The Dimensions of the AXA IM Company Repository

AXA Investment Managers used MEGA tools to model its business processes and to implement its company repository. This enterprise architecture served as a basis for various applications within the company, such as Business
Continuity Planning, Outsourcing and Business Process Improvement.

“It was our view of the company’s landscape that changed: our ‘perceptual looking glasses are constantly being polished,” stated Michael Jameson, Head of Organisation, Paris and AXA Way Leader within AXA Investment Managers. This multinational subsidiary of AXA with multiple specializations in the fi eld of asset management discovered the importance of business processes by focusing on the value chains that were most relevant to the company. “Fund management is a network of players who exchange information, products and services with one another through business processes.” “The execution of such processes makes all the difference”.

“In order to go from conceptualization to implementation, you need a meta-model of the enterprise architecture.”

The approach begins by establishing the defi nition of a business process, which can be expressed four different ways or in four different steps: as a series of interrelated activities; as the process of transforming input from suppliers into output for customers; as a stream of inter-departmental activities within the company; or as a logical combination of operational components. This defi nition involves calling every aspect of the company into question: “The result of this transformation is
added value that comes closer to the customer’s expectations. It is a matter of establishing the boundaries of our operational scope; that is, where the process begins and where it ends. The value chain includes customer and supplier activities,” explained Michael Jameson, who insists on the importance of the «process owner» who takes responsibility for the process from start to fi nish and promotes it: “No process without a process owner.”

Once the business processes are defi ned and situated and the responsibilities are attributed, AXA IM uses the enterprise architecture, as developed with MEGA, as a frame of reference.“A concept that is both easy to understand and relayed by many of the consulting fi rms,” Michael Jameson pointed out. “In order to go from conceptualization to implementation, you
need a meta-model of the enterprise architecture.” This meta-model is shared by the three process layers: business, application and technical infrastructure, refl ecting the organization of AXA IM around the processes. The business (Organization) is responsible for the “business and organizational architecture” layer, whereas the IT (department) is in charge of modeling “data and applications” and “technical and operational architecture” layers. Between the two teams, there is a joint steering committee, known as the “Business Modeling” team who manages the evolution of the meta-model. Each of the players in the company can navigate through the maps using this meta-model. Thus, the organization that owns the business processes “drills down” to the application components managed by the IT department. Conversely, in case of an incident
occurring within lower layers, the information system people can “drill up” to the consequences for the business processes.
Business process modeling and establishing the company repository are the prerequisites for three major projects conducted by AXA IM: Business Continuity Planning (BCP), Outsourcing and Business Process Improvement.

Business Continuity Planning: “resilience” is an asset The BCP, or business continuity planning, is the way in which the company plans (or does not plan) disaster recovery. Indeed, for AXA IM, risk management of force majeure events is a
mandatory part of fulfi lling regulation requirements and its commitments to its customers. Michael Jameson insists on the notion of “resilience”, that is, the ability to handle, withstand, and recover from major unexpected events: “A company’s ability to get back on its feet and get up and running again after a major crisis is critical to its survival. Disaster recovery is the height of “resilience”. Various contingency strategies can be pursued, the most elementary of which consists of improvisation along the lines of “we’ll wait and see”. AXA IM’s attitude, like that of any responsible company, is completely different and follows the lines of thinking that “this could happen to us, so we should prepare ourselves for it.”

This preparation consists in:

• Framing the right questions: What is critical for our business?
• not focusing on the details, but on the most stable aspect of the company: the business processes;
• identifying the minimum levels of service to be produced within the next 24 or 48 hours or the next fi ve business days.

We believe that, as a general rule, a company consists of approximately 15-20 processes (or subprocesses) that are truly critical. For the purposes of the BCP, AXA IM identifi ed seven major ones (cash management, trading, delivery settlement and fund valuation, among others). “The key is choosing the people well to identify THE process, which will lead to producing a specifi cation sheet for the required technical and offi ce standby facilities,” said Michael Jameson. After identifying the business needs, you must establish the means, and then test them periodically.“The business modeling repository has served to formalize and validate our critical business processes, to document in one single place our backup plan (the mini-BCP), and to test our recovery plan (testing protocol),” Michael Jameson summarized. Mini-BCPs are informationgathering tools in the form of documents that outline the needs of each AXA IM team. They are updated regularly, as the content in the repository changes.

