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SAP Change Management Program Success

July 30th, 2012 by
SAP Change Management

SAP Change Management

Lots of literature, information, and resources focus on change management for successful enterprise application projects.  To help address SAP change management the SAP ASAP Methodology provides lots of resources, tools, and templates along with guidance for Change Management during your SAP project.  This is one of the key reasons for Why to Use the SAP ASAP Methodology?

Even though the ASAP methodology and various other resource provide some great sources the high level guiding framework always seems to be a little vague.  For example, there is a constant message that people resist change and that it is so hard.  That is not true.  As I have often said, if people resisted change no new product or service would ever be sold.  No new invention, gadget, method, or anything else would ever be developed.  There would be NO innovation in anything.

People do NOT simply resist change–, they resist change they do not understand and change they perceive is a threat.

Applying Sales and Marketing Principles to SAP Change Management

If sales and marketing departments for every type of organization in the world manage to sell new products or services maybe we should look to them for what works.  For both marketing and sales there are four key phases for customers considering a purchase:

  • Awareness (Marketing)
  • Consideration (Marketing, sales)
  • Evaluation (Sales, marketing)
  • Purchase (Sales)

These four general stages or phases of buyer behavior correlate well to a solid change management program–, messaging, engagement, credibility, and commitment.  To be successful you must be committed to Leading Change (and Change Management).

1.  Messaging – This is the beginning of the stakeholder analysis process.  Exploration, active listening, and facilitation are critical.  At this stage messaging is outbound.

Product or Service Sales Phase

Awareness

Customers understand and can communicate their desire or problem or need.  What are your constituents facing?  What are their struggles and what will help them do what they need to do better?  If the change will add more burden to them then why is the change necessary? 

Enterprise Change Phase

Discovery and blueprinting

A good SAP or enterprise application change program must start right from the beginning of the project.  First the identification of the key stakeholders at all levels of the organization must be made.  Afterward a clear effort must focus on the benefits to the affected users.  You must focus on the WHY of Achieving Business Value from SAP Investment.

A system-centric blueprint which does not connect to user needs will only breed mistrust and fear.

Analysis

Surveys are distributed and results tabulated.

2.  Engagement – Deeper determination of the issues, active communication, and targeted messaging.  Stakeholders at all levels must be encouraged to participate and be heard.  At this stage communications and messaging just start to go both ways (inbound and outbound).

Product or Service Sales Phase

Consideration

Marketing and communications are directed at addressing customer desires, problems, or needs.  Assurances are provided that the product or service will meet those issues.  The customer begins to solidify whether or not to explore a purchase decision.

Enterprise Change Phase

System functionality demonstrations and stakeholder feedback

Key stakeholders have the first part of their issues addressed.  There are 4 key types of change categories each user fits into here.  They are:

  • Opposed
  • Unsure, anxious, or fearful
  • Accepting or willing
  • Promoting

This phase of the change process is designed to aggressively uncover and then address those who are opposed or anxious about the upcoming changes.  These key stakeholders must be heard and their concerns answered.  It is also where the key message around SAP Service Delivery versus Value Delivery is promoted.

Analysis

Survey results are synthesized, reviewed, and then communicated to the broader enterprise.  Action plans to address the survey results are developed.  Any evaluation metrics are defined.

3.  Credibility  – benefits messages, demonstrations, insight, and information.  Change activities must promote openness and clearer understanding of the reasons for change.  More of an inbound and outbound dialog begins to occur.  Communications are actively going both ways.

Product or Service Sales Phase

Evaluation

Understanding of key features of a product or service and how they are different or better than competitors occurs.  Price considerations are also important.

Enterprise Change Phase

Aggressive information sharing and open dialog

One way you can Achieve Business Benefit is Through SAP Prototype Demonstrations.  Part of the communication and benefits program involves live system demonstrations (demo days), active engagement of super users, subject matter experts, and key change agents throughout the organization.  Messaging would also include external web resources, links, presentations, and other information to help “sell” the organization on the coming changes.

The goal of this phase is to overcome objections, fear, and anxiety.

Analysis

Action plans from the surveys are communicated to the organization and execution activities are carried out.   Evaluation metrics are refined, communicated, and adjusted to the organizational requirements.

4.  Commitment  – full user participation is critical at this stage.  If they are not involved in the process all of the previous effort falls apart here.

Product or Service Sales Phase

Purchase

For the purchase of a car this is the test drive and price negotiation.  For services or other items it is the understanding of key differentiators and how the service will help or enhance the customer’s issue, customer references, and possibly case studies.

Whether it is a test drive, understanding differentiators, price negotiations, or the benefits of a product or service these are all directly related to building a level of trust which in turn produces commitment.

