Realizing benefits in an SAP transformation program by linking People, Process and Technology
Digital transformations are powerful instruments to realize business value through;
- Process improvements that drive efficiency
- Enhanced analytics capabilities that support better decision-making
Unfortunately, many projects fail to realize their potential. Gartner research predicts widespread failure among ERP initiatives: By 2027, more than 70% of recently implemented ERP initiatives will fail to fully meet their original business case goals. Although there may be varied reasons for this, this article focuses on the People aspect of the golden triangle of People, Process, and Technology.
The common misconception about digital transformation
Organizations often mistakenly believe that implementing and operating new systems and processes alone is sufficient to realize the business case. This used to be particularly relevant for cost-saving benefits, which typically featured high in the business case. I bear the scars of projects lacking critical customer end user and technical input as the relevant employees were already made redundant, sometimes even before the implementation project was completed.
Although this is an extreme example, there are many other examples where the People aspect of the transformation was deemed addressed by training the end users to operate the new system and processes.
The need for people transformation
As a lesson learned from the many transformation projects failing to address the people transformation aspects, many organizations now understand that to make a digital transformation project successful, people transformation must be a success.
The answer to addressing people transformation is business change management or organizational change management (OCM). This is a specialized discipline - and is typically not part of the IT and process capability in an SAP project. OCM often takes shape through a separate workstream led by an in-house or external expert with a set of agreed deliverables per phase aligned with the process and IT implementation. The SAP Activate Methodology, and Atos’s enhanced SmartGuide approach, are used to manage SAP transformation projects, supporting the OCM workstream activities as an integral part of the implementation project.
Defining benefits in process and technology
But - back to the topic - how do we realize the business case? I believe it is by linking the Process and the IT benefits with people change rather than viewing employees (that is: middle management and below) as obstacles to realizing the business case and needing to be ‘change managed’.
Processes and Technology often represent clear value in a business case. These are measurable and based on measurable standards, including industry and peer benchmarks. SAP provides tools and services to create a business case by linking processes to SAP solution capabilities and potential value (benefits, costs, ROI, etc.), and SAP Value Lifecycle Manager provides clear guidance on the Value of Intelligent Enterprise and an option to build a business case by process or by SAP Product.
Yet, in many cases, the People benefits of a digital transformation project tend to be less clearly defined, demonstrated by the following examples: ‘user-friendly interface improves motivation’ or ‘automation reduces repetitive work.’ So how do we better leverage this important source of benefits?
Integrating people into benefits realization
We start with the clearly defined process and technology benefits, and instead of doing the project to the employees, making them part of the business case. This requires that both OCM and benefits realization are an active part of the project.
Benefits realization is the process of defining, planning, and achieving the benefits of a transformation project. The initial approach is centred on taking input from relevant stakeholders in the organization to draw out a path from the project activities to achieving the business case. This approach enables a milestone-based approach that can be measured and adjusted where circumstances change.
The role of employees in benefits realization
In my view, employees are indispensable in this process. Not only do they have the business knowledge and knowledge of the current pain points, but at the same time, these people become bought into the benefits realization and -as a result- become enabled to make decisions that will promote the benefits realization.
Atos’s approach to digital transformation
Atos has supported clients for many years with digital transformation, benefits realization, and our specialized OCM services. More recently, we have moved to an integrated delivery model supported by experienced consultants, with positive results for our customers.
