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PMO as Strategy Enabler January 26, 2018 Giorgio Difronzo Global PMO Director
PMO as Strategy Enabler
January 26, 2018
Giorgio Difronzo
Global PMO Director
Agenda
▪ Campari Group - Introduction
▪ PMO Journey in Campari Group
▪ PMO and Strategy Execution
▪ PMO value creation in Strategic Initiatives Management: Lessons Learned
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Campari Group - Introduction
3
Campari Group’s History
Campari was founded in 1860 - the year Gaspare
Campari invented the bright red bittersweet aperitif in
downtown Milan.
From 1888 onwards, his successor and son, Davide
Campari, developed and implemented an extensive
campaign to grow the brand globally, featuring a
winning marketing strategy; the creation of the first
single-serve aperitif, Campari Soda, in 1932; and a
patronage of the arts to enhance product promotion.
In the 1960s, Gruppo Campari’s distribution power
already reached over 80 countries.
In the second half of the 1990s, the beverage
industry was characterized by a strong M&A trend
which led to the creation of corporations with global
dimensions and remarkable portfolios appealing to a
broad consumer dynamic.
Therefore, Campari chose to expand not only via
organic growth but also via external growth, turning
from a single-brand company as late as 1995 to a
multinational company with a solid and expansive
portfolio with international appeal today.
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Campari Group today
5
Campari Group today is a
major player in the global
branded spirits industry, with a
portfolio of over 50 premium
and super premium brands,
marketed and distributed in
over 190 markets around the
world, with leading positions in
Europe and the Americas.
The Group employs around
4,000 people and has an
extensive portfolio of premium
and super premium brands,
spreading across Global,
Regional and Local priorities.
Shares of the parent company
Davide Campari - Milano
S.p.A. are listed on the Italian
Stock Exchange since 2001.
* Source: Impact’s top 100 Premium Spirits Brands Worldwide by Company, March 2016
Campari Group is today
the sixth-largest player
worldwide in the
premium spirits
industry*.
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DiageoPernod RicardBacardi Ltd.Brown-FormanBeam SuntoryCampari GroupConstellation BrandsE.&J. DistillersMast-JägermeisterThe Edrington Group
Worldwide PresenceA STRENGTHENED ROUTE-TO-MARKET AND PRODUCT SUPPLY CHAIN
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Headquartered in Sesto San Giovanni (Milan),
Campari Group has its own distribution network
in 20 countries. Since 2004, it dramatically strengthened
its route-to-market from 5 to 20 in-market
companies which account for 90%
of Group revenues. The Group
insourced bottling activities in the core
US and Australia markets and globally
increased its manufacturing plants
from 8 in 2004 to 18 today: Italy (4),
Greece, Scotland, Jamaica (3), France (2), Australia,
Mexico, United States, Canada, Argentina, Brazil (2).
2004 in-market companies
Italy, Germany, USA, Brazil, Switzerland.
Additions since 2004
Austria, China, Argentina, Mexico,
Ukraine, Belgium, Luxembourg, Australia,
Russia, Jamaica, UK, Spain, Canada, Peru,
South Africa.
Growth Strategy
Campari Group’s growth strategy aims to combine organic growth through strong brand building with
shareholder value enhancing acquisitions.
Spirits are the company’s core business and where it focuses its acquisition efforts. The group’s strategic thinking is
driven by the desire to reach or enhance critical mass in key geographic markets.
50%ORGANICGROWTH
50%EXTERNALGROWTH
Drive faster growth
of Global Priorities
and incubate Regional Priorities
with best-in-class marketing,
innovation and brand building
Generate steady growth
in key Local Priorities
through periodical renewals
Leverage on rigorous cost
discipline to reinvest savings
into strategic brand building
Develop the Group’s presence
in high-potential markets
Seek acquisitions in markets
where Campari Group
controls its distribution
Acquire local brands
with strong equity
to build new distribution
platforms
Identify Specialty Brands
with strong equity
and pricing power
Maintain financial
discipline
A history of successful acquisitions
8
Campari Group focuses its external growth efforts on spirits and the strategic thinking is driven by the desire to
reach or enhance critical mass in key geographic markets. Campari has a significant track record of successful
acquisitions, having executed 26 since 1995, for an overall value of more than € 3 billion.
Contract beverage Packer**Distribution Company* Subsequently disposed***
Brand Portfolio
Gin
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of over 50 premium
brands in the following categories
and super premium
Campari Group has a portfolio
Tequila
Rum
Aperitifs
Soft Drink **
Whisky
Vodka
Sparkling
Wines
* Campari Group’s portfolio also includes a range of Ready to Drink and other liqueurs and distillates
Liqueurs / Distillates / Others
Subsequently disposed**
Global Priorities
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CAMPARI GROUP GLOBAL PRIORITIES ARE:
* Source: GfK Total Single Source Panel data - Italian market release 2014.2, processed by DCM S.p.A.
