Building a Lean Digital Ecosystem for Celonis Co-Founders
Unlocking Trapped Value presents opportunities for Celonis to establish industry leadership, drive growth, and address key issues like developing industry-specific solutions, in-house capabilities, and organizational structure. Forming a new org structure, honing development capabilities in-house, and prioritizing proactive insights for key stakeholders like Dave, the CTO, are crucial for success.
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Unlocking Trapped Value: Building a Lean Digital Ecosystem Presenting to: Martin Klenk, Bastian Nominacher, and Alex Rinke (Co-Founders of Celonis) Presented by: Ariel Gardner, Jechayni Khobalakrishnan, Sean Visser, and Tyler Boulanger Date: January 2022
There is an opportunity for the founders of Celonis to position Celonis as an industry leader and successfully navigate the company through the tremendous growth possible ahead of them. 2
Preferred Solution Build industry-specific solutions Transition Development Capabilities In-house Develop a Process Planning Feature Form a matrix Organizational structure Key Issues Analysis Opportunities Preferred Solution Implementation Risks 3 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Preferred Solution Build industry-specific solutions Transition Development Capabilities In-house F O R M Develop a Process Planning Feature Form a matrix Organizational structure Key Issues Analysis Opportunities Preferred Solution Implementation Risks 4 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
F O R M orge a new org structure nboard capabilities in-house elease new features cross-organization easure & adapt 5
Meet Dave Chief Technology Officer (CTO) Computer Hardware Company 17 years with Company 6
Daves Needs Wants niche data collected 7
Daves Needs Wants niche data collected Has difficulty using Celonis insights 8
Daves Needs Wants niche data collected Has difficulty using Celonis insights Desires proactivity over reactivity 9
Daves Needs Wants niche data collected Has difficulty using Celonis insights Desires proactivity over reactivity Needs RPA for industry specific uses 10
Key Issues 11
Key Issues - Importance + Lack of competitive advantage - Urgency + Lack of 3rd party application control Customer industry specific demands Reliance on human consultants Key Issues Analysis Opportunities Preferred Solution Implementation Risks 12 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Analysis 13
Celonis is still consultant reliant Hiring more could ruin ecosystem of partners 2500 Representing 10% new hires consultants Key Issues Analysis Opportunities Preferred Solution Implementation Risks 14 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Celonis is still consultant reliant Hiring more could ruin ecosystem of partners KEY TAKEAWAY 2500 Representing 10% new hires consultants Celonis and its software is still extremely reliant on non-automated processes, including consultants Key Issues Analysis Opportunities Preferred Solution Implementation Risks 15 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Keeping Celonis Lean Wastefulness Activities which do not add value The need for third party developers can be eliminated or reduced and do not add long-term value to the company MUDA Key Issues Analysis Opportunities Preferred Solution Implementation Risks 16 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Keeping Celonis Lean Wastefulness Activities which do not add value The need for third party developers can be eliminated or reduced and do not add long-term value to the company MUDA Non-uniformity Divergences from optimal work The current system consists of many different industries and solutions which reduces efficiency MURA Key Issues Analysis Opportunities Preferred Solution Implementation Risks 17 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Keeping Celonis Lean Wastefulness Activities which do not add value The need for third party developers can be eliminated or reduced and do not add long-term value to the company MUDA Non-uniformity Divergences from optimal work The current system consists of many different industries and solutions which reduces efficiency MURA Overburden Software can be further automated to reduce the need for consultants MURI Key Issues Analysis Opportunities Preferred Solution Implementation Risks 18 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Keeping Celonis Lean Wastefulness Activities which do not add value The need for third party developers can be eliminated or reduced and do not add long-term value to the company MUDA KEY TAKEAWAY Non-uniformity Divergences from optimal work The current system consists of many different industries and solutions which reduces efficiency Celonis, itself, is lean and optimal. Celonis is intentional about making a product that keeps their clients lean, however, there is much work to be done in terms of ensuring that MURA Overburden Software can be further automated to reduce the need for consultants MURI Key Issues Analysis Opportunities Preferred Solution Implementation Risks 19 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Industry specific needs unmet Wants niche data collected Has difficulty using Celonis insights Desires proactivity over reactivity Needs RPA for industry specific uses 20
