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How To Navigate the SAP Business Transformation Journey

March 19th, 2012 by
SAP Business Transformation

SAP Business Transformation

One of the drivers for this continuing Series on SAP Competency Center or SAP Center of Excellence is the desire for so many senior IT leaders to become future-state business strategist CIOs.  Last week’s post provided the introduction of SAP Enabled Business Transformation for IT Leadership–, a key requirement for senior IT leaders to become strategic business peers.  

Last week’s post introduced the three key milestones on the journey to the future-state business strategist IT leader–, especially if you have any thoughts about ever becoming a CIO.  In 2010 the CIO Executive Council conducted a study of some 200 selected business leaders.  They wanted to “identify goals, challenges and best practices among a representative population of top IT leaders.”  The survey indicated that fully 80% of these leaders wanted to advance to the “future-state, business strategist CIO position.”  As the last post addressed, this objective requires 3 stages IT leaders must move their organization through: internal focus, enterprise focus, and then external focus.  In terms of organizational maturity this means going from service provider to business partner to business peer.

The reason I focus on the SAP Center of Excellence concept [FN1] is that model provides any IT organization undergoing transition or transformation with an understandable future-state to work toward.  Having that future state is also why maturity models have become so popular.  Maturity models, like the SAP Center of Excellence, provide a roadmap to build the structure around for reaching your destination.

Beyond a mountain of SAP service providers pushing for outsourcing there is little information about building, maintaining, and then delivering excellence in a live SAP organization.

The Internally Focused SAP IT Organization

–          The Internal IT Focus correlates to the basic IT service provider model.

To summarize, the Internal IT Focus is about IT leadership being concerned with system stabilization, fixing problems, and addressing any high priority changes or needs.  At this point your SAP IT Organization activities are all about the “care and feeding” of the new SAP system–, basic system maintenance and support.  Some commentators refer to this as “keeping the lights on.”

At this stage the critical SAP IT organization development activities include:

  • Gaining functional competence with the SAP applications (maintenance for the support staff, providing further training and knowledge transfer for end users).
  • Developing leadership skills to manage internal SAP / IT initiatives (SAP project management, team leadership, blueprinting, scoping, estimating, etc.).
  • Proper data management (data governance, correction, and ongoing refinement).
  • Managing system security.
  • SAP Help Desk and support operations.
  • Maintaining hardware / system responsiveness.

The IT Leadership Domain in this area is as functional head or basic management.

Many organizations are eligible to receive the SAP Certified Customer Center of Expertise designation at this point.  However this is only a service provider model and offers little value to the business.

The Business Aligned SAP IT Organization

–          Enterprise Integration is where the IT organization transitions from service provider to business partner through change management and organizational transformation.

The second key competency is Enterprise Integration, or, as many previous commentators have called it “business to IT alignment” but it is actually Beyond Technology Alignment.  At this stage the IT organization is beginning to develop a level of business understanding, business awareness, and taking the first steps to business integration.  

The biggest problem at this stage is with system integrators and staffing firms who promote the business and technical divide by providing resources who are clearly not real consultants.  To get past this you as the customer are responsible for FIXING Stupid SAP Vendor – Partner Selection RFI – RFP Processes and using Screening and Interview Methods to Find the Right Consultant – Part 2. Think about this a moment, if your SAP implementation vendor provides “consultants” who do not even understand business, or have barriers to actually consulting, do you expect your own internal IT organization to “automagically” bridge the gap?  The internal resources generally have limited or no SAP exposure.

At this stage the critical SAP organizational development activities include:

  • More direct interaction with business users, supervisors, and business leaders (earning trust).
  • Participating in resolving business challenges by offering technology options to HELP the business address their concerns.
  • Speaking in business terms about technology solutions.
  • Collaborating with business users across different departments to solve complex or interrelated challenges and problems (for one method to do this with SAP, see SAP, ERP III, SOA — Learning Organizations through Social Media Collaboration
  • Overall Change Management leadership by the IT organization
    • Investment in training and development around organization change management
    • Leadership / Management training of IT employees.
    • Periodic “shadow” or “employee exchange” programs for SAP employees to perform various business functions from the end-user and supervisory perspective.
    • Regular IT meetings (generally weekly) on how technology is being applied to company vision, strategy, and business goals.
    • Regular meetings (generally monthly) with various business stakeholders to provide progress in applying technology to business vision, strategy, and goals as well as seeking new areas of opportunity.  This is part of the Steering Committee Governance for an SAP Center of Excellence and why Using Your SAP Steering Committee for Business Transformation is critical for SAP program success.

