Transition from project to - Oracle Transportation …otmsig.communities.oaug.org/multisites/otm/images/Presentations/...Transition from project to functional organization The IKEA

Transition from project to

functional organization

The IKEA journey

by Peter Larsson and David Neyret

Agenda

• IKEA facts & figures

• OTM turning into ITM – the STMS program

• Receiving ITM in functional organization – the top five

challenges

• Lessons learned and Q&A

3

Agenda




challenges


4

IKEA – our vision

5

Our vision“To create a better everyday life for

the many people.”

•Our business idea

“We shall offer a wide range of well-designed,

functional home furnishing products at prices

so low that as many people as possible will be

able to afford them.“

IKEA FY14

6

1,002 Suppliers

9,500 Products

in our range

€28.7 billionTotal sales

716 millionstore visits to

IKEA Group stores

147,000Total number of co-workers 700,000

Solar panelson our buildings

2,9 million Meatballs sold

every day212 million copies of the

IKEA catalogue

7

EUROPEStores

IKEA Industry

production

units

RUSSIAStores

IKEA Industry

production

unitsASIAStores

IKEA Industry

production

units

23

2

5

NORTH

AMERICAStores

IKEA Industry

production unit

51

1

222

36

14

5

AUSTRALIA

Stores

IKEA Group figures

59%of production takes

place in Europe

IKEAs ambition...

8

To reach €50 billion

in sales and 1,5 billion

visitors by 2020

9

25 material areas

36 categories

1002 suppliers in 52

countries

50 million m3 transported

1.5 million shipments

> 14.5 million customer deliveries

>700 million customers

370 stores

in 40 countries

32 DCs in

17 countries

33.000 routes

400 carriers

13 CDCs

In 9 countries

IKEA SUPPLY CHAIN

Distribution center 1

10

Supplier 1

LAND FLOWSStore 3


Supplier 2CP/ Cross-dock

Store 4

Supplier 4


Port 1

Port 2

IMT 1

Store 2

Store 1

Multi-leg mid-receiver delivery

Direct sender-receiver delivery

Combined delivery options

Direct multi-leg ocean delivery

Multi-stop & mid-receiver delivery

OCEAN FLOWS

11

…fit flat packages… …optimized for pallets…Products developed to…

…optimized to load into equipment that can… …be unloaded directly to the point of sales

Transport – a vital part of the IKEA concept –low prices also means low costs

Agenda




challenges


12

OTM turning into ITM – the STMS program

• STMS (Supplying Transport Management Solutions)

started in 2010, ending mid 2017 (consisting of seven

different projects)

• ITM (IKEA Transport Management) is the IKEA name of

the configured OTM standard software

• One of the biggest IT connected projects at IKEA

13

IKEA want OTM to support…

14

• Increased product availability for customer

• Lower costs

• Reduced environmental impact

... and enable

• Growth

STMS scope

15

Need

planning

Transport

Network

Management

Optimise Transport Network

Transportation Sourcing

Purchase

order

Logistic

Order

Management

and

Delivery

Planning

Contract

Management

Buy

against

contract

Consignment & Shipment

Management

Service

Settlement

Delivery Event Management,

Track & Trace

16

Delivery planning live in ITM July 2015Baltic cluster

31 suppliers

138 receivers

19 countries

1.390.000 m3

Scandinavia

10 suppliers

13 receivers

8 countries

115.000 m3

Shanghai

7 suppliers

5 receivers

1 country

170.000 m3

Italian cluster

10 suppliers

87 receivers

10 countries

617.000 m3

Royal Leerdam (NL)

1 supplier

10 receivers

10 countries

73.000 m3

North America

12 suppliers

22 receivers

2 countries

130.000 m3

Pacos (PT)

2 suppliers

10 receivers

7 countries

20.000 m3

DP Pilots ongoing

Praha (CZ)

Ocean (6

relations)

