TOP 10 SAP TO-DOs for 2011 (Part One)
By Sam Sliman, President, Optimal Solutions Integration
The gist of Auld Lang Syne is that old friendships should never be forgotten and New Year’s Eve is a fitting occasion for parted friends to reunite, reminisce and share a pint. And while we at Optimal would love to buy all our newsletter readers a Guinness, it’s an objective that even Google can’t help us do online (Maybe Groupon? We’ll have to research that). One thing we can do is dispense SAP advice and with this issue we’d like to take the opportunity and share some with you.
One thing we realized this year is that very few people actually know the words to Auld Lang Syne, one of the most famous ballads in the English-speaking world. After some in-depth investigating, we turned up that, interestingly enough, Scottish bard Robert Burns concludes his song: ‘And surely ye'll be your pint' stowp, And surely I'll be mine…’ Translation: ‘And surely you will pay for your pint, And surely I will pay for mine…’
Burns’ point is that friends who’ve taken separate paths are responsible for their respective decisions and accountable for their present situations. (Read: paying their own bill!) And with that, we have a tie-in to the business at hand. SAP is a journey whose path is determined by a host of decisions -- critical decisions forced by business changes, market dynamics and evolving technology. Missteps yield costly consequences and significant risks. Educated decisions deliver meaningful, measurable gains.
And so it’s in the spirit of SAP camaraderie (and a desire to keep our “old acquaintances” informed and out in front) that we share with you the Optimal list of TOP 10 SAP TO-DOs for 2011. Here’s to you -- our readers -- and best wishes for a prosperous SAP journey in 2011!
OPTIMAL TOP 10 SAP TO-DOs for 2011
1. Know (or Learn) Your Accounting Rules for Capitalization
The Obama administration handed businesses and the IT industry a gift last month when it signed off on a tax package that includes an accelerated depreciation rule to encourage capital expenditures in 2011. Under the terms of the provision, in 2011 companies can write off 100% of their capital expenditures immediately instead of over several years. Not all SAP projects can be capitalized and, if not, they will need to be expensed, adding more strain to income statements that are already under tremendous pressure. Get to know your resident bean counter and find out what the new rule means to you and your ever-growing list of SAP projects -- there could be some pleasant financial surprises that will allow you to make some serious progress in 2011.
2. SAP Assessment / Performance Audit
Over time SAP landscapes can become very complex, particularly within growing global businesses with SAP implementations dating back 5 years or more. A thorough SAP inventory and performance audit identifies all instances of SAP deployed throughout your enterprise, maps out SAP-driven business processes, identifies opportunities to rationalize processes and functionality, and assesses how many and how well end users within your business utilize SAP applications. Immediate benefits include identifying opportunities for SAP app consolidation; identifying unnecessary end-user licenses; exposing under-utilized functionality within existing SAP applications; identifying functionality that can be improved, replaced or augmented through upgrades; isolating response time and performance bottlenecks; and evaluating security controls for SAP access management, among others.
3. SAP Master Data Management
Without a single source of accurate, consolidated, harmonized and centrally managed master data, the efficacy of any new or improved business process can be limited. It is essential that a disciplined, well-designed master data management (MDM) model be in place to weave all the various application data together into an accurate, complete, and actionable picture. MDM is a linchpin for unleashing the full value of your SAP investment -- from new business processes to exposing ‘data-as-a-service’ to achieving enhanced enterprise performance, BI, analytics and GRC capabilities. It’s not new, but it is powerful -- and many SAP sites still haven’t rolled it out despite a very compelling ROI profile.
4. Evaluate Your SAP Outsourcing Strategy
With a still sluggish economy, uncertainty about taxes, and ever-present budget constraints, outsourcing SAP-related work is rapidly becoming the norm among CIOs looking to cut costs and improve service levels, particularly in the area of SAP application management, which can account for as much as two-thirds of an application’s long-term cost of ownership. Put simply, CIOs can no longer justify the time, cost and difficulty of attracting, training and retaining appropriately skilled SAP experts. From hosting to technical management to functional enhancements to strategic upgrades and business process improvements, outsource suppliers have the experience, discipline and delivery models to handle most of your SAP-related work at a fraction of your current costs and with markedly better results.
5. SAP Upgrade Planning
By analysts’ estimates, a little more than one-third of SAP customers have upgraded to SAP ERP 6.0., which leaves a sizable number of SAP customers heading toward an upgrade. Findings from Panaya’s 2010 SAP Upgrade Survey show that SAP ERP 4.7 is presently the most prevalent version of SAP ERP in use, and that nearly 80% of companies surveyed have definite plans to perform an SAP upgrade within the next 16 months. To be sure, 2011 will be a big year for SAP upgrades, and while upgrading to 6.0 need not be a massively disruptive and expensive ‘rip-and-replace’ operation, upgrading does present considerable challenges and risks. Thorough and careful planning is paramount. In addition to mapping out the SAP application/module upgrade path, your SAP upgrade plan also should factor in the time and resources for the requisite pre-upgrade testing and impact analysis work, and the tools, methodologies, and specialized skill sets you will need to keep your upgrade projects on track and on budget.
The next installment of Optimal SAP Advisor will detail Optimal SAP 2011 TO-DOs 5 – 10.