Enterprise Change Phase

Acceptance, Adoption, and Promotion

More user demonstrations, training, super user network, subject matter experts, and pilot processes are all important here.  This is where everything starts to come together. 

This is also where any changes to originally expected benefits or reductions in scope must be carefully managed.  Another key area is the Organizational Change Management Inside the SAP IT Support Organization.  A key component at this phase involves Change Management Strategies and Knowledge Transfer Processes for a Successful SAP Project 1 (and Part 2).

The goal of this phase is to produce acceptance and even promotion of the changes.  However acceptance, adoption and promotion are not possible if the stakeholders have not established trust in the coming change. 

Analysis

Execution activities are carried out and nearing completion.  Reviewing, analyzing, and then distributing the results of the previously defined metrics results occur.  Lessons learned are captured and communicated.

Conclusion on SAP Change Management for Business Application Project Success

Every phase of your SAP or enterprise application project must be wrapped in the appropriate change management processes.  Just as with sales and marketing people do not resist change as much as they resist change which they perceive as a threat or do not understand.  So the key is to learn to sell the change and its benefits so that the perception of a threat is removed.  In doing so you will help to transform your project and company into a winner, both now and in the future.




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Achieve Business Benefit Through SAP Prototype Demonstrations

July 16th, 2012 by
Imagine what is possible by showing what is achievable

Functionality Prototype and Demonstration

SAP Conference Room Proof of Concept Pilots

Proof of Concepts with frequent early prototyping drive project costs down.  It is like the old saying that “an ounce of prevention can avoid a pound of cure.”  Proof of concept pilots during the project is one of the rarely mentioned SAP critical success factors. 

Early in my SAP career I used to get a little frustrated by the disruption these prototype sessions, conference room pilots, or whatever you want to call them would cause.  My thought was I had a job to do and didn’t have time for this.  No one ever stopped to help me understand WHY these pilots and prototypes are important.

Before I get into the substance of this let me first be very clear about what I am referring to–, a prototype, pilot, or demonstration is ACTUAL system functionality set up in the application to demonstrate transactional business processing.  I have heard of some system integrators who call PowerPoint process flows these types of “pilots” and that is completely ridiculous.  That is just regurgitating SAP Blueprint process flows and is NOT a prototype, pilot, or system demonstration at all.

Stop the SAP Consulting Merry Go Round – Real Life Experiences

Nothing is more frustrating than trying to work through a complex issue and going around and around with meetings, discussions, process flows, etc.  At one client we had a very complex third party process which involved one foreign company code doing sales deliveries for a domestic company code, but the domestic company would bill the customer and collect the cash, the foreign company would do inter-company billing, etc.  There was not only third party processing involved, there was also foreign trade, batch, and serial number tracking required (YUCK!).

After getting a large and very expensive group of consultants together with key client resources we hammered the first pass out.  Then we did it again a few days later, and then again a few days later.  After about 4 or 5 weeks of this madness it turns out the consultants were the problem more than the client.  Several of the consultants essentially said this couldn’t be done.

To stop the complete waste of time I left the last meeting and spent 3 days setting up a prototype the consultants said couldn’t be done.  Now, in their defense it is complicated and it DOES involve setup in SD, MM, PP, FI, and EDI.  Very FEW consultants have ever done this type of integrated setup.  I scheduled a DEMONSTRATION with all of the key stakeholders and project leadership to put this issue to rest.  The SAP standard functionality covered approximately 90% of the overall requirement and we were now discussing small tweaks or changes that were required rather than trying to over engineer a customized process mess!

Reduce SAP Implementation Cost, Improve SAP Quality, and Manage SAP Scope More Effectively

Using Conference Room Pilots, or Functionality Playbacks is effective for difficult to understand processes system demonstrations.  This technique can significantly reduce meeting times and increase customer satisfaction.

Stanford professors Carleton and Cokayne spent seven years studying the user of physical prototypes in “foresight engineering” which is the ongoing development of products or services that are three or more product cycles in the future.  They studied the use of prototypes for “capturing and communicating a team’s opportunities inside the organization, connecting the company’s vision and strategy with… day-to-day [engineering design work], and helping teams to connect vision to research to engineering design.”  Carleton, T., and Cockayne, W., (2009) The Power of Prototypes in Foresight Engineering.  International Conference on Engineering Design, ICED’09/493, Stanford University, August 24-27 2009, page 1.

The use of prototypes has been found to “make ideas tangible, iterate quickly at a low cost, and develop a shared language” (ibid.).  These demonstrations are part of the change management process and can help to bring the broader organization along in the process. In the second half of the post on ERP, SAP, or IT Project Management and Prototyping for Success more detail is provided for the following items:

  • System demonstrations focus on delivering what is important while allowing for early adjustments.
  • Complex or difficult functionality demonstrations help reduce the overall amount of meeting time.
  • System demonstrations identify gaps and problems earlier reducing the number of testing defects and rework time.
  • Early demonstrations help ensure scope is properly accounted for and last minute process surprises are reduced.
  • Some performance problems are exposed.
  • Possible schedule and work completion issues may be exposed while they might still be manageable.

