Whitepaper: A Capabilities Approach to Value

High- Value RDS:

A Capabilities Approach

September 2012

SAP sponsored this white paper; Asuret does not endorse any vendor’s product or service

Photo by Michael Krigsman

Copyright © 2012 by Asuret, Inc. All rights reserved. Page 2

High- Value RDS: A Capabilities Approach

EXECUTIVE SUMMARYPackaged implementation approaches, such as SAP’s Rapid Deployment solutions (RDS), represent an important step in reducing implementation time and cost. RDS consists of software, pre-defined services, and educational content bundled with a methodology that describes steps and procedures for conducting a rapid implementation.

This white paper offers a framework that presents Rapid Deployment solutions in a broader context of business planning, process transformation, and post-implementation change management. The goal is helping SAP customers and prospects gain highest value from their RDS projects.

During discussions with SAP customers and partners, the benefit of a systematic framework that complements the RDS methodology became clear. This framework describes key readiness issues as “capabilities” that customers should possess in order to achieve maximum value from an RDS implementation.

The framework includes three primary components:

� Project management capabilities, which ensure the organization is on track to address its business needs with RDS

� Business / operational capabilities, which ensure the RDS implementation serves as a catalyst to improve operations and processes

� Change management capabilities, which ensure the organization can achieve desired outcomes in a planned, predictable, and positive manner

All these capabilities are critical to achieving success and realizing maximum benefit over the entire life of an RDS implementation.

Achieving short, easy implementations has been an enterprise software ideal for many years. Virtually every major software vendor has attempted, with varying degrees of success, to achieve this goal.

Rapid Deployment solutions (RDS) represent SAP’s newest approach to simplifying implementations. Each Rapid Deployment solution combines a specific software configuration with a fixed scope of work, guided by an RDS methodology. Bundling pre-configured software and fixed-price services into a packaged solution simplifies the buying choice while reducing risk associated with open-ended implementations. These solutions are a direct response to customer demand.

Table of Contents » Complementary Business

Capabilities 4

» Project Management Capabilities 6

» Business / Operational Capabilities 11

» Change Management Capabilities 13

» Core Guidance 15

» Appendix: Rapid Deployment Solutions 16

» About the Authors 17



Although methodologies and packaged solutions are highly beneficial, they only address part of the software value equation. Software methodologies alone cannot ensure that an organization is clear about its own strategies, goals, and challenges. This clarity is an essential ingredient in achieving success with SAP software.

Although software implementation involves many technical steps, long-term success usually involves business process changes that improve operations and transform how people conduct their work. The expertise required to create long-term business process transformation is distinct from the technical skills associated with core implementation activities. In other words, a successful implementation requires business expertise that complements the technical skills of software deployment.

Organizations that achieve the greatest long-term benefit from SAP software typically possess strong levels of complementary business expertise. Conversely, companies that undertake a technical deployment without the requisite exper-tise tend to gain less value from their software project. This is true for both RDS implementations and traditional deployments.

The complementary expertise needed to gain greatest value from SAP software forms a set of points that customers should consider before, during, and after their implementation. The most successful SAP customers possess strong expertise in these capabilities, which bind together the various technical and business activities an organization needs to gain the most benefit from an RDS implementation.

This white paper describes the complementary business capabilities that SAP customers should apply when planning and executing an RDS implementation.

The audience for this white paper includes organizations planning an RDS project along with SAP employees and partners responsible for creating cus-tomer success. Non-technical line of business leaders, and project managers in IT who work with the business, should study the information in this white paper before starting an implementation. This white paper is also a valuable reference for one interested in gaining most value from an RDS implementation.



Complementary Business CapabilitiesThe RDS implementation methodology specifies three stages: start, deploy, and run, as shown in the following diagram supplied by SAP:

Although these stages describe an RDS implementation, the overall solution lifecycle starts before the RDS project itself and continues after the software goes live. The broader lifecycle includes activities such as designing the solution, supporting it after going live, and ensuring that beneficial business transformation occurs.