2016 Figures
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* EBITDA e EBIT before operating adjustments in full year 2016
Sustainable Campari
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Camparistas are the first
ambassadors of our Group
around the world
and one of the most important
assets in assuring the
success of our business.
Nurturing each unique talent
is crucial to embrace
the challenges
and opportunities presented
by the market.
Consumer safety
and worker well-being
are key factors
for Campari Group’s business:
this is why Health and Safety
in the workplace
and protection
of the Environment
are the milestones upon
which our Group bases
its production activities.
Campari Group’s focus
is on providing the best
products possible
to our customers
and consumers, and aims
to reach this objective
by always choosing superior,
top-tier business partners.
Establishing fair,
transparent and loyal
relationships enables
our Group to offer products
of the highest quality
while constantly delivering
a competitive advantage.
Campari Group
actively promotes a culture
of responsible drinking,
having the deep conviction
that its brands are a way
to enjoy pleasurable
moments, celebrations
and sociable occasions.
Our Group strongly condemns
excessive, inappropriate
or illegal consumption
of alcohol.
In the last few years,
Campari Group has grown
significantly both in terms
of geographical expansion
and number of people
employed, and it is now
directly present in several
countries with different social
landscapes. For this reason,
our group is committed
to promoting excellence,
entrepreneurship and equal
opportunities.
Mission and Values
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CAMPARI GROUP AIMS TO BE THE SMALLEST BIG COMPANY IN THE SPIRITS INDUSTRY
BUILDING ICONIC BRANDS AND SUPERIOR FINANCIAL RETURNS, TOGETHER WITH
INSPIRED AN PASSIONATE CAMPARISTAS
PMO Journey in
Campari Group
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Project Portfolio
Reporting & Analysis
Project Portfolio Management
Practice
Project Management SupportProject Management Support
Project Portfolio Administration
Process, Tools & Capabilities
Project Portfolio Reporting
▪ Consolidate info/data gathering to
facilitate the decision making
▪ Analyze Portfolio to promote
insights, review key business
Projects to ensure correct
prioritization and alignment to
overall strategy
▪ Provide project management
support to functions for
selected key initiatives
Business
Transformation
Business
Development
Innovation
Renovation
Fast
Track
Supply
ChainIT
▪ Provide Workshops
(training and informative
sessions) to emphasize the
importance of Project and
Portfolio Management to
Camparistas
▪ Define and implement a
scalable Project
Management framework
(processes, easy to use tools
and templates)
▪ Project Portfolio
Management Assessment
& Design
▪ Consolidate risks,
assumptions, issues and
dependencies via Status
Report
▪ Project Document Storage
▪ Approval Workflow
Maintenance
▪ Create Dashboards, ad hoc
reports and PMO Executive
Reporting
FROM PROCESS TO VALUE
Project
Type
▪ Facilitate alignment of Projects
and strategic goals by means of
effective portfolio management
▪ Educate on Campari Way of
Project and Portfolio
Management by means of
Workshops (training and
informative sessions)
▪ Continuous improvement
approach leveraging on the New
Campari Group Project
Management Platform (MS Project
Online)
From Process to ValueThe PMO journey in Campari Group
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PMO Achievements so far….
Innovation Project Portfolio : 187 projects managed in 2016
Innovation Time to Market 2016 -39% vs 2015
Less Proliferation of Low GM Product with greater focus on GM accretion
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4
1
5
Integrated approach to Project Management methodology across Campari Group
Benefit from staffing of highly skilled project management professionals to increasingly
complex projects and programs
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Improved collaboration, staff productivity, integration and cost-effectiveness, delivering
Projects benefits on time and within scope
3Improved results on business objectives from completed projects, capitalizing on
accomplishments and lessons learnt
2Efficient strategic resources prioritization through Project/Program/Portfolio tracking,
reporting and analysis.
Enhancement of maturity for Campari Group through structured and distributed
Project/Program/Portfolio Management6
Improved efficiency of Operational Functions
Global PMO Expected Key BenefitsFrom integrated approach of PM methodology to efficiency of Operational Functions
PMO and Strategy Execution
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STRATEGY COMPASS
Strategic Pillars, Goals and Objectives
ENSURE
STRATEGIC
ALIGNEMENT
PROGRAMS AND
PROJECTS
Enable Benefits
Do things right
Portfolio Management
Do the right things
PORTFOLIOS
ENSURE
VALUE
CREATI
ON
Benefit Realization &
Sustainament
Business Value
BUSINESS
OPERATIONS
CU
ST
OM
ER
S &
MA
RK
ET
S
Source: Adapted from 2017 PMO Quick
Tip Guide.
The new role of PMO: greater focus on Value Creation
PMO Sustainability and Viability
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• PMO is positioned at an enterprise executive-level, and has senior-executive support.
• PMO existence allows the other areas of the enterprise to focus attention on their functional areas of operational responsibility.
• PMO is assigned those formally established and commonly accepted roles and responsibilities of an independent functional organization.
