We are pleased to share with you our discussion with Don Mailliard, the lead partner responsible for KPMG Powered Enterprise, as we set out to explore KPMG Powered Enterprise. Read on to find out about what it is, does and what value it provides to our clients across the world.
1. Don, if I was a CXO and you’d caught me at the coffee machine for a minute, how would you explain what Powered Enterprise is all about?
Powered Enterprise is all about successful functional digital transformation. Many people in established firms see digital transformation as a threat – a way for their competitors to steal a march on them or for new entrants to enter their markets, but most CEOs see it as an opportunity to transform their business – and we agree with them.
But many firms have a poor track record on realising value from new technologies, let alone using technology as a way of transforming their key business functions. Powered Enterprise is designed to redress that balance and dramatically increase the likelihood of success.
2. But it’s more than just a technology implementation tool is it not?
Very much so. Powered Enterprise is a collection of proven tools, methods, leading practice and know-how to get a business function such as HR from where it is now to where it needs to be. Taking HR as an example, typically the best way to fast-track a functional transformation is to replace the legacy admin system with a modern one, often cloud based.
However, that’s where many firms have in the past come unstuck. For whatever reason they haven’t had the wherewithal to manage that transition and/or to maximise the opportunity it should bring. They may have failed to do so because of a lack of in house skills or maybe because there was a gap between what they can do and what the software provider can do, or where consultants have been involved, the project may have become overly complex and costly, resulting in it being curtailed before the benefits have been realized.
When we set out to create Powered Enterprise, it was with a mission to close those skills gaps, overcome ambiguity, and de-risk a major change program that is required for a technology platform implementation.
3. So, it always involves a technology platform change?
Typically yes, although we do not necessarily require it because the Target Operating Model is still very relevant for functional transformation. However, without it, it is more difficult for the business function to create a modern future state that meets the needs of the 2020s and to adapt to change beyond that. KPMG professionals work closely with the key technology providers across the key business functions of HR, Finance, Procurement, Supply Chain, Sales & Service. Those providers include Oracle, Workday, ServiceNow, SAP, Salesforce, Coupa and Microsoft. We have in depth knowledge of what these platforms can achieve, but the real value of Powered Enterprise is how to build functional best practice on and around these platforms in a manageable, low risk way.
That’s why we’ve invested heavily in a tangible skillsets and assets within the Powered Enterprise family that act as the enabler for managing this change and delivering transformation. The potential value for the client is that they just don’t implement what they already have onto a modern platform, but that they take the opportunities that modern technologies offer to automate wherever possible, to exploit artificial intelligence, to build agile functions and processes and to give themselves an ability to drive future successful change. This is what we mean by functional transformation.
4. You mentioned the Powered Enterprise ‘family’ what specifically does it include?
That’s a great question. To answer it, I’m going to go back to state the problem we set out to achieve with Powered Enterprise – and that is as follows:
If you accept that functional transformation is our market’s goal, and that it is best served by replacing legacy with a modern, (often cloud based) digital platform, and you accept that very often technology driven business change programs at large enterprises have not delivered the expected benefits (where they have delivered anything at all), then the gap Powered Enterprise set out to close is as I mentioned earlier – how do we get a clients’ main business functions from where they are now to where they need to be?
In our experience, those gaps were firstly to overcome the ambiguity (or increase the certainty) of the eventual future state. You could call this the transformational target.
Secondly, there’s the question of how do you actually best support a firm in managing that project?
Thirdly, who has the skills to actually perform the transition?
And fourthly, how do you best manage on an ongoing basis to keep delivering business value while the world around you is evolving?
Taking these in turn, we’ve developed the TOM – the target operating model that maps out the future state of the function based on their preferred cloud technology solution (eg. Workday). It gives the stakeholders surety around where they are heading to and why, with measurable business value.
To support the transition itself we have an integrated collection of methods and tools we call the Powered Execution Suite. This is our implementation added value that takes a client from where they are now and helps them move to the pre-agreed (and pre-defined) target operating model.
To address the third problem of who has the skills (together with the inevitable question about how you manage down project people costs), we’ve built out the Powered Enterprise Global Delivery Network – the GDN. The GDN is a three-tier delivery capability that leverages the client/market expertise of our local consultants, supported by a wider regional Powered Enterprise team (eg. North America) and exploits the expertise and cost benefits of having access to global Powered Enterprise delivery hubs, our first one is located in Bangalore. This three-tier delivery strategy is a classic use of rightshoring.