Many of the planning and business transformation activities that come before, and after, the RDS project require business expertise rather than technical skills. We refer to this expertise as complementary business capabilities because they represent the capacity of an organization to perform a variety of non-technical activities. Although not specified by the RDS methodology, these complemen-tary activities are essential to gaining most value from the SAP software.

We recommend that SAP customers develop complementary capabilities to support the planning, implementation, and post go-live activities associated with RDS projects. The following diagram summarizes the broad implementa-tion lifecycle to show activities related to these complementary capabilities; the Implement phase includes the three RDS project stages mentioned earlier:

Prepare Implement

RDS Lifecycle

Maintain

Prepare to Implement RDSTwo activities prepare the ground for

RDS implementation

Maintain RDSThree activities maintain RDS in

the months and years after it has been implemented

Implement RDSThree stages (14 activities): Start, Deploy and

Run. After these stages, RDS is fully operational



The complementary business capabilities described in this white paper address three important areas:

�Project management

�Business and operations

�Change management

Project management capabilities address issues and activities that help the project team link the RDS solution, which includes software and services, to the organization’s business needs. These capabilities enable the business to “take ownership” of its project and related decisions.

Business / operational capabilities ensure that SAP customers use the RDS implementation as a catalyst to improve operations and processes. The highest long-term value arises when an organization uses its RDS implementation to transform business processes and operating practices.

Change management capabilities help RDS customers achieve their business transformation goals in a planned and positive manner. Change management is key to enabling business transformation without causing negative disruptions that can disturb or interfere with operations. These capabilities also address post-implementation activities that are necessary to gain greatest value from the deployment.

These three capability areas cover deploying RDS, ensuring the organization applies the right business resources to the initiative, and maintaining the busi-ness transformations over a sufficiently long period to gain maximum benefit from the investment in RDS.

Customer Insight An SAP customer that is a global automotive supplier illus-trates the importance of combining these capabilities to gain highest value from an RDS implementation.

The company was attracted by the RDS methodology because it wanted to avoid the expense of a typical CRM implementation. In addition, this customer understood the need to change processes and “jump start” improvements with a “small, neat project.” Through this initiative, the IT program manager learned that the company needed to improve its ability to “use technology that adds value to daily business. We need management to become more engaged with our business initiatives that involve technology such as CRM or ERP.“ The program manager plans to use the capabilities described in this white paper to ensure his organization gains greatest benefit from the RDS deployment.

The following sections describe these capabilities in more detail. Many under-performing enterprise software projects suffer from insufficient customer attention to these capabilities. Therefore, it is important to understand the capabilities described in the next sections and assess your company’s strengths and weaknesses accordingly.



Project Management CapabilitiesEven organizations that understand basic project management often overlook steps that can ensure their software initiative delivers anticipated results. The most successful implementations also include an overall solution strategy that begins with pre-implementation business planning and continues after the software project goes live.

As previously mentioned, the RDS methodology defines a process to implement RDS in three months. However, managing the entire solution life cycle requires skills that augment those needed to complete the technical deployment. We call these skills complementary project management capabilities; most of them relate to business and organizational issues.

The following diagram shows the distribution of these project management capabilities through the overall software lifecycle:

These complementary project capabilities are organized into three areas:

�Project preparation

�Core project steps covered by the RDS methodology

�Maintaining the software and solution

Project Preparation Capabilities

Creating a high value, predictable and fast software deployment relies on deci-sions the team makes even before it specifies the project plan. For example, defining the right project, choosing appropriate technology, and properly orga-nizing the team all affect project outcomes and whether the business attains desired outcomes.

Implementations that start with poor project preparation have little chance of success and face higher risk when going live. In addition, skill at monitoring progress and collaborating with stakeholders can give project managers early warning that activities are not going according to plan and help resolve issues that might arise.

CORE RDS STEPS

PROJECT CAPABILITIES

PrepareFive capabilities support prep-

arations for RDS implementation

MaintainTwo capabilities support

maintaining RDS

ImplementFour capabilities support the RDS implementation

Supports

Prepare MaintainRDS

Customers and partners must be able to perform each project task



Customer Insight The IT Program Manager of an automotive parts supplier, which is an SAP customer, said that designing a solution to deliver value, “requires organizational changes that management must support to get the right people on board.” Without understanding the underlying business needs and goals, this manager believes that even the best run project will not deliver expected benefit.

