SAP ROI — Enterprise Architecture & Business Solutions

SAP Program Management

Many may be unaware that SAP provides a broad set of tools and resources for Program Management and Capability Maturity Model (or CMM). Very few are familiar with SAP’s broad set of supports for this purpose such as the “new” ASAP Methodology Phase 6 “Run” enhancement. It is loaded with key information which aligns with Program Management responsibilities and CMMI (Capability Maturity Model Integration) [FN1].

So, what is CMM (or CMMI as it is more properly referred to)?

“CMMI (Capability Maturity Model Integration) is a process improvement approach that provides organizations with the essential elements of effective processes, which will improve their performance… CMMI models are collections of best practices that help organizations to dramatically improve effectiveness, efficiency, and quality” [FN1].

The entire CMMI methodology and development is maintained at Carnegie Mellon’s Software Engineering Institute. These CMMI standards have been applied in a vast number of organizations together with various methodologies. The CMMI approach is well suited to engineering and software development, design, or implementation. SAP’s entire ASAP methodology, and especially the “new” Run methodology incorporates a number of CMMI principles.

SAP Program Management is all about Capability Maturity Management (or CMM)

The contract SAP program manager is accountable for providing the key tools, templates, techniques, and resources to ensure projects are properly managed and delivered for business benefit. If they are not providing this type of methodology guidance, including key templates and techniques to deliver business benefit, what are you paying them for?  In other words, if the contract program manager is not helping to deliver the key tools, templates, and resources to enhance your project delivery capability then why do you need them at all?

SAP Program Management or Project Management Gaps

After all these years one of my biggest frustrations is the lack of SAP contract program or project managers use of the ASAP Methodology. They all talk about it, and during sales presentations they use lots of SAP’s material, but as soon as the project begins you never see it. They seem to have absolutely no idea what they are doing.

What is the contract SAP Program Manager, or SAP Project Manager accountable for? What are they on the hook to deliver and how is their performance measured?

As I have often said, I never believe that a client / customer of project management or program management services has the primary responsibility for this knowledge. If they did why bother hiring outside help and paying the rates for this service except for that contract “expertise?”

Contract SAP program management or SAP project management that is not able to deliver on a clearly understandable methodology development are fakes. Anyone can call themselves a program manager, but what does that mean? What is the contract SAP Program Manager accountable for? What are they on the hook to deliver and how is their performance measured?

Using SAP ASAP and CMMI to Mature the SAP Enabled Enterprise

The SAP ASAP Methodology, in particular the Phase 6 Run section, should be studied by every SAP program manager before they start doing project or program work. Even though it is in the last ASAP Methodology phase, its greatest effectiveness is realized when you begin your internal SAP delivery maturity planning from the beginning of your SAP project.

One of the critical benefits of starting your CMMI related planning right from the beginning is your SAP project can be structured to support business integration at the outset. Using this type of maturity model integration as part of your project guidance can have significant benefits to the enterprise:

“Many CMMI using businesses have beneficial results to their bottom line… including improvements in schedule and cost performance, product and service quality, forecasting accuracy, productivity, customer satisfaction, return on investment, and other measures of performance” [FN2].

SAP has already done a significant amount of the work for you. All your program manager has to do is adjust the plans, alter the templates, follow the ASAP Methodology instructions, and build the resources to support this transition. You really must question SAP program manager service providers who do not keep up with the ASAP tools and delivery methodology that SAP provides and supports.

SAP’s Capability Maturity Model Starting Point

The following maturity model is just one small example of a powerful tool that is critical for long term technology and business integration [FN3]:

This model, provided freely by SAP as part of their standard ASAP methodology is a great starting point. Your contract SAP program manager should be able to use this as it is, or adjust it to fit your particular organizational needs. This is just one very small component of the Run Phase and an even smaller component of the entire ASAP Methodology toolset.

In many cases you would be better off sending your own internal employees to SAP ASAP certification courses and Microsoft Project classes and making use of their new found knowledge. At least then you would have a knowledgeable employee who could help keep an integrator who claims to use ASAP honest. And if they claim to use ASAP in their sales materials or sales pitches GET THAT CLAIM IN YOUR STATEMENT OF WORK AND YOUR CONTRACT WITH THEM!

