SPEER program - Jan Vos

October, 13th, 2010

SPEER

Commodore Jan Vos M.Sc.

Programme Manager SPEER

Ministerie van Defensie

The SPEER programme

Implementation of ERP in the logistic and financial domain of the Dutch Armed Forces

Commando DienstenCentra2Het Programma SPEER October, 13th, 2010

Content

• Programme overview: Business Case, Scope, goals• Programme characteristics • Programme approach• Programme results• Experiences / Lessons learned• Conclusions

SPEER: STRATEGIC PROCESS ERP-ENABLED RE-ENGINEERING

Commando DienstenCentra3Het Programma SPEER October, 13th, 2010 3

Like most of the world’s defense forces, the Dutch saw a major change over the past 15 years

New focus: world wide missions for international peace and stability

The SPEER Programme context

Wider mission spectrum, flexible expeditionary capabilities, cooperation between services, use of common assets

Joint operations


Restructured NL Defence Organization

MINDEF

Navy ARMY Air Force

BEFORE 2005

To

MODNL

Defence Material Organisation

Defence Services

Navy

Army

Air Force

OPERATIONALCOMMANDS

SERVICECENTERS

MP


Why is change inevitable ?

JOINT LOGISTIC SUPPORT FOR JOINT OPERATIONS

Improve efficiency(phase 1 668 FTE / 20 M€/yr)

Support new business model (costs visibility, shared service centres)

Phase out legacy,Improve IT management

Improve asset management & financial control structurally

The world changes …

Policies are changing …

The Dutch Mod is changing …

Technology is changing …

Program goals


SPEER Programme: Scope, facts and figures

Program scope:• All Logistical & Financial Processes• Entire defence organization• Ca. 8000-9.000 users (first phase)• Investment budget M€ 268 (first phase)• Timeframe: 2005 -2014• Programme organization: 200 - 300 Def. Employees

Strategic partners

ERP: SAP

Programme control & kernel design & custimization

Cap gemini\Logica

Implementation partners:Atos Origin, IBM, Ordina, PA Consulting, PWC

Auditing & Second Opinion: HEC / SAP


Core processes of Defence: Value chain

FOR

M U

NIT

S

(Onderhouden/Bevoorraden)(Onderhouden/Bevoorraden)

OPERATIONALEXERICISES &TRAINING

EXECUTE

OPERATIONS

MANAGEMENT CONTROL

MISSIONS &OPERATIONAL READINESS

LOGISTICS(SUPPLY AND MAINTAIN)

PERSONNEL

EQUIPMENT OPERATIONALLOGISTICS


Joint missions require joint support: Possible scenario

42 Tankbat

301 SQN

130 CL-CIE

Marns-batDepot AGB

DepotODC

Ops Theatre

VC

APACHEDET

VC-DET

MARNS-DET

TKPEL

HRSTGPTKPEL

APACHEOHDGP

Foreign Unit

LocalSupplier

933 SQN

Formation TF & NSE

SPOD/APOD

SPOE

APOE


Programma characteristics (1):Best practice processes or defence specific

Identical to other businesses / government- Basic processes on procurement, supply, maintenance, configuration

management, ILS- Finance (cash/committments)

Specific for military• Flexible organizational structure (mission structure)• Non-static / flexible supply chains• Mobile units /deployed technology in remote area’s

Good news:• Defence uses many common components• Additional SAP components are available for specific military

processes

The bad news:• Diversity in processes leads to a complex cocktail of SAP-solutions• Most individual SAP-components are proven technology, however an

integrated cocktail of all these components has never been implemented


Programme characteristics (2):Best practice migration or defence specific

What makes up the challenge:• quantity and diversity of processes• number of organizational units • a defence wide standardization and

integration• unclear ownership process chains• unclear ownership business benefits

Consequences:• The system too big to customize in

one step(?)• A big-bang roll out impossible ->

multiple migration steps• Long timeframes (!)

Rough ride expected, escorts are needed, minefields to be avoided ..


Programme Characteristics (3) SPEER as a bridge between two worlds

Transparency: sharing information

Government

Checks & balances

Focus on efficiency & conformance

Security: protecting information

Operations

Focus on effectivity

Defence

Modern business processes:supply, logistics, ILS,

maintenance, procurement, finance

Public governance MilitaryCommand and control


Key elements in approach

One ‘standard’ SAP kernel fits all:•One standardized proces design•One overarching architecture derived from Defence IT architecture•One kernel to be customized•Control costs and enforce proces standardization•Implemented in two phases (basic processes first, proces chain optimization second)

Combination of proces standardization over ‘business units’ and integration over functional domains •Combines benefits of standaardization and integration in one migration step•Maximizes change management riscs

Think big, act small•No big bang implementation: trial, learn and expand•Large timeframe•Takes longer time before legacy systems are taken out of service

Parallel implementation projects

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To beCurrent Practices

StandardizedProcesses

OneStandardizedInformation

system

StandardizedData

Migration

Migration

Processes

Informationsystems

Data

Processes

Informationsystems

Data

Processes

Informationsystems

Data

Navy AirforceArmy

Proces Standardization as a key element: It symbolizes both change and joint operations

Processes

Info Systems

Data

Finance


procurement

Service centers Operational Commands

Depots MaintenanceDepots

SPEER Programme results

Finance, Integrated Logistic Support

VSPK JUN 2009

NH 90 MAR 2010

MATLOG 320 NOV 2010

JUNI 2008

Transport

Supply chain management


What problems to expect? Insights from NL national audit office (& others)

Projects are often too complex•Grand designs•(political) fantasy deadlines•Winners curse.

Evaluation and redirection are neccessary

Strong governance needed

ICT is no quick fix

Business – IT alignment is poor

Business – IT architecture = basis of IT governance

Demand and supply of ICT need to be better organized


SPEER experience:Lessons identified, measures taken

Measures to complexity:• Stepwise improvement of kernel (High Level Design !).• Stepwise migration approach.• Periodic programme evaluation.•Ambitions & ability to change need to be balanced.

Governance:• Strategic: SG & CDS primary sponsors• Tactical: SPEER supervisor with direct mandate

Change management:• ICT is just an enabler• Importance of Business benefits•Ownership of business benefits never passes form line to

programme organization.


SPEER experience:Lessons identified, measures taken

• Risks, cost and benefits of simultaneous standardization and integration.

• Don’t shoot at a moving target: Simultaneous Reorganization & implementation of ERP.

• Establish / organize procesownership and its tasks and responsibilities.

Integral business process management required Architecture: From ‘surplus of abstract documents’ to ‘tight fit harnass’.

• A vision is not enough to guide proces design and business re-engineering.

• Don’t forget the IT-complexity (SAP cocktail, interim landscapes, interfaces, data).

• Knowledge management and competence managementReorganize internal ICT service provider

• Speed of implementation: Changes can be too slow.


Conclusions

1. The programme is vital for the Dutch MOD.

2. The size of the SPEER programme is unique for (MOD)NL

3. … Thus, SPEER faced many common problems

4. …………. And SPEER learned many ordinary lessons

5. But the unique size causes also some new problems

6. ……… And SPEER gained some additional insights and produced secondary results


QUESTIONS ?

Education

SPEER program - Jan Vos