EUROPEAN SHARED SERVICE CENTRE MIGRATION PROJECT –

FREQUENTLY ASKED QUESTIONS

Generic Questions
1. What is the European Shared Service Centre migration project?

During 2009, changes were made to the HR operating model globally, designed to improve our overall
effectiveness by simplifying and clarifying the way we work with each other and our customers. Shared
service centres were launched for the Americas (based in Norwalk) and Europe (based in London),
known as first point.

The first point teams in Europe and America began providing HR support and services to the UK, Ireland
and North America in 2009. This included the introduction of a new telephony service for Line
Managers, Employees and HR for managing queries to these service centres. The Europe project is now
focusing on migrating in HR support and services for Hungary, The Netherlands and Spain, which is
planned on a phased basis throughout F11.

2. Why are we making this change now and what are the benefits?

This change is part of a wider programme, designed to improve the effectiveness of the HR function
globally, to set us up for success and uphold our Destination ambitions. This includes increasing the
focus on consistent service delivery and standardisation of processes.

Introducing and expanding a shared service centre (SSC) supports our focus on service delivery by:
 Gaining synergies and finding efficiencies by making changes to the operating model across
multiple markets
 Allowing more markets to take advantage of the investment Diageo is making in technology
designed to improve our effectiveness
 Greater use of the SSC for support of HR transactions and delivery will mean Business Partners
in-market have increased ability to focus on talent, reward and organisational effectiveness, to
drive business performance
 Providing dedicated support to our HR process and services will allow us to deliver these more
consistently and build deeper skills and experience within these specialist teams.
 Providing easier access to these dedicated teams, putting line managers and employees at the
heart of everything we do and being consistent in the way we deal with our customers
 Simplification and standardisation of HR processes and services, which allows us to better
manage the balance between quality and cost efficiencies
 Consolidation of service delivery into fewer locations (ie London and Norwalk) to better embed
a clear service delivery culture

Within the UK, Ireland and North America, we had already started on this effectiveness journey. The
challenges of the current economic environment have encouraged us to push further and faster with the
HR Operating Model within other key geographies to realise further benefits. This includes expanding
first point to other markets within Europe, Latin America and the Caribbean.

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3. Which European markets are moving to first point?

The first point team in Europe began providing HR support and services to the UK and Ireland in 2009
and will extend their HR support and services for Hungary, The Netherlands and Spain in F11.

4. Why are the rest of the European markets not moving to first point? Will they move in the future?

The benefits case for migrating to first point is determined on a market by market basis, balancing such
factors as local legislative requirements; market needs, scale and complexity; maturity of process; costs
and complexity of implementation. Thus, a number of our European markets would be unlikely to
realise significant benefits if they were migrated to first point.

A key principle of the HR operating model design is scalability ie that we are designed with the flexibility
to grow and shrink service as the priority changes in the markets. It may therefore be appropriate that
other markets are considered in the future for migration to first point, although currently the focus is on
the UK, Ireland, Hungary, The Netherlands and Spain.

5. Is first point a Diageo service or has it been outsourced?

All of the first point team are Diageo employees, having either moved internally or been recruited
specifically to the team, and based predominantly within London (with some exceptions – see question
13 below).

6. Is this part of an outsourced strategy?

Diageo is not currently working towards a strategy of outsourcing our HR services. It is prudent for
Diageo to continually review the most effective and efficient means of providing HR services, however,
outsourcing was not considered to be the best option for Diageo’s HR services and support. This
decision is reinforced when looking at external trends in the market; increasingly organisations are
looking to in source HR Services, to ensure they achieve certain levels of customer service.

7. What are some of the implications of moving to first point?

The success of the service centre will demand much greater consistency of application and efficient
delivery of common HR processes across multiple geographies. In order to realise this success we need
to move to common processes and standardisation of policy wherever possible. Of course one size
doesn’t always fit all but we need to minimise variations and have a clear rationale for the exceptions as
heavily customised services increase complexity and therefore cost. It is likely there will be some
changes to how services are provided to the market, though clearly we wish to maintain high levels of
customer service.

