SAP & ERP Consulting from the Customer Point of View

SAP Project Success

In all the years I’ve been involved with SAP I’ve often puzzled about what makes a really good project rather than some of the freak shows they call SAP projects.  After involvement in over 20 SAP projects I’ve seen a few of them go really well, a few that were more like horror shows, but most were mediocre.  I’ve often asked myself “Why?”  What makes the difference between a good project and one that is nothing short of a mess?

One key item that stands out is project management.  Even with the most talented and dedicated resources bad project management can ruin an otherwise great SAP project.

I don’t blame client project managers because if they had all of the resources they would not need outside help and guidance.

Before I get into this, let me define what I consider a “good” project.  A good project is one where there is a lot to do, but the stress level is not intense.  The timeline may be tight but it is achievable (maybe a little bit of a stretch).  The project is delivered on time, on budget, within scope and the result is high quality (a fairly smooth transition without a chaotic go-live).

Methodology Considerations for a Good SAP Project or SAP Program

The list below is from a synthesis of materials from SAP’s ASAP methodology, the PMI (Project Management Institute), and my personal experience over the years.  Much of this is contained in the SAP ASAP methodology in one form or another so you really have to wonder what any consultant is following if they claim to use it and these items are lacking.  In fact the latest ASAP Methodology version 7.1 includes a project start-up checklist to ensure key components are addressed.

Unlike several years ago when contract project managers had to rely on experience alone – the SAP ASAP Methodology is well-proven and mature today.

There are several key characteristics of a well managed SAP project which includes:

Early SAP Project or Program Management Activities (Before the Overall SAP Project is Fully Underway)

• Success criteria defined and communicated for the project.
• One of the first things that is defined for the project are the key roles, responsibilities, and tasks that will be performed by each participant group in the project.
• A clear, definitive project plan with WBS elements, networks, and activities planned for every major work-stream throughout the entire timeline.
• A clear list of deliverables, milestones, templates, and instructions on their usage are provided for the entire project.
• Deliverables are clearly tied to project value rather than useless administrative exercises (value added activities) (see SAP System Vendor Project Success Criteria & Factors 1 scroll down to Sections 8 and 9).
• Scope, time, issues, risk, cost, communication, and integration management plans, together with additional key components are defined.
• Various standards for the project are defined and documented, including but not limited to business process, development, configuration, enhancement, transport management, testing, etc.

If you are using outside contract project management resources and  these items are not substantially in place by the time you start your project you will likely have your timeline and budget destroyed.  Along with the blown schedule and budget your project will also be a pressure cooker filled with stress, anxiety, and frustration. These are also characteristics you find when an SAP project manager or SAP program manager is not qualified.  The chaos, tension, stress, and confusion caused by their inability to coordinate the many moving parts of the project are a direct result of their lack of experience and ability.

I don’t blame client project managers because if they had all of the resources they would not need outside help and guidance.

The project should be delivered on time, on budget, within scope and with high quality…

Conclusion on Effective SAP Project or Program Management Practices

You are headed for a project disaster when a contract SAP project manager or SAP program manager fails to ensure the following items are in place early in the project:

• responsibilities by group and role are defined,
• deliverables are well laid out,
• templates are properly prepared,
• forward looking expectations are set,
• coordination occurs between all project groups,
• etc.

I’ve only ever been on a few projects when the SAP project manager or SAP program manager failed to produce a properly detailed project plan.  Every one of those projects had one thing in common, they were absolutely horrendously stressful, difficult, and took more time and cost more than necessary.  Along with the failure to produce a proper project plan the lack of proper deliverables, proper roles and responsibilities, and all of the other things a good project plan would help you define were also missing.  If this happens to you FIRE those contractors, you are being bled dry and are headed for a budget and timeline disaster.

For much more detail on what happens when you have bad contract SAP project managers or SAP program managers see the post Some Reasons SAP Projects are Over Budget and Over Time.

Related Posts:

• More SAP Project Leadership Tips for Managing Conflict
• 5 Leadership Tips for Successful SAP Project Management
• SAP Project Manager – SAP Program Manager, Lessons from the Trenches
• SAP System Vendor Project Success Criteria 1
• More on Vendor Selection Criteria and Methods for ERP Project Success

SAP Center of Excellence Governance

This post is based on information from my recent ASUG presentation in Atlanta…  Beyond Technology Alignment – Building a Center of Excellence @ http://bit.ly/jJefxP

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At the intersection of business and IT you have convergence.  At the place of convergence is where the Center of Excellence exists.

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One of the key SAP project success factors is to use a steering committee made up of key business stakeholders.  They can meet once a week or once a month, but generally they are involved to provide business level guidance to an SAP project or IT programs.  The most effective steering committees include at least one executive and several senior leaders from throughout the business (see The Real Reason Executive Participation Creates IT Project Success).

That steering committee performs a critical function over large projects like SAP implementations.  This group is critical to your project’s success because of the amount of time from company employees, capital from the organization’s coffers, and decisions which change the business.

