“Don’t discredit or undervalue the small wins; the small wins are what eventually end up stacking on top of each other to lead us to some of those larger, more ambitious TBM goals that we all set off on our TBM journey to achieve.”
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Stanley Black & Decker is winner of the 2022 TBM Council’s Business Innovation Award. |
In December 2021, Securitas AB agreed to purchase the Stanley Security business from Stanley Black & Decker (SBD) for $3.2 Billion (USD). As part of the sale, the SBD IT team needed to develop a holistic estimate of total IT costs for Stanley Security before the end of the year. To deliver on this very aggressive timeline with accuracy and precision, the SBD Information Technology (IT) team turned to their Technology Business Management (TBM) team members. Leveraging TBM tools, methods, and practices, SBD’s TBM team delivered an initial estimate to the deal team in less than two days – representing an 85% faster turnaround time and a 60% reduction in transaction-related costs.
Founded in 1843 and headquartered in New Britain, CT., Stanley Black & Decker (SBD) is the world leader in tools and engineered fastening systems, including brands like DEWALT, BLACK+DECKER, CRAFTSMAN, STANLEY, Cub Cadet, Hustler, and Troy-Bilt. In its 179-year history, the business has grown organically and through mergers, acquisitions, and divestitures (M&A&D). SBD has completed approximately 100 M&A&D over the past decade with a company strategy to maintain a robust pipeline for acquisitive growth and divestiture.
In December 2021, Securitas AB agreed to purchase the Stanley Security business from SBD for $3.2B (USD). As part of the sale, the IT team developed a holistic estimate of total IT costs for Stanley Security before the end of the year, a very aggressive timeline. Compounding the challenge of the aggressive timeline was the imperative that the estimates of SBD’s complex IT ecosystem (which maintains approximately 1,500 applications) be accurate and precise to preserve the integrity of the transaction.
Stanley Black & Decker established a strategic TBM discipline to drive transparency into IT consumption, specifically to create clarity in two areas:
TBM is a significant capability for Stanley Black & Decker and is leveraged extensively for strategic acquisitions and divestitures. Leveraging the TBM tools, methods, and practices, SBD’s TBM team delivered an initial estimate to the deal team in less than two days. This represents an 85% reduction in turnaround time versus the prior, largely manual estimating methodology, which would have taken two or more weeks.
Supporting stretch use cases like M&A&D activity has proven pivotal for the SBD TBM team. The capability was developed in 2020 and fully refined in 2021. With the Security business divestiture, the true value of having reliable and defensible. IT cost information for these transactions became clear in late 2021. The deal team applauded the quick turnaround and enabled those IT team members engaged in the Securitas transaction to take scheduled end-of-year holidays.
Using TBM tools, methods, and practices, the team was able to reduce transaction-related costs incurred by Stanley Black & Decker by 60%, which translated to a multimillion-dollar improvement in the accuracy of costs in the deal model. By leveraging TBM in these efforts, IT was able to dramatically reduce the time necessary to provide cost details, accurately and precisely estimate SBD’s cost obligations as a part of this deal, and drastically decrease the amount of time to validate costs and supporting details around those costs on a go-forward basis as the transition occurs.
By leveraging TBM to estimate IT costs for site closures and M&A&D activity, SBD can readily provide accurate and defensible information that is easy to understand by stakeholders across the company. This has dramatically improved stakeholder confidence in the information provided by Stanley Black and Decker IT. Additionally, the SBD TBM team has developed repeatable processes to support strategic M&A&D activity moving forward, which will continue to achieve a fast turnaround, and reduced transaction costs.
TBM data, tools, and processes have helped significantly improve the time required to gather the data and the accuracy of the costs provided. Manual cost tracking and validation, which previously took weeks to perform, were replaced by automated reporting using TBM tools. Additionally, SBD eliminated the need to manually re-run updated cost models to answer ad-hoc questions from the deal team and provide accurate and precise reports available on demand to key stakeholders.
Leveraging the standard TBM taxonomy over the past two years has established consistent and predictable models for IT costs and generated reliable IT consumption information month over month. Beyond M&A&D, using TBM methods, tools, and practices to create strategic reporting helps answer key business decisions around site optimization. TBM has truly driven cultural change at SBD, requiring that tools supporting other functional areas, such as PPM, CMDB, and procurement, are designed with TBM in mind. This has helped normalize a common language across departmental and functional lines. The application of TBM is evolving to support key company strategies around performance resiliency with a focus on identifying sites, users, and applications that cost more than average to improve overall company profit margins.
As the 2022 TBM Council’s Business Innovation Award winner, the Stanley Black & Decker TBM team encourages organizations to celebrate the small wins along the TBM journey. Trae Baker, TBM Manager, shared, “Don’t discredit or undervalue the small wins; the small wins are what eventually end up stacking on top of each other to lead us to some of those larger, more ambitious TBM goals that we all set off on our TBM journey to achieve.” These small wins provide your team the energy to persevere through new challenges, and they provide momentum in trust-building and developing advocates within the organization.
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