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Will SAP HANA Lead to a Big Data Revolution?

December 17th, 2012 by

SAP HANA – Big Data

Lots of folks focus on HANA as a competitor to Oracle, and it is.  Even if HANA adoption and sales were to completely devastate SAP’s biggest competitor (Oracle) that would not be HANA’s biggest impact–, the HANA product has the potential to disrupt entire industries in the context of Big Data.

Unlike Big Data, I’ve been skeptical about the benefits and use of social media in the enterprise, writing about it in Why Social Media Marketing Success Is Elusive for Business and Social Media Fads and the Risk to the Enterprise.  On the other hand, Big Data hasn’t gotten anywhere near the attention even though it has a fairly clear business case.  Big Data has the capability to transform enterprises, organizations, and even entire industries.  We are not talking about abstract “build it and they will come” theories here either.  We are talking about a revolution in the way business is done.

Big Data will have huge impacts on customers, products, even whole regions of the world.  What do I mean when I refer to Big Data?

BIG DATA:  The ability to analyze large volumes of both structured data (like transactional data streams) AND unstructured data (social media, industry information, news trends, etc.) leading to market makers and market losers across virtually all industries.

This ability to synthesize structured and unstructured data streams with technology advances WILL transform companies and industries.
 
Over the next 5 – 10 years:

  • Computing power will continue to grow.
  • High speed memory processing (like in SSD drives) will improve.
  • Massive memory storage will come down in price.
  • In-memory database technologies will mature.

This “perfect storm” of Big Data know-how and technology advances will lead to the ability to identify:

  •  Subtle and even unknown market segments.
  •  Market and sales trends.
  •  Customer sentiments, needs, and wants.
    • Leading to new product or service opportunities.
  • Competitor strengths or weaknesses.
  • Etc., etc., etc.

Big Data will be part of the ERP iii [FN1] technology innovation driving customer focus related to customer acquisition, customer retention, and marketplace performance.  Big Data represents a business transformation shift in how business will be done in the future–, it represents a potential seismic shift in business performance in the marketplace.

The Big Data Revolution

The struggles are the semantics in how to synthesize the information and filter the nuggets from the noise.  Big Data allows you to understand what the keys are in terms of words, concepts, and ideas.  It then allows you to synthesize those keys with the various data sources.
 
In other words, how do you take the product sales information (transactional data), customer demographics (transactional), corporate market knowledge (unstructured internal), key word search (semi-structured internal and external such as with Google or Bing), with marketplace intelligence (unstructured external, including external social media), and innovate new or existing products and services?  That is the challenge that some folks are beginning to work on today.  That is the challenge that SAP’s HANA product enables for the future enterprise. 

Big Data means “Business Intelligence” will finally become, well, intelligent!

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[FN1]  For more information on ERP 3 see this comprehensive ERP treatise ERP vs. ERP II vs. ERP III Future Enterprise Applications.

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Creating a Knowledge Centered Learning Organization

April 16th, 2012 by
R3Now Knowledge Management

R3Now Knowledge Management

This is a continuation of Business Transformation for IT Leadership and is part of a journey around Organizational Change Management Inside the IT Support Organization .  To achieve an active, vibrant, knowledge-sharing learning organization requires some baseline understanding of what your goals are.  You need a culture that produces, organizes, disseminates, applies, and then refines information (see the image to the left).

This leads me to the next key point of which few people who call themselves “knowledge managers” have much understanding of –, information management is NOT knowledge management.  But both information management AND knowledge management are critical components of a learning organization.   

Information is the vehicle, knowledge is the destination

What is Knowledge?

Knowledge is the application of information, in a particular context, coupled with experience -–, it is NOT in some system.   Information is stored in systems, knowledge is stored in people.  Bill Wood, 2006.

Creating a Knowledge Centered Learning Organization is Really Exciting! (In the Sales Material)

Lots of folks get excited about the idea and even the prospects of creating a learning organization.  Achieving a vibrant learning organization with a knowledge sharing culture can reap huge rewards for a company’s competitive position in the marketplace.

Even the Harvard Business Review has gotten on board and sells a few “knowledge products” of their own.  Their pitch suggests that creating a learning organization leads to competitive business advantage.  After all, when you have a workforce which learns and applies new knowledge, new techniques, new methods to addressing the marketplace you are creating competitive advantage.  It is more than a pitch however and can in fact make a significant impact on your business and organization.

