The Advanced Business Services & Technology Sector

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Overview

!

Romek Lubaczewski

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• Elimination of duplicated cross-country effort. • Reduction in operating cost by re-locating to a lower cost country.  

Cost

Quality

Strategic

Benefits

Source: PwC SSC Advisory, 2014

• The ability to implement and control change. • Management team

focus on strategy and not daily operational issues.

• Enable “bolt-on”

capabilities for potential, future acquisitions.

• Easier and cheaper to roll out ERP.

• The ability to implement best practice standard processes.

• Specialisation to increasing efficiency and improve service levels.

• Better service through unified processes and technology.

• Improved control.

KRAKÓW is a Maturing Market

BU

SIN

ESS

BEN

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BYDGOSZCZ Alcatel-Lucent Atos Origin WARSAW Accenture Aviva Avon CBRE Outsourcing Citibank Colgate Palmolive Elavon Esselte Euronet GE GSK Goldman Sachs Itella Information Jones Lang LaSalle

Lionbridge Oriflame Procter&Gamble Roche RBS RS Components Schneider Electric Sitel Stanley Symantec  Tchibo Wipro Wincor-Nixdorf GLIWICE Ista Pregis Saint-Gobain GDAŃSK Acxiom Arla Foods Bank BPH/GE Capital

Bayer Fineos First Data Geoban Kemira Metsa Sii Sony Pictures Thomson Reuters WNS LUBLIN Genpact Orange Electrolux EPAM Estimot Ericpol Euroclear Euroscript Farnell element14 FMC Technologies FQS Fujitsu GE Healthcare Genpact Google R&D Hays HCL HEINEKEN Herbalife Hitachi HSBC IBM International Paper Kenexa Lastminute Lufthansa Lumesse Lundbeck Luxoft Making Waves Mota-Engil Motorola Nokia Ocado Technology Oracle Perkin Elmer Philip Morris Rolls Royce RWE Sabre Samsung Sappi Serco Shell Sii

State Street Services Stefanini Tesco UBS UPM Valeo Vesuvius Xerox SZCZECIN Arvato Services Coloplast Genpact

Stream Global Services Metro Group Tieto UniCredit Unizeto Technologies POZNAŃ Amazon Arvato Services Carlsberg Dalkia Duni Franklin Templeton Jeronimo-Martins Carl Zeiss GSK IKEA MAN Roche WROCŁAW ACP Alstom CAN Credit Suisse Diehl Controls Fagor Geoban Google SSC HP IBM Irevna KPIT Cummins Luxoft McKinsey Microsoft Mphasis

Nokia Siemens Networks Opera Software PNC (PFPC) QAD Remy International Ruukki Siemens Tieto UPS Volvo Wabco Whirlpool DĄBROWA Alba Arcelor Mittal Wipro ŁÓDŹ Accenture Atos Origin BSH CERI Citi Financial Fujitsu Services General Electric HP Indesit Infosys Nordea PCT SouthWestern CZĘSTOCHOWA TRW KATOWICE Capgemini Grant Thornton HireRight IBM ING PwC SSC Rockwell Automation Steria

Source: ASPIRE, January 2014

12k

9k

7k

6k

3k

!

Shared services, outsourcing & IT centres in Poland

6k

!

35k

BIELSKO – BIAŁA Fiat SSC Żywiec CH2M Hill Chatham Financial Cisco Clifford Thames Comarch Connect2Media Delphi Deutsche Telecom EDF

!

KRAKÓW ABB Accenture AMS Amer Sports Amway Antenna Aon Hewitt Apriso Arvato Finance Assa Abloy BNP Paribas Brown Brothers Harriman

Capita Capgemini CBB

!

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2007 2008 2009 2010 2012 2013 2014 30 10 20 40 50 Kraków Prague Budapest Brno Warsaw Bucharest Bratislava Sofia

Top 50 Global Outsourcing Cities 2007-2014

- Top Cities in Central & Eastern Europe

!