Opportunities Remain Industry Silos Industry Partnerships Industry-Agnostic Restructure organization for industry silos, internalizing specific industry support Develop core product while moderating third- party applications Build cloud service for third-party application integration Key Issues Analysis Opportunities Preferred Solution Implementation Risks 22 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Remain Industry Agnostic 1 Benefits Further develop core product for use by all types of customers. Increase moderation of 3rd party applications to ensure consistency across brands Reduced organizational change provides less culture risk Focus on core product means new features for all customers Considerations Reliance on 3rd party developers who can switch to competitors Lack of differentiation against emerging competitors Key Issues Analysis Opportunities Preferred Solution Implementation Risks 23 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Industry Silos 2 Benefits Restructure organization for industry silos, internalizing specific industry support. Slowly remove reliance on 3rd party developers and partnerships Meets the needs of large customers with industry specific needs Reduces reliance on potentially inconsistent 3rd party applications Considerations Increased cultural risk Core product development could suffer Key Issues Analysis Opportunities Preferred Solution Implementation Risks 24 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Industry Partnerships 3 Benefits Build cloud service for third-party application integration. Enable greater level of collaboration with 3rd parties, providing greater quality and control Meets industry specific customer demands Increases quality control and brand consistency across applications Considerations Increases reliance on 3rd parties, losing relative company power Increased industry focus could slow development on core offering Key Issues Analysis Opportunities Preferred Solution Implementation Risks 25 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Decision Matrix Industry Partnerships Decision Criteria Weight Industry-Agnostic Industry Silos Lack of competitive advantage 0.4 3 4 3 Lack of 3rd party application control 0.3 3 5 4 Industry demands 0.2 1 5 4 Reliance on human consultants 0.1 4 4 2 Total 1 2.7 4.5 3.4 1 5 Low High Key Issues Analysis Opportunities Preferred Solution Implementation Risks 26 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Decision Matrix Industry Partnerships Decision Criteria Weight Industry-Agnostic Industry Silos Lack of competitive advantage 0.4 3 4 3 Lack of 3rd party application control 0.3 3 5 4 Industry demands 0.2 1 5 4 Reliance on human consultants 0.1 4 4 2 Total 1 2.7 4.5 3.4 1 5 Low High Key Issues Analysis Opportunities Preferred Solution Implementation Risks 27 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Preferred Solution Build industry-specific solutions Transition Development Capabilities In-house Develop a Process Planning Feature Form a matrix Organizational structure Key Issues Analysis Opportunities Preferred Solution Implementation Risks 29 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Implementation F O R Measure & adapt Jan 2022 18 Months orge a new org structure 6 months Sep 2022 nboard capabilities in-house 12 months elease new features cross-organization Mar 2023 Onward Sep 2023 Key Issues Analysis Opportunities Preferred Solution Implementation Risks 31 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
New Organizational Structure - Matrix Industry Broad Focus Manufacturing Oil & Gas TelCo Department Development Sales Digital Consulting Marketing Key Issues Analysis Opportunities Preferred Solution Implementation Risks 32 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
New Organizational Structure - Matrix Industry Broad Focus Manufacturing Oil & Gas TelCo Department Matrix Organizational Structure will enable Celonis to scale sustainability, address industry specific needs and maintain efficiency when increasing head count in the next coming years Development (Recommended not to exceed 5 industry specific categories) Sales Digital Consulting Marketing Key Issues Analysis Opportunities Preferred Solution Implementation Risks 33 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Internal Culture Considerations Create a a customer focused culture to drive innovative capabilities Capabilities Behaviour Implement monthly learning days and educational opportunities for employees Internal Culture Establish internal communication channels and customer specific reward programs Key Issues Analysis Opportunities Preferred Solution Implementation Risks 34 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Celonis Product Offerings Core Product Industry Divisions EMS for Oil & Gas EMS EMS for Manufacturing Utilized by medium sized organizations Organizations not targeted within the industry specific offerings EMS for Telecommunication Key Issues Analysis Opportunities Preferred Solution Implementation Risks 35 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Customer Journey Overview Partner Ecosystem EMS for Manufacturing suite of products Training & Education Center In House Consulting Team (Digital Consulting Depmartmnet Dave CTO of a Manufacturing company Key Issues Analysis Opportunities Preferred Solution Implementation Risks 36 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
FORM Phase 1 Forge a new org structure Duration: Jan 2022 June 2023 (18 months) 2022 2024 2023 Key Actions Restructure organization into matrix structure Communicate changes to internal staff Hire employees for each department 500-1000 per each industry across departments Integrated internal communication platforms Develop process planning software to be integrated into the core offering (Executive Management System) Establish relationship with 3rd party RPA developer to learn best practices Develop customer education & training center Integrate cultural considerations Key Issues Analysis Opportunities Preferred Solution Implementation Risks 37 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