The IT Leadership Domain in this area is as transformational leader with heavy organizational change and integration.

What about External Focus for the SAP Organization?

The IT Leadership Domain in this area is strategic leadership with a heavy emphasis on external market forces, sales, revenue generation, and improved company products / services.

We will look at some of the key activities related to the final step on this journey in a future post.  This is where the divide between business and IT is changed so that the SAP support organization is seen as a business peer and is respected and even sought out for their strategic contribution to overall business direction.

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[FN1]  It didn’t hurt that Michael Doane and I used to work together at Grant Thornton in the late 90’s on SAP projects, or that we’ve periodically stayed in touch since then.  Mr. Doane is one of the original advocates of approaching SAP implementations from the perspective of planning for the long term use of the system rather than just getting through a project.  An approach he refers to as building a “Center of Excellence” for the productive SAP instance.

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SAP Enabled Business Transformation for IT Leadership

March 12th, 2012 by
SAP Business Transformation

SAP Business Transformation

Continuing the Journey to the Business-Converged SAP Center of Excellence

After many years researching and living through IT and business convergence for IT leadership I ran into a study which brought more clarity to the key dividing concepts.  Some interesting approaches and maturity models are available for senior executives but little direction for the delivery organization (for detailed development see 3 Development Phases for SAP Center of Excellence Maturity).

CIO magazine established a CIO Executive Council for doing research on challenges faced by senior IT leaders.  As a result of this research they developed a great senior IT leader competency model which is easily applied to transforming the SAP enterprise.  Their CIO competency also correlates well to SAP’s RUN methodology (part of the new integrated SAP ASAP Implementation Methodology).

The competency model which can be adapted to SAP transformation consists of three stages:

  • Internal IT Focus
  • Enterprise Integration
  • External Business drivers

The Chevron CIO Journey Through the States of Internal to Enterprise to External

As Louie Ehrlich, President, Chevron Information Technology Company, and CIO, Chevron Corp described his journey of discovery around the first two key areas:

The hard lesson I learned as a CIO looking to advance my role and serve as a business strategist is that one must recognize that there is likely to be a capability/expectation gap, and that this gap doesn’t go away by itself. It’s something that we as [senior IT leaders] have to close.

In my view, the expectation gap is influenced by three factors. The first factor is the state of the fundamentals of your IT environment. Is it cost effective? Is it reliable? If it isn’t, then by definition your role needs to be one of IT function leader. Without that foundation, nothing else is possible.

The second factor is the capabilities and business knowledge of the IT function. Do you have an IT employee base with the experience and ability to bring strategic business value to the company?  If not, then again – much of your focus should be as the IT function leader. The first and second factors are within our control.  [FN1]

Ehrlich’s experience, insight, and direction is part of The Real Reason Executive Participation Creates IT Project Success.  The executive guidance provides invaluable insight which ultimately aligns to business needs and requirements.  Without executive sponsorship it will be difficult (if not impossible) to make the transition from pure technical delivery to IT-business convergence.

The Current State of SAP Business Transformation Needs Attention

You know you’ve got a serious problem when the user community expresses these (all to common) frustrations: “the IT group just doesn’t get it!” or “they think they know what I deal with but they have no clue,” or worse still “I’m sick of them putting something in and just throwing it at me and saying here it is…”

Too often many SAP enabled enterprises have IT organizations who genuinely do not appreciate their role in the enterprise.  Many SAP IT organizations seem to lack the critical understanding that technology in the enterprise is there to further business needs.

