Profitability AnalysisPeter Wells – Head of Projects & Delivery

Agenda

•Introduction to Sthree PLC

•Addressing Business Issues

•The Science Bit

•Keys to Success

•What’s Next?

Introduction to

Contract and Permanent Staffing

Launched in 1986

Sector: ICT

Launched in 1995

Sector: Banking & Finance,

Engineering & Energy ICT

Launched in 1990

Sector: Engineering & Energy, Oil

& Gas, Life Sciences & ICT

Launched in 1990

Sector: Banking & Finance, Life

Sciences & ICT

Launched in 2013

Sector: Fin Services Senior Roles

Launched in 2013

Sector: Enterprise Applications (SAP)

Multi Brand Model

Global Footprint

48 Offices

19 countries

Operational Highlights:

Group Headcount circa 2,500

Continued Sector Diversification – 60% non ICT

Strong Performance in Energy & Life Sciences – 30% of GP

Continued Global Expansion

Financial Highlights

PAP

Addressing

Business Issues

Reasons for the Project

Improved Business Intelligence

- Improving Profitability reporting through improved Business Intelligence aligning to Group Strategy

- Provide improved data quality and reporting to support decision making, both within the finance

function and across the business, including the Front Office.

- This will also provide improved visibility of profitability by client to support the move towards a more

customer focused strategy.

Strategic Enablement

- A key feature of the proposed PA solution is that it includes substantial redesign of some of the core

organisational structures and objects in the SAP ERP system. The current design is a legacy of poor

design decisions in the past

- This has resulted in a SAP solution which is significantly constrained and not fit for purpose in the

context of future expansion and management reporting currently built on top of it.

- Getting these things right is vital first step to enable projects on the HR and Finance Roadmaps.

Efficiency/Cost Savings:

-Time savings arising from removal of manual or inefficient current activities, such as reporting, data

manipulation, reconciliation, spreadsheet analysis.

We are not leveraging

our investment in

technology

Sponsor (CFO)

Business Managers

CEO + Directors

HR

HR Org Structure

doesn’t service HR needs

due to finance

& sales dependencies

I can’t see which parts of the

business are performing

well and which aren’t

Strategic direction

of Sthree could be

negatively affected

due to poor

information

Inaccurate reporting means

I can put measures in place

to improve profits

I want to see true office

and sales team profitability

SAP Solution inflexible and

heavily dependent on IT

Finance

IT

We are often seen

as a blocker to change

Difficult to deal with

organisational change

We need standard, automated &

scalable solutions to

support business growth

Manual Allocations of

Costs time consuming

& difficult to trace back

Minimal Overhead

allocations means I

can’t see true

profitability.

We can’t deliver true

insight for the business

to make decisions that

will increase profitability

SAP HR

Is restricting our

roadmap for change

Addressing Business Issues

From this…. Switch to Cost Centre &

PCM

To this…

Before & After

We’ve started & can

continue to leverage

our investment in

technology

Sponsor (CFO)

Business Managers

CEO + Directors

HR

The HR Org structure

Is now servicing needs

I can see which parts of the

business are performing

and which aren’t.

This is a real eye opener

I have clear and

detailed information to

map out the Strategic

direction of Sthree

Accurate reporting

means I can put

measures in place to

improve profits

I can see true office and

sales team profitability.

More flexible systems,

less dependency on IT.

(ECC, PCM and BOBj)

Finance

IT

Sometimes we don’t

even need to be

involved with changeSAP is more standard

and scalable to support

business growth

Allocating costs is

more automated,

accurate and less

time consuming

Fuller, more accurate

allocation of overheads

means I can see my

true profitability

Our reporting

delivers true insight

to drive strategic

Decision making

SAP HR

is enabling our

roadmap for change

Business Issues Addressed

The Science Bit

– Provide Office, Team, Client, Sub-Territory profitability at a detailed level using Business Objects (v3.8)

– Standardise SAP structures (FICO, HCM in ECC6) to provide flexibility to support on-going business change.

– PCM to be used to automatically allocate costs and provide information for more detailed and accurate profitability analysis

– Use of SAP’s recommended FIM Solution for managing data flow to and from PCM

– Process re-engineering to ensure capture information is accurate and efficient

– COPA to be used to capture more granular segmentation of sales and cost of sales (later phase and ongoing)

Technical Solution

EDW

BW

ECC

PCM

MAP

SD/MM

FICO

SD/MM

FICO

1

1. Base data feeds into BW from ECC & BOBJ

2. ECC data transformed & feeds PCM

3. PCM results fed back to BW for

dissemination

4. PCM Allocations provided to EDW for

integration with enterprise data

5. Management Account reports produced

within Business Objects

HCM

PCM

HCM

FIM

Bu

sin

ess O

bje

cts

1

1

2

3

4

5

CO-PA CO-PA

Office P&L

Revenues

ContractorDirect Costs

Gross Margin

Sales TeamDirect Costs

Local Contribution

Indirect Costs

Country Contribution

Head office costs (allocated)

Profit Before Tax

PAP System Architecture

Cost Allocations with PCM

PRESENTATION TITLE PAGE 16

CHOICE OF QUICK OR RICH INTERACTIVITY

PDF - Group PDF

Division

Brand

Country

Sector

Interactive - Group Interactive

Division

Brand

Country

Sector

Interactive – Team-level

WebIntelligence

Keys to Success

Project Structure & Governance

Collaboration is Key

Keys to Success

– Make it about Real Business Issues

– Ensure you have the correct project structure & governance

– Ensure the right level of business involvement

– Collaboration with Implementation Partner and Business

– Change Management is key

What’s Next?

What’s Next?

– COPA Rollout – increased granularity (e.g. candidate specialisms)

– ROAMBI Visualisation (now Live for Exec)

– BI Upgrade (Improving Performance, use of wider toolset)

– Improved Client Profitability

– Moving BI and ECC to the Cloud..

Any Questions