FORM Phase 1 Forge a new org structure Duration: Jan 2022 June 2023 (18 months) 2022 2024 2023 Objectives Key Actions Restructure Celonis Increase customer autonomy Gain RPA specific knowledge for future integration Restructure organization into matrix structure Communicate changes to internal staff Hire employees for each department 500-1000 per each industry across departments Integrated internal communication platforms Owners Martin Klenk Alex Rinke Development Team Develop process planning software to be integrated into the core offering (Executive Management System) Costs Total $30M Establish relationship with 3rd party RPA developer to learn best practices Restructuring costs $30M Process planning software - $80k Education and training center - $300k Develop customer education & training center Integrate cultural considerations Key Issues Analysis Opportunities Preferred Solution Implementation Risks 38 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
FORM Phase 2 Onboard capabilities in-house Duration: July-Dec 2023 (6 months) 2022 2024 2023 Key Actions Develop industry specific products and features: Manufacturing Telecommunications Oil & Gas Integrate process planning software into EMS Launch (soft) industry specific offerings to select customers across 3 industry divisions Gather feedback to ensure customer needs are addressed Key Issues Analysis Opportunities Preferred Solution Implementation Risks 39 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
FORM Phase 2 Onboard capabilities in-house Duration: July-Dec 2023 (6 months) 2022 2024 2023 Objectives Key Actions Creating industry specific offerings Improving the customer journey Gathering feedback Develop industry specific products and features: Manufacturing Telecommunications Oil & Gas Owners Martin Klenk Alex Rinke Sales & Marketing departments Integrate process planning software into EMS Costs Total $3.2M Launch (soft) industry specific offerings to select customers across 3 industry divisions Gather feedback to ensure customer needs are addressed Industry specific offerings $3M Soft launch - $250k Key Issues Analysis Opportunities Preferred Solution Implementation Risks 40 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
FORM Phase 3 Release new features cross-organization Duration: Jan-Dec (12 months) 2022 2024 2023 Key Actions Release industry specific offerings (hard launch) within 3 selected industries Release core process planning features across customers in new update Share information across the organization about the features developed internal communication & knowledge sharing Start building competencies in additional industries (healthcare & retail) through engaging experts Key Issues Analysis Opportunities Preferred Solution Implementation Risks 41 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
FORM Phase 3 Release new features cross-organization Duration: Jan-Dec (12 months) 2022 2024 2023 Objectives Key Actions Launch new core product offering Create processes for sharing development progress across the matrix Release industry specific offerings (hard launch) within 3 selected industries Release core process planning features across customers in new update Share information across the organization about the features developed internal communication & knowledge sharing Start building competencies in additional industries (healthcare & retail) through engaging experts Owners CEO CTO Divisional Development Leads Costs Total $14M Launch Marketing ($4M) Launch Maintenance ($6M) New Industry Engagement ($4M) Key Issues Analysis Opportunities Preferred Solution Implementation Risks 42 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Celonis Products Are Reactive A B C Key Issues Analysis Opportunities Preferred Solution Implementation Risks 43 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Celonis Products Are Reactive A B C Key Issues Analysis Opportunities Preferred Solution Implementation Risks 44 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Celonis Products Are Reactive A B C ACTION Key Issues Analysis Opportunities Preferred Solution Implementation Risks 45 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Celonis Products Are Reactive + Predictive Reactive Key Issues Analysis Opportunities Preferred Solution Implementation Risks 46 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Celonis Products Are Reactive + Predictive Reactive =PROCESS PLANNING EXCELLENCE Key Issues Analysis Opportunities Preferred Solution Implementation Risks 47 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
Developing Industry-specific Presence + Industry-specific Features Key Issues Analysis Opportunities Preferred Solution Implementation Risks 48 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
FORM Phase 4 Measure & Adapt Duration: 2025 Onwards 2022 2024 2023 2025 Objectives Key Actions Continue culture of innovation to build product offering Expand into more industries Optimize the technologies being released Repeat industry division development process for 2 new industries (healthcare & automotive) Continue utilizing lean development, testing, and roll- out process to optimize process planning and industry- specific features Assess product performance and customer satisfaction Engage existing clients vocally and through their data in new industries to learn their problems Compile add-ons into industry-specific products when three are validated and fully launched Monitor key performance indicators to make evidence- based decisions on future expansions Owners Martin Klenk, Chief Technology Officer Divisional product managers Financial Director Costs Total $28.5M 2 new industry rollouts ($22M) Performance Assessment ($2M) Industry-specific product rollout ($4M) Customer satisfaction meetings ($500k) Key Issues Analysis Opportunities Preferred Solution Implementation Risks 49 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
FORM Phase 4 Measure & Adapt Duration: 2025 Onwards 2022 2024 2023 2025 Total Planned Costs Incurred Revenue Increased by Recommendation $75.7M $95.0M Key Issues Analysis Opportunities Preferred Solution Implementation Risks 50 Key Issues Analysis Opportunities Preferred Solution Implementation Key Success Factors Risks