If you really want to find out the business perspective of your IT organization why don’t you do an internal poll asking how true those user statements are on a scale of 1 – 5.  You might be shocked by the answer.

A Change Program for the SAP Organization is Needed

You can use SAP as a Change Enabler to achieve tremendous benefits throughout the enterprise with the right approach.  But as my former colleague and friend Michael Doane has suggested by using a marriage vs. wedding analogy, SAP Implementation is an Investment NOT an Event!

Often the consultants who have done SAP for any period of time focus on how to help the business make the transition to the new system.  Unfortunately in the course of the project we rarely focus on helping the SAP support organization make the transition to business partner.  Instead we focus on setting up help desks, support, data management, etc.

To achieve Sustained Business Value from SAP Business Software it is important to incorporate a Change Management Program within the SAP / IT Organization itself which is focused on Achieving Business Value from SAP Investment

The SAP Enabled IT Organization’s Perspective Needs Internal Change Management

As part of the approach 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.  Some organizations are taking this approach as they seek employees who are “business analysts” rather than merely functional consultants.  In other words they are looking for employees who clearly have a business background as well as SAP experience.

It is important to incorporate a Change Management Program within the SAP / IT Organization itself

The SAP organization MUST focus on developing depth of business skills and business collaboration.  Failing to do this will only result in a loss of credibility for the SAP enabled IT organization.  As long as that is the perception of the broader user community, and especially of business leadership, the SAP / IT organization will not be seen as a business peer.  In fact, until this internal frustration and distrust is addressed there will be a natural resistance on the part of the broader business community to allow IT to become a business partner.

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[FN1] Closing the Expectations Gap, CIO Dashboard

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The Consultant Certification Ruckus

October 4th, 2010 by

Training and CertificationHere we go again.

Jon Reed, Dennis Howlett, Martin Gillet, Michael Koch, and Leonardo Di Araujo, collectively known as the Certification 5, have posted a 55-page, somewhat discoordinated white paper exploring the need to vastly upgrade the SAP consultant certification process. http://www.sdn.sap.com/irj/scn/weblogs?blog=/pub/wlg/18849

The article even got the attention of Larry Digby, Editor in Chief of ZDNet http://blogs.zdnet.com/BTL/?p=33369&tag=col1;post-33369

Given the prominence of all of the above, it is certain that this work will be seriously scrutinized by SAP as there is still a perception that too many of the SAP consultants in the field are short on the requisite skills. As it happens, the whole subject was kicked back into high gear about a year ago when (then) CEO Leo Apotheker had this outburst in front of reporters and bloggers:

“I don’t give a s**t if it’s Accenture or IBM. I care about the customer. I find it shocking people are walking around talking to customers and have no experience on [SAP]. [Consultants] get hired by people and have no clue. It’s annoying but that’s a fact. Let’s start by certifying people,” said Apotheker. “If we believe [a project] takes 500 days and another partner says it’s 5,000 days I’ll do it for 500 and a fixed fee.”

While I would welcome tighter certification of individual consultants, even the Certification 5 tend to focus on technical skills (DiAraujo elaborately argues against the viability of testing “soft” consulting skills.) All the same, I remain convinced that it’s the systems integration firms that require certification. We all know that even with a team of highly qualified consultants, a single crappy project manager can drive a project into the ground. This was my argument a year ago http://snipurl.com/vpb26 and it remains my argument today.

If certification is focused on SAP technical acumen alone (without business knowledge), the certified term should not be “consultant”. 

Engineers without business knowledge often build beautiful and efficient bridges to nowhere.

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It’s long past time some of the lack of talent in the consulting world finally got real scrutiny.  And it is way overdue for SAP to offer an actual transcript service for any consultant who claims to have had training or certification.

For the current crop of high quality training companies out there that offer SAP training, maybe SAP can provide a “certification” or logo program for them and include their classes and training in its transcript service.  SOMETHING has got to be done to improve the quality of the consulting field because there are way too many snake oil salesmen out there with too much hype and not enough skill.

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Republished from Michael Doane’s Web Site:

http://sapsearchlight.blogspot.com/

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