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SAP Business Value & ROI

SAP Business Value & ROI

As a follow up to last week’s post on Sustained Business Value from SAP Business Software I did a little research on the study authors and discovered their continued focus on this issue.

Recently Peppard (one of the authors) and a couple of other colleagues provided real business value success findings in an upcoming journal article called “Factors Affecting the Successful Realization of Benefits from Systems Development Projects: Findings From Three Case Studies” [FN1].

While I read through and reviewed the draft 35 page study I couldn’t help but notice the striking similarity to my nearly 5 year old post on the subject of SAP as a Change Enabler. What SAP as a Change Enabler summarized in a few pages appears to have been empirically tested by comparing and contrasting a few case studies of live software implementations.

Following my personal experience around SAP since 1994 I’ve added additional insight on how to gain SAP ROI through Strategic Business Transformation by also Using SAP to Improve Revenue and Profitability.  The “how-to” instructions, and detailed guidance is starting to gain some traction. To amplify their initial research I’ve cross-linked many posts throughout this one.

Changing from SAP System Delivery to Business Benefit Delivery

Before anything else a benefits focus must be the guiding framework for your SAP project. Every major business software project must begin with some clear guidance on the “why” of the project.

Business Centered SAP Change Management is Required

The authors highlighted several key observations around organizational change management and the need for user participation but missed one of the key areas of success–, knowledge transfer (see Change Management and Knowledge Transfer Part 1, and Part 2). Not just end user training, but more holistic knowledge transfer about the new system, its capabilities, and how to maintain them.

SAP business transformation is an ongoing effort. To achieve this one of the goals of SAP projects has got to be to create a learning organization. An organization where knowledge exchange and benefits centered collaboration is key to SAP program success (see ERP III – Is the Integration of Collaboration the Future of Enterprise Applications).

WHY do an SAP Project?

So, what is the basic idea here? Their findings indicate that a large scale software program requires a business benefits focused approach. An approach which addresses the “WHY?” of the project.

[A] project might be successful in meeting its internal targets, yet not deliver beneficial business outcomes. [FN2]

For too long enterprise software vendors and SAP system integrators have focused on everything but the genuine business “WHY?” of the 5 W’s and the H of SAP projects. For too long companies have addressed:

  • “WHO” (who will implement, who will support, who will the core team be, etc.)
  • “WHAT” (what is the scope, what technology, etc.)
  • “WHERE” (both project logistics as well as the organization structure that is impacted)
  • “WHEN” (project timeline, business timelines, milestones, etc.)
  • “HOW” (use our custom methodology [i.e. make it up as we go], or use ASAP)

Few companies get down into the details of the “WHY?”

WHY is Management Engagement and User Participation Lacking?

It is the “WHY” which will engage the larger business community and senior leadership and that is The Real Reason Executive Participation Creates IT Project Success. It is the “WHY” that will bring about badly needed business process changes from the user community. Unfortunately it is my opinion that because the compelling “WHY” part of the business case has been missing for so long senior leadership and ultimately the user community is generally disengaged from the project delivery process.

Think about it, how many multimillion dollar investments, with such wide organizational impact, do management stakeholders and end users take such as “hands off” approach to?

If you want your SAP project to be a business project, GET THE BUSINESS ENGAGED! If you want it to be a technology project, nothing else is required. Just put the system in and when people complain tell them to shut up. It was never really about the business anyway!

Do Your SAP System Integrator Consultants Have Business Knowledge or ANY SAP Experience?

This leads to the next issue. If the business is engaged and you decide to bring in a system integrator then define BUSINESS expectations from your system integrator up front. If they only speak to the business in techie terms then get rid of them because do no one  needs “consultants” who can’t consult? (see Screening and Interview Methods to Find the Right Consultant – Part 2).

Think about this a minute and let it sink in. If you hired a system integrator for an SAP business application project then shouldn’t they be focusing on the business? If they can’t speak to you in business terms then why again did you hire them?  Are they really consultants? To gain real competitive advantage in the business marketplace you must Change How You Look at SAP to Create ROI because SAP Implementation is an Investment NOT an Event.

During the sales cycle you as an SAP prospective customer have GOT to ensure there is a clear business vision. Again I ask, if not, then why are you even doing this?

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[FN1] Doherty, N., Ashurst, C., and Peppard, J. (2011) Factors Affecting the Successful Realization of Benefits from Systems Development Projects: Findings from Three Case Studies. Journal of Information Technology (upcoming).

[FN2] Sauer, C. and Davis, G. B. (2010) – Information Systems Failure, Encyclopedia of Library & Information Sciences, Third Edition, pp 2643-2652.

Additional Resources for Successful SAP Implementation

Check out these posts for specific ideas, thoughts, and experience on achieving real results from your SAP project or other enterprise software projects:

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Contact me today through our site contact form ( http://www.r3now.com/contact ), phone, or e-mail.

Bill Wood
+1 (704) 905 – 5175
Bill Wood contact

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2 Responses to “Achieving Business Value from SAP Investment”

  1. A print icon will be nice!!

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