IT Innovation: Balancing Act

The debate on IT innovation continues... Latest insights from SAP research leader are particularly interesting. I agree with the concept of thinking enterprise, but allowing investment in interim or temporary solutions to either reap quick value or offer time for the solution to flourish / die on its own. ...

... "The smart innovators realize there's nothing wrong with transient systems or investments that let you constantly add value in small increments." ...

Via techWeb: IT Innovation ...

SAP Users: ITIL Opportunity ...

Companies using SAP's ERP system have gaps in IT service management as defined by the ITIL standards. Referenced checklist is a source for self-assessment to identify strengths and weaknesses. ...

... "Of course, designing IT processes that conform to the ITIL can improve the quality of services only when it actually optimizes and reorganizes the IT service processes in a company. " ...

Via SAP INFO: Green Flag for ITIL?

Talent Management Software: Edge Goes To ...

Interesting faceoff in the Human Resource software space ... with the predicted war for talent on the horizon, Oracle gains an edge in the competition with SAP. ...

... "During the general session titled, Clash of the Titans: The Second Annual Oracle & SAP Shootout, both Oracle and SAP were tasked with demonstrating how their respective HCM offerings help companies solve three typical HR problems written by Co-Chair Kutik. Leveraging a live demonstration of Oracle's PeopleSoft Enterprise HCM, Oracle scored ahead of SAP in two out of three segments, winning the Manager Empowerment and Workforce Planning/Talent Management problems. SAP won the problem on Reducing Healthcare Costs by using partner software from VitalSpring Technologies. " ...

Via Oracle: Oracle Beats SAP in Human Resources Software Shootout

ERP Justification: Is it Worth it?

There's a discussion on IT Toolbox about the benefits and disadvantages of ERP solutions that is worth examining.

Some key points this jogged for me (and a few I've added) are:

• ERP improves enterprise visibility, collaboration, and integration. That's the chief selling point of ERP. If that's what your organization needs, ERP sounds like the right solution.
  
• ERP does NOT typically improve individual efficiencies, and should not be sold as such. It's important to set the right expectations up front on just what an ERP system will offer the company and what it will not offer most individuals.
  
• ERP can help achieve cost reduction IF it's replacing many manual steps.
  
• It's not a bad idea to offer SOME predetermined set of key pet reports to decrease resistance. Aside from that, scope should be kept tight.
  
• It's important to have someone running the ERP project with the clout to say no when everyone wants to retain their current way of working (getting past the "I've always done it that way" syndrome).
  
• It's important to ask: Does the company want and need to operate as an enterprise? In most cases, the answer is yes.

However, until the organization reaches "enterprise maturity," chances are it won't realize the full benefits of ERP. On the other hand, an ERP system can help facilitate an organization's maturity in that direction, if that's where they choose to go.

Just some food for thought. I'd be interested in others' experiences and thoughts on the topic.

ERP benefits and disadvantages - ITtoolbox Groups

Project Risks; Let's Talk About the Weather

When doing risk planning for your project, don't forget about seemingly off-topic risks, such as the weather, or the season of the year. It's an obvious concern if you're in the construction or farming industry, but in many other organizations, timing your project rollout to avoid quarterly closes, the company's peak season, or any other major seasonal events, can make or break your project.

I've heard of one popular confection organization that couldn't ship candy during Halloween because of a problem with their new SAP implementation. Bad timing. Another company that dealt with agriculture had to have a project completed before the summer growing season. They were smart enough to list that as a constraint.

The seasonal elements didn't just affect Napoleon in his failed Russian campaign (and many before and after him). It can affect those of us in business as well.

Project On-Time, On-Budget: The Truth Is Out There ...

IT Week reports on insourcing of CRM project by Centrica, that was experiencing delays in its final phases when implementing SAP billing capabilities. This situation would be challenging for any implementation partner. Its a perfect storm: Siebel CRM, SAP Billing, legacy systems, third-party implementation, systems integration, and organizational change management. It may not be late, but really on-time, if the magnitude of effort was estimated correctly. ...

... "Energy giant Centrica has moved its GBP400m transformation programme in-house, taking back the running of the project from consultancy Accenture. " ...

Centrica takes back IT project: Via IT Week

SAP CRM Projects: Barriers Acknowledged by SAP ...