8. What will remain unchanged?

Driving Business Performance within the market remains a key objective of the function, and therefore
Business Partner roles will continue to be located within the markets. During the changes to the
operating model, changes were made to the Global Expertise team in 2009 to clarify roles and
accountabilities, and up weight our process governance. Support and guidance they provide to the
market following this change will also remain unaffected.

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About first point
9. What is first point and what do they do?

First point forms the heart of HR performance delivery. They respond to the immediate HR needs or
concerns of employees and line managers; handle transactions, queries and requests; directing more
complex issues to the right specialist team. For line managers and employees, the majority of their
interactions with HR will now be through the first point team. By answering more queries over the
phone, it will free up time for the business partners in market to focus on driving business performance.
The service centre is organised into two tiers:
 Tier 1 are contact centre agents armed with information and tools to be able to respond to and
answer the majority of incoming queries
 Tier 2 are HR specialists who support the business real time, in executing core processes such as
SAP HR data entry and maintenance, document creation and resourcing eg vacancy posting,
interview scheduling, and contract generation
 Tier 2 HR specialists also manage Employee Relations cases (in market) and are contact points
for employees, line managers and in-market HR on a case by case basis
 Tier 2 Talent Delivery roles are responsible for the coordination of end to end delivery of talent,
learning and resourcing activity; working with the Global Expertise teams to ensure programs
are effectively implemented, coordinated and delivered. They track and monitor key
deliverables in this area

In addition to the above first point teams, information will be available on our HR intranet site, Diageo
One, which employees, line managers and HR teams can access directly. This will include, for example,
policies and forms.

10. How do I contact first point?

The first point team will be contactable either by phone or via email, details of which will be
communicated in the coming months, ahead of the launch.

11. Will first point provide exactly the same services I am used to getting in market?

The project and in-market HR teams are currently working on the designs for how services will be
provided, and what will migrate to first point, based on Diageo’s global processes.

The success of the service centre will demand much greater consistency of application and efficient
delivery of common HR processes across multiple geographies. In order to realise this success, we need
to move to common processes and standardisation of policy. Of course one size doesn’t always fit all but
we need to minimise variations and have a clear rationale for the exceptions as heavily customised
services increase complexity and therefore cost. The majority of services will still be delivered though it
is likely there will be changes to how services are provided to the market, and clearly we wish to
maintain high levels of customer service. We will communicate these changes as part of our project and
engagement activities as appropriate.

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12. Which HR processes are changing – what will be serviced by first point and what will remain in
market?

From our experiences to date of working with the markets, and from the initial process work carried out
so far, we are confident that markets are already broadly following Diageo’s high level global HR process
framework.

Any changes to process are likely to be within the deeper level of detail, and the project and in-market
HR teams are currently working through how the HR processes will operate for each of the markets
migrating to first point. This involves doing a more detailed analysis of how the processes work
currently, and how close they are to Diageo’s global processes, and where there may need to be minor
changes.

Once this work has been completed, we will work with the wider HR team to share what processes are
impacted and how, and the plans for sharing this with our customers in the market.

13. Where will the first point team be located?

The European first point team are based in London. By locating the team in one place, we believe we
can better embed a clear service delivery culture and more easily flex our resources. The exception to
this is where some activities have high legislative requirements that either have to remain - or are best
managed - in market. In these instances individuals may be located in market to deliver these activities,
but may report into the first point team in London.

14. Will first point also manage payroll?

Payroll will continue to be provided in the market rather than migrate into first point. A number of
markets have legislative and tax requirements that demand this remain in market, and for most other
markets the complexity means there is not a strong business case for migrating payroll to first point.
However as SAP HR will be the master source for our core employee data for these markets, there will
be automatic feeds of this data from SAP to the market payroll provider.

