Strategic IT Transformation at Accenture Essay

Accenture is today one of the world’s leading organizations providing management consulting, technology and outsourcing services, with approximately 275,000 employees. Accenture has offices and operations in more than 200 cities in 56 countries and net revenues of $28.6 billion for fiscal 2013. Over a decade ago, Accenture was part of the group Arthur Andersen. Arthur Andersen was founded in 1913 to meet the requirements of new tax regulations enacted when the Federal Reserve System was established that same year. In 1989, due to the market’s consultation needs, the firm decided to split its business in two different entities. Andersen Consulting for market consultation and Arthur Andersen for auditing. Andersen Consulting experienced a strong growth since its starts up as a division of the group Arthur Andersen. In December 1997, this last division decided to began a process of arbitration. The process required the separation of Andersen consultation division from the financial audit firm. Finally, this is how the consulting division got its independence in a $175 million rebranded campaign by paying $1 billion to Andersen. The new company was renamed Accenture on January 01, 2001. In the beginning, the Accenture launch was supported as a new independent business company. Accenture had the right to use Andersen’s Technology infrastructure for one year while they created their own IT infrastructure.

They needed to create new IT infrastructures that exceed the functions of the old platform. The main aspects they had into account were: easy interconnection of the applications with each other, access to the platform from the Internet when and where necessary, and unification of the accounting and HR systems within the offices around the world. Important players were playing roles in this process. The organization Accenture was an important player because of its decision of independence; even when the company was undoubtedly growing as an independent division, there was still a big risk to fail with the new branding process. As well as the Chief Information Officer (CIO Frank Modruson) who was responsible for carrying the IT transformation challenge’s responsibility. Another vital player was the customers; they were directed affected by the efficient/inefficient changes made by the new IT platform. Last player to mention would be the employees; they would be involved in downsizing and hiring outsourcing applied by the company in order to reduce costs in some operations areas. The challenge

The challenge for Accenture was creating this new IT infrastructure like a business within a business, without sacrificing the quality or inventiveness of the technology tool currently offered to its consultants and clients. It involved the integration of the IT decisions within the whole organization, including the offices in other countries. For example: the unification of the IT processes made by individual offices in different countries: these many “islands” in each location often developed their own software applications to solve urgent needs in their own spaces. The new IT infrastructure needed to cover the aspects that were failing in the old platform. This new IT platform must be responsible for satisfying the needs of internal customers and stakeholders, offering a clear service level regarding to IT products and services for a particular technology, and determining IT spending priorities based on different divisions of the business (strategic, financial, operational, and technical). Highlights

I general terms, I consider that Accenture did a really good job structuring its plan to develop the new IT infrastructure. The company had a great vision and an efficient system to determine the key point to develop its platform. I will mention some elements I think drove the success of the IT platform project. First, the leaders developed very good ideas in order to carry its plan out. Their vision focused on having the best of the best under an efficient cost/efficiency policy. They visualized a technology able to support personnel access to knowledge and information “anytime, anywhere”. It was a key point to threat the internet access aspect mentioned before. It built an –in conditional service-focused image to their customer and a trusting environment for its employees. The second point to emphasize is the changing of the IT philosophy and its meaning for the company Accenture. When an organization is in the process of implementing technology as part of its daily operations, it is relevant to shape the internal staff with a positive attitude towards the new technologies. The creation of an IT infrastructure culture was an important step to introduce the system. Changing the way how the old culture viewed IT “As a cost center” with limited involvement from management. I would also highlight Accenture selection of the single-vendor approach as its IT platform. After considering the advantages and disadvantages of the –best of breed- and the –one platform approaches-, Accenture accurately selected a –single vendor- approach as is IT infrastructure. This decision was very precise because it helped them to minimize ownership costs and integrate its worldwide applications. This is exactly what they were striving for. Later on, the partnership with Microsoft and the use of SAP as its global applications providers for financial and HR (Human Resources) solutions promoted the organization’s success. These two decisions encouraged simplicity for the development of its infrastructure and run global processes within the company. Another point was the Outsourcing phase adopted by Accenture in order to reduce costs (IT Budget). They started to outsource its IT staff from other lower-cost center. These centers were located in India, China, Philippines and Latin America. They developed a global delivery network called “GDN” and an Infrastructure Outsourcing group called “IO”. The two systems allowed them to borrow IT employees/knowledge when it was necessary. The outsourcing initiative assisted Accenture in leveraging to a global presence without incurring in high costs. Accenture was running as a high-performance business. Lastly, to stress in this case study was the application of an efficient IT governance action and the implications that this new system represented to the organization. I particularly was fascinated with the IT governance rule called “The two hats rule”. I think that it was a very creative way to grow a wide vision of each project outcomes/benefits for just one division, as well as for the whole company. It definitely creates a wider perspective of each COO personal opinions and at the same time develop a right decision making process for the entire company. Accenture also had a sponsorship program implementation for each project. It seemed very interesting to me because it clearly shows that they were very organized and focus on their ROI methodology (Return of Investment), while trying to not affect the quality of their products and services.

Accenture is definitely a interesting IT development example. They had not only a good vision but also located their vision in a realistic ship. Accenture decisions were made based on real needs and were developed with efficient and competitive technology. They did a real good job with the promotion of the IT infrastructure as a business and not as a cost center. They effectively separated the concepts and processes applied by -the old Arthur Andersen Company infrastructure- and made them more competitive and innovative. The strategy to create Accenture IT platform was simple and successful; they partnered with the right organizations to develop their project and used the correct tools/systems to improve the areas detected as failing Areas. This Case Study gave a very remarkable impression to me. I am sure it works as an example for many companies in the market that are trying to implement IT sources but they simply do not know how to implement them.