In this article, SAP leader shares lessons-learned with SAP CRM implementation: the closer you get to the customer, the more different the requirements ... CRM software needs flexibility at the customer interface ... enterprise offerings are not flexible ... without early wins in the sales force and front-office, the workforce satisfies its requirements with other tools. ...

... "For many SAP customers, CRM adoption was scheduled in the second and third phases of an ERP project and by that time, customers were either worn out or not willing to undergo system disruptions ... " ...

SAP CRM Pojects: Barriers Acknowledged by SAP: Via SearchSAP: SAP acknowledges barrier to mySAP CRM implementations

SAP ERP NE Benefit Realization

Does SAP ERP equal benefits realization? Not according to study ready for imminent release. Don't remember showing that negative NPV at the governance meeting? Neither do I.

Realizing benefits from ERP projects is a challenge by itself, regardless of the vendor. With SAP's dominance in the industry, you would have expected it to be the pacesetter in realizing the meximum benefits from ERP implementations.

Does IT matter? It matters if you want to derive business benefits from your ERP investment. ...

... "It's a study by Nucleus Research, an independent reseach house that specializes in helping companies assess the financial returns on IT investments. The headline of the Nucleus Research study is a bit different than SAP's advertising tagline: SAP customers are 20% less profitable than their peers. " ...

Via Rough Type: Nicholas Carr's Blog: Does SAP sap profits?

Collaboration and Openness in the Participation Age ...

Sun CEO Scott McNealy challenges industry leaders to rethink traditional business models built on the global network economy, where transparency, community, and collaboration drive innovation into The Participation Age. ...

... "Sun believes the world is entering a new era - the Participation Age - where dramatically lowered barriers to entry, plummeting device prices, and near-universal connectivity are driving a new round of network participation. From blogs to Java, SMS messages to Web services, participants are forming communities to drive change, create new businesses, new social services and new discoveries. This growth in the network economy is fueled by sharing and collaboration among communities interconnected by technology and driven by purpose. Sun also believes that sharing and collaboration in the Participation Age will stimulate innovation to help all participants from across the world grow and prosper. " ...

Collaboration and Openness in the Participation Age: Via Sun Microsystems: Thought Leaders Prove Sharing Builds Economies at Sun Microsystems' Participation Age Event: Sun CEO Scott McNealy Pushes Industry to Rethink Business for 21st Century, Focus on Collaboration and Community ...



Addtional references on the intersection of transparency, collaboration, community, and innovation:

Via SAP: SAP Leads Industry Collaboration in Support of Enterprise Services: "For the first time, a community process in which collaborative business process innovation can flourish in an open and transparent forum will become the standard by which all enterprise services development is measured. The Enterprise Services Community Process is the only industry-driven method for defining enterprise services and is poised to become the preferred method for the SAP customer and partner ecosystem to achieve business process innovation through the use of enterprise services. "

Via The Future of Work Weblog: Distributed Work and Network Building Tools: "As work becomes ever-more-highly distributed, an individual's responsibility for maintaining his or her network of connections, both inside and outside his or her company, is increasing. Team members might be located in different geographic locations and timezones. They may only have come together for a short-term project or they might not even be members of the same company. ... "

Via Business Week: This Way To The Future: "Ultimately, innovation is about continually pushing back the boundaries of what is possible. The true genius of capitalism is that it provides economic incentives for sustained innovation. "

IT Strategy Dream Job ...

Finally found my dream job ... SAP IT Strategy, Beer ... Only problem, it's complete. ... Andrea Stercken writes about the ERP modernization program at Krombacher Brewery, where the SAP suite was implemented to centralize systems and serve a broad set of standard business processes with transaction processing and business intelligence. ...

... "The brewers from Germany’s Siegerland have taken an important step along the way to their IT strategy with the new applications. At the end of 2005, Krombacher completed the conversion from SAP R/3 to mySAP ERP. " ...

IT Strategy Dream Job: Via SAPInfo: SAP in the Brewery ...

SAP Project Management Strategy: Public Education Industry ...

One of the keys to SAP / ERP implementation success is to develop a repeatable project strategy and build on that for future implementations of modules and feature/function points. Demir Barlas profiles a successful SAP project and change management strategy in the public education space, by Orange County Public Schools system. ...

