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3 Development Phases for SAP Center of Excellence Maturity

May 14th, 2012 by
SAP CoE Maturity

SAP CoE Maturity

Before we get into the substance of HOW TO build a next generation IT organization that is integrated with business a quick review is in order.

Last week’s post on SAP Service Provider to Business Peer Through Center of Excellence Maturity proposed the direct maturity of the SAP IT organization.  The key principle is there are three stages or strata of Organizational Change Management Inside the SAP IT Support Organization These stages create clear distinctions between SAP Service Delivery versus Value Delivery

This week is an overview of the development and maturity details to use SAP as a Change Enabler through SAP Enabled Business Transformation for IT Leadership.  Please keep in mind this organizational development overview is just one component of the Series on SAP Competency Center or SAP Center of Excellence.  The need to continue your Steering Committee Governance for an SAP Center of Excellence cannot be ignored.  Properly formed and instituted your SAP steering committee is a key enabler for business to IT convergence. 

To achieve SAP IT Convergence Beyond Business to IT Alignment requires a senior leader change champion to make this a deliberate and accountable effort.  This is not intended to be a theoretical discussion but instead it is an action plan.  The entire initiative is as a project and needs a project plan, deliverables, key milestones, assigned resources, etc.   All of the structure and processes will need to be defined within your IT organization to move this forward.

SAP Center of Excellence Maturity Development Level 1 – Internal Focus on IT Operations (Service Provider)

Internal focus is an “all hands on deck” effort.  If internal focus, or basic IT service delivery is suffering then everyone within the IT organization must work to ensure your systems are meeting business needs.  You will not gain enough trust of the business community to become a partner or peer until the basic infrastructure works. Some of the key development in this phase includes:

  • A skills matrix
  • IT staff training and development plans
  • Clear SLA requirements
  • Consistent and regular feedback and coaching

Typical activities for service delivery include:

  • Help desk functions
  • Data maintenance
  • Security and authorizations
  • Technical infrastructure (servers, system performance, database maintenance, network, etc)
  • System access (desktop, remote, mobile, etc).
  • Hardware procurement
  • Knowledge (information) base development (Wikis, SharePoint, collaboration tools, etc.)
  • Knowledge transfer to the user community (formal and informal training)
  • Super user development

Skills development focuses on SAP or technical domain competence

  • Application module specialties (SD, MM, PP, SRM, CRM, FI, APO, BObj, etc)
  • Programming languages (ABAP, Java, PHP, etc.)
  • Infrastructure (Cisco, routers, VOIP, IPv6, DHCP, LDAP, etc.)
  • SAP Solution Manager use
  • Effective presentation skills

SAP Center of Excellence Maturity Development Level 2 – SAP IT Integration With the Broader Business Enterprise (Business Partner)

At this stage, depending on the size of your SAP or IT organization, there are 2 levels of leadership here: 1) delivery management, and 2) process management while developing methodologies, tools, templates, and controls.  A key part of the process management is the development of KPI indexes.  Typical activities for business (enterprise) integration include:

  • Requirements gathering
  • Blueprinting
  • System & solution architecture
  • Business case development (cost and value)
  • Knowledge transfer
  • Subject matter expert training
  • Super user training
  • KPI and PPI* development with analytics
  • Project management
  • Team and project leadership
  • Basic supervisory tasks
  • Mentoring, coaching, and staff development
  • Budget adherence
  • Sourcing and supplier management
  • SAP Solution Manager setup and maintenance for project delivery as well as BPM

Skills development focuses on project delivery and management.

  • Facilitation, meeting, and time management skills
  • Project management (training and certification)
  • Managing conflict
  • Supervisory & leadership
  • Negotiation skills
  • Organizational Change Management
  • Total Quality Management
  • Business Process modeling

SAP Center of Excellence Maturity Development Level 3 – Strategic Development Around the Marketplace and Competitors (Business Peer)

Split development track for leaders – 1) product or service engineering support (i.e. the “innovation” track) or 2) sales and marketing (i.e. customer focus).  Typical activities for value added strategic technology convergence include:

  • BPI* development and analytics
  • Marketplace analytics with solution proposals
  • Customer analytics with solution proposals
  • Value analysis – ROI assessment and benefit compliance
  • Cost analysis – TCO assessment and cost savings
  • Business case review for strategic fit
  • Technology roadmap for system & solution architecture
  • System architecture integration with business process management
  • Program management
  • Program & project budget development
  • Project audits / QA’s
  • Mentoring, coaching, and development of level 2 participants
  • Vendor management

Skills development focuses on business drivers, marketplace competitive pressures, sales, and senior leadership.

  • Advertising principles
  • Business statistics
  • Market research
  • Sales management
  • International marketing
  • Sales models
  • Organizational development
  • Coaching and leadership
  • Delegation
  • Strategic planning

Conclusion on SAP Center of Excellence Maturity Development

This analysis provides a framework for development of a world class, fully integrated SAP IT organization.  However, this framework only scratches the surface of a much broader and more important topic–, Organizational Change Management Inside the SAP IT Support Organization.