Lastly, once live, we have our Powered Evolution team which are entirely focused on helping clients to continually deliver value from their Powered Enterprise Solution for years to come.
5. That all sounds great Don, but how does it differ from the competition? Oracle for example have many implementation partners, so couldn’t any of those deliver a successful Oracle Finance project?
If I go back to my basic marketing training, any proposition worth its salt needs to be compelling, unique and defendable for the market to believe in it strongly enough to pay good money for it.
So, is the Powered Enterprise proposition compelling? Well, whenever I speak to functional CXOs, the problem they are always wrestling with is how to meet the demands of their CEOs to deliver more value back to the business, how to exploit digital technologies and data, and the biggest problem of all, how to get their people to do it – not only once, but on an ongoing basis. Anything that overcomes those issues is compelling to them, believe me!
Is Powered Enterprise defendable? Yes, absolutely it is. We can point to our client success stories, which are ever growing. These success stories are beginning to cover the biggest industries (Retail, Financial Services etc.) across all of our target functions (Finance, HR, Sales & Service etc.) and are even now beginning to provide us with client success reference points for each of the components within Powered Enterprise (the TOM, the GDN etc.). My ambition is to have a Powered Enterprise client success story for every function in every industry across each geography.
How unique it is requires a bit more thought. So here goes:
Let’s start with the TOM. We’ve put a huge investment into this. It covers the six key design layers needed to design and build functional transformation – The functional processes, people skills and roles, the target service delivery model, how the technology is to be deployed, what the main performance insights should be and how to present them, and what governance framework is needed. This is where the main visioning and validation takes place. This is how we close the ambiguity gap.
We now have 17 detailed assets within the TOM. We should cherish these because they add significant value to a transformation program.
Now let’s consider the Powered Execution Suite. This is an integrated set of tools that provides a centralized, collaborative way of working that is populated with content that is tailored to the specific characteristics of the client’s transformation journey. This drives greater engagement from day one, promotes better adoption, delivers quicker speed to value and mitigates risk by providing more certainty around expected outcomes. By itself, the Powered Execution Suite is a very powerful capability. Coupled with the Target Operating Model, it may be unrivalled.
But let’s not stop there because the investment we’re putting into developing the GDN is significant – and for good reason. Based on what we’ve experienced in the last year or two, we expect Powered Enterprise to become one of the most significant income streams for KPMG. We think it is the right solution for the market right now. So often in the past we’ve seen other firms become victims of their own success. The GDN is our strategy for ensuring that we can meet the demands of the market for Powered implementations, but to do it in such a way that we leverage one of our key strengths – our global business with local expertise. The GDN will help us to fulfil our Powered commitments in a consistent, high quality, timely manner. By leveraging local, regional and global Powered expertise we can deliver projects in all of our chosen markets across each of our geographies. Given that many natural clients for Powered Enterprise will be multi-national firms with their own global service delivery models, we’ll be able to demonstrate that KPMG people can support their functional transformation in whatever location (or set of locations) they wish.
Last but not least, are the Powered Evolution services. These are a set of services and support to drive continuing evolution once the transformation program has gone live. As well as catering for the usual needs such as application maintenance and release & configuration management, we offer ongoing knowledge management and value management that helps clients adapt to their changing landscape typically driven by regulatory changes, mergers & acquisitions, evolving technologies and the continuous need to drive hard at costs.
Again, the GDN is of great benefit here as it allows us to deliver Powered Evolution from a choice of global Powered centres of excellence.
Are each of these four elements of the Powered Enterprise Solution unique? Maybe, maybe not. Certainly, we’ve not seen any evidence that anyone else has something as well developed as the Target Operating Model. However, you can be sure that right now, the combination of these four elements is unique in the market.
So, back to your question – couldn’t other cloud vendor implementation partners deliver functional transformation? The answer is ‘yes, probably’. But can they do it in the same way? Can they add the same business value? Can they de-risk a transformation in the way that we can? And can they do all this irrespective of their industry, location, internal capability and culture?
I would say not. I think in that, Powered Enterprise is unique.