Some of the key functions a steering committee carries out during the course of your SAP project include:

• Set SAP project scope and then help manage it.
• Define project objectives and evaluation criteria.
• Monitor project progress, including key milestones and deliverables progress.
• Oversee Quality reviews at key check points.
• Evaluate and mitigate organizational impact of business changes.
• Promotes the project throughout the organization.
• Coordinates staffing and resource levels from key business areas.
• Makes critical decisions which the project team is unable to resolve (escalations or key business decisions).

The ongoing functions and tasks of the SAP steering committee cannot be underestimated. During the course of their duties they gain that list of unique and critical skills related to applying technology to business issues and problems (see Using Your SAP Steering Committee for Business Transformation).

You go live and WHY do you disband your steering committee???

Integrating the SAP – IT Organization Into the Business

In an SAP Center of Excellence, after your SAP implementation goes live, the steering committee functions change to one of developing and managing technology road-maps.  Their skills with scope, schedule, cost, performance, prioritizing, and evaluating risks / rewards are ideally suited to their continued involvement in the application of technology to the business.  But the underlying issue here is that they must continue to function –, they should not be disbanded.

One of the key benefits of continuing to leverage the SAP Steering Committee after the SAP business software goes live is you continue to build on their experience and unique skills.  Even as they rotate out of the steering committee role these individuals move through the ranks of the larger enterprise and take that technology to business integration experience with them.  If they have served on a steering committee long enough to see the benefits technology can bring to the larger enterprise their exposure is invaluable to building a long term Center of Excellence –, an organization dedicated to converging business and technology to meet business marketplace requirements.

These individuals have worked through many key business decisions, budget decisions, scope and schedule decisions, and how to move to technology integration project success.  As a result of their experience applying technology solutions to the business they develop critical skills for the converged and integrated organization, these skills are difficult to replicate.  In a nutshell this steering committee develops a convergence of three critical skills for tomorrow’s powerhouse enterprises: they understand management, technology, and business integration.  Those are the key ingredients to the converged SAP enterprise.

Related Posts:

• SAP Program Management Requires a Type of CMMI
• Competitive Pressures and Value Propositions, Is Lean the Answer?
• The Real Reason Executive Participation Creates IT Project Success
• Change How You Look at SAP to Create ROI
• Why Use the SAP ASAP Methodology?

Legal Liability

To my talented friends and colleagues at Deloitte, Sorry folks!  This needs to be addressed.  It is not that all of Deloitte has a problem, I know some incredibly talented Deloitte folks, unfortunately a few bad apples CAN and sometimes DO spoil the whole entire bushel (or barrel if you prefer).

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The recent Marin County California Lawsuit against Deloitte Consulting took an interesting turn.  The initial complaint was filed in mid 2010 against Deloitte only for fraud in providing inept and incompetent consultants (for background see my previous post SAP ERP Project Failure Lessons Learned and Mini Case Studies 1).

Not long ago Marin County amended their complaint (a pretty standard legal practice after the initial legal complaint is filed) and included several other failed Deloitte projects as examples of a common practice.  Along with that SAP AG and SAP Services were joined to the complaint as additional parties.  The basis of SAP’s liability, as alleged in the complaint, is that SAP through its partnership with Deloitte knew or should have known of Deloitte’s fraud and continued to give them credibility.  That modified complaint was filed on December 16, 2010.

The SAP software itself was still not alleged to be the problem

The introductory statement of the complaint lays it out:

This action arises from defendants’ illegal and continuing scheme to defraud the County and other governmental entities while reaping tens of millions of dollars in ill-gotten gains in connection with the implementation of enterprise resource planning (“ERP”) software known as SAP for Public Sector, licensed by the German software developer SAP AG.  As part of this scheme, Deloitte, with the knowledge and assistance of the SAP Defendants, targeted the County by misrepresenting its skills and experience in SAP for Public Sector software to obtain a highly lucrative public sector implementation contract for itself, and licensing, maintenance and support contracts for SAP Public Services, Inc.

As a further part of the scheme, Deloitte falsely represented to the County – which had no ERP or SAP for Public Sector experience – that Deloitte had the requisite skills and experience in SAP for Public Sector software to deliver a successful implementation for the County.  Deloitte and the SAP Defendants also falsely represented that Deloitte, by virtue of its “alliance” with the SAP Defendants, was uniquely qualified to properly implement SAP for Public Sector software.  These representations were false because, at the time they were made, Deloitte and the SAP Defendants knew, or were reckless in not knowing, that Deloitte in fact lacked the ability and/or the intention to provide the County with appropriately skilled consultants.