A learning organization requires a social component (people), delivery architecture (technology), and a structured method to share information (process).  By transforming your SAP / IT Organization into a learning organization you are taking the first steps to bridge the gap between an enterprise focus and an external market or customer focus.

A learning organization requires motivation

The Wheels Fell Off My Learning Organization Bus

You’re excited about the possibilities, you announce your thoughts to your leadership, and you can hear a pin drop.  Except for Joe the brown-noser no one is jumping on your bus! Why should they?  It sounds like another fad, another task, something else to monitor.  It sounds like you’re talking about one of their worst fears and frustrations–, you’re talking dynamic cultural transformation and they’re hearing social media and more work.  Your managers are thinking “Have you lost your mind?  How do I manage all this social media stuff when I have to meet my other goals?”  My employees are already frayed, I have 2 employees going through a divorce, one of the two cries half the day and the other is despondent.  Their emotional weight and negative energy are dragging down two of my departments and now I have to play policeman around social media junk?

Get the Employees ON the Bus First (BEFORE You Start to Drive!)

Before you start promoting the idea of creating a learning organization it is important to do this in manageable and incremental steps.  The key is in making sure the key resources are ON the bus before you try to make the trip.  Otherwise it might be a pretty lonely trip with an empty bus!  It is important to get the broader business community in a more accepting posture for your SAP / IT organizational changes by using Change Management Strategies and Knowledge Transfer Processes for a Successful SAP Project 1

Lasting Change Begins at Home

As part of a 3 tier process for transforming your SAP or IT support organization you might begin with Change Management Strategies and Knowledge Transfer Processes for a Successful SAP Project 2 so the business gains greater application maturity.  As part of that internal focus it is just as important to address the How To Steps in the SAP Business Transformation Journey within your SAP IT organization.

The Right Information Right Now

The goal for the first phase is the right information right now within the SAP/IT Organization.  After the internal IT support organization is immersed in information sharing it can then be rolled out systematically to the other two key areas of the Enterprise and then to the broader marketplace.

Build the infrastructure to support a learning organization first

The right approach consists of three tiers which look like concentric circles.  These consist of creating a learning environment within the IT organization itself.  This must include both push and pull tools for collaboration and information exchange.  From there, the ability to build ad hoc and dynamic groups for decision-making, skills use, process insight, and other resource needs become the focus. 

This collaboration approach is the first step to ERP III – Is the Integration of Collaboration the Future of Enterprise Applications?  The three key phases to this organizational transformation include:

  • Make use of collaboration and social media tools within the organization
  • Deploy both push and pull information tools to leverage information resources
  • Create an internal employee skills base (like an internal LinkedIn)

Once the information sharing infrastructure is in place, then you can focus on creating an information consuming culture within your SAP or IT organization.  In other words, build the infrastructure to support a learning organization first!

High Level Steps to Build a Knowledge Based Learning Organization

  1. Build out the push / pull information infrastructure
  2. Make participation part of the goals / review / bonus structure
  3. Pilot this inside the IT organization
  4. Roll out to the entire IT organization
  5. Scale up and modify push / pull infrastructure.
  6. Pilot within a BU or business organization (i.e. begin to converge IT and the business)
  7. Capture lessons learned and adjust then roll out to the broader business community.
  8. Repeat the steps to roll out to the customer base…
  9. Repeat the steps to roll out to broader (possibly targeted) market segments



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Organizational Change Management Inside the SAP IT Support Organization

April 2nd, 2012 by
SAP Business IT Convergence

SAP Business IT Convergence

The last few weeks have focused on the path for IT leaders to become strategic business partners.  Academic research shows that for Sustained Business Value from SAP Business Software you must focus technology implementation efforts on business benefits.  This includes metrics to determine if business goals were achieved by the software implementation effort.

Achieving Business Value from SAP Investment was about case studies which evaluated organizations which applied a business benefits approach.  These case studies determined the business benefits focus also requires organizational change management.  Several years before these case studies I wrote about SAP as a Change Enabler which provides a good summary of what the authors found in their 35 page study. 