Communication is One Key to Business and IT Integration

One of the most critical components of a change management program is not listed above in any of the bullet points – developing communication channels.  Maybe this is naïve of me but I would expect that actively and aggressively developing clear and open lines of communication between IT at all levels with the business would be assumed.  Developing an overall communication program and plans is a basic part of any change management initiative.

There is a significant amount of additional guidance for developing your SAP Center of Excellence in the Series on SAP Competency Center or SAP Center of Excellence.  A systematic approach, including key milestones to measure progress against are important elements to success.  To that end I hope this framework contributes to the dialog and direction of future SAP IT organization maturity.

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* An upcoming post in the future will look in detail at this concept of “KPI, PPI, and BPI” as Key Performance Indicators, Process Performance Indicators, and then finally Business Performance Indicators.




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SAP Service Provider to Business Peer Through Center of Excellence Maturity

May 7th, 2012 by
Deliver Business Value with SAP CoE

Deliver Business Value with SAP CoE

One key pillar of moving Beyond Technology Alignment requires Organizational Change Management Inside the SAP IT Support Organization (OCM inside IT).  A key component of that OCM within IT relies heavily on Creating a Knowledge Centered Learning Organization.  And within that learning organization, especially with enterprise applications like SAP, you need to build organizational maturity.  There is a three-tier approach to building that organizational maturity as part of the Series on SAP Competency Center or SAP Center of Excellence.

The SAP IT Organization Challenge

Being an “IT Organization” is where the challenge for change begins.  IT has been so focused on delivering technical solutions that business integration was missed along the way.  Adding to this is the “youth” of IT as a business discipline.  Think about it, people have been doing business for thousands of years.  Technology, bits, bytes, interconnected systems, data transmissions, and information age “knowledge” workers are a new phenomenon within the last 2 – 3 decades.  Compared to the age of business they haven’t even hit puberty!

So, the real issue here is how to quickly mature the SAP or IT organization from simple service provider, to business partner, and then to business peer.  This requires far more than the traditional domain and technology management in so many IT organizations today.  The problem comes down to SAP Service Delivery versus Value Delivery

The Answer: Develop Organizational Maturity, both Aligned and then Integrated With the Business

For SAP Enabled Business Transformation for IT Leadership we started with CIO Magazine’s CIO Maturity Model and applied it to the IT delivery organization.  The delivery organization maturity model consists of three key levels of organizational maturity or competence; they are internal, enterprise, and external focus.  These are reflected in the concentric circles below.  When considering SAP Service Delivery versus Value Delivery it is important to understand how to develop that maturity.  The service delivery domain is technical in nature and the value delivery domain is focused on enabling business.  The value domain is related to customers, marketplace, and improved products or services.

SAP IT Convergence Maturity Model

SAP IT Convergence Maturity Model

 

SAP IT Organization Maturity: Growing Pains

Within each of these three concentric circles a particular delivery competence is required.  This delivery competence roughly equates to the skills and experience needed to address each of the key business support areas.  There will also be “growing pains” within each of these maturity stages as you:

  1. Plan
  2. Execute
  3. Adjust and stabilize
  4. Transition part of the organization to the next maturity level

This is a hierarchical maturity model.  While the diagram I use shows the concentric circles they should be thought of as circles of influence, skill development, and promotion.  Not everyone will move from the Internal Support area to the Enterprise Integration domain.  Likewise not everyone will move from Enterprise Integration to Marketplace Development either.  These should be considered as key career milestones for the SAP or IT employee.

For insight on How To Navigate the SAP Business Transformation Journey you will need to re-think the SAP IT organization’s role in the enterprise.  Are you satisfied with being just a service provider?  Do you want to do more?  To make the transition you will have to evaluate the constraints and then do what is necessary to remove them. 

Dealing with SAP IT Organizational Constraints

Whether those constraints are time, resources (budget, technical infrastructure, etc), or people it is important to do a SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats) of each area as you engage.

One other key thing to note here is if you have relatively small SAP or IT support organization then the Level 1 and Level 2 maturity areas can be merged and use less extensive development efforts.  There are practical budget, time, and resource limits that many have to work with.

The Three Part SAP Organization Change

The first two levels of the maturity model involve SAP Service Delivery versus Value Delivery. The second and third levels are about SAP IT Convergence Beyond Business to IT Alignment.

The three maturity areas are:

  1. Technical service delivery
  2. Cost and process value delivery
  3. Customer and marketplace integration

As senior IT leaders everywhere struggle with growing budget pressures it has never been more important to focus more aggressively on business value.  This will require Organizational Change Management Inside the SAP IT Support Organization with a strong focus on Creating a Knowledge Centered Learning Organization.  By developing both the infrastructure to support a learning organization, as well as the mentoring, coaching, and development you will be well on your way to transforming your IT efforts and move toward becoming a business partner.

Next week’s post (which has already been written) will evaluate the specific maturity and development details for each stage in creating a genuine IT Converged SAP Center of Excellence!

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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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