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Toward an SAP Center of Excellence or SAP Competency Center – PART 3

July 28th, 2010 by

SAP Production Support 3Part 3 of 3

Stages and Components of the SAP Center of Excellence

To wrap up this series we will take a brief look at the post go-live or the production support environment.  One academic study I reviewed on ERP project success factors defined the three production stages of Acceptance, Routinization, and Infusion (see The Top 5 ERP Success Factors by Project Stage from 22 Critical Success Factors).

These three terms fit the requirements for SAP production system stages as you move toward an SAP Center of Excellence so I’ll use them for reference rather than inventing new terms just to be different.  However, I have defined them in my own way below which may, or may not be 100% consistent with the academic literature.

The ultimate goal of an SAP Center of Excellence is Business Transformation.

SAP Center of Excellence Model for Business Transformation

I’m less concerned about terms and phrases here than I am about the focus and objectives of the effort.  So if you want to call your department an SAP Center of Excellence, or an SAP Business Transformation Center, or an SAP Business Support organization, or whatever please feel free. 

Your SAP staff must be proactively engaged with the business community.

Here is a high level SAP Center of Excellence Model for Business Transformation after you are live in your SAP environment:

Acceptance – go-live and productive business use of the system (heavy change management).

  • Training
  • Process Documentation
  • Help Desk
  • Internal Collaboration (structured Instant Messaging, Forums, and other structured as well as unstructured information capture)

Routinization – the overall acceptance and sustained productive use of the system (system stabilization).

  • Knowledge capture (Wiki and Forums)
  • Troubleshooting methods and Company Best practices
  • Process overviews, refinement, and business / system adjustment
  • External Collaboration (Forums, Customer Channel feedback, marketplace intelligence, vendor collaboration, collaborative product or service development, etc.)

Infusion – long term acceptance and use of the system as well as additional functionality additions (re-focusing on business and SAP to business alignment, i.e. strategic direction).

  • Rotating IT staff assignment into business organization (throughout the process chain)
  • At least once a month work in the department business process area of responsibility
  • FAQ Development (Wiki and Forums)
  • Enhanced or new system functionality
  • System and Process Change Risk Management

SAP Competency Center or SAP Center of Excellence Conclusion

Enterprise applications like SAP are more important than ever in today’s globally competitive and economically sensitive era.  It is simply not enough for IT departments to serve in a more passive support role.  In today’s global economy your SAP and IT support staff can not wait for the business requirements to come rolling in.  For the health and welfare of your business and your SAP or IT organization it is more important than ever to ensure that your SAP staff is proactively engaged with the business community.  That engagement must take the form of an active partnership in looking for new and better ways to use technology for competitive advantage and process improvements.

As for the future, this type of alignment between all of the IT functions, under the banner of the CIO is beginning to take place [FN1].  While SAP Competency Center management and development can focus on the operational excellence business proposition (better, faster, cheaper, more automation) the SAP Center of Excellence framework is more closely aligned to the innovation and customer focus value propositions.

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[FN1]  A four part series on the current and future technology leadership landscape, this includes the direction of technology and the pressures CIOs face now and in the future.

Part 1:  What is the Proper Relationship for the CIO, CEO, and CFO?

What the changing business and IT landscape means to the CIO, IT Director, IT Manager, or other key technology decision makers.

Part 2:  CIO, CFO, and CEO Alignment – Why ROI is Lacking from Today’s System Landscape

This post provides an overview of the current system landscape and the focus on business processes and contrasts that with the emerging trend of the customer focus value proposition.  This piece also looked at the future business landscape and how the technology focus and direction will be permanently changed no matter what happens with the economy and global competition.

Part 3:  Changing the Direction of SAP, ERP, and IT Applications to Focus on the Customer and Innovation

A brief review of the supply side and the demand side of business shows that unless you have lots of customers (demand) to fill a bigger and bigger pipeline (supply) then an operational excellence business model collapses.  While it is hidden during good economic climates, any disruption in those economic conditions which fails to fill the capacity pipeline points out the glaring insufficiency of the “operational focus” to technology.

Part 4:  Future Technology Landscape Alignment for the CIO, IT Director, or Key IT Decision Maker

The final part of the series looks at the emerging technology landscape and what the future holds.  It lays out an emerging technology landscape model which has some re-alignment and some components already in use by some of the world’s most successful companies.  A new alignment of technology with the customer facing processes, and the use of social or collaboration tools across the enterprise with a clear business objective is explored.  The driver for the future change will be because the business does not see the revenue generation prospects of technology–, they fail to see the possibilities of promoting customer retention, customer acquisition, innovation, and marketplace analytics.  The new technology model looks to change that dynamic.

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Toward an SAP Center of Excellence or SAP Competency Center – PART 1

Explaining the differences between an SAP Competency Center or sometimes referred to as an SAP Center of Expertise and an SAP Center of Excellence.  As Peter Drucker wrote either Do Things Right or Do the Right Things.