On this journey to SAP Enabled Business Transformation for IT Leadership we reviewed some of the senior leadership work by CIO Magazine and their 3 stage competency model of:

  • Internal Focus
  • Enterprise Focus
  • External Focus

Insight and activities to address the Internal Focus area were provided in the How To Steps in the SAP Business Transformation Journey and the Phase 6 RUN SAP ASAP Methodology.  This post will offer insight on taking your SAP or IT organization to the next level.  The focus now is on the Enterprise area with additional efforts to prepare your SAP IT support organization for External focus.

Making SAP About Business Transformation and Business Benefit

To move your SAP organization to the next level means your efforts must take SAP IT Convergence Beyond Business to IT Alignment.  As previously discussed, the Internal Focus in this maturity model is about “keeping the lights on” with your enterprise systems.  The next level requires a deliberate focus on convergence by IT leadership because SAP IT Convergence is About Business Focused Integration–, it is NOT about IT!

IT leaders must be deliberate about working through a full IT competency model–, there are no shortcuts! 

There is no “magical formula” for suddenly transforming your SAP or IT organization into a market and customer focused powerhouse.  It is a methodical path driven by an internal (senior level) champion to move the entire IT organization through the preliminary steps before arriving at the external market / customer / business competitive pressure focus.  Here is the ugly reality, no matter how smart, talented, diligent, hardworking, dedicated, or committed your IT staff are, or how hard you work as a leader, until you gain a trusted peer relationship with the business any externally focused efforts will not be well received.  The good news for many SAP organizations who provided great business resources for your SAP project is that you have a lot of talent to tap into to help bridge the business gap for an Enterprise Focus.

Some of the Steps to Achieve SAP IT Convergence require deliberate efforts at internal SAP support organization transformation.  A few maturity characteristics of that enterprise focus are:

  • SAP and IT staff communications, internally and externally, are more in business language rather than technology.
  • Proactively seeks out new business opportunities.
  • Able to interpret, and then implement, business marketplace requirements by turning them into technology solutions.
  • Adapts to business market conditions.
  • Not worried about the latest “techie buzz” like social media (Twitter, Facebook), cloud, etc. unless there is a direct business marketplace connection.

To be effective you must work at Integrating Business Stakeholders as Part of SAP IT Convergence.  I call a “converged” SAP or IT organization a “Center of Excellence” because it goes far beyond the SAP Center of Expertise.  The SAP Center of Excellence concept should not to be confused with SAP’s “borrowing” of the term in some of the sales literature.  Generally when SAP refers to a “Center of Excellence” they are talking about their “lights on” support oriented “Center of Expertise” where you as the customer take care of some of the support you pay them for.  To achieve this you need continued and ongoing Steering Committee Governance for an SAP Center of Excellence.

Organizational Change for the SAP and IT staff

One of the key arrangements I have seen over the years, which some of the commentators are beginning to explore, is a dual IT organization.  One part focuses on day to day support (“lights on”) while the other part addresses key business needs in the business environment.

1) Create a solid internal “anchor” focus with emphasis on bridging the business perception of any “capability/expectation gap” (Louie Ehrlich, President, Chevron Information Technology Company, and CIO, Chevron Corp).

That capability / expectation gap is related to taking care of the “lights on” IT functions in such a way that IT is effective and reliable.  The internal focus is where IT operates almost like a utility, the electricity is on but we really don’t think about it unless it goes out and then it is a big disruption because it is generally so reliable.

2) Try to develop more internal employee “exchange programs”.  This is an effective approach to build bridges between business and IT.  But it really should go both ways.  Not just IT embedded into the business, but certain business stakeholders embedded into IT.  This is one way to “be deliberate” integrating your IT organization into the business.

Work to create a “converged” IT organization RATHER than an “aligned” IT organization. 

As my previous post on ERP II & ERP III – SAP Business IT Revolution, from a TechRepublic.com article:

“IT has to stop thinking of itself as a business utility and start seeing itself as a business catalyst. In order to do that, it’s going to have to think in business terms and economic impact for everything it does…”

Creating a Learning Organization Through Collaboration and Knowledge Management

Another key phase which we may visit in the future is about creating a “learning organization” first within the circles of the SAP IT organization, and then within the broader business community.  This collaboration network will serve as a critical foundation for the third stage, or the “external” focus.  In ERP III – Is the Integration of Collaboration the Future of Enterprise Applications we take a look at Learning Organizations, Knowledge Transfer, and Knowledge Management (rather than information management). 




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