“More than half (55%) of mid-market companies said they cannot make data and business process changes to their ERP software without the help of external consultants, which costs both time and money, according to a study undertaken by Technology Evaluation Centers (TEC) and provided by UNIT4.”

What about the rest 45%? How do they make changes to their ERP software?

The answer is simple! They employed highly skilled IT staff as a part of their organizational structure because they believed in ERP and they knew that the skilled personnel would reduce their outsource consultancy costs and also save time.

Consultancy firms usually dawdle over their jobs to make more money. If a company does not employ the personnel who have the knowledge and competency in IT business and ERP systems, then the existing problems and the solutions that are offered by the consultancy firms cannot be brought under control. Worse still, the company cannot control the budget intended for IT developments.

The rest 45% understood that both time and money are important and they made their moves. They hired highly skilled IT professionals or trained their existing team members to save money and time in the long run. Hereby, they have placed themselves among the rest 45%…

The 55% have got the excuse: saving Time and Money! But the real reason would be the lack of perspective and vision.

Failure stories are majority in number compared to success stories in ERP Implementations. We all accept this as “The Nature of ERP”, but the reality is that “Human Nature” and the mentality of the 55% are responsible for these failures, not the ERP itself…

Harun DOYURAN
ERP Systems Consultant
Follow on Twitter @harundoyuran

ERPNEWS.net — IT consultancy Bluefin Solutions has claimed that SAP’s in-memory database, HANA, could cause the biggest paradigm shift since the introduction of IBM’s original PC in the 1980s.

Speaking at the SAP User Group conference in Birmingham, Bluefin’s information architecture and strategy capability lead Ian Brown made the strong claims.

Brown said that HANA has made it possible for a finance director to sit in his office with a box in a cupboard next to him running two billion rows of data.

“HANA is effectively the ability to take an enterprise scale database and put it in a single box,” said Brown, “and it only costs £50,000 (€58,195). That may sound like a lot, but in the 80s businesses used to have to spend £10,000 (€11,639) to get things working on a PC, and that transformed the small business. You’ve now got a box which is not a million miles away from that. For big companies, they can put their numbers on it and run it live.”

Brown expands on this idea in a blog post on the Bluefin website, in which he identifies several similarities between the development and marketing of both the SAP HANA technology and the earlier IBM PC. These include open, well-defined standards, flexible and scalable architecture, ‘off-the-shelf’ hardware and a focus on business value and engineering excellence.

“I believe SAP HANA will take off because it’s going fundamentally to hit the same sweet-spot of huge corporate demand that drove the PC’s takeover of most of the world,” said Brown.

Launched in December 2010, HANA employs an in-memory computing engine, wherein data to be processed is held in RAM instead of being read from disks or flash storage, providing a performance boost. SAP intends HANA boxes to be attached to its own ERP systems, sucking in and analysing transactional data in real time. However, HANA’s ‘agnostic’ data access functionality means any information source can be used.

Bluefin works with clients such as BSI, Camelot, Travelodge and Royal Mail to help them achieve greater business performance by optimising SAP technology. Brown said that HANA could potentially be of use to all its customers, but that the company is currently targeting those running SAP NetWeaver Business Warehouse on SQL server.

“HANA will swallow anyone who’s running BW on SQL server, as they’re likely to have a database that’s small enough to run on HANA today,” he said. “For the bigger enterprises currently running Oracle or DB2, the technology isn’t there yet. Oracle databases tend to go up to around 30 Terabytes, whereas HANA can swallow around 2 Terabytes.”

However, Brown said Oracle is getting very nervous, as Moore’s law will mean that ultimately the hardware will get bigger and cheaper, until it becomes a direct competitor with Oracle Exalytics.

Constellation Research analyst Ray Wang agrees that a SAP’s strong play targeting the database market will hurt Oracle, but said that it should not get worried just yet.

“If you’re really serious about undercutting Oracle, you make a database. You cut into Oracle’s market on database so that you actually stop funding there,” Wang said.

“But Oracle’s got so big because of all the acquisitions, you can’t just cut them off on database, although that’s one big piece. They were vulnerable at one point in time. Teradata pretty much was in that same boat. So this is just natural competition between the tech vendors.”

Sorry, let me rephrase that. Hearing about an SAP implementation that finished ahead of schedule is like hearing that someone captured the Loch Ness Monster and turned it into a kiddie ride. It’s as likely as Bigfoot singing “La Traviata” at Lincoln Center. It’s as if you called a software company’s tech support line and the voice on the other end didn’t insist you reboot your PC.