He urges colleagues to “breathe life into business cases; lines of business should determine why software features are really needed, and ask, “How will this proj-ect help my department improve?” and “Will the proposed project improve sales turnaround time or decrease my time on the road?”

These practical questions create the best foundation for achieving success with an RDS implementation.

The following table identifies capabilities that help prepare for the start of a project:

CAPABILITY KEY QUESTION RATIONALE

Analyze Real Business Needs

How do business needs guide selection of the solution?

Identifying they key business require-ments is an essential precursor to selecting a solution. Work within your organization’s governance and policy framework to identify clear business goals and ensure the project supports the company’s strategic objectives.

Select the Appropriate Technology

How does your organization select the appropriate tech-nology for the business?

Define a technology specification that supports your long-term business requirements and objectives. Doing so requires close collaboration between line of business users and IT technologists; cooperation between these groups is critical.

Value-Driven Business Case

How do you justify investments in new technology?

This capability ensures that strong busi-ness logic guides the solution definition. A solid business case increases the likelihood your technology solution will ultimately deliver anticipated business benefits. An unclear or murky business case puts downstream benefits at risk.




Planned Project Goals How does your company set, measure, monitor, and manage the project’s planned goals?

Choosing the right goals is essential to evaluating progress and whether the solution is on track to deliver desired outcomes. The right metrics can make progress and status transparent to the team, help keep everyone informed, and ensure the organization provides ongoing support.

Hands-On Project Management

How does the project team plan, run, and deliver proj-ects on time, in- full, and to-budget?

Keeping a project on track, including managing tasks covered by the RDS methodology, is fundamental to delivering work on time and within budget. This capability is particularly relevant to project managers.

Capabilities for Core Project Steps

The RDS methodology specifies the steps to deploy and go live with an RDS project. Even though the RDS methodology covers the entire implementation project, various system-related and asset ownership issues fall outside the RDS process. SAP customers should ensure they possess sufficient expertise (or capability) to make wise choices about hardware and software ownership; the completeness, accuracy, and recency of data; and the degree of integration with other systems. Customers should address the asset ownership issues when developing the business case because these decisions may affect cash flow and technology buying decisions.

We recommend reviewing these capabilities as a reminder (and checklist) to challenge vendor proposals, pricing models, and assumptions on both long- and short-term planning horizons. Although many SAP customers have mature governance and other processes to handle these matters, their impor-tance in constructing a successful project warrants this additional attention. Knowledgeable customers that make informed choices are more likely to achieve their goals.

Customer Insight One SAP customer, an international provider of electrical parts, began an ERP project as part of an overall business improvement initiative.

During the implementation, the company deployed and RDS project for CRM to “create a single repository to track and manage all project-specific opportunities, jobs, and customer information,” and improve its customer relations manage-ment. According to the CIO, before implementing the system, his company “struggled to devise sales forecasts, see projects through to completion, and accurately determine profitability.” The RDS approach simplified the CRM deploy-ment, which allowed the CIO to focus attention on the core ERP implementation.



Despite running an efficient RDS implementation, the CIO recognizes the need to improve his organization’s capability to bring lines of business into the planning process, especially when setting goals and metrics. Reviewing the capabilities described in this section, he prioritized requirements to increase focus on these areas.

The following table identifies capabilities that enable these core issues:


Software Ownership Model

How does your organization install, customize, operate, and buy software to maximize flexibility?

Choice of software ownership (for example, cloud vs. on-premise) model has significant implications for deployment, technology, software development, user experience, software costs, and upgrades over time. This is a foundational choice to make with great care.

Hardware Ownership Model

How do you maximize the cost-effectiveness of hardware needed to run the software?

On-premise and private cloud buyers must balance price / cost against required per-formance. Be sure to account for current and future expansion, system needs, and growth of data and transactions. Wrong choices in this area can lead to late and over-budget projects.

Dynamic Data Loading How does the broad range of data required to manage the business get prepared, loaded, and updated?