SAP Project Management Strategy: Public Education Industry: Via Line56.com: SAP Education Benefits ...

... "The important factor going forward is that OCPS has already worked out a change and project management strategy that is in place for its upcoming functionality expansion. " ...

SAP has a history of delivering successful ERP solutions in public education. ...

Via SAP: Public Schools Improve Operations with SAP® E-Solutions: Intranet Resource Frees Teacher and Administrator Time for Better Education of Students ...

... "SAP Public Services Inc., a subsidiary of SAP America, Inc., which is itself a subsidiary of SAP AG (NYSE ADR: SAP), showcases the successful implementation of three K-12 customers that have selected SAP e-solutions to manage budgets, track student and employee records, and streamline district operations. Seattle School District No. 1, Oklahoma City School District, and Polk County Public Schools (FL), each chose a comprehensive SAP solution to more efficiently, transparently, and cost-effectively operate and manage their respective districts. SAP is the world's leading provider of e-business software solutions. " ...

SAP R/3 ERP Customers Have a Tough Decision to Make

From eWeek comes interesting news that many customers of SAP's R/3 4.6c are going to soon be stuck without maintenance support (by the end of 2006). Their choices seems to be paying a fortune for a new release that doesn't bring much in the way of functionality, moving to SAP's next generation platforms, or taking the opportunity to jump ship.

A leading alternate contender seems to be Oracle, whose waiting-in-the-wings Project Fusion suite (which combines the best of PeopleSoft, JD Edwards, Siebel, and Oracle's E-Business) could make organizations want to wait and see.

I'd add that others will probably use the opportunity to revisit hosted solutions, which can decrease infrastructure complexity (even if cost benefits are minimal).

Here's the report below...

R/3 Orphans-to-Be Contemplating Jumping Ship

When is SAP Project Complete?

Recent, Dupont announcements show that, even though an SAP project go-live is complete and stabilized, business value must be driven through follow-on projects, using methods such as Six Sigma and lean supply chain techniques. ...

When is SAP Project Complete?: Via DuPont.com: DuPont Announces Actions To Increase Shareholder Value ...

... "DuPont will accelerate work already underway to standardize and simplify its operating processes and will reduce its functional support costs to externally-benchmarked top-quartile standards. This work will make full utilization of the investment in new state-of-the-art information technology for business and financial systems (SAP) implemented over the past five years. Building on its well-established Six Sigma base, the focus will include lean global supply chain practices to strengthen service, reduce costs and reduce inventory. " ...

Why SAP Projects Fail

With the recent report of the Irish government canceling two runaway SAP projects, I decided to do some research on what make SAP projects fail (not that they all fail, but when they do, they fail big, since the product is so complex).

Here's a good report from ITToolbox on why projects fail in general, and some feedback comments on why SAP projects fail in particular. As expected, the focus is on lack of communications and cultural change leadership abilities (which I'd say is true of any large project).

To their report, I would add lack of scope change management abilities as well, which ultimately relates to cultural change management. These products are massive, and unless there's a strong leader that can withstand the demands of the organization wishing to make SAP mimic their old processes, it's a scope-creep situation waiting to happen.


Project Management SAP Failure

SAP Project Fiasco Halted in Ireland after $170M over budget

Talk about a project management disaster! Computerworld reports that two SAP ERP projects for the Irish government, estimated at more that $380 million were halted by the Irish national health committee.

One project, an HR/Payroll project, had been started 10 years ago (it was targeted as a 3 year project) and ran into problems due to the complexities of the requirements. This project was budgeted at $10 million and was now targeted at $180 million.

The other was a Financial Systems SAP project (budgeted at $203 million), which wasn't as far along, but was apparently cancelled due to lack of trust after the HR/Payroll fiasco.

Both projects were being led by Deloitte and Touche. Here's the full report from Computerworld...

Irish agency halts work on two SAP application projects - Computerworld

IT Governance: New Initiatives Executive Alignment

IT Governance still requires a degree of executive alignment before significant investments can be approved. Any delay can seem bureaucratic, however it is necessary to build an executive support network, or coalition, to align behind a major multi-year investment program. Lawrence M Walsh explores the challenges vendors face when they must align their sales cycles with public sector governance processes.