SAP implementations don’t finish ahead of schedule. Failed to finish is much more likely.

The company that made the pronouncement? Daiwa House Industry. Not only did Daiwa House complete its SAP implementation ahead of schedule, it did so despite being interrupted by the Tohuku earthquake — the one that measured 9.0 on the Richter scale and took several nuclear power plants offline.

Intrigued, I set up a meeting with Daiwa House’s SAP implementation team at the Realization Project Flow conference, and through two excellent interpreters, spoke with Kyoji Kato, executive officer and general manager of Daiwa House’s information systems division, Project Leader Ryuzo Matsuyama, and Isao Nakae, SAP solution division director at Fujitsu Kansai Systems, Daiwa House’s implementation partner on the project.

What follows are six valuable lessons they learned transforming a seriously challenged effort into a roaring success. Consider this a practical supplement to my recent “13 tips for turbocharging projects” post.

Lesson No. 1: Having staff wait for work is better than having work wait for staff
All three interviewees were emphatic that moving from traditional project management techniques to critical-chain project management had a huge impact, resulting in 25 percent cycle time reductions for every phase of the effort.

This isn’t the place for a tutorial on the subject (among other reasons, I’m not qualified to provide it), but one of critical chain’s most important principles is that projects should never be delayed because staff are not available to work on the next task. Why? Because one such delay sets off a — no pun intended — chain reaction of late task starts.

In other words, chaos ensues, and each late start makes the expected time lines in every dependent chain of tasks increasingly unpredictable.

Lesson No. 2: Multitasking is more prevalent and more harmful than anyone thinks
Companies that don’t understand the importance of Lesson No. 1 inevitably attempt to maximize staff utilization. It would seem to make sense. After all, any time you pay an employee for doing nothing sure sounds like waste — and it is waste. The problem is that most attempts to maximize staff utilization do more harm than good.

We’ve already mentioned one problem: cascading project chaos. Beyond that, keeping employees busy means insisting that they multitask.

Employees never multitask, of course. What the word actually means is having to switch from one task to another, unpredictably and often. Ask anyone whose work requires concentrated effort what impact this has and they’ll give you the same answer: It’s all bad. Every switch means getting one’s head out of one task, reorienting, and getting it back into the other task.

This process is neither effortless nor instantaneous. The lesson is clear: Let employees finish what they start, even if that means they occasionally find themselves with nothing to do. All in all, they’ll be far more effective and productive.

Lesson No. 3: Eliminate “apple polishing”
Last week’s column mentioned the importance of making sure everyone knows when they’ve “reached the exalted state of ‘good enough.’”

Daiwa House’s project leadership team recognized this issue — they call it “apple polishing” — and hit it head on. They provided clear exit criteria for every task. They communicated the importance of avoiding apple polishing often. Then they communicated it more, because if there is anything to be said about the shared culture of engineers, it’s that they constantly strive to find ways to make whatever they’re working on even better.

It should come as little surprise that Mr. Matsuyama chuckled when I asked how readily his team members accepted the need to stop polishing their apples. The answer: While it’s vital to project success, it takes constant, active management.

Lesson No. 4: Don’t overdefine the tasks
“Defining details,” the team explained, “doesn’t help understanding. It causes misunderstanding.”

By “details” they weren’t referring to specifications. They were referring to task definition. They were emphatic that there comes a point of diminishing returns, below which the project manager is micromanaging instead of allowing team members to use their experience and good judgment to get the job done.

In this vein, they also mentioned extensive use of prototyping as a way to determine implementation details. “Prototyping” isn’t a word commonly used in conjunction with “SAP implementation” — it’s about as common as the phrase “ahead of schedule.”

With the right team, though, it turns out to be entirely feasible and well worth the effort. (For more on this subject, check out “A surefire bet for IT job security.”)

Lesson No. 5: Be aggressive about business improvement
Regular Advice Line readers understand a core principle of next-generation IT: There are no IT projects. It’s a principle so important that my consulting company advises clients to never name a project after the technology. As Daiwa House’s project title was “SAP Implementation,” I was curious as to whether that was, in fact, the actual focus.

Interestingly enough, as initially chartered, this was very much a classic IT project. Its primary goal was to support management, particularly in accounting, human resources, and compliance by providing a more coherent view of the company’s information. The main expected business benefits were to close the books faster, improve HR management, and support international compliance requirements.

Over time, though, the project team became more aggressive in defining business improvements. Designing different and better processes and practices enabled by the new software became a formal part of the effort. It shifted, that is, from implementing SAP and figuