SAP Clients Cling to their Guns and their Religion: The Failure to Gain Measurable Benefit from SAP Investments

In recent times, there has been a resurgence of the political argument that “the government should be run more like a business.” Really? One of the more dispiriting aspects of my many consulting missions in the SAP installed base (i.e. at businesses) is the fact that while all are run under the auspices of a Profit & Loss, the majority of strategic decisions for SAP activities are made based on “gut”, “experience”, and “vision” rather than on business metrics. Gut, experience, and vision are the ‘religious’ aspects in play while authority represents ‘the gun’.

While jokes abound about the meaning of SAP, many of them are negative: Send A Payment. Shut up And Pay. Shoot A Programmer. (I have literally heard dozens whereas for me SAP means Suitcase And Passport.) The negative jokes are based upon a view that SAP is about software. This is, of course, a pernicious superstition that should be stamped out with vigor.

What I have long believed SAP should stand for is: Sweeping Awesome Profits. Given the investments that firms have made in SAP, I am continually surprised at how few of those firms adhere to such a belief.

The cost and stake of SAP drove the subject of information technology into the boardroom and one might think that board members would like to know what they are getting for their investments. However, when I asked 100 clients in the installed base what implementation mistakes were still causing them pain, the most cited problem (at 59%) was: “There was no quantifiable measurement of business benefits derived from implementation.”

More recently, I have been engaged with clients undertaking my SAP Maturity Assessment (www.3vsolutions/Assessment.php) Value Management, one of four areas tested, is perpetually the least mature.

At the turn of the millennium, it was understandable that most clients were busy stabilizing their SAP applications portfolio. It is now 2010 and far too many are still stuck in that rut.

Until about 2005, SAP itself gave only lip service to the crucial notion of gaining measurable benefit. Since that time, it has provided Value Engineering, the heart of which is quite similar to Deloitte’s ‘Enterprise Value Mapping’, and the now defunct BearingPoint’s ‘Enterprise Value Creation’ (to mention two of the more prominent predecessors). With Value Engineering, clients can move beyond bullet-point objectives into Key Performance Indicators, the former being superstition/vision and the latter driving P&L results. Further, SAP’s acquisition of Business Objects has vastly accelerated the evolution of business intelligence, thus helping clients in the SAP installed base to turn away from ‘guns and religion’ as the foundation for decision-making toward the science of value management.

To download a white paper:  Using SAP as the Engine to Measurable Business Benefit, follow this link:

http://www.michaeldoane.com/uploads/SAP_the_Engine_to_Measurable_Benefit.pdf

For more on this subject, please visit:  www.michaeldoane.com/