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2007 2008 2009 2010 2012 2013 2014 10

5

15

Top 50 Global Outsourcing Cities 2007-2014

- Europe’s Top 2

!

Source: Tholons Top 100 Cities for Global Outsourcing

Dublin 4 Kraków 16 15 14 11 11 10 Kraków 9 Dublin 10 9 8 7 6 5

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Evolution of the Business Services Sector...

20%

2015 Forecast

The Old:

!

Basic Accounting

!

Call Centres

!

Payroll

!

Data Processing

The New:

!

Analytics

!

Audit & Compliance

!

Software Development

!

Marketing

!

Investment Fund

Servicing

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New entrants

Accenture

Arvato Finance

Herbalife

GE Healthcare

Lundbeck

Ocado Technology

Sappi

RR Donnelley Technology

RWE

Samsung

Stefanini

Companies that added

200-500 jobs

Brown Brothers Harriman

Capgemini

Cisco Systems

Comarch

Euroclear

HEINEKEN

HSBC

Lufthansa Global Services

Sabre Holdings

Shell Business Services

State Street Services

UBS

Tholons Ranking

Kraków has replaced Dublin as the top ranking

location in Europe.

Kraków 2013 Headlines

35,000

jobs

11

1st

12

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OUR BUSINESS CREATES JOBS

New jobs in advanced business services and technology, 2000-2015

Source: ASPIRE Headcount Tracker and AG Test

12 500 25 000 37 500 50 000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 1 000 1 500 2 000 2 500 3 000 4 000 6 000 8 000 11 000 14 000 16 000 19 000 22 500 27 000 32 000 38 000 Today Headcount

New jobs created every year

in each of the last 5 years

20%

38 000

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Our Business supports the development of modern OFFICE SPACE

2015 Forecast

37%

63%

Advanced business & technology services Other

!

• Centres lease approx. 330,000 square metres

of class A office space out of a total stock of 530,000 square metres!

!

• An additional 115,000 square metres of office

space is being delivered in 2014

Companies in the advanced business & technology services sector are driving the

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Transport Strategy

20%

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Józefa Babińskiego Zawiła Jugowicka

Podmokła Stanisława Stojał_owskiego

Cechowa Kosocicka Kobi erzy ńska Kobierzy ńska Ka_pe lan_ka Tyniecka Tyniec ka M irowska

Księcia Józefa

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Jana Surzyckiego Rybitwy Tadeusza Śliwiaka

Księcia Józefa

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Karola Łowiń_skiego

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Aleja Jana Pawł_{a II}

Tadeusza Ptaszyckiego Uja ste k M og ilski Igoł_omska Igołomska Topo lowa Krakowsk a Past_ern ik Aleja Soli darności K ra si ń sk ie go M ickie wicz a S łowackie go Józefa Wybickiego Prą dnic ka

Aleja 3 Maja MiastoStare

A4 A4 A4 10 000 8 600 5 800 9 200 6 200 12 100 8 200 9 200 Liczba pracowników 19-39/godz. 10-18/godz 1-9/godz LEGENDA

LICZBA KURSÓW TRAMWAJÓW 10 000

Source: Knight Frank, 2014

As the sector grows so too does the need for a transport strategy to accommodate the sector’s commuting needs!

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Our Business has significant COMMUTING NEEDS

20%

2015 Forecast

36%

64%

Public transport Private transport

22,400 people

12,600 people

35,000

people commute to work on a daily basis.

This puts a strain on the transport system, especially between 8-9 a.m. and 5-6 p.m.

Bicycle paths

!

4% travel to work by bicycle Parking

!