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As a further part of the scheme, to conceal implementation problems that resulted from Deloitte’s lack of skills, Deloitte and the SAP Defendants engaged in unlawful conduct to ensure that the County proceeded to go live with the SAP system on the scheduled go-live dates, in order to secure payment of their fees.  Such misconduct included deliberate under-testing of the SAP system by Deloitte to obtain artificially positive results and thereby conceal system defects; attempt by Deloitte and the SAP Defendants to silence an employee who raised issues with Deloitte’s deficient implementation work; and efforts by Deloitte and the SAP Defendants to corruptly influence defendant Culver, a County official who was also the County’s Project Director, to cover up Deloitte’s deficient implementation work, obtain payment for work that was not properly performed (or not performed at all) and cause the County to enter into additional contracts with Deloitte and SAP Public Services, Inc.

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The fraudulent scheme that Deloitte and the SAP Defendants perpetrated on the County is consistent with a pattern and practice of similar misconduct that they have perpetrated on other public entities, including those in Los Angeles, San Antonio, Colorado and Miami-Dade in connection with the implementation of SAP for Public Sector software.

On January 26, 2011 it appears the case was removed to Federal District Court for Northern California from the Marin County Superior Court.   On February 23, 2011 SAP filed motions to be dismissed as parties from the case, and to strike their name from the complaint.  On March 21, 2011 the Motions to Dismiss and Strike were terminated because the parties all agreed to allow the complaint to be amended, and allowed for additional time to respond to the newly amended complaint once it is complete.

So, the case continues.  Once again there is a key and noteworthy item in this case, the SAP software itself was still not alleged to be the problem.  The allegations within the case surround the consulting practices of Deloitte and SAP is “guilty by association” because they put their “seal of approval” on Deloitte as a qualified integrator.

Consulting Industry Implications – Especially for SAP Partner Programs

This case reminds me of something Michael Doane wrote about some time back about the need for SAP system integrators to be certified as well as their consultants (see Certainly Certifiable – SAP System Integrators Not Just Consultants).

After reading through the entire complaint I can 99.999% guarantee that one or more of the “consultants” Deloitte brought to the project had partially or even completely fake resumes and SAP backgrounds.  I wouldn’t be surprised at all if the number of fake or fraudulent “consultants” on that project was closer to 30% or even higher.  I’m not talking about fake or fraudulent because they didn’t have public sector experience, I’m talking about completely fake and fraudulent work histories and experience in general.

If the Marin County outside attorneys at Kasowitz Benson Torres & Friedman LLP subpoena the employment application information and contractor resumes and do a thorough background check on the Deloitte consultants I wouldn’t be surprised if they find massive fraud.  Worse still I’m equally sure that a careful review of the Deloitte vetting process will reveal that the experience claims and employment history for contractors was not verified.  It wouldn’t surprise me if many of these “consultants” listed fake “certifications” on their resumes as well which was not verified (for more background on the MASSIVE fraud around SAP “consultants” please see Screening and Interview Methods to Find the Right SAP Consultant and the follow-up piece Screening and Interview Methods to Find the Right Consultant – Part 2).

What Would be the Impact on SAP and SAP System Integrators if the County Wins?

If SAP bears even a small amount of liability by the end of this case it will have huge ripple effects throughout the entire business application space.  It might actually force SAP to ensure that their partners have some measure of verifiable skill rather than just buying a seat at the table.  On top of that it will put all system integrators on notice that if the current failure to verify skill and experience continues they may be held liable.

Maybe it’s time SAP finally put in that “transcript” service for consultants who claim to have SAP training or certification.  Let decent training programs apply to be “certified training centers” or “training alliance partners” to submit the training information to SAP’s transcript service.  After all, SAP offers a Higher Education industry solution so they have the software to support it.

One Way SAP MIGHT be able to Get Out of the Marin County Case Fast!

I’m guessing here that the reason SAP was joined to the complaint was because Marin County recently ripped out the SAP system and wants to get their SAP license fees and maintenance fees back.  If they can get treble damages for fraud, all the better.  Guess what SAP, if you are REALLY smart you might want to try to negotiate that with the County in a private settlement IMMEDIATELY.  Cut the legal fees, end the PR headaches on the heels of the Oracle debacle, give them back their money for the software and the maintenance fees and then fix the partner program!  Get those settlement negotiations started IMMEDIATELY because your private settlement discussions are NOT admissible in court.  Run from this mess fast!

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Complete Marin County Deloitte-SAP Complaint Removed to Federal Court

I have attached a copy of the entire, lengthy case for anyone who is interested in reading this.  Even if every allegation is not true, I have seen enough of these kinds of tactics to know that this type of thing happens routinely.  This complaint should be REQUIRED READING FOR EVERY POTENTIAL SAP CUSTOMER IN THE RFI OR RFP STAGE!  (Complaint document here).

Related Posts:

• SAP System Vendor Project Success Criteria 1
• Tactics, Strategy, ROI, TCO and Realizing Business Benefit from SAP
• SAP Technicians or Experts
• SAP Failures: Is Lack of Sr. Mgt. Commitment the REAL Issue?
• Screening and Interview Methods to Find the Right Consultant – Part 2