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About the VCG

VCG Mission Statement Goal Value Proposition Member View Process Transformation Framework (VRM) Value Reference Model (XRM) X Reference Model (VLM) Value Lifecycle Model (SOA-IM) Service Oriented Architecture Information Model (ICIM) Integrated Continuous Improvement Methodology copyright Value Chain Group all rights reserved

VCG Mission Statement The Value Chain Group supports businesses who seek to strategically optimize their enterprise/network in the areas of agility, innovation and time to react to changing conditions in a global environment. To this end, the Value Chain Group s Process Transformation Framework provides: tested reference dictionaries proven methodology consensus driven continuous improvement in processes The standard integrated process framework: guides modeling, design, and measurement of business performance encompasses the plan, govern and execute requirements addresses the design, product, and customer aspects of business We believe in a consensus-driven and non-proprietary, open source standard and seek the diversity of ideas provided by our constituents and partners as we share Value Chain perspectives, strategies and best practices. copyright Value Chain Group all rights reserved

GOAL The VCG goal is to be the most recognized and respected global non-profit organization for Value Chain Management throughout the product, or service life cycle. The VCG will provide: the resources to access and understand the available open standard models the toolsets the implementation methods training for self sustaining process frameworks that enable best in class strategic, operational and tactical Value Chain Excellence. The VCG s Business Process Transformation Framework supports an Integrated Process & Technology strategy to enable the Service Oriented Enterprise.

Value Proposition The VCG BPTF includes reference models and methodology. The advantage to learning and adapting the entire framework is: Speed of business process transformation Accuracy and fidelity of business requirements Integration with model based enterprise architecture Utilizing the VCG s body of knowledge is a great enabler and a starting point. Companies can utilize the VRM as a semantic framework and business process ontology that provides the basis for the Integrated Continuous Improvement Methodology. Companies can then utilize the framework and methodology to quickly create their own extensible Reference Model (XRM) for further modeling and analysis.

VCG Subscribers Organizations that endorse VCG Models & Methodology through successful proof of concept projects. Technology Partners include: Cordys, IDS Scheer, igrafx,metastorm, Holocentric, Value Chain Associates Consultant Practices that have utilized VRM: Accenture, Oliver Wight Plus over 300 other end user, vendor, academic members representing 50+ companies. copyright Value Chain Group all rights reserved

Process Transformation Framework

Semantic Framework Elements Governance enables explicit definition of roles, metrics and rules governing process transformation specifies how are processes measured, modeled, analyzed, promoted to, replaced or removed from the execution environment Methodology ties all elements together specifies techniques, methods and tools used for each step of the business transformation specifies steps and deliverables of using semantic EA framework enables continuous improvement of the framework Process (modeling and analysis) enables representation of process flows including every detail required for successful mapping to technology reference architecture processes can be defined by practitioners, not just EA specialists processes can be analyzed to determine root causes of underperformance consensus can be developed between various process owners and stakeholders Reference Run-Time Architecture provides components and semantics for process execution monitors and life cycle manages various versions of processes in execution provides security, scalability, portability and reusability of the process execution environment

VRM Value Proposition Metrics Driven Process Focus Using same metric definitions and formulas = measurable Formulation of strategy in terms of measurable high-level business objectives. Metrics are tightly connected to performance attributes Change projects are identified based on chain (s) performance rather than point solutions. Speed of Execution Facilitates creation of strategies or solutions in weeks, not months, without re-work. Quick start up and less frustration due to organized framework and management. Effective communication (common language) Pre-defined process definitions, metrics and best practices Application independent Redirects focus from systems to processes. Focus on resolving problems rather than symptoms. No systems internal functionality knowledge required to understand a process description No need for translation for software and process experts. Easy lookup of predefined definitions. Reusability of project documentation. Cost Saving Competency which does not require involvement of external consultancy. Shorter project lifecycles (fast startup and execution) saves money. Prevention of re-work and abandonment of non-valueadd IT solutions copyright Value Chain Group all rights reserved

New Model for Business Process Order to Cash Corporate Executive Administration Portal Concept to Product Procure To Pay Sales Sales & Process Marketing Portal Product Developer R&D Portal Financial Finance Workstation Opportunity To Quote Service Customer Process Service Portal Fulfillment Warehouse Portal Field Customer Service Support Device SOA Based Business Services Update Customers Submit Orders Virtualized Enterprise Data Order Promising Finalize Compensation Merge Accounts Order Supplies Customer Contracts Products Inventory Accounts Source - Forester

Systems Based Approach VRM methodology was designed from an hololistic perspective with the following objectives in mind to see better to understand better to act better It's underlying structure is integrated into the VRM model enabling analysis of value chain strategies and interactions. copyright Value Chain Group all rights reserved

SLIDE NOTE: The VCG Models are housed and managed in an explicitly defined database.