IT Governance: New Initiatives Executive Alignment: Via CRN: VARs Must Play Politics To Expedite Government Sales

... "Even with centralized IT governance, such as Takai's in Michigan, in which the CIO has budget and oversight of all IT deployments, it still takes time to build consensus for new initiatives. " ...

PMThink references on IT governance:

• CA Niku ITGovernance Growth Engine?


• Centralized IT Governance: Enterprise Architecture Modeling Tool


• COBIT Course: IT Governance Controls Framework ...


• Discussion on Distributed IT: Governance ...


• Does Architecture Visualization Enable ITGovernance?


• EPM Software IT Governance Market Growth ...


• From CIO Magazine - A Cry for Full-Cyle Governance


• Governance Alignment: Project Portfolio Management (PPM)


• Governance Software: OMB A123 Compliance


• IT Governance Common Themes ...


• IT Governance Integrated Application Development: Software Solution


• IT Governance Repeatable Processes ...


• IT Governance Road Map ...


• IT Governance Role: Architecture


• IT Governance Solution: Maturity Acceleration ...


• IT Governance Transformation: New York State CIO


• IT Governance: Application Services Flexibility or Efficiency?


• IT Governance: Board-Level Visibility ...


• IT Governance: Board of Directors ...


• IT Governance: SAP ESA Strategy


• IT Governance: Services Transformation ...


• IT Governance: Service Portfolio Management Applications ...


• IT Governance: Shift Investment to Business Value Opportunities


• IT Governance: The Board ...


• IT Governance: Value and Cost Measurement ...


• IT Governance; Where the Value of IT is Hiding


• IT Savvy: Governance Best Practices: Peter Weill


• Leadership and IT Governance


• Microsoft IT Governance Woes ...


• Process Governance Tool Upcoming ...


• Process Models: ITIL ITGovernance ...


• Project Management and Governance


• ProjectManagement ITGovernanceSoftware Linux Capable ...


• SOA and IT Governance ...


• SOA Governance: Best Practice Strategies Webinar ...


• SOA IT Governance


• Software Supports ITGovernance CorporateGovernance

Business Strategy: Align Objectives and Execute

IBM launches new software that enables workers and managers throughout an organization to align their personal and departmental objectives with business strategy and drive execution of their workplace activities ...

Business Strategy: Align Objectives and Execute: Via IBM: IBM Software Helps Employees at All Levels Align Their Objectives With Company Strategy ...

... "According to feedback from IBM's customers and partners, more companies are recognizing that while they have lots of data and a sound business strategy, the execution of the strategy needs improvement. IBM Workplace for Business Strategy Execution helps employees understand their company's strategy in concrete terms, focus on what is important, and remain current on status and risks. A department leader can use IBM Workplace for Business Strategy Execution to clearly communicate team objectives and how they fit into the company's strategy; link to and monitor internal and external dependencies that could affect the ability to reach objectives; track progress toward the objectives though intuitive scorecards and dashboards; and initiate actions to correct gaps in performance. " ...

PMThink references on strategy and alignment:

• Achieve Strategy Execution: Accelerate Plan Funding Support


• Business Continuity Project: Key Part of IT Strategy ...


• Business IT Alignment: Business-Relevant Metrics


• Business IT Strategy: Successful Alignment


• Governance Alignment: Project Portfolio Management (PPM)


• IT Alignment: Cost Benefit Analysis ...


• IT Governance: SAP ESA Strategy


• IT Strategy: Motorola Exec Podcast ...


• ITIL: IT Service Catalog: Alignment Focal Point ...


• Microsoft Framework: Business IT Alignment


• PMO Role: Align Business and IT ...


• Project Failure: A Success Strategy


• Project Management Strategy Integration Conference December2005


• PublicSector CIO: Enterprise View IT Strategy


• Software Aligns Project Management With Enterprise Strategy: Enhanced Portfolio Analytics ...


• Strategic Alignment: Project Portfolio


• Strategy: Visualize the Design ...

IT Governance: SAP ESA Strategy

Implementing effective IT governance is suggested as a pre-requisite to the transition to SAP's enterprise services architecture, SAP ESA.

IT Governance: SAP ESA Strategy: Via Search SAP: Breaking down SAP's ESA strategy ...