Your strategy will affect downstream data design, management, preparation, and quality – so carefully consider carefully the long-term implications of your plans. Do not rely on vendor recommendations alone, but be sure to obtain independent opinions and expertise.

System Integration How seamlessly does the solution operate with other systems used by the business?

A fully operational solution requires all system components to work seamlessly; integrating hardware, networks, data systems, and software is an important technical aspect of many implementa-tions. These issues are particularly relevant at points when you establish your data strategy, test the solution, and switch to production.



Maintaining the Solution

According to narrow definitions, implementation extends from project start to the point of go live; actually, however, the end goal is achieving desired busi-ness outcomes in the post-go live period. For this reason, RDS customers should extend their implementation strategy to include all steps needed to achieve the business objectives through a longer time horizon.

The capabilities described in this section will help you create strategies for achieving desired outcomes over the entire life of your SAP solution.

Customer Insight To improve profitability planning, a global animal feed-pro-cessing company implemented an RDS version of HANA to speed up the real-time analysis of large volumes of data. For example, prior to using HANA, running Characteristics in Profitability Analysis (COPA) was time consuming; with HANA, the company can run COPA reports in seconds.

Although the project was completed on time and the solution accomplished the intended goal, this company plans to improve its capability to capture even more benefits from its SAP software. According to the business intelligence manager, “IT tries to enable operations, but the business must exert leadership to get those benefits.” He explains that active participation by business sponsors is needed “on every initiative, when designing the solution, to help create buy in from the business.”

The following table identifies the capabilities that help an organization achieve maximum benefit from the software:


Capturing Business Benefits

How does the business ensure that maximum benefit results from the solution?

The ability to capture intended benefits is fundamental to maximizing the likelihood the solution will meet your expectations. Too often, companies pay insufficient attention to this point, by assuming their investment will pay off as expected. Careful attention to this issue can make a substantial difference in ensuring your company gains expected benefit from its implementation.

Post-Implementation Support

How is system and business support provided to users after the solution has been implemented?

Many companies do not plan for post-implementation support until late in their project. Long-term support is important help users remain efficient and produc-tive after the solution is deployed. Also consider the need to hire and train quali-fied support staff, to ensure consistent support quality over time.



Business / Operational CapabilitiesMany organizations knowingly delegate control over their project to third-party consultants and system integrators without understanding the full implications of doing so. Problems arise if this delegation becomes an abdication of respon-sibility for improving processes and changing how the organization operates. Ultimately, the customer is always responsible for achieving implementation success, regardless of how close a relationship with third-party consultants might exist.

SAP customers should develop the business and operational capabilities required to deliver whatever business improvements are desired from the RDS implementation.

Customer Insight A global publisher of books and scholarly journals imple-mented SAP CRM, using an RDS deployment, to gain a “quick-start CRM solution without high risk,” according to the Director of IT Fulfillment.

Although the software went live on time within three months, the IT manager recognizes the company must improve its ability to translate project goals into defined business outcomes. He explains that, “Acceptance and buy-in are very important, but we must learn to measure adoption because then you can reward it.” In addition, he believes that IT must find ways of improving its understanding of the business issues: “We in IT need a better understanding of the business value drivers.”

The capabilities in this section can help organizations like this improve alignment between IT and lines of business.


EnablersFive complementary capabilities

enable RDS to create more value for the business

Enables

BUSINESS / OPERATIONAL CAPABILITIES

ImplementedSoftware

CORE RDS STEPS

Prepare MaintainRDS


Leveraging RDS for Business Value

These capabilities go far beyond traditional project management and provide a systematic means to link IT execution and delivery to organizational business goals:


Encouraging Desired New Behaviors

How does the company moti-vate staff to adopt desired new behaviors?

Attaining desired business improvements usually requires an organization to adopt new processes or work flows. To ease this change for employees, management should initiate strategies that motivate staff to embrace the new processes. This capability influences all tasks related to user training and adoption over the life of the solution.

High Performance Work How does the solution maximize the fit between employees, processes, and work structures?

It is important to develop the orga-nizational conditions that enable high-performance work based on the new software. The point is increasing the likeli-hood that the organization can operate in an optimal manner using the software.

