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The SAP S/4HANA golden thread

David Lowson
April 22, 2020

Ever wondered what “good” looks like for a customer? The best tender I ever received (and I paraphrase) contained only three requirements:

  • We want to pay all our employees on time, accurately, and carry out all HR functions required to do their jobs.
  • We want to complete our accounts accurately in three days.
  • We want all our employees to be able to buy what they need to do their jobs electronically

The customer also made it clear that they would not pay unless these requirements were met. There was no need for expensive advisors to come up with this list. The client left it up to the vendors and software partners to decide how they wanted to pursue this goal. Amazingly, even without the (un)usual 1,000 absurd questions in a typical RFP, some bidders failed to respond. The company I was working for won, and I remember when the contract was done, it was delivered on time, within budget, with very little bespoke work and a 100% focus on those outcomes.

What the client bought was business outcomes not clever functionality, or, clever bespoke work, or, even teams or day rates or experience. They got what they wanted because they knew if they achieved the outcomes, they would make substantial savings and service improvements.

The point I am trying to make is that an ERP program is about achieving outcomes using the resources that were agreed. There’s not much else. I’ll go a step further and debate if ERP program is even the right term for the SAP S/4HANA Digital Core – but that’s for my next blog!

There is evidence that some outcomes can be achieved by implementing ERP without needing to focus too much on them. This is amazingly possible courtesy of the successful triangulation of a great product, quality of the client, and forethought of the partner team. However, as we head into a digitally disruptive world filled with technology and business transformations, less of the solution is delivered in the core and more in the platform around it with additional complexity of multiple SaaS products.

Thus, it’s imperative that we focus on achieving results. For example, if the desired outcome of implementing a single ERP was to have better control of inventory in an organization that had multiple ERPs, then having one solution where all inventory can be seen would achieve it fairly easily. (Un)surprisingly I still see implementations fail to deliver this. However, for sophisticated outcomes, such as lead time reduced from nine months to three months, the complexity of things you need to change or factor in to achieve them, isn’t likely by implementing a software only. It requires a coordinated approach over multiple business areas and products, such as IBP, third-party products, sales, inventory, etc.

At the Capgemini SAP Center of Excellence, we have developed a golden thread that runs through the ERP program, flowing from the business case and desired project outcomes to the delivery of those outcomes and continued innovation and improvement. The thread adapts with the complexity of the S/4 program, from the landscape/environment that already exists in part and by using multiple components such as data, security, business areas affected, other stakeholders, customers, suppliers, etc. in tune with our Renewable Enterprise strategy. This makes it possible not to lose sight of the outcomes despite having a phased component go live at different intervals while some delivery is incremental. We revalidated our tools and methods, extending them and adding new components to make sure that the golden thread runs from the initial value analysis and business case through the build and go live and into support and continuous improvement.

This isn’t about gathering thousands of user requirements and then making sure they are delivered through design and test. We have noticed that many of these requirements will not address the real goal and most others are already satisfied by the standard solution. Clients using this approach inadvertently just add extra cost and unwanted overhead and distract themselves from the real business. Similarly, are the delivery methods employed in the ERP marketplace designed to deliver outcomes or simply to get a project live, and measure convenient milestones? I don’t think methodology is the answer to everything. Tolls and a strong methodology support the goals, but the need of 100% commitment from the team to remember why they do what they do and, in times of inevitable crisis, come up with solutions that do not jeopardize the desired outcomes is greater.

A networked and distributed small number of high-level, high-impact outcomes across the enterprise with executive sponsorship and focus is a critical success factor. You’ll never be successful if you have a knot of golden threads because you’re trying to change lots of things at the same time.

Capgemini’s Renewable Enterprise allows you to align your SAP S/4HANA transformation with your real business priorities. Let’s talk. Contact me directly to know more and if delivering an intelligent enterprise on a stable digital core is a desired outcome!