30% travel to work by car

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Our Success Story is being written by Kraków’s YOUNG PEOPLE

20%

• The quality and the value of our services stems directly from the potential of our staff pool

• The multicultural skills, abilities, the sensitivity to diversity – all these are the characteristics of our people which are not

widespread in other global locations

• The industry offers unique opportunities for learning and development

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Average age of people working in Kraków centres

70%

% of staff that are graduates of Kraków universities

83%

% of staff with a university degree

7.9

Average Training days per year per employee

• Kraków centres provide career

opportunities to Kraków graduates, keeping the best talent in the city • Our centres like universities

-aspire to be centres of learning and excellence

• We also attract young talent from across Poland and other parts of the world

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Our Business is dependent on LANGUAGE and CULTURE

2015 Forecast

36

Languages utilised in Kraków centres

11%

% of foreign nationals working in centres 86% 15% 14% 11% 5% 4% 3% 2% 2% 1% Top 10 Languages

1% equals approx. 300 people

94

Countries served from Kraków centres

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Our Business develops MANAGERS & EXPERTS

2015 Forecast

ASPIRE Market Survey 2014

5,000

Managers

14% of staff are in

management positions

General Management 1% Operational Managers 3% Team Leaders 10% Operational Staff 86%

(17)

Our Business delivers ECONOMIC VALUE

2015 Forecast

57%

● Average gross monthly salary per employee within SSC/BPO/IT/ITO sector

!

● Average gross monthly salary in enterprises employing more than 9 employees.

Polish Statistical Office, 2012

6 116 PLN

3 878 PLN

133k

PLN

Annual value to the local economy of each job created in the

advanced business services and technology sector

4 655m

PLN

Total value of the sector annually to the economy of Kraków

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Shared Service Centres (SSC)

Magdalena W

ł

odek

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ASPIRE members representing Shared Services sector are some of the world’s biggest global brands:  

Philip Morris, Shell, Heineken, Amway, ArcelorMittal

Companies

SSC is a separate organisational entity providing services (i.e. accounting,

IT, payroll, HR, logistics etc.) for internal clients within a geographically

scattered corporation or capital group

Apart from transactional processes, the centres provide more and more complex added value functions (eg. tax or legal advisory), to improve the levels of expert knowledge and offer their employees more development opportunities

SSC in Kraków attract not only talented Polish graduates using many

foreign languages, but also young people from across Europe offering

them jobs in multicultural environment, access to professional training and attractive career paths

Definition

Range

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Business Process Outsourcing (BPO)

"

Wojciech Pop

ł

awski

Accenture

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ASPIRE members representing BPO are among others: Accenture, IBM, Capita, AON Hewitt, AMS, Genpact

Companies

BPO providers are the global corporations operating accross all

continents and typically combine mutliple capabilties from bussiness

process management for the exteral Clients, strategic advisory and technology solutions.

BPO providers deliver services to the largest international companies

and brands across all industries in the fields of Finance & Accounting,

Human Resources, Supply Chain, Procurement, Marketing and more.

Range

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BPO sector in Central Europe primarily attracts the multilingual

candidates (including foreigners) and develop highly educated

workforce working for the largest global brands who gain the

international experience without a need of leaving Krakow – very often being the best City advocates who bring more work to Poland.

BPO providers contribute to attracting a number of new foreign

investors to Krakow, who initially got to know the location and talent

potential thru the cooperation with BPO companies from Krakow.

Companies in this market segment are the largest single employers

of the entry level profiles creating the first time job opportunities for the university graduates. The comprehensive global and local training

programs help developing the broad range of competences and

Graduates

Impact

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Financial Services

"

Scott Newmann

State Street

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ASPIRE companies representing Financial sector:

HSBC, Goldman Sachs, State Street, Euroclear i Brown Brothers Harriman

Companies

Wide range of services being provided incl. Investment Fund Servicing, Hedge Fund Administration, Derivatives, Portfolio Analytics, Private Banking and Asset

Sector creates high value, advanced products, services and technologies

Substantial future development plans

Added value and benefits for the city

Range

!!!!