Improving Organizational Structure

How does the company restructure the organization to make the best use of the solution?

Business transformation affects can affect staff roles and responsibilities. This capability is necessary to ensure the organization adapts to take maximum advantage of the solution. These orga-nizational changes must be sufficiently durable to last through the entire period in which the solution is used.

Re-engineering Business Processes

How does the business rede-sign processes to make best use of the solution?

Business transformation relies on the organization making process changes based on the business plan and goals. Before implementation starts, consider how your company will change and improve processes.

Business Operating Model

How does the business ensure that the solution is embedded within an appropriate business operating model?

It is important to define the links between process transformation and changes to the business operating model. This capa-bility is relevant when defining business requirements and planning how they will affect the company after the software is deployed.



Change Management CapabilitiesCustomers can only realize maximum value from enterprise software after executing all project activities and positioning the business to take advantage of new processes enabled by the software. When these improved ways of work become part of daily life, the organization experiences beneficial outcomes that arise from business transformation.

Change presents a challenge for many organizations; managing this change is essential to help workers make a smooth transition from implementation to productive system based on new processes.

After putting planned process improvements in place, the organization must sustain the changes. This involves monitoring business outcomes and adjusting the solution as needed over time. The solution should also evolve as required to meet changing business conditions, or because management seeks further refinements in how the business runs. Gaining enduring value from the soft-ware deployment therefore requires managing for continuous improvement.

Customer Insight A European financial services company implemented RDS for Mobile Sales, to deploy a mobile office quickly.

However, the project manager was concerned that benefits would be short lived, saying, “Sometime after six months, attention fades away quickly. When the new-ness is off, the project no longer sexy, we must place getting the best out of the solution higher on our agenda.”

He adds, “Our company does not realize you cannot just throw change over the wall and expect it to stick. Making change last can require two or three years. Change must be continuously addressed, so someone has to take responsibility for nurturing, and planning, for change over a long period.”

Change ManagementFive capabilities ensure that

process and operational changesendure with non-disruptive impact

BUSINESS CAPABILITIES

CHANGE CAPABILITIES

Changes


CORE RDS STEPS

Prepare MaintainRDS

Fully implemented softwareincluding changed processes and

performance improvements



Managing for change requires leadership to ensure the solution drives desired behaviors and creates desired outcomes for the business. To ensure user adop-tion, use metrics to measure performance but link the goals to changes that users will find meaningful and valuable. The implementation manager advised, “If you want continuous improvement, put it on the agenda every week or every month, discuss it often, and make it visible. Always ask how the solution works and ques-tion whether it continues to bring benefits the business needs.”

Achieving success with change-related activities requires an organization to develop skills and capabilities to support long-term user engagement and buy-in. These conditions drive user adoption and are important foundations for successful change management.

The following table lists important change management capabilities that help accomplish these goals:


Mentor Front-Line Staff How do business leaders mentor staff to drive and sup-port required changes?

This capability is particularly important when the business transformation requires significant change to organiza-tions and operations; it addresses the need to guide staff and work with them to ensure that changes occur as planned. Making a successful transition from go-live to productive system requires enlisting staff support right from the project start.

Staff Training How does the company train staff to use the solution and create business advantage?

A company’s training strategy determines how well staff will performs new roles, responsibilities, and work methods. It directly impacts the tactics for creating training materials and getting employees up to speed quickly.

Engage Key Staff How does the company involve key staff to select, implement, and operate the solution?

Engagement is critical to gaining the buy-in needed for a successful implemen-tation. This capability directly impacts project team staffing, and affects collabo-ration with lines of business. Engaging key individuals is important for all tasks in the solution life cycle.




Project Communications How does the project team communicate to its own members, other relevant internal groups, and external stakeholders?

An effective communications strategy is an essential part of change manage-ment. The strategy should cover the full spectrum of information that stakeholders need to understand the business trans-formation and its impact on them. This strategy should address the kick-off work-shop, user training, the go-live period, and support stakeholders over the entire solution life cycle.

Long-term Management Commitment

How does management sup-port the solution months and years after it has been implemented?