Toward an SAP Center of Excellence or SAP Competency Center – PART 2

A more complete and thorough explanation of the differences between the SAP Competency Center (or Expertise Center) and the SAP Center of Excellence (or the Business Transformation Center).  An understanding the operating differences and how the Competency Center is focused on reactive processing of things like help desk tickets, problem resolution, data correction, and knowledge transfer.

Toward an SAP Center of Excellence or SAP Competency Center – PART 3

Business model application of steps, techniques, and methods to produce an SAP Center of Expertise or an SAP Business Transformation Center.  The major business transformation steps on moving from an SAP Competency Center to an SAP Center of Excellence.




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Toward an SAP Center of Excellence or SAP Competency Center – PART 2

July 27th, 2010 by

SAP Production Support 2Part 2 of 3

SAP Competency Center – Doing Things Right

SAP Center of Excellence – Doing the Right Things

The SAP Center of Excellence approach assumes a dynamic organization that is experiencing a fair amount of change, at a pace that causes the organization to stretch.  This is usually the case with growth oriented companies who are seeking to find new competitive methods and ways of operating in a challenging global climate.

The SAP Competency Center approach assumes a fairly stable business model, without significant market disruptors, and a mature marketplace.  This is generally seen with older companies who compete in commodity spaces.  The SAP Competency Center is sometimes called an SAP Center of Expertise, but without more direct and clearly aligned business integration the organization name does not make it a true center of excellence.

The SAP Center of Excellence Structure and Purpose

For purposes of this post we will focus primarily on the SAP Center of Excellence structure or model (where IT organizations focus on business to SAP alignment).  This Center of Excellence structure first requires building out some of the stability infrastructure that comes from developing an SAP Competency Center.  The SAP Competency Center Framework is used to stabilize the application and business processes immediately after go-live.  The  SAP Competency Center becomes the foundation for the Center of Excellence structure (to aggressively focus on market and competitive pressures).

The basic differences between an SAP Competency Center and an SAP Center of Excellence are related to maturity and function.

The competency center seeks to employ change management strategies to regain system and business stability; the center of excellence seeks to integrate application support staff and support technology into the business for competitive advantage.

SAP Competency Centers are REACTIVE to any business need, waiting for unsolicited help desk tickets or business input.  Competency Centers react to requirements.

SAP Centers of Excellence on the other hand are PROACTIVE and try to find ways to apply technology and resources to value propositions and competitive pressures in an ongoing manner.  Centers of Excellence actively look for value opportunities.

SAP Competency Center – Doing Things Right

From an SAP Competency Center approach there is a strong focus on:

  • resolving day to day activities,
  • preserving existing market share (customer retention),
  • managing help desk requests,
  • and a general focus on stability and structure.

The Competency Center approach is needed for some time after a new SAP implementation goes into production, and it is a good place to start for companies who want to build a true Center of Excellence.  However, as Peter Drucker has noted there is a difference in philosophy around doing things right or doing the right things.  SAP Competency Center management does not seek to achieve a strong, changing, vibrant dynamic within the business.

The Competency Center framework and approach seeks stability, predictability and short to mid-term incremental improvements.  Not too much change and not too much disruption.  The goal of a competency center is to maintain smooth operations after the period of system stabilization.  Long term adoption of an SAP Competency Center framework is for those companies who have a business model that is both change and risk averse.  Otherwise the SAP Competency Center framework should become the foundational building blocks for an SAP Center of Excellence Structure shortly after achieving stable production operations.

SAP Center of Excellence – Doing the Right Things

The SAP Center of Excellence approach assumes a more aggressive business model, one that is dynamic and pursuing market opportunities.  This model and approach are well suited to growth oriented companies no matter what their size.  The idea of doing the right things means that in the process of change some things may not always be done at their optimal level.  Business is not perfect, markets are not perfect, no matter how hard companies may try, products and services are not perfect.  This does not mean they are sloppy, it just means you don’t have the luxury of pursuing the last mile of perfection.

The SAP Center of Excellence structure tries to find the right things to do to continue to be a market maker or a market mover.  This usually means creating a very dynamic and fluid SAP support organization that is more closely integrated into the business (and not just aligned to it). Because of the pace, and the struggles involved in being a market maker or market mover some things can not always be anticipated.

Is Your Company a Good Fit for an SAP Center of Excellence?

Companies that are good candidates for an SAP Center of Excellence are (or want to be) able to change and adapt quickly because of market necessities or because it is part of their business model. Together with many of the items listed for Competency Center focused companies, those who want to implement an SAP Center of Excellence structure have a strong focus on:

  • wanting to gain market share, or wanting to protect market share in a volatile marketplace
  • customer retention and customer acquisition,
  • market intelligence,
  • innovation,
  • market responsiveness (the ability to quickly adapt and change).

The SAP Center of Excellence requires new methods, tools, and approaches for companies to achieve this level of business performance.  The SAP Center of Excellence at its heart and soul is more about business than it is about applications.  So, with a firm SAP Competency Center framework and management foundation,

“a true SAP Center of Excellence seeks to do the right things the right way.”

