P4075-R: Nextel - Financial, HR, Procurement Systems Overhaul Project: Executive Vision Follow-up Session

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GOVERNMENT EXHIBIT P4075-R

Slide 1

Financial, HR, Procurement Systems Overhaul Project

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Executive Vision Follow-up Session - 09/26/02

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HIGHLY CONFIDENTIAL


Slide 2

Agenda

  • Hackett Summary of Benchmark Findings 12:30 pm - 1:30 pm
  • FSO Summary of Findings to Date 1:30 pm - 2:45 pm
  • Resulting findings of Joint Hackett/FSO Brainstorming Session 2:45 pm - 3:00 pm
  • Break 3:00 pm - 3:15 pm
  • Straw-man Vision 3:15 pm - 3:45 pm
  • Project Approach Recommendation 3:45 pm - 4:15 pm
  • Business Case Model 4:15 pm - 4:45 pm
  • Budget Process 4:45 pm - 5:00 pm
  • Schedule and Next Steps 5:00 pm - 5:45 pm

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Slide 3

Hackett Summary of Benchmark Findings 12:30 pm- 1:30 pm

  • Benchmarking is a proven tool to identify and "steal" best practices
      Þ Establish a baseline of the current state
      Þ Determine gap across five dimensions in comparison to world-class companies
      Þ  Evaluate key drivers of dimensions
      • Best practices utilization
      • Partnering capabilities
      • Staffing utilization
      • Technology utilization
      Þ Identify and prioritize short- and long-term opportunities
      Þ Establish goals and measure progress
      Þ Define tangible benefits and next steps

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Slide 4

Hackett Summary of Benchmark Findings 12:30 pm- 1:30 pm

Nextel Business Functions Were Measured Across 5 Areas

World Class

Strategic Alignment
Value

  • Linkage to business strategy

  • Communication of strategy
Efficiency
  • Evidence of finance strategy
  • Strategic planning results tracked

Process
Value

  • Meeting req./satisfaction
  • Quality of reporting output]
Efficiency
  • Cost per transaction
  • Total process cost

Partnering
Value

  • Capability of external partners to gain access to internal applications
  • Collaboration with suppliers/customers
Efficiency
  • Viewed as partner in decision making
  • Online application usage - internal

Technology
Value

  • Use of available functionality
  • Information on demand
Efficiency
  • Application complexity
  • Integration

Organization
Value

  • Utilization of managers and professionals
  • Selective use of outsourcing
  • Overall staffing level
Efficiency
  • Staff mix/span of control

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Slide 5

Hackett Summary of Benchmark Findings 12:30 pm- 1:30 pm

Finance overall scorecard - DRAFT

Summary chart showing the finance overall scorecard [D] Value Summary
  • Application complexity is relatively low; high usage of available system functionality
  • Managers' time allocation is heavily skewed towards transaction processing activities
  • On-line exchange of information with external stakeholders is lacking
  • Communication by Finance rated as poor to good
Efficiency Summary
  • No evidence of a strategy for Finance
  • High total costs and staff level compared to 1Q
  • Analysts' spend 75% of their time gathering/collecting data
  • Several processes have a low cost per transaction
  • Collaboration between Finance and business operations is not consistent

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Slide 6

Hackett Summary of Benchmark Findings 12:30 pm - 1:30 pm

HR overall scorecard - DRAFT

Summary chart showing the HR overall scorecard [D] Value Summary
  • Percent of change efforts tied to business strategy is high
  • HR proactively researches strategic business opportunities
  • Service level agreements are used to a high extent
  • Company information made available weekly
Efficiency Summary
  • Hours of required training is low
  • Cost per EE is 4th quartile
  • A formal documented HR strategic plan is only being utilized to a medium extent
  • High manager staff mix
  • Communication to employee about change midway through project
  • Specific targets, scorecards and goals only built into success criteria 50%
  • High percent of time collecting data instead of doing analysis

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Slide 7

Hackett Summary of Benchmark Findings 12:30 pm- 1:30 pm

Procurement - Overall scorecard - DRAFT

Summary
High




Value
Procurement
adding value to
the organization
REDACTED Value Summary
  • Procurement strategy is not communicated
  • Limited partnering with suppliers
  • Limited access to Web/electronic application functionality
  • Relative low usage of best practices
Efficiency Summary
  • Basic Procurement activities done manually
  • Limited utilization by procurement of cross-functional teaming
  • Staffing levels are lower than first quartile
  • Low productivity/High process cost
Low High  
  Efficiency
How efficient the
Procurement function is in
performing its role
  