“The business modeling repository has served to formalize and validate our critical business processes, to document in one single place our backup plan (the mini-BCP), and to test our recovery plan (testing protocol),”
Michael Jameson, Head of
Organisation, Paris and AXA Way
Leader within AXA Investment
Managers

Outsourcing: for better fl exibility and lower costs AXA IM decided to outsource the entirety of its back-offi ce activities. The company had grown by leaps and bounds, which was why there was a certain mix between back-offi ce and frontoffi
ce activities. In order to separate these two parts of its operative system, AXA IM mapped out the various processes: in the front-offi ce, in the back-offi ce, front-to-back and back-to-front, in order to “take everything that was part of the back-offi ce out of the front-offi ce, which was hindering our fl exibility and increasing front-offi ce costs, and to establish the new operating model between back-offi ce and front-offi ce,” Michael Jameson explained.

The mapping clearly defi nes the functional scope of outsourced activities and the detail of the expected inputs and outputs. “Deliverables entrusted to our partner and those for which we are responsible for are outlined in the contract,” he added.
The exercise of defi ning and agreeing on the outsourcing scope was facilitated by the construction of an intranet by AXA IM specifi cally for the partner. Created using the MEGA repository, this tool enabled the partner to learn intelligently about the activities and the structure of AXA IM. It introduced the teams, expertise, and procedures, all of which was supplemented by comments explaining how operations are performed with browsing and drill-down capabilities.

Business Process Improvement: choose the right processes and measure them Why Improve? To gain a competitive advantage, this is essential in the highly competitive business in which AXA IM operates. This is an ability that results in innovation, quality, effectiveness, reputation, expertise and spirit. The improvement of a company occurs through the improvement of its processes: “Processes are vehicles for completion; they are factors of differentiation,” commented Michael Jameson. Just like for the other two applications (BCP and Outsourcing), you must choose the right processes. In this case, the ones that are the most critical are those that offer the most quality to customers, the most added value: “Get the right process right.”

MEGA’S OFFERING

A pioneer in the fi eld of modeling, MEGA is an architect of modern companies that structure their management around value creation mechanisms. Its enterprise architecture solution, is intended for the executive management of major organizations. The consultants specialized expertise and the MEGA software Suite, enable them to anticipate and assist with complex decision making that impacts the organization and the information system, by offering a clear, general overview of the activity and resource architecture for which they are responsible, using a company repository. This service offering, which is unlike any other on the worldwide market, has given MEGA its global leadership position in the fi eld of company repositories.

“Processes are vehicles for completion; they are factors of differentiation,”

In order to improve the business processes, you must be able to measure them, i.e. how well are they performing?. Measures and improvements can pertain to various aspects: customer dissatisfaction, lack of employees’ motivation, dysfunctions (breakdowns or recurring incidents), the presence of «re» (re-do’s, reconciliations, re-calculations, re-validations, re-initialization, etc.), indicating wastes of energy and time. “At this stage, customer expectations, our objectives and
internal performance evaluations must be included in the mapping,” said Michael Jameson.

It is not a matter of going directly from what one thinks is the current situation (without specific mapping in support) to what one thinks it should be ideally. First you must take the time to fully understand the process as it really is (gathering the facts), and in order to do this, evaluate and analyze it, before aiming at the fi rst target, that is, what it should be: the implementation of the improved process must consider the return on investment (for the customer and for the company).

“It was the only solution offering a consistent and simple meta-model.

Choosing MEGA

To build its single repository, support for business processes and a tool to facilitate dialog between process owners, AXA IM selected MEGA. In the fi nance industry, there are major players who are already using MEGA, and we have benefi ted from the advice of these companies so that we would not commit their errors. The pilot projects enabled us to assess our ability to use the tool on our own after a limited amount of time had elapsed (less than one year),” Michael Jameson explained. “We watched the cost curve decline and the utility curve rise, which would not have been possible if we had been dependent on a consulting fi rm.”