In the next post we will look at a first pass at a very high level SAP Center of Excellence framework and model.  Many of these components would also be in the Competency Center, but in a Center of Excellence the ability and need for collaboration and change is much more aggressive.

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Toward an SAP Center of Excellence or SAP Competency Center – PART 1

Explaining the differences between an SAP Competency Center or sometimes referred to as an SAP Center of Expertise and an SAP Center of Excellence.  As Peter Drucker wrote either Do Things Right or Do the Right Things.

Toward an SAP Center of Excellence or SAP Competency Center – PART 2

A more complete and thorough explanation of the differences between the SAP Competency Center (or Expertise Center) and the SAP Center of Excellence (or the Business Transformation Center).  An understanding the operating differences and how the Competency Center is focused on reactive processing of things like help desk tickets, problem resolution, data correction, and knowledge transfer.

Toward an SAP Center of Excellence or SAP Competency Center – PART 3

Business model application of steps, techniques, and methods to produce an SAP Center of Expertise or an SAP Business Transformation Center.  The major business transformation steps on moving from an SAP Competency Center to an SAP Center of Excellence.




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Toward an SAP Center of Excellence or SAP Competency Center – PART 1

July 26th, 2010 by

SAP Production Support 1

Part 1 of 3

Is There a Difference Between an SAP Center of Excellence, SAP Competency Center, or SAP Expertise Center?

Michael Done and I were talking about his SAP Green Book–, thriving after going live with SAP [FN1].  As the conversation progressed it was obvious to both of us that although he has been advocating for an SAP Center of Excellence for quite some time few companies had succeeded in creating one. 

Our conversation started a lengthy thought process on our careers doing SAP projects, at numerous companies, across several industries and in a number of Fortune companies as well as small and midsized companies.  Over the years a few companies have done well at developing SAP Competency Centers, but only a couple have ever succeeded in developing an SAP Center of Excellence.

Most of what we see is IT-centric and service delivery driven and not business-centric and value delivery driven.

You might ask, “What is the difference between an SAP Competency Center or an SAP Center of Excellence?”

Do Things Right or Do the Right Things?

In Peter Drucker’s Theory of Business from 1994 he discusses the changing business world and how to stay competitive.  He describes the two types of paradigms–, doing things right or doing the right things [FN2].

During the course of an SAP implementation there is a focus on doing things right.  At least this should be the focus.

What Does it Mean to Do Things Right in an SAP Project or Implementation?

You as a customer assume that SAP as a company has done the right things already in the form of the application depth and breadth so your job in implementing the software is to do things right.  You can see this embedded in the techniques, templates, methodologies and “tools” used to ensure that the ERP system is properly implemented.  Frequently doing things right entails:

  • following the SAP ASAP methodology (or some version of it)
  • doing some research on successful projects,
  • preparing your company with the right committed resources,
  • ensuring interdepartmental cooperation,
  • selecting the right implementation partner with the right consultants,
  • correctly using the pre-project RFI and RFP processes,
  • etc.

For a whole list of numerous success criteria from the academic literature please see the post on The Top 5 ERP Success Factors by Project Stage from 22 Critical Success Factors.

Doing the Right Things for Your SAP Project After Going Live

This is very different than what is needed after the system is live.  Once your system is up and running and the consultants are rolling off the project, it is time to change direction.  At this point you have a couple of options.  You can develop an SAP Center of Excellence or an SAP Competency Center.

While there is not a lot of information or literature on these two approaches we will try to carve out the differences seen over the years, and then attempt to develop a basic starting model for the Center of Excellence.

———————————

See the entire series on creating an SAP Center of Excellence

———————————

Toward an SAP Center of Excellence or SAP Competency Center – PART 1

Explaining the differences between an SAP Competency Center or sometimes referred to as an SAP Center of Expertise and an SAP Center of Excellence.  As Peter Drucker wrote either Do Things Right or Do the Right Things.

Toward an SAP Center of Excellence or SAP Competency Center – PART 2

A more complete and thorough explanation of the differences between the SAP Competency Center (or Expertise Center) and the SAP Center of Excellence (or the Business Transformation Center).  An understanding the operating differences and how the Competency Center is focused on reactive processing of things like help desk tickets, problem resolution, data correction, and knowledge transfer.

Toward an SAP Center of Excellence or SAP Competency Center – PART 3

Business model application of steps, techniques, and methods to produce an SAP Center of Expertise or an SAP Business Transformation Center.  The major business transformation steps on moving from an SAP Competency Center to an SAP Center of Excellence.

———————————-

[FN1]  If you have not yet seen or heard of his book please consider purchasing it here: http://www.michaeldoane.com/The_SAP_Green_Book.html . You can also see a copy of his white paper on this topic, and on his book here:  http://www.michaeldoane.com/uploads/Thrive_After_Go_Live_DA.pdf

[FN2]  Drucker, P. “The Theory of Business,” Harvard Business Review, September / October 1994, pp. 95-104.

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