By doing a LOT of prototypes early in a project you also quickly separate the good IT resources from those who are not so talented or even those who are complete fakes.

Conclusion on Using SAP Prototypes, Functionality Demonstrations or Conference Room Pilots for Project Success

Just as the real world example I noted above shows, by using prototypes or demonstrations to understand where the real business requirement gaps are you may be able to avoid a major investment in custom development work.  And by avoiding that development you reduce ongoing maintenance headaches.

As for dealing with scheduling and work completion I have been on many projects where some of the consultants or team leads would simply lie about their status and completion.  By having a clearly defined pilot and playback schedule throughout the project for certain key functionality you help to ensure that what is committed is actually delivered.  Too many times the real status does not show up until testing starts, or worse still, items get taken out of scope because of misleading status.  By then it is too late.




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Untangle SAP Software Licensing

July 9th, 2012 by
SAP Software License Guide

SAP Software Licensing

Recently I read a self-serving post on LinkedIn from a company who promotes how “wonderful” Oracle is for having a public price list and how terrible it is that SAP and others do not.  While it may be true that SAP does not publicly publish a price list there is one, it is regularly updated, and it is quite thorough. 

The main complaint was that SAP lacks “transparency,” whatever that means.  There was no mention in the post about how Oracle sales tactics include virtually giving their software away and then after a company finally gets stable they hammer them with massively increasing maintenance fees and costs.  Think about that, once you become dependent they more than make up for the software license with the forced maintenance march.  That really makes their price list completely worthless.  My response about SAP’s lack of “transparency” was:

On this point I completely disagree.  It is not that SAP does not have transparency, it is that their solution and license portfolio, as well as dependencies reflect their size.  Unfortunately it does make it complex.

So, I will absolutely guarantee you that if you do NOT have deep SAP application experience you will be completely baffled.  Not because anyone is trying to trick anyone, but because the solution portfolio and its capabilities are huge. 

SAP is like an “erector set” both in how you set up the various applications to meet business needs AND how you deal with multiple application integration issues to address a particular need.

Just concluded an SAP software licensing negotiation.  Significant solution portfolio, significant application landscape, typical fragmented multi-national who grew by M&A.  If you do not know the SAP landscape you will become completely LOST in their price list and in understanding the solutions.  You almost need to be a solution architect to really be able to help customers navigate the solution footprint.

———————-

I can absolutely guarantee you that if you do not have deep SAP solution exposure you WILL be lost.  However that is NOT a function of some nefarious scheme to hide pricing.

I reviewed a recent copy of SAP’s price list I have from January 2012 and found there are roughly 18 spreadsheet type pages, with a little over 50 price list entries on each page, for around 900 total entries.

One Reason Why SAP Doesn’t Publicly Publish Their Price List

I have heard from some SAP insiders that one reason for not publishing their price list is the sheer amount of confusion it would create.  Solution architecture can be difficult enough –, even as an SAP veteran since 1994, with a deep and diverse SAP background, the substantial size of the SAP solution portfolio can be overwhelming.  Then combine that with the dependencies or requirements for each solution and you have a recipe for more confusion rather than clarity by publishing a large price list.  Then you have the “sales model” of “give it away” and make it up by crushing dependent customers after they finally stabilize.  Add to this the natural tendency of competitors to seize on any single item and deliberately take it out of context to “land a deal” and it is understandable why SAP doesn’t publish their price lists publicly.

Where To Get SAP Licensing and Pricing Information

Probably as a result of the licensing confusion SAP publishes a public license guide and has a price list which is also available.  Both of them are designed to help clarify licensing with SAP products and solutions.  Keep in mind that between the “introduction” guide and the actual price list document we are approaching 200 pages (Into Guide about 40 pages, full price list around 140+).

The introductory guide helps customers understand the SAP licensing approach and options.  It is freely available and I have included a recent version on my site here:

While this license guide provides you the key principles you need to understand there is also an actual, detailed price list as well.  That price list includes roughly 120 pages of explanations and examples for licensing the various specific SAP products, and then another 20 pages of the roughly 900 price list items.  THAT guide should be obtained through your SAP sales rep.  I can assure you that they will generally provide this if you ask. 

Out of respect for SAP’s decision not to openly publish their price list to the public I will not place any versions of their price list online.  However if you are a customer and are confused with the price list I will be happy to walk you through it if you contact me.

Good luck on your SAP journey!




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