SLIDE NOTE: The Level 3 Execution Processes span across the enterprise. The VRM is a cross industry business process reference model. Level 3 process can be configured into specific ValueStreams such as; Procure to Pay, Order to Cash copyright Value Chain Group all rights reserved

Create Green Policy Templates that can applied to specific VRM/XRM Process elements SLIDE NOTE: All I/O s are explicitly defined and connected with execution processes. Therefore modeling in VRM provides quick cycle time analysis, understanding of dependencies and realization of critical path within a value chain. copyright Value Chain Group all rights reserved

SLIDE NOTE: This is an example of Green policy information that was researched and entered into the VRM as an I/O Definition. URL to Policy Example / Template copyright Value Chain Group all rights reserved

SLIDE NOTE: This is an example of Green sustainability metric researched and entered into the VRM as an I/O Definition. URL to Metric Template and Benchmarks Green Performance Measurement Paper Page Consumption Number of paper pages used per employee (e.g. per day) this KPI has been introduced in order to a/ measure the paper consumption in an organization b/ to set up goal c/ to reduce the paper consumption. copyright Value Chain Group all rights reserved

XRM Example: Product Development When modeling value stream any element from any dictionary is useful for as long as: - Dictionaries follow same class structure, - Elements have normalized definitions - Dictionaries are adding different levels of specificity - Terminology is applicable to the context of the value stream copyright Value Chain Group all rights reserved

XRM Example: Supply Chain Execute Acquire Level 1 Level 2 Place Order Create PO When modeling value stream any element from any dictionary is useful for as long as: - Dictionaries follow same class structure, - Elements have normalized definitions - Dictionaries are adding different levels of specificity - Terminology is applicable to the context of the value stream Qualify Supplier Issue Request Evaluate Proposal Negotiate Contract Place Order Receive Order Verify Order Level 3 Generate PO Adjust PO Receive Acknowledgement Cancel PO Browse E-Catalog Place E-Catalog Order Place P-Card Order Transfer inventory Process Invoice

XRM Example: Customer Relations Execute Brand Level 1 Level 2 Architect Brand Create Artwork When modeling value stream any element from any dictionary is useful for as long as: - Dictionaries follow same class structure, - Elements have normalized definitions - Dictionaries are adding different levels of specificity - Terminology is applicable to the context of the value stream Define Brand Req Differentiate Brand Select Market Channels Architect Brand Validate Brand Protect Brand Assess Supply Network Create Marketing Roadmap Level 3 Create Graphic Options Draft Artwork Refine Artwork Evaluate Artwork Options Fit - Copy & Context Create Technical Drawings Finalize Copy Approve Copy Launch Brand

XRM Dictionaries are created to provide company, industry and/or domain specific activity models. XRM models are loosely coupled to provide flexibility while maintaining context to an overarching VRM framework. Agriculture Water Resources Public Works Electricity Manufacturing Oil Product Development Supply Chain Customer Relations copyright Value Chain Group all rights reserved

Insert Green Business Maturity Model SLIDE NOTE: The VCG recommends defining the Green Business Maturity Model as a Practices aligned with Processes within VRM not stand alone. copyright Value Chain Group all rights reserved

SLIDE NOTE: The VCG supports Green Sustainability. Now is the time to define goals & objectives to develop Green Process Designs: Procure to Pay, Order to Cash, Concept to Product Logistics. copyright Value Chain Group all rights reserved

Select priority dimensions Derive balanced score cards Identify relevant metrics Assign metrics to processes Ensures alignment with goals and objectives Allows measuring effectiveness of business process design Enables continuous improvement Use of metrics to identify and prioritize required changes: Process Automation Culture Organization Metrics

Process Modeling and Analysis Initiative I Procure to Pay (P2P) Process Modeling and Analysis Initiative II Order to Cash (O2C) Value Stream P2P As Is Value Stream O2C As Is Value Stream P2P To Be Scenario Structured PO Value Stream P2P To Be Scenario Self Procure Value Stream O2C - To Be Blueprint A Blueprint B Blueprint C Blueprint D Blueprint E Initiative Change Requirements and Communication Plan Initiative Solution Implementation Plan Initiative Process Integration Plan Solution Implementation Initiative

VRM / XRM Scenario Development Resource Plan Program Team GV02.05.01 Front End Education Program Vision VRM Program Charter GV02.05.02 Charter VRM Program ValueStream Design Charter Program Plan Charter VRM ValueStream GV02.05.03 Practice Definitions Metric Definitions Role Definitions Subject Matter Expertise VRM Process Design Determine Scenario Scope GV02.05.04 Scenario Scope Gather Process Documentation GV02.05.05 Existing Process Document Translate Existing Documents GV02.05.05 VRM Translation Guidelines Scenario Scope VRM Dictionary Elements Create Process Design GV02.05.07 Initial Process Design Design Entry into VC Architect GV02.05.08 Review Process Design GV02.05.09 Process Diagram Process Diagram, Revised Preliminary Process Design Process Definition Template Create Definition Templates GV02.05.10 Define Process Elements GV02.05.11 Process Change Recommendations Process Definitions GV02.05.12 IO Definitions Metric Assignments Practice Assignments Generate Scenario Summary Report Scenario Summary Report Role Assignments Validate Scenario Design GV02.05.13 Process Governance Validated Scenario Design End Improvement Initiative Report Out Recommendations copyright Value GV02.05.14Chain Group all rights reserved

Benefits A standard based approach to define essential collaborations between trading partners Accelerated agreement and implementation of process scenarios Reusable process templates based on best practices Integration of existing and new information management systems Ultimately, a fast response to changes while maintaining and extending value chain performance