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For more information on related topics please see:

• SAP Project Manager – SAP Program Manager, Lessons from the Trenches
• Effective Results from SAP Project Managers – SAP Program Managers
• SAP IT Convergence Beyond Business to IT Alignment
• Create SAP Convergence Instead of Business to IT Alignment
• Integrating Business Stakeholders as Part of SAP IT Convergence
• Steps to Achieve SAP IT Convergence
• SAP IT Convergence is About Business Focused Integration
• Steering Committee Governance for an SAP Center of Excellence
• Using Your SAP Steering Committee for Business Transformation

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[FN1] CMMI Overview: Software Engineering Institute at Carnegie Mellon University, retrieved November 5, 2011. http://www.sei.cmu.edu/cmmi/

[FN2] Why CMMI: Software Engineering Institute at Carnegie Mellon University, retrieved November 5, 2011. http://www.sei.cmu.edu/cmmi/why/

[FN3] SAP ASAP Methodology version 7.1, WBS 6.2.1 – Table 1: Maturity Level Characteristics. For more information on the SAP ASAP Methodology please go to http://www.sap.com/services/more/servsuptech/asap.epx

Related Posts:

• 3 Development Phases for SAP Center of Excellence Maturity
• Steps to Achieve SAP IT Convergence
• SAP Service Delivery versus Value Delivery
• SAP Customer Responsibility for SAP Project Success
• Organizational Change Management Inside the SAP IT Support Organization

Business - IT Convergence

Proper SAP project governance is a function of the business in partnership with IT.  With the exception of a few of SAP’s technical applications (like parts of Solution Manager, HANA, etc.) the entire application suite is about business; business transaction processing and business processes. If key business resources are not directly engaged in SAP project governance you may never realize the SAP benefits you expect.

This brings me to the point of what benefits you expect from an SAP implementation?

From what I have seen there are generally 2 broad “buckets” of benefits on SAP projects.  The first “bucket” is focused on consolidating and eliminating systems while the second is all about transactional business execution.  Or, IT benefits and business benefits.

SAP Project Drivers in IT

The first benefit “bucket” is related to pure IT cost reduction with a focus on consolidating and eliminating legacy systems for many of the following reasons:

• reducing numerous applications’ license costs
• narrowing technical infrastructure needs
• simplifying technical architecture
• reducing system maintenance costs
• reducing legacy staffing needs
• standardizing on a single development platform

If your SAP project is more of a pure landscape play, around replacing legacy systems, then SAP project governance would fall more clearly under IT.  However these types of projects usually end up having the business user community demand that all legacy system functionality be meticulously reproduced in SAP.  In the end you will likely achieve some measure of savings but far less than you originally anticipated.  Any expected savings will generally be consumed through mountains of custom coded solutions which will need continual care, maintenance, and feeding after go-live.  These custom coded “solutions” are not supported by your SAP maintenance agreement and can eat you alive in post-production support costs.

SAP Project Drivers in the Business

The second benefit “bucket” is related to business processes and business transaction execution producing results such as:

• improved cycle times
• greater process automation
• inter and intra departmental integration
• unified reporting data
• improved inventory management
• better planning capabilities
• greater supply chain efficiencies
• faster, more accurate financial closes and statements
• better operational decision making tools

As you can guess, the list goes on.  The difference here is the focus is on direct engagement and active participation with the business.  This is the real challenge.  A business partnership in your SAP project requires more change management, greater flexibility, and a clear understanding that some business needs will override IT drivers and IT goals.  The goal of well executed SAP project governance is to achieve measurable benefit –, it is more about delivering business objectives and strategic direction. 

IT Governance of the SAP Enabled Organization

When the SAP enabled IT organization is able to deliver on business objectives and focus on strategic direction their role in the enterprise changes.  This SAP change moves the IT organization from being a mere “service provider” (a very expensive cost center) to a critical “value added” business partner. When the SAP IT department is seen as a “service provider” you quickly encounter budget and cost cutting pressure.  As I have previously noted:

In today’s competitive global economy, filled with international economic instability, no part of the enterprise can afford to move very far from what pays the bills.  If your SAP or IT organization is focused completely on technology solutions you lose sight of what is important to the business.  And what is that?  Customers! Customer retention, acquisition, loyalty, satisfaction, and experience.  Without customers there is no growth or revenue.  Without growth or revenue there is no need for that expensive SAP or IT investment…

Without a clearer focus on customers as well as innovation in the enterprise, or “how business gets done,” the SAP and overall IT organization becomes a very expensive operational support layer.  Without the genuine business focus the organization becomes a commodity to be outsourced (see SAP IT Convergence Beyond Business to IT Alignment).

SAP Governance Includes Business to IT Convergence

The whole area of governance and convergence is very closely related.  For effective governance the business direction and integration must be a key component of all SAP or IT initiatives.  When you have that involvement, over time, and with some effort, convergence happens.  It isn’t automatic but the environment for it to occur begins with direct business engagement. 

If the business isn’t in the SAP co-pilots seat you may be headed for a IT crash landing.

If you’re thinking to yourself this “doesn’t apply to me” then you might want to think again.  A recent IBM study found that many corporate lines of business are beginning to make their own independent technology purchase decisions.  And they are doing this outside of the SAP or IT organization.  Add to that Ray Wang’s recent Harvard Business Review Blog Post about the consumerization of [business] IT (see Integrating Business Stakeholders as Part of SAP IT Convergence) and you have a serious issue to contend with.  As his research noted, “corporate tech spending is up by 17 to 20%… [but] spending by IT departments is flat.. business leaders, not their IT colleagues… are driving purchasing decisions.”