Growth

Impact

The sector attracts industry professionals to Krakow from all over the world

Our investment in Training & Development is core to the sector

Career

People

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Technology

"

Wojciech Burkot

Google

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ASPIRE member companies representing advanced technology sector are some of the biggest global brands such as: Sabre, Motorola, GE Health, HCL, EPAM, Ocado, Akamai, Cisco, Google

Companies

Technology centres enable the establishment of new innovative start-ups using open access technologies (API, „open source”). These technologies are also available for universities through opening of labs, funding research scholarships as well as providing lectures

Technology centres main business area is software development but they also provide services complex systems traffic maintenance as well as training activities

Approx. 6000 employees are solving problems on global scale mainly. During recruitment process we need to compete with all the attractive global locations such as Berlin or London in Europe or the Silicon Valley

Innovation

Range

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Our aims

"

We aim to benefit from the out-shoring trend

"

•

BPOs, SSC, Financial Services & IT Centers bring organizational and

technological solutions which

drive progress and innovation

.

"

•

We need to attract skilled students and employees to Krakow so we

can

climb the value ladder

of our parent companies by attracting more

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Cooperation triangle

Municipality role:

"

• influencing curricula, promoting climbing

up the value ladder for new centres;

"

• funding diversity programs

Universities

Innovators

Companies

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•

A key for the future city’s development is

cooperation within the triangle

-

moderated by the City Council.

"

•

Kraków’s development history clearly shows that cooperation between

potential competitors

helps to ‘grow the cake’

(and benefits) for all parties

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Potential

areas of

cooperation

Transport

Promotion

Non-Polish

nationals

Consultation

Education

Innovation

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Transport & Infrastructure

"

• Bicycle Paths connecting central transport hubs and housing areas to

major office developments – e.g. Bonarka, Krakow Business Park, Kazimierz, Bronowice

• Development of a Central Business District (CBD) to better compete

with other cities, rationalize infrastructure development and enable effective management of zoning with developers

• Transport from the airport to the city centre – e.g. Metro

• Increased availability of parking near to major office locations

• Road repairs and working together to identify and optimized schedule to

avoid significant disruption to roads and the transport network

1

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Promotion of the sector

• Work together with ASPIRE to promote the sector and member

organizations and their career opportunities

• Promote the sector outside Krakow in other Polish cities to attract

skilled workers to come and work in Krakow, e.g. develop a relocation incentive

"

Support for Foreigners & People from outside Krakow

• Work together to help provide assistance to foreigners to navigate

through local bureaucracy, e.g. registration at the Department for Foreign Affairs

• Assist foreigners with integration into the local community  

– e.g. where to go for help and information, documentation in multiple languages, Web-site for foreigners in Krakow

2

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Consultation with the Sector

• Actively collaborate with the sector to consult on policy decisions which

may directly impact the sector and the workforce – e.g. childcare

"

University collaboration

• Collaborate to develop curriculums which help students to better

prepare for a career in a multi-national organization, e.g. More

internships, public speaking, project skills, business language classes

4

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Innovation

• Stimulating the development of local firms which target their products

and services at the sector (solving communication or parking issues)

• One common list covering the needs of both the city and sector, that

would define the city’s ‘Demand for Innovation’

6

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Projects

Joined analytics program that aims analysing the students/graduates migrations (in/out) and the alignment of the competences of

graduates to the jobs offered by the sector. The outcomes / insights should aid the city and universities’ authorities in decision making around the new sources of talent outside of the near region and modification of the educational streams / programs including the hands-on languages skills beyond the typical western languages. ASPIRE members are interested in participating on the educational programs and more structured internship projects.

Continued employment growth should be synchronised with the

relevant increase of talent supply (nominal increase of the graduates or the structural change of the profiles / educational steams fitting the jobs offered by the sector)

Market saturation create impact location competitiveness

vs. other cities in Poland or CE

Challenge

Aim

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Adapting the transportation infrastructure to the sector

requirements

Joined analytics program to create the interactive comuting routes of the sector employees (office, schools) to optimizethe public

transportation network in the city, working ours flexibility and reduction of the cars traffic.

Optimizing the transportation network taking into account the

business service sector requirements improve the workforce mobility and work life balance what is in the center of core values of business services organisations.

Aim

Actions

Projects

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