Driving eTransformation

1
Driving eTransformation

• Australia and New Zealand Banking Group Limited
• David Boyles
• Chief Operations Officer

2
Todays Agenda

• ANZs eTransformation Strategy
• Laying the foundations for successful
  eTransformation
• Focus on People, Customers, Process
  Infrastructure
• Examples Infrastructure Rationalisation
• Examples Leadership in web-based technologies
• ANZs approach to internal eTransformation
• The PeopleSoft Partnership
• Key Learnings

3
Continuous Productivity Improvement - ANZs way
of life
Cost leadership
Provides the opportunity to
CTI

• Rationalise standardise our infrastructure
• Implement web-based technologies across a vast
  range of platforms processes
• eTransform our internal processes

Target Mid 40s
4
ANZs Strategy

• Building a portfolio of stand-out businesses with
  distinctive business leadership and a sustainable
  top 3 position that work as one ANZ

• Embracing technology to drive radical change,
  boost productivity, accelerate innovation and
  dramatically improve service and value

eTransform

• Ensuring best in class performance for
  shareholders, customers, staff and the community

Perform

• Demonstrating strong growth momentum in core
  businesses and positioning ourselves in
  attractive new high growth categories

Grow

• Being bold and different, a high performance
  culture with a human face, technological
  leadership and a strong domestic and regional
  strategic position

Breakout
5
Laying the Foundations for Successful
eTransformation

• Starting in 1998 we made some key commitments
  involving People, Customers, Process and
  Infrastructure
• People Alignment, collaboration team work.
  Environment where individuals can excel. Retain
  critical individuals.
• Customers Customer feedback processes
  accountability, meaningful service levels, align
  with BU, implement TQM.
• Process Consistent project management standards,
  strict criteria for new investment in
  applications, rationalise standardise
  operational processes.
• Infrastructure reduce costs, rationalise,
  consolidate automate networks platforms.
  Position for the future. Reposition backend
  product functions behind integrated service
  frontend.

6
We rationalised and standardised our
infrastructure
Core Systems
Internet Protocol (IP) network
1998 6 major systems
2001
1998 Multiple data networks
2000

• Single IP Network provides universal connectivity

• Simpler systems platforms reduce cycle times

Platforms
Servers Desktops
1998 8 major platforms
2002
1998
2002
W2K
UNIX
MVS

• Provide all staff with best tools possible
• Low cost of ownership through standard solution

• Greater ability to leverage new technologies
• Lower hardware, software licence fees support
  costs

7
Leadership in Web-based Technologies

• PAYplus Global Payments Platform
• Standardised processes for enhanced product
  development
• Reduced operating and technology costs
• Improved operational risk management
• VIPS - Visual Image Processing System
• Improved customer service through faster
  retrieval
• Enables eTransformation to customer self
  service via Internet
• Eliminates geographic dependency on paper
  allowing stream lining of processes
• Lowest unit costs from one pass data image
  capture

8
Web-based Technologies for a Range of Platforms

• Tandem Replacement Project
• New lower cost base platform for EFTPOS ATM
  switching
• Achieving high availability high transaction
  performance
• Microsoft Windows 2000 Platform for Branches
• Server work stations deployed to 1000 branches
  across Australia New Zealand to support new
  sales service application
• Deployment also provided all branch staff with
  enterprise standard email intranet
• Proof of Concept of MS SQL 2000 for new data
  warehouse

9
Positioning for Internal eTransformation

• Online self service is not new to our people
• eTransformation from the top down - Board and
  CEO eTransformed using Directors online
• Introduced a common intranet (Max)
• Key people functions moved online - business
  process maps, Manage My Leave, Manage My Pay
• PCs_at_home offer taken up by 13,000 of our people

10
Our Approach to the eTransformation of Internal
Processes

• Set Clear Objective
• To move to online, standardised, real time
  processing, with Internet capability and wherever
  possible, self service environments.
• Prioritise Strategic Opportunities
• Identify and reengineer key business processes

11
PeopleSoft

• One area identified early on was the need for a
  common, standardised administration system or ERP
  we chose PeopleSoft
• PeopleSoft met all our mandatory selection
  criteria
• HR functionality was tailored to Australian
  regulatory environment
• General ledger structure is a good fit to our
  operations
• Technology fits well with our architectural
  standards
• Relationships were effective and at the
  appropriate level

12
Building on Microsoft Windows to Deploy
PeopleSoft 8

• In the midst of deploying PeopleSoft 8 on MS
  Windows 2000 and MS SQL 2000
• MS Windows 2000 is our standard desktop operating
  environment
• MS Windows 2000 is also our standard for
  application servers running
• MS Windows 2000 has the lowest projected Total
  Cost of Ownership in comparison to other options
  we examined
• ANZs PeopleSoft implementation is one of the
  largest on this platform in the world

13
Scope of our PeopleSoft Implementation

• Vanilla implementation
• Processes changed to fit the software
• Focus on people impact change management
  training
• Major modules
• - Procurement
• - Human Resources / Payroll
• - Fixed Assets
• - Accounts Payable
• Finance (General Ledger)
• Will cover 22,000 staff in Australia New
  Zealand in 5 releases over 12 months 5th
  release in September 2002
• Pushing the time / cost boundaries

14
Organisational Impact

• Changing the way we work, rather than the core
  system low customisation

Low Customisation Major change to processes and
jobs significant business change
Change to ANZs existing processesand job
structure
Low
stakeholder impact zone
Low
High
Degree of package customisation
Degree of package customisation
15
Internal eTransformation Benefits

• People
• Empowerment and satisfaction
• Transformation of culture real time high
  velocity execution, delivery of web-based
  information anytime, anywhere, any place,
  straight-through automation
• Productivity
• Faster, easier and more cost effective ways of
  working
• Easier capture and use of business information
• Consistent business platform across ANZ
• Reduction in operational risk
• Costs
• Reduction in HR, finance administration and
  procurement spend greater control of fixed
  assets

16
Internal eTransformationKey Learnings

• Need strong sponsorship/leadership from the CEO
  down
• Strategic architectural framework established
  early
• Project leaders must make key decisions with
  broad impacts not always time to consult
• Full resource commitment right quantity, right
  skills
• Vanilla discipline vigorous scope control at
  all levels
• Hard decisions taken up front in the PeopleSoft
  implementation
• - restructure of chart of accounts for the
  general ledger
• Significant reduction of vendor base from more
  than 18,000 to approximately 5,000
• Be ruthless on inefficiencies take the
  opportunity to re-engineer your processes