15. Will first point speak my language?

Diageo One, our HR intranet portal will be extended for Hungary, The Netherlands and Spain. Policies,
forms and useful information will be made available in English, Hungarian and Spanish and individuals
will be encouraged to use this site to answer their queries in the first instance.

Within first point there are already native Hungarian and Spanish speakers and this will be strengthened
in number with the recruitment of additional resources to support the new markets migrating in. There
will also be a requirement for Dutch speakers in some areas of first point.

We are currently working with the markets to identify the critical activities that require native speakers
to support them, and we anticipate that they will be in the production of documents, dealing with
telephone queries and supporting employees and line managers through the key HR processes.

At this stage there are no plans to formally expand our language capability to support service provision
beyond English, Hungarian, Dutch and Spanish – although as we have a very diverse team we often have
individuals with other language capabilities.

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16. Who will be my HR contact within first point?

The first point contact centre team (see question 9, ref tier 1) will be the first point of contact for all
employees, line managers and HR colleagues for transactions and queries. All agents have been
equipped with information on the markets they support to be able to answer queries and this
information and supporting tools will be expanded to hold the equivalent information for the new
markets migrating in.

Where activities are more complex and therefore referred onto one of the other first point teams, they
will confirm as appropriate who the point of contact is. An engagement partner will be appointed within
the first point team to support the market on making the transition successful, though individual queries
should still be directed through the first point contact centre team.

17. Where will employee files be kept and how will documents be handled that need to be signed
locally?

Physical hard copies of employee files will be kept in the market. Documents that need to be signed by
the employee (such as contracts of employment) will be handled through an in-market HR Co-ordinator
who will provide first point with scanned soft copies. The soft copies available online will enable first
point to access the information remotely.

18. What times will I be able to call?

The current operating hours are GMT 0800 to 1800 however these times are being reviewed as part of
the project migration and any changes will be confirmed in due course. Outside of these hours, an
answering service is in operation and queries are dealt with as soon as possible the following morning.

19. Can I still send in my questions/change to details by email?

Yes, there will be an email address for the first point team available and details of the address will be
confirmed and advertised ahead of the launch. To ensure changes are executed consistently and
accurately, there will be a set of line manager and employee forms available on Diageo One which line
managers and employees will be asked to complete as appropriate.

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Implications for the Market
20. How will the change affect the HR team in my market?

Many of the transactional activities that are currently done by the in-market HR team will move to the
first point team, which will impact some of the in-market HR roles. We are currently working through
the detailed process review, and until this is complete, we can’t confirm all the details of the change.
However we will work closely with individuals who will be impacted by this change.

21. Will it mean there isn’t a HR representative left in my market?

No, the business partners supporting your business will still remain located in the market. There may
also be exceptions where employees of the first point team are located in the market supporting
activities that need to remain there for legislative or effectiveness reasons. This will be confirmed
following the process review and ‘knowledge transfer’ phase of the project.

22. How will the change affect line managers and their teams?

The first point team in London will now be the first point of contact for queries your line managers and
employees have, rather than the Business Partner. Line managers and employees will be accountable
for providing information required to complete certain transactions directly to first point through forms
on Diageo One and increased use of the Academy, as well as be accountable for the execution of certain
elements of the process.

23. What support will my market get during this project?

The HR Effectiveness programme has a project team specifically supporting first point to migrate
Hungary, The Netherlands and Spain, who will provide support to all aspects of the change. This includes
for example:
 Systems/Technology – design and implementation of new shared service centre technologies
 Knowledge transfer – supporting the market to capture information on how the local market
works, and where necessary making changes to simplify and standardise this information or
activity.
 Change management activities – ensuring the HR teams and their market stakeholders are
supported through the change and equipped with the right skills and knowledge to make the
change successful
 Training – on the new technology (eg SAP HR) and all other aspects of the change including for
example changes to processes and ways of working
 Communications – with a toolkit of communications materials that will be developed by the
project team with input from the in-market communications lead, who will then deploy locally

A toolkit has been developed explaining each of the phases of the project – what is required to make it
successful, the key steps and learnings from other migrations – which will be made available through
your Hub HRD and in-market lead.