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Slide 8

Hackett Summary of Benchmark Findings 12:30 pm - 1:30 pm

  • Nextel should not have the expectation that we can be a 1st quartile player in every area within one year
  • A "home run" would be 15% improvement in each of the next 4 years
  • Summary of functions with the biggest opportunity for improvement/savings:
      Þ Finance
      • General Accounting
      • Reporting
      • Budget Planning/Forecasting
      • Order to Cash functions (AR, Collections, Credit, Billing)

      Þ Tax

      • Financial Reporting
      • Planning
      • Tax Report Filings

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Slide 9

Hackett Summary of Benchmark Findings 12:30 pm - 1:30 pm

  • Summary of functions with the biggest opportunity for improvement/savings:

      Þ HR

      • Payroll
      • Benefits Administration
      • Information Management
      • Recruiting and Staffing
      • Learning and Development
      • Organizational Effectiveness
      • Compensation Administration

      Þ Procurement

      • E-sourcing - online RFP/RFQ
      • E-online auctions
      • Electronic Invoicing/order acknowledgement
      • Establishment of end to end procure to pay process
      • Material Receipts
      • Supplier Performance Management
      • Contract Management

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Slide 10

FSO Summary of Findings to Date 1:30 pm - 2:45 pm

  • Project Assumptions

      Þ Wherever possible, software will be off-the-shelf, with minimal customization.

      Þ  Use industry-leading Best Practices as input to the software selection process.

      Þ After software solution is selected, business processes will be based on Best Practices of the software chosen, except as where noted by SMEs.

      Þ Requirements will be based on Best Practices and off-the-shelf functionality. Gap analysis will be performed to determine unique functional needs.

      Þ We want to create a unique, accelerated procurement process for this project.

      Þ Fewer systems are better (interface points are the weakest part of the infrastructure).

      Þ We will consider outsourcing functions in order to be world class.

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Slide 11

FSO Summary of Findings to Date 1:30 pm - 2:45 pm

  • Project Assumptions

      Þ The interface between Atlas and Oracle could be problematic and may dictate part of the solution.

      Þ We want to use electronic signatures whenever possible.

      Þ We want to build in work flow wherever possible.

      Þ We should eliminate duplicate data wherever possible.

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Slide 12

FSO Summary of Findings to Date 1:30 pm - 2:45 pm

  • Project Scope
Included Business Functions
Human Resources Accounting & Finance Supply Chain Tax
Benefits Accounts Payable
Asset Mgmt

Tax Prep
Career Dev& Planning &
Competency Tracking
Accounts Receivable Auctioning Financial Reporting
Compensation Budgeting Catalog Mgmt
POS
   Cash Tracking Contract Mgmt
Service
Contractor Tracking Commissions Distribution Requirements
Planning
Use Tax
Employee Admin Consolidation eCommerce
TEMS
Employee Communications Cost Accounting    Contract Review
Employee Relations Expense Reporting Forecasting
Planning
Mergers, Acquisitions,
Restructurings
Financial Planning Inventory Mgmt
Incentives
Performance Mgmt Financial Reporting
MWBE and supplier database

Research
Policies and Procedures Fixed Assets P.O. Accruals
Recruiting Forecasting Property Management
Tax Report Filings
Succession Planning General Ledger
Receiving Goods

Payments
Surveys Handset Inventory Requisition
Reconciliations
Termination Processing Journal Entry RFP Adjustments
Training Payroll Supplier Scheduling
Unclaimed Property
Transfers and Relocations Project Accounting Vendor Eval Audits & Litigation
Workfoce Planning/Staffing Revenue Mgmt Work Order Mgmt Property Tax Filings
Workforce Deployment T&E Processing Assessment Review &
Controls
Tax Payments & Verification
Data Warehouse
Business Intelligence
Compliance
iConnect
IT Infrastructure
Engineering Operations
Imaging

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Slide 13

FSO Summary of Findings to Date 1:30 pm - 2:45 pm

  • Project Scope
Other Organizations
Billing
Cell Site Tracking
Collections
Corp. Financial Strategy
Corporate Communications - Employee Communications
Customer Care Productivity
Downstream Reporting Tools from DW
Employee Phone Fulfillment
Extemal Business Relationships (Boost, NPI, NII.EDS, IBM Teletec, USI, Amdocs,)
Legal Contract Mgmt
Legal Litigation
Legal Security/Privacy
Nextel Retail
Product Mgmt - Product Profitability
Revenue Assurance
Sales Commissions/Direct&lndirect
Sales Distribution/Direct&lndirect
Sales SFA
Spectrum Tracking