Other Pilots ongoing

Visibiliy

Document mgt

Events mgt

OTM turning into ITM – the STMS program timelines

17

Delivery

planning #1

R1.2

Sept 2013

R2.0

Feb 2014

R2.1

May 2014

R3.0

Sept 2014

R3.1

March 2015

R4.0

July 2015

R4.1

Jan 2016

R4.2

June 2016

Global rollout

ending mid 2017

Delivery

planning #2

Delivery

planning #3

Pilot

Service Settlement & Visibility #1

Pilot

Pilot

Service Settlement & Visibility #2Pilot &

Rollout

Pilot

Pilot

Global rollout

Close Legacy

NOW

Pilot

Consignment & Shipment mgmt

#1

Consignment & Shipment mgmt

#2

Move of Integrations

Agenda




challenges


18

Move from project to functional

organization at IKEA IT

19

Project Management

• Running all programs and

projects

• Defined scope, time and

budget

• Practical Project Steering with

decision points

• Formal handover to

functional organization at

Decision Point 7

Service Management

• Receiving new IT services

from programs and projects

• Running Business –

Application Maintenance &

Support and Enhancements

• ~350 IT services

• Robustness and

maintainability focus

20

Manual effort

need in the ITM

solution

Solution and

Technical

documentationChoice of

functional run

partner

Agile project to

waterfall

functional

organization

Incident and

problem

management

ITM in Functional organization

- Top five challenges

21

ITM in Functional Organization – Top five challenges

1. Incident and problem management

Project problematic Project Solution

• OTM new tool at

IKEA

• User feedback

needed

• Parallell

development

• Pilot and coordination

meetings

• Direct communication

into project

• Problem implementation

by project

Functional problematic Functional Solution

• More than 10k users

• Extensive amount of

incidents expected

• 24/7 Support

• Defined way of handling

problems at IKEA

• Global Helpdesk

Functional mitigation and lessons learned

Functional

organization

from start

• Reduce person dependency

• Conscious decisions

• Service Level Agreement

• Stakeholder Management

Use of

Service

Transition

Accept project

approach, require

long term plan

22


• Scope – time

constraint

• Limited effort on

backlog

• Master data

• Acceptance of manual

work for end users

• Acceptance of

workarounds by AM&S

• Some system support

for master data


• Maintainable solutions

and risk avoidance

• Resolve dependency

from AM&S

• Avoid time consuming

manual work in solution

• Focus on problem root cause correction

• Define process around solving problem

• Provide solution with needed support for master data

Functional Mitigation and lessons learned

Functional

organization

from start

• Identify and analyze problems based

on facts and figures

• Total cost of ownership perspective

Service

TransitionDedicate time for

problem correction in

project

Importance of

Master Data


2. Manual effort in the ITM solution

23


• Limited time in project

scope

• Constant pressure on

delivering on time

• Underestimating of

documentation effort

• Business value over

documentation

• Focus on document

design and

requirements


• Outsourced AM&S –need of similar WoW

• Reduce person dependency

• Needed information should be available for all stakeholders

• Document solutions in a

streamlined way

• Identify and prioritize the

documentation

• Involve run partner in

implementation stage


Functional

organization

from start

• Functional organization support

creating documentation

• Clear requirements on

documentation

Service

TransitionMake sure that the

documentation level

is agreed as early

as possible


3. Solution and technical documentation

24


• Need of extensive

OTM expertise

• Core knowledge at the

implementation partner

• Implementation partner

involved in incident

handling


• Outsourced AM&S

• Works for the many,

but not all IT solutions

• Strategic partner and

niche competence

• Participate in project to

develop the competence

• Identify and secure

critical competence


Functional

organization

from start

• Staff AM&S team with resources

from implementation partner

• Clear requirements on knowledge

transfers and documentation

• Ensure long term partnership with

Service

Transition

Total cost of

ownership

perspective

implementation partner

Secure inhouse

functional expert

role


4. Choice of functional run partner

25


• Time to market

• Leadtime of handling

test environment,

deployments and

infrastructure

support

• Integrate setup of test

environments,

deployment capability

and OTM infrastructure

competence in project


• Enable involved

functional actors to

perform as per the

processes

• Need to align to legacy

solution release cycle

• Clear responsibility and

onboarding of functional

actors

• 24 well defined

processes


Functional

organization

from start

• Scale up functional organization for

transition

• Try to reduce project integration of

other actors responsability

• Involve functional actors in project

Service Transition

Anchor roles and responsibilities of each

actor in both project and functional

organization

Agile when a lot of

dependencies?


5. Agile project to waterfall functional organization

Overall lessons learned and Q&A

26

Support project

approach, and secure

long term robustness at

the same time

Put your requirements

early in Service

Transition and follow up

regularly

As a receiver: Be there

from the start!

As a project: involve the

receiver from the start!

27

Home is the most important place in the world

Contact details

Peter Larsson, [email protected]

David Neyret, [email protected]

28

mailto:[email protected]

mailto:[email protected]

Documents

Transition from project to - Oracle Transportation …otmsig.communities.oaug.org/multisites/otm/images/Presentations/...Transition from project to functional organization The IKEA