Management commitment is vital for real-izing maximum value from the solution over its lifetime. High levels of manage-ment support enable the business to work through issues that might arise long after the project has gone live and the system is used in production.

Core Guidance Gaining the most value from an RDS implementation depends on a number of factors that are complementary to steps defined in the core RDS methodology. SAP customers should therefore develop the skills and expertise represented by these complementary capabilities, to achieve the best possible results from their implementation. SAP partners and employees will also find these capabili-ties a useful guide and checklist to considerations that make an implementation deliver long-term value.

As you study the capabilities in this white paper, keep these points in mind:

�The RDS methodology defines the implementation process; complementary capabilities describe skills, expertise, and decision points. Your implementa-tion process will flow more smoothly if people in the organization possess the expertise described in the capabilities.

�Before starting an RDS initiative, perform a realistic assessment of your own capabilities

�Only the largest companies will likely possess in-house expertise related all the capabilities described in this white paper. Work with SAP and your system integrator to determine where it makes sense to bring in external resources and assistance.

�Be clear your system integrator understands which capabilities you expect them to provide



�Focus on the capabilities that apply to your particular situation. Companies undergoing a long-term business transformation initiative will face larger change management challenges than organizations implementing a narrowly focused solution.

�Don’t worry about perfection, but do consider the issues. Your company will benefit from whatever level of attention you pay to the capabilities described in this white paper.

Appendix: Rapid Deployment SolutionsRapid Deployment solutions consist of a range of solutions designed to help customers implement SAP software faster and with less expense than in the past. With RDS, customers can license SAP software in a manner that is consistent with historical approaches, but implementation proceeds, “without massive blueprints, high costs, or substantial length. Customers can leverage RDS for immediate value and build from this scalable model,” as described by SAP.

According to SAP, there are 100+ available RDS packages covering areas such line of business applications, analytics, and vertical industries. The following diagram, supplied by SAP, shows the broad coverage of RDS packages:

SAP continues to produce more RDS packages each quarter and they are avail-able in all global regions. RDS packages are an important part of SAP’s strategy to help the enterprise consume innovations such as HANA and enterprise mobility; approximately one-third of RDS packages support these new areas; there are currently 13 RDS packages for mobile, 4 for cloud, and 15 for HANA.

http://www.sap.com/solutions/rapid-deployment/index.epx

http://www.sap.com/solutions/rapid-deployment/solutions-by-business.epx%3FSearchText%3Dhana%26SortOrder%3DASC%26pageSize%3D20%26Filter1%3D%26Filter2%3D%26Filter3%3D

http://www.sap.com/solutions/rapid-deployment/solutions-by-business.epx%3FSearchText%3D%26SortBy%3D%26SortOrder%3DASC%26Filter1%3DSOLA000062%26Filter2%3D%26Filter3%3D%26page%3D1%26pageSize%3D20

http://www.sap.com/solutions/rapid-deployment/solutions-by-business.epx%3FSearchText%3D%26SortBy%3D%26SortOrder%3DASC%26Filter1%3DSOLA000062%26Filter2%3D%26Filter3%3D%26page%3D1%26pageSize%3D20



About the AuthorsMichael Krigsman, CEO of consulting and research firm Asuret, is an inter-national authority on creating IT project success and related CIO issues. He has written one thousand posts on enterprise software, cloud, CRM, ERP and alignment between IT and lines of business. In addition, Michael has created thought leadership reports for major analyst firm, IDC, on project portfolio management, CRM, social business, and cloud computing. Michael has been mentioned over 500 times in important blogs, newspapers, television, trade publications, presentations, academic dissertations, and other media. He has also been quoted in almost 20 books and has written on social business for the Wall Street Journal CIO blog. Michael has worked with companies such as SAP, IBM, Lotus, and many others to create consulting tools, methodologies, and implementation strategies related to business transformation success. He often attends and presents at enterprise software conferences and has presented to Harvard University, Babson College, University College London, Boston University, and Suffolk University.

Lisbeth Shaw, Vice President of Asuret, has managed education, training, and business process methodology projects for over 100 companies. She is an engineer by training and has written numerous reports and case studies for global analyst firm IDC.