Petr Podlipný (ČEZ)

CEZ SSC – CURRENT ISSUES
AND COOPERATION WITH ABSL
16 October 2014
Petr Podlipný, Accounting SSC Director
CEZ GROUP
CEZ GROUP INTRODUCTION
CEZ Group:
 Created in 2003
 Belongs among ten largest energy companies in Europe
CEZ Group core business:




Generation
Trading, and
Distribution of power and heat,
Also deals in coal mining, nuclear research, planning, construction and maintenance of energy
facilities
CEZ Group is one of the largest employers in the CEE region - employing almost 27,000 people.
1
CEZ GROUP
WHY CEZ GROUP DECIDED TO HAVE A SHARED
SERVICE CENTER (SSC)?
Quality and quantity drivers for SCC
CEZ
CEZ
CEZ Prodej
CEZ Energetické
Služby
CEZICT
CEZ Distribuční
služby
CEZ Prodej
CEZ Zákaznické
služby
CEZ Správa
majetku
CEZ Distribuce
CEZ Korporátní
služby
CEZ Distribuční
služby
CEZ Měření
CEZ Logistika
CEZ Zákaznické
služby
CEZ Distribuce
Obnovitelné
zdroje
CEZ ICTS
Major arguments for change
•
•
•
•
•
2
Simplification of governance model
Unification and centralisation of supporting services into Shared Service Center
One level of service standard
Cost reduction and increase in service quality
Increase in efficiency – best practice, FTE reduction, low-cost location
CEZ GROUP
JOURNEY TO SHARED SERVICE CENTER
Phase
Goals
Transformation
to process
driven
companies
 Post-acquisition
restructuring
 Process driven
management
Process optimisation
inside the companies
(Accounting SSC)
 Productivity increase
 Process unification
 IT system unification
 Major processes
automated
 FTE and cost reduction
 Accounting SSC
established
CEZ
CEZ Prodej
CEZ Energetické
Služby
 Mass data processing new working practices
 Specialisation - focus on
elements of transaction
-> lack of complex
picture
 Group structure simplified
 Other supporting services
transferred to SSC
 Cost reduction and
accountability
 Continuous improvement
CEZ
CEZ Distribuční
služby
CEZ Prodej
CEZ Zákaznické
služby
CEZ Distribuční
služby
CEZ Měření
3
 Team and processes
stabilisation
CEZICT
CEZ Distribuce
Timeline
Stabilisation
Multifunctional
SCC
established
CEZ Správa
majetku
CEZ Korporátní
služby
Obnovitelné
zdroje
2003 - 2007
CEZ Zákaznické
služby
CEZ Distribuce
CEZ Logistika
CEZ ICTS
2008 - 2011
2012
2013 up to now
CEZ GROUP
MULTIFIUNCTIONAL SSC WITH INCONSITENT
MATURITY OF ITS SERVICES
 Incorporated on 1. 1. 2013 (only 7 months from decision)
 430 employees; approx. 60% in Ostrava
 30 internal and external customers only from the Czech Republic
 Attrition rate: 15.3% (during transformation)
Line of Services:
Fleet management Facility management
 +4,500 vehicles
 +660 buildings
 +81 mio kms driven/year  +1,5 mil km2 of land
 55 employees
 84 employees
Accounting
 +1 mio processed
transactions per year
 20 customers
134 employees
HR Back office
Other supporting
services
 Internal mail service
Payroll calculation
for +12 ths. employees
 Printing & copy
Staff personal data
 Security, etc.
administration
 57 employees
4
CEZ GROUP
THERE IS A MIXTURE OF GROWTH OPPORTUNITIES
 Expansion opportunities in the current services exists but are limited
 F&A – small companies outside
the present scope and more complex
(planning and controlling support)
activities
 HR – additional agenda and companies
 Fleet – very limited as full owner
outside the scope
of the whole process
 Property – production related equipment
 Potential exists in new areas
 Follow general trends of SSCs
5
CEZ GROUP
WE FACE NUMBER OF LIMITATIONS AND RISKS
WHERE SOME ARE UNIQUE ONES
 Substance of CEZ operations in CR -> growth limitations
 Existence of Trade unions – significant impact on staff management, incl. costs
 Inconsistent approach to processes in terms of centralisation
 Industry decline with continuous push on cost reduction without internal clients accepting
service quality change
 Highly sensitive business (nuclear power) with regulation setting strict rules affecting
efficiency efforts
 Lower flexibility of staff and higher resistance to changes – stable industry over past
decades
 Multifunctional SSC – more complicated management
 Customer relationship – new skillset to be developed; add value
 Highly customised ERP across the group – standardisation limitation
6
CEZ GROUP
IN OTHER ASPECTS WE ARE TYPICAL SSC
 Full ownership of the process subject
to SSC with improvement suggestion
to ultimate process owners
 Basis of the processes standardised
 ERP owned by group IT
 Unique team at SSC which is able to modify
ERP to certain extent based on e.g.
accounting policies changes, new business
acquisition…
 Performance measured to internally defined
parameters with limited reference to market for
advanced service lines and no reference to
market for developing service lines
 Costs per transaction and productivity
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CEZ GROUP
WE SEE ABSL AS MEANINGFUL PLATFORM
BECAUSE…
 …it is an excellent opportunity to learn about global trends in SSC business and
their application which can help in supporting our growth plans inside the Group
 …it enables to share the experience of lessons learned by us or by others
 Open house event organised with ABSL on 18 September 2014
 …we were able to establish direct contacts with relevant SSCs having similar
scopes or issues
 …we can benchmark ourselves to other SSCs in terms of e.g. operating model,
efficiency measurement, staff management etc.
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CEZ GROUP
THANK YOU FOR YOUR ATTENTION
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CEZ GROUP

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