Business decision makers are starting to use their own budgets to make their own IT decisions rather than making the contribution to what they see as a very expensive “service provider.” That integration or “convergence” with the business is more important than ever because in the end they have more influence over your budget than you may realize.

For more information on this topic please see these additional posts:

• Steps to Achieve SAP IT Convergence
• SAP IT Convergence is About Business Focused Integration
• Steering Committee Governance for an SAP Center of Excellence
• Using Your SAP Steering Committee for Business Transformation
• SAP & Business Convergence

Related Posts:

• How To Navigate the SAP Business Transformation Journey
• Steering Committee Governance for an SAP Center of Excellence
• Series on SAP Competency Center or SAP Center of Excellence
• 3 Development Phases for SAP Center of Excellence Maturity
• SAP Customer Responsibility for SAP Project Success

Business - IT Convergence

In the new global business age it is more important than ever to leverage technology organization expertise for business benefit.  Too often technology organizations focus on technology for the sake of technology rather than for how it might improve products and services or how it might create more customer focus.

In today’s competitive global economy, filled with international economic instability, no part of the enterprise can afford to move very far from what pays the bills.  If your SAP or IT organization is focused completely on technology solutions you lose sight of what is important to the business.  And what is that?  Customers: customer retention, acquisition, loyalty, satisfaction, and experience.  Without customers there is no growth or revenue.  Without growth or revenue there is no need for that expensive SAP or IT investment.

Finding SAP IT Convergence in Innovation and Customer Focus

A dynamic shift away from “back office” or operational focus is needed to move the SAP organization toward genuine IT convergence.  To make the change requires a deeper and more meaningful understanding of business itself.  It requires a focus on the organization’s products or services (i.e. innovation, read Process Execution of Business and IT Innovation) and then how those products or services are marketed and sold.

This emphasis on IT convergence, especially in the SAP enterprise, is about preparing your organization for the changes which are beginning to shape the future of enterprise applications, or “ERP III” (for a detailed explanation of ERP, ERP II, and ERP III see ERP vs. ERP II vs. ERP III Future Enterprise Applications).  So what is ERP III?  ERP III is the next generation of enterprise applications which leverage social media (or other collaborative tools) in news ways to integrate customers into the borderless enterprise.

Without a clearer focus on customers as well as innovation in the enterprise, or “how business gets done,” the SAP and overall IT organization becomes a very expensive operational support layer.  Without the genuine business focus the organization becomes a commodity to be outsourced.

How Can You Transition to Full SAP IT Convergence?

By now the need for full convergence is clearer.  But if it’s still not clear enough consider another element or your SAP or IT organization–, look at the pay structure for your SAP skills.  Your SAP staff is likely paid equivalent salaries to very senior level employees at your company.  In some cases they may make as much as some of the junior executives.  And then remind yourself, this pay range is for non-management positions.  So we have to consider what it will take to change the organization to achieve convergence.

From the last few posts, as well as my own experience, here is my “short list” of important things to do to achieve convergence:

• Steering Committee Engagement and Roadmap Management
• Pursue business executive sponsorship but don’t wait for it to get started
• Engage at all levels of the organization
• MBA in the IT organization
• Conduct one or more pilot programs and capture lessons learned

Start a communication program

Exchange staff program to integrate the IT organization into the business

Hold IT staff accountable for participation

Don’t let available tools stifle participation or innovation

• Invest in NON-TECHNICAL IT training

Public speaking

Presentation skills

Meeting skills

Facilitation skills

Questioning and Negotiation

Conflict management and resolution

Managerial skills

There are two other areas that I will offer some insight on.  As a result of the explosion in mobile devices (literally hundreds of millions of them) there is a need to ensure that technology solutions are “device agnostic.”  In other words, as employees begin to provide their own smartphones be ready to support them.  If your organization is tasked with the cost for the plans and hardware, supporting employee provided mobile devices is cheaper even with the additional support overhead.  On the second front there are business direct buy purchases of technology.  As last week’s post pointed out, because of what the business perceives as a lack of responsiveness to their needs they are making more of their own direct technology purchases.  Learn to live with this and to engage in more of an internal consulting role so that the solutions are a better fit for the business and the SAP or IT organization.

How you approach the future for your technology organization–, isolation, alignment, or convergence; will determine how valuable you are to the business in the future.  And with today’s competitive landscape combined with the economic struggles it is more important than ever to demonstrate business value.

Related Posts:

• Organizational Change Management Inside the SAP IT Support Organization
• Creating a Knowledge Centered Learning Organization
• How To Navigate the SAP Business Transformation Journey
• ERP vs. ERP II vs. ERP III Future Enterprise Applications
• SAP, ERP III, SOA — Learning Organizations through Social Media Collaboration