Cloud Ready in Three Years

Photo: How important is the Strategy of One program (StOne) for Deutsche Post DHL?

Stefan Geilen, Deutsche Post DHL: StOne is aimed at optimizing the application landscape of Deutsche Post DHL’s Global Business Services (GBS). Our goal is to capitalize on software as a service (SaaS) and cloud computing. But outsourcing only adds value to your business if you’ve optimized your internal portfolio and landscape. And that’s precisely what we’re doing. The first three steps are designed to whip our internal portfolio and IT landscape into shape and structure them as best as possible to better accommodate cloud computing and SaaS in the delivery and supply mode. What is your number one priority – cutting costs or increasing flexibility?

Geilen: Both, and more. Deutsche Post DHL is a logistics service provider, not an IT company. We do, of course, have highly skilled employees, but we will never be able to top the global IT market’s power to innovate. What’s important to us is translating this innovation into flexibility, cost reduction, and better services as quickly and efficiently as possible. Isn’t that a never-ending mission?

Geilen: Yes, because change is constant and innovation will never cease. But the StOne program has a clear objective. From the very beginning, we have focused on being able to measure progress, which is anything but trivial in the field of innovation. Our first results clearly demonstrate that we are on the right path and that we will reach our goals.

Will other programs follow StOne?

Sure. Mobility and Big Data are the buzzwords here. In an organization as huge as Deutsche Post DHL, you have to market these kinds of programs, you have to give your child a name. And because you need to manage resources, in other words, shore up necessary support from business divisions and from governance, it is important to set main focus areas. Where does SAP fit in here?

Geilen: SAP is the backbone of our GBS IT landscape. We combined the German and global SAP systems into one site as part of our “site consolidation”. Thanks to our company history, our previous landscape was quite decentralized and fragmented, so our “application consolidation” towards a purely SAP landscape is an ongoing task. But we are making good progress on the SaaS front together with SAP. We are SAP’s development partner for its SaaS travel and expense mangament solution. Our StOne trend scouting was unable to uncover any comparable solutions that were suitable for Deutsche Post DHL. That’s why we decided to partner up with SAP on this one. How important is this solution for the German postal service ?

Geilen: The solution simplifies travel management. We are a global organization with more than 480,000 employees, and our travel volume is quite high. We basically wanted to increase process efficiency. Processing taxi invoices manually is very expensive. But an SaaS-based tool, which you can use as an app on your smartphone, makes this process much easier.

Next page: What were the stumbling blocks along the way You have determined a product overlap of 1:7.5. What does that mean?

Geilen: This is the relationship between a business process and the number of products we use for that process worldwide. Let’s take accounts payable accounting as an example. A product overlap of 5, for example, does not mean that the accountant in Germany has five different systems – he only has one. His colleague in Poland or Singapore also has one system, albeit a different one, for the exact same process. Do we really need an average of seven or eight systems? We will never get it down to just one. But we will be able to consolidate them much better in the future. Our targeted basis averages a ratio of 1:4.8. You use “stones” to record this success, and project participants have to collect a certain number of these by year-end. Can you explain this?

Geilen: Innovation or consolidation results are difficult to measure. Because we can’t count this success in euros, we’ve introduced “stones” as a currency, as a kind of innovation and consolidation points system. We’ve put together a catalog with around 25 different measures to be taken. Each measure scores a certain number of stones. In 2012, for example, we have to score around 1,000 stones if we are to have our IT landscape ready for cloud computing and SaaS by 2015. Are you satisfied with the process?

Geilen: Yes. Introducing stones and the catalog has had two main effects. By assigning a stone value to measures, we can control our business processes and set focal points. What’s more, the product and program managers can now design a flexible product road map for the IT products they are responsible for. What were the biggest stumbling blocks along the way?

Geilen: Change management. As everywhere, our work is fact-based, there is a business case for each measure. Plus, people are involved. Eliminating emotional hurdles is crucial for success. Especially because cloud computing and SaaS also change the day-to-day work of the individual product managers. These stones give project participants a certain degree of autonomy. This in turn leads to happier, more creative employees. What’s the most important thing you personally need to be able to do here?

Geilen: I need to be able to listen to the employees and encourage their innovative and creative drive; I also need to be flexible and never lose sight of our goal.