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Slide 14

FSO Summary of Findings to Date 1:30 pm - 2:45

Human Resources

45 Human Resources   [D]

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Slide 15

FSO Summary of Findings to Date 1:30 pm - 2:45

Human Resources

45  Human Resources [D]

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Slide 16

FSO Summary of Findings to Date 1:30 pm - 2:45

Accounting & Finance

45  Accounting & Finance [D]

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Slide 17

FSO Summary of Findings to Date 1:30 pm - 2:45

Accounting & Finance

45  Accounting & Finance [D]

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Slide 18

FSO Summary of Findings to Date 1:30 pm - 2:45

Tax

45 Tax   [D]

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Slide 19

FSO Summary of Findings to Date 1:30 pm - 2:45

Tax

45  Tax [D]

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Slide 20

FSO Summary of Findings to Date 1:30 pm - 2:45

Supply Chain Management

45  Supply Chain Management  [D]

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Slide 21

FSO Summary of Findings to Date 1:30 pm - 2:45

Supply Chain Management

45 Supply Chain Management   [D]

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Slide 22

FSO Summary of Findings to Date 1:30 pm - 2:45

Overall Collective Rankings

Data for this graphic was the result of numerous consulting firms numerically ranking leading software vendors (1, 2, 3, etc., with 1 being the most favorable) across identified business functions within Human Resources, Supply Chain Management, and Accounting & Finance.

Overall Collective Rankings[D]

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Slide 23

FSO Summary of Findings to Date 1:30 pm - 2:45

Overall Rankings Summary by Firm

Data for this graphic was the result of numerous consulting firms numerically ranking leading software vendors (1, 2, 3, etc., with 1 being the most favorable) across identified business functions within Human Resources, Supply Chain Management, and Accounting & Finance.

Key Takeaways:
  • Different firms have different preferences
  • Deloitte and CGEY dramatically prefer Oracle overall
  • KPMG, PWC, and Answerthink prefer SAP overall, though only marginally

Overall Rankings Summary by Firm

[D]

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Slide 24

FSO Summary of Findings to Date 1:30 pm - 2:45

Human Resources Ranking Summary

  PEOPLESOFT
(8.x)
ORACLE
(11i)
SAP
(4.6x)
KPMG Consulting Logo1.001.301.30
Deloitte Consulting Logo1.651.851.70
CAP GEMINI ERNST and YOUNG Logo1.001.091.00
Price Waterhouse Coopers Logo1.441.881.75
answerthink Logo1.061.111.28
AVERAGE1.271.531.44

Lowest rankings are preferred (and highlighted)

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Slide 25

FSO Summary of Findings to Date 1:30 pm - 2:45

Accounting & Finance Ranking Summary

  PEOPLESOFT
(8.x)
ORACLE
(11i)
SAP
(4.6x)
KPMG Consulting Logo1.001.001.00
Deloitte Consulting Logo1.731.091.82
CAP GEMINI ERNST and YOUNG Logo1.391.001.72
Price Waterhouse Coopers Logo1.521.191.14
answerthink Logo1.271.181.27
AVERAGE1.411.071.42

Lowest rankings are preferred (and highlighted)

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Slide 26

FSO Summary of Findings to Date 1:30 pm - 2:45

Supply Chain Management Ranking Summary

  PEOPLESOFT
(8.x)
ORACLE
(11i)
SAP
(4.6x)
KPMG Consulting Logo2.261.951.63
Deloitte Consulting Logo1.631.001.63
CAP GEMINI ERNST and YOUNG Logo1.441.281.44
Price Waterhouse Coopers Logo1.581.211.11
answerthink Logo1.781.391.06
AVERAGE1.731.361.45

Lowest rankings are preferred (and highlighted)

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Slide 27

FSO Summary of Findings to Date 1:30 pm - 2:45

Industry Summary

Key Takeaways:
  • Majority of HR systems are Peoplesoft; Majority of Financial systems are Oracle; a wide variety of tools are used for SCM.
  • 13 of the 45 companies use a combination of Peoplesoft HR & Oracle Financials
Industry Summary[D]

Peer Sample (most company data was provided anonymously):

Vodafone, Sprint Wireless, France Telecom, Nortel, SBC, Deutsche Telecom, AT&T, Weblink Wireless, Bell South, Lucent Network Services, Cingular, IDT Corp, France Telecom, Verizon, Motorola, Nokia (China), Ericsson, Bell Mobility

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Updated August 14, 2015

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