• PMO is given recognition and acceptance as an integral part of enterprise’sorganizational structure.
• PMO leads establishing and institutionalizing Project Management methodology best practices enterprise-wide.
• PMO has cross-functional organizational support from the enterprise’s operations organizations
Source: PMO Framework and PMO Models For Project Business Management, Bolles & Hubbard 2015
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To create a culture that embraces project management and to increase the business value they bring to the organization, PMOs need to have clear direction, governance and support.
They must be 1) staffed with skilled personnel2) have access to top management.
“Hiring of people with the necessary business skills or leadership talent to drive strategy implementation is a very high priority at their firms”
Source: Economist Intelligence Unit. Why Good Strategies Fail: Lessons for the C-Suite. 2013.
PMO Key Success Factors
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With the initiative roadmaps having been rigor-tested, the PMO well positioned, its role clearlyunderstood, and the right processes established for gauging progress against upcomingmilestones and objectives, strategically aligned PMOs provide the means for the businessmanagers tasked with delivery to provide senior executives the information they need – and onlythat information – with enough time to make course corrections and ensure that the initiative getsdelivered in terms of both impact and timing
Source: The Boston Consulting Group. Strategic Initiative Management: The PMO Imperative. 2013.
High Performers PMO are four times
more likely than Low Performers
to be rated better than
their peers on strategy execution..
Enterprise wide PMO delivers more Value
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Overall, a PMO with a broader business-wide responsibility—such as an Enterprise-wide PMO (EPMO)—is closest to delivering business value to the organization because it is more likely to
routinely help in aligning project outcomes to strategic priorities
Source: The impact of PMO on strategy – PMI Pulse of the Profession 2013
PMO value creation in Strategic
Initiatives Management:
Lessons Learned
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Communication Strategy
Clearly communicate organizational strategy, choices and goals to stakeholders, and guideleaders by means of Portfolio Management and
Intake Processes.
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SETTING THE DIRECTION
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STRATEGIC COMPASS
PILLAR GOAL OBJECTIVE
What
provides
strength
and
support
the
Vision?
What is
the
broad
primary
outcome
?
What our
organiza
tion
must
achieve
to make
its
strategy
succeed
?
How do
we
enable
the
project
prioriti
sation?
How do
we
measure
the
achieve
ment of
the
strategic
objective
?
How do
we
measure
the
achieve
ment of
the
strategic
goal?
OPERA-
TIONAL KPI
ECONOMIC
KPIPRIORITY
Setting Goals
Support, clarify and drive processes for capturingdepartmental goals, and for validating and
assessing proposed initiatives againstthe stated strategy accordingly
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Planning
Facilitate the necessary assessments, planningand integration of related initiatives and programs formed to deliver the required outcomes - whether it concerns change or new product and services
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Benchmarking
Develop common goal-setting and benchmarking models for your business
initiatives
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Scenario Modeling
Collaborate with business leaders and financefor strategic portfolio scenario modeling and planning, as well as long-range planning and
develop related business cases
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Creating business roadmaps
Assist your Portfolio business units with high level roadmaps to illustrate key planned activities and benefits, and leverage them for all leadership
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Migrate XYZ to CRM Decom XYZ
Q3Q1
Milestone #1
Q2 Q4
2017 2018 2019 2020
Q3Q1 Q2 Q4 Q3Q1 Q2 Q4
Owner: N. Surname
Milestone #2
Benefit SustainamentBenefit Realization
IllustrativeBenefit Realization Roadmap - High Level 3 Year Plan
Ident./Prep ClosureStrategic Goal A
-KPI
Benefit SustainamentBenefit RealizationIdent./Prep Closure
Q4Q3
New Cloud Service Platform –
Reduce Time to Market 40%
Reduce Cost of Invoicing - Reduce #
Formats by 60% (1M€)
Increase Region 3 Customer Satisfaction
By 1.3
Owner: D.Chang
Owner: A. Smith
Owner: S. Nielsen
Benefit SustainamentMigrate System A
POC, Source New Platform
Decom Old
Configuration
SET BASELINE
Customer Care Training
Launch System C
Migrate System b+
Product Launch and Maintenaince Benefits
0,5
M€40%
+ Milestone
Develop XYZ CRM feed + 30% 60%
Develop Training, Comms
Update Revenu Controls
1M€ Benefit Sustainament
Savings
+
Benefit
Root Cause, Plan +
Customer Service Staffing
Migrate XYZ to CRM Decom XYZ
Source: 2017 PMO Quick Tip Guide.
Maintaining alignment
Continuously review the portfolios and confirm that you "do the right things" in line with current strategy
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Reviewing opportunities
Organize regular opportunity reviews to consistently guide the organization to expect, anticipate and embrace change and opportunity. Grow capability to identify and integrate change to drive organizational agility
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Leading change
Lead change initiatives, develop methods by productizing processes and tools, more broadly
across the organization….to create more value together
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You have to learn the rules of
the game, and then play better
than anyone else“
Albert Einstein
“.
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