where there were no early termination penalties Established HP’s CXO site as network core and began migrating BE applications (e.g., PerForm/Reward$, Inside BearingPoint, APS/AccPac) Early terminations of TSA’s allowed savings to be harvested by eliminating redundant services and solutions (US TSA language required full 4 years) Migrated every office, server, desktop, telephone, application, byte of data, at every site on time, within budget and with no significant interruptions!
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4 © All Right Reserved – BearingPoint 2003 2003 – 2006 Integration & Consolidation Adopted an Active Directory (AD) enabled architecture that allows user credentials to be passed between the network and applications as a means of user authentication – an initial step towards a single sign-on environment Eliminated national systems providing messaging, HR, CRM, Finance, Payroll, etc. which was complicated by the Andersen acquisitions as in many cases the support infrastructure was collapsing along with the parent firm, in many cases being acquired by BearingPoint competitors – global applications were placed in the network core Undertook IT initiatives to define requirements for OneTeam (HR), OneView (CRM), OneGlobe (F&A – which was deferred due to lack of ability to create a steering committee), OneSuite (ancillary applications) – each was delivered by BE professional services teams once IT Steering Committees defined requirements – they were then outsourced for hosting and/or apps management Created the Enterprise Integration Broker (EIB) middleware platform to allow parallel systems design while maintaining a design parameter that across systems each discrete data element should have a single authoritative source – a publish and subscribe databus to prevent re-keying, reduce errors and lower operating costs Deployed IPT as a replacement for numerous disparate telephone systems and created an AD-enabled platform to provide decision support applications
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5 © All Right Reserved – BearingPoint 2003 2005 – 2008 Optimization This is the period where IT shifts its focus from migration to engagement support – separations are complete, the need to fully segment ‘A’ & ‘B’ networks is past, the opportunity to leverage the BE IT professionals, processes and technologies presents the potential for increased revenue yield The focus area for IT cost reduction contributions similarly shifts from pure IT operating cost to reductions in corporate SG&A (e.g., policy compliance, consolidation & integration of IT services across the firm, best practices for outsourcing, risk management with regard to engagement activity, etc.) SG&A impacts should be approximately $8M-$12M/year through this planning period IT partners with the Business Units to define, repeatable solutions for client delivery ranging from engagement office designs to remote user technologies; from BE developed internal solutions to emerging technology support; and from audit compliance support to improved financial system operations and reporting OneGlobe moves into IT in order to operationalize the environment and facilitate creation of a successful Financial Transformation plan which charts a path forward for consolidation and integration of financial systems The Office of the CIO should become an advocate for the business units, reinforcing the message to the client and analyst communities, reestablishing our credibility as a capable and trusted systems integrator and business partner; internally IT is recognized as one of the primary business enablers
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6 © All Right Reserved – BearingPoint 2003 IT Department 2006 Team Goals Primary 2006 Goals: Fully transition our IT focus from separation and migration to consolidation, integration and optimization Support the reduction of corporate SG&A costs using the IT tools and processes we have developed Work to stabilize the OneGlobe application into an ‘operations state’ Strengthen the end user computing focus by enhancing the employee-client interface Leverage our internal solutions in support of market facing engagement teams (IPT, EIB, etc) Transition IT procurement to the Procurement department Continue 2005 IT Image Program – speaking at national conferences on BE Optimization activities People: Reestablish a 90%+ long term retention rate within our group – highlight value of IT team Focus on end user satisfaction – accelerate Advisory groups & BU UAT implementations Emphasize integration with OG, MSO, GDC, Infrastructure and engagement teams Consolidate functional IT organizations where practical Participate in the 3600 feedback program when available Budget accountability rests with the Project leads as identified in OG Process: Continue Operations Reports, Policy & Procedures, Controls documentation and postings Expand Scope&Approach process as a critical tool for corporate IT Portfolio Management Adopt a structured workplan management structure for OneGlobe modifications Improve tools and processes in support of SOX 404 - emphasis on SDLC across major applications Improve tools and processes in support of DCAA audit requirements Institutionalize compliance monitoring processes to mitigate risk and reduce SG&A costs Integrate Financial dashboards into our monthly review process (we are supposed to get them this year) Elevate quality of IT planning documents for corporate wide disclosure – add new IT subcomponents (e.g., Finance Transformation) Transition all IT procurement functions to the Procurement department to insure compliance with DCAA regulations Technology: Develop an IT Training program for end users in conjunction with CLD - define role of IT, helpdesk, procurement, etc for employees - identify technologies available for internal and external work - emphasize current support for home, client site and other remote workspaces - reduce IT support costs Develop architecture templates for client facing environments (offices, BSC’s, GDC’s, on-site client teams) Support adoption of an on-line procurement solution for IT items requiring no secondary approvals Assist OneGlobe technical support in transition to an ‘operations team’ Complete execution of stabilization projects currently underway
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7 © All Right Reserved – BearingPoint 2003 Industry Recognition! McLean, Va., September 12, 2006 – BearingPoint, Inc. (NYSE: BE), one of the world’s largest management and technology consulting firms, today announced that it ranked 38 on the 2006 InformationWeek 500 list. After ranking 297 in 2004 and 274 in 2005, BearingPoint earned top 50 status this year, moving up 236 spaces. For the past 18 years, InformationWeek has identified and honored the nation’s most innovative users of information technology with its annual listing. The list is unique among corporate rankings because it spotlights the power of innovation in information technology, rather than simply identifying the biggest IT spenders. “The InformationWeek 500 honors today’s leading companies who set the benchmark for business technology strategies and projects,” said InformationWeek publishing director, Fritz Nelson. “The companies on our list are some of the most innovative users of technology.” BearingPoint leaped ahead in InformationWeek’s ranking due to a major overhaul of key internal IT services, including the successful launch of a company-wide VoIP system and a leading-edge SAP implementation in Germany. Additional details on the InformationWeek 500 can be found at www.informationweek.com/iw500/.http://www.informationweek.com/iw500/www.informationweek.com/iw500/ Extract from BearingPoint Corporate Communications press release:
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