... "... according to Naeem Hashmi, chief research officer of Information Frameworks, an IT research and strategic consulting group in Londonderry, N.H. Good IT governance and a hefty amount of planning should prepare most enterprises for the changes ahead, he said. " ...

SAP has developed a consortium-based strategy to its enterprise services architecture ESA:

... "SAP has established Enterprise Services-Ready to identify products that incorporate the Enterprise Services Architecture, leveraging the power of business process services in the enterprise. This standards based certification ensures that SAP and partner ISV solutions that are Enterprise Services-Ready are able to extend ESA functionality across the IT landscape, to help organizations design, deploy, run and maintain innovative business processes at lower cost and higher flexibility. Industry support for Enterprise Services-Ready and ESA as the enabler of flexible, next-generation business continues to grow, already adopted by Adobe, Avaya, Computer Associates, Dell, EMC, HP, Intel, Macromedia, Mercury, Microsoft, Network Appliance, Novell, Research In Motion, RSA Security, Symantec and VERITAS. " ...

Project Management Belongs In-House

It started with the ERP boom after Y2K. Massive software projects, such as SAP implementations, were led by consultants and typically came in over budget and behind schedule. While consultants can and should be a vital part of any project that involves new technology or unfamiliar areas, it's important for organizations to retain ownership of the overall project and not leave everything at the mercy of the consulting company.

Part of that is insuring that contracts are creatively designed with a combination of time and materials plus incentives (and/or penalties for not delivering on certain tangible objectives). Fixed-fee contracts only tend to work when the scope can be defined precisely and agreed upon. Otherwise, the consulting company may make unwanted sacrifices to stay within budget. Time and materials without any incentives or penalties (or at least a "not to exceed" limit) puts all the risk on your organization. Incentives work better than penalties as it facilitates more positive collaboration. Vendors will be reluctant to accept penalties unless scope and the means to achieve it is crystal clear.

This doesn't mean that pride should get in the way of benefiting from a consulting company's tried and true methodology, merely that the leadership, ownership, and accountability of the efforts should remain in-house. Part of this accountability is insuring the right contracts are negotiated.

This oldie-but-goodie below from CIO Magazine is from 2002, but is still relevant today. It explores further the pitfalls of consultant-led projects and offers some sage advise. Some things have changed since 2002, but one thing hasn't. Suffering from the residue, organizations are still struggling to get value out of their expensive ERP products. Don't make the same mistakes they did back at the beginning of the millenium. Take control of your projects.

Take Control Consultants-can't live with 'em, can't live without 'em - ENTERPRISE PROJECTS - CIO Magazine Jul 15,2002

Project Management ERP Integration: End-to-End Business Process

Project management tools provide an environment for project planning, scheduling, and tracking. Integration of project management tools with ERP and financial systems creates a powerful end-to-end business process for enterprise program management. Actual progress can meet actual costs in a hands-free manner for better visibility and decision making. Integrating systems is challenging business. Here is an interesting reference on third party middleware for project management and ERP integration ...

Via Impress Software: NB Power Goes Live with Impress Project Integration Application: Implementation of Impress Project I.App™ completed in record time to integrate Primavera® Project Management software with SAP® PLM Application ...

... "Project I.App integrates the business processes of project planning and enterprise resource planning (ERP) that would otherwise run independently of each other. Ensuring project data is consistent across all systems at all times, Project I.App eliminates the need for duplicate data entry and the risk of mismatched schedules and resources. Project I.App is a pre-packaged, out-of-the-box Integration Application that links SAP with major project scheduling and management products, such as Primavera, Microsoft Project, and TrackSoftware.NET. Accessible via a standard web interface, Project I.App includes a set-up wizard that is easy to use and administer and requires no programming knowledge. Project I.App was jointly developed by SAP and IMPRESS and is supported through SAP OSS. " ...

Impress Software provides packaged enterprise integration applications for SAP customers. Called I.Apps™, these applications enable quick and cost-effective deployment of streamlined business processes across multiple enterprise systems. Impress I.Apps are ready-made combinations of pre-defined integration elements. Coupled with tools that enable flexible implementation of custom and specific integration scenarios, Impress I.Apps allow integration to be completed at a fraction of the time and cost compared to traditional EAI development platforms. Impress customers include global leaders such as Bayer, DuPont, Halliburton, Nebraska Public Power District, Ontario Power Generation, Valero, and Total.