A project engagement lead will also be appointed from the first point team to partner with the market
on migrating the services and support to first point.

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24. How much time will be required from my team during the project?

The amount of time required from the HR team will vary depending on the phase of the project and
activities being covered, i.e. knowledge transfer, training etc. This will also be affected by the size of the
market; what services and support are migrating; how closely they are aligned to the current Diageo HR
processes and; consequently the level of change in the market. All time required by the team will be
planned and agreed in advance with the project team and market HR Director.

Support will be provided from the project and first point teams on all aspects of the change and
implementation and to ensure success, an in-market lead will be appointed to support the project
activities outlined above. We will also leverage the expertise in market, therefore a number of
individuals will be involved in, for example the knowledge transfer and training development phases.
For more information, please speak to your HR Director.

25. Do we all have to be trained on new technology?

Where new technology has been introduced that line managers and employees use, such as the Diageo
One intranet site, this is intuitive and easy to use therefore will not require training on any new
technologies. We will create awareness of Diageo One as part of the change and comms activities
planned for the market.

Almost all of the shared service centre technology is used by the first point team, rather than the in-
market HR roles. There may be some exceptions where some HR individuals within the market may
need to be trained on SAP HR, and other first point technologies (eg EIC - our case management tool;
knowledge point and document point) but the project team are working with the markets at present to
identify where this is the case, and what training may be required.

Any other changes associated with the migration such as changes to core HR processes or ways of
working will be captured in the change management activity. In addition to a range of communication
methods and materials, there will be a number of face to face sessions designed to help the HR team,
leadership teams, line managers and employees understand the changes and how it relates to them.
First point have already been operating the new service centre technologies since going live with the UK
and Ireland in 2009, and the majority of these technologies are also being used in North America. There
will be some minor changes to the systems to incorporate data and processes for the new markets, as
well as any process changes, and the first point team will receive refresher training on these additional
aspects.

26. What are the SLAs for queries or actions resolution?

There are 7 different SLAs that first point work to when delivering their service, these are:
 Customer Satisfaction (target 85%)
 Tickets closed within 48 hours (target 95%)
 Employee Documentation Accuracy (target 95%)
 Job Vacancy Posting Timeliness within 48 hours (target 100%)
 Candidate Satisfaction with interview-related administration (target 75%)
 Call Abandonment Rate (target of max 5%)
 Delegate satisfaction with the Learning Event co-ordination (target 80%)

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A monthly scorecard is produced by first point that shows overall team performance for that period and
also performance in the period for each specific market. This scorecard is shared with customers and
used as a basis for discussion around opportunities for improvement and growth.

27. What does this change mean for me?

The impact for individuals and their roles may vary market by market, and will become clear as we go
through the process ‘fit gap’ work to determine what solutions and services remain in market and which
migrate to first point. The results of this will be shared as soon as possible, but in the meantime,
individuals with queries should direct speak to their HR Director.

28. Will the SAP functionality be the same across all markets?

We are building upon an existing SAP HR platform which has been used for the UK and Ireland for the
past five years. In order to achieve the rollout of Global Template in a timely and cost effective way, it’s
important that we focus on the core scalable modules to enable the key employee lifecycle processes.
Therefore, the SAP modules provided will be dependent on the model and the needs of the market. It is,
of course, still important that we minimise variations and have a clear rationale for any exceptions.

29. Do I have to do anything?

Depending on the HR role you currently play, you may be asked to support some of the project or
change activities. Types of activities that require support may include for example knowledge transfer;
training materials development; or supporting the data migration or testing of SAP HR.

Within the change management activity, this may be either as an attendee to understand the change
and how it impacts your role and customers, or as part of the HR team that will lead the engagement
activity with the market stakeholders, line managers and employees. This will be supported by the local
change lead, first point and project team as required.

For more information about the activities you may be asked to get involved in, please speak to your HR
Director or market change and comms lead.

30. Does this mean more work for line managers and employees?

When first point was implemented for the UK and Ireland, the overall workload for line managers and
employees did not increase. However, line managers and employees were required to do things
differently and to take greater ownership of their conversations with HR. So, as markets migrate to first
point, there may be an increase in workload during this transition until our new ways of working are
embedded.

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Business Readiness/transition
31. When will the change happen?

We are currently working with Hungary, The Netherlands and Spain on the plan and timing of the
change. We anticipate that the markets will migrate in F11 with Hungary in H1 and The Netherlands and
Spain throughout F11. Within the HR team, you will start to see activity from approximately 6/7 months
before launch, through such activities as the process ‘fit gap’, knowledge transfer, systems configuration
and training.

32. How will knowledge on local HR processes and policy be transferred from existing in-market HR
team to first point?

Through the process ‘fit gap’ and ‘knowledge transfer’ work, we gain a deep understanding of the local
HR processes and policies in detail, identifying how the in-market processes work currently and whether
or not they align to the current global process model. Where there are differences to the (global) first
point processes, the team will work through with the market how best to handle these differences and
decide how to align them or whether to leave elements in market.

This knowledge transfer process captures all the relevant information that the first point team will need
to deliver the processes, transactions and query resolution for example, terms and conditions of
employment, legislative requirements etc. This is validated by the in-market HR team and subject matter
experts, led by the local project lead. The outputs from this work are captured in a number of tools and
documents (such as work instructions, FAQs, terms and conditions matrices etc) which are stored on
Knowledge Point. Knowledge point is the first point knowledge management system that provides them
with robust, consistent and up-to-date information to ensure efficient and effective handling of queries
and processing of transactions.

33. I have some concerns that certain information may not get handed over to first point, who can I
share this concern with?

The knowledge transfer process (see question 30) has successfully been used to capture information for
the England, Scotland, Ireland and North America migrations in 2009 and more recently the Latin
America and Caribbean migrations in 2010. Learnings from these first phases have been incorporated
into process for the future migrations and we are confident this will capture all the information required
to make the migration successful.

However, if you do still have concerns or require more information on the knowledge transfer process,
please contact your Hub HR Director.

34. How will this change be communicated to my market/stakeholders?

A local change and communications lead has/will be appointed for each of the markets migrating to first
point, who will own the development and execution of the market communications plan. The local HR
team, who already have the relationship with the business, will lead the comms and engagement for
senior stakeholders, line managers and employees. This will be supported by the project team with a
suite of comms materials (eg stakeholder messages, elevator speech, newsletters, posters, briefing
packs etc), which will be developed with input from the change and comms leads to ensure it fits the
market needs.

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The high level template plan of communications activity has been created, and over the coming weeks
and months (timing varies for each market), we will work with the change and comms lead to finalise
the more detailed market plan timings.

35. Who will manage the comms to my business leaders in market?

The Hub HR Directors with support from the local change and comms lead will identify the most
appropriate person to engage the business leaders in the market. We will work with the change and
comms lead to ensure business leaders and other key stakeholders are identified and a robust plan is in
place to engage them. In the meantime, please contact your Hub HR Director before communicating to
your stakeholders, to ensure that messages are consistent.

36. What can I expect to see happen next?

The phasing of markets means this will vary by market. For more information on which phase of the
project your market is in, please speak to your Hub HR Director.
The below timelines are only indicative. Timelines will be slightly different for each market, however
markets will go through the same phases as described below. The time indicated here may be reduced
or increased depending on market circumstances and their HR calendar.

37. Who can I talk to about this change?

If you have queries about any aspect of the change, please speak to your relevant Hub HR Director –
Jade Starrett (Southern Europe), Monica Peach (Northern Europe) and Ekaterina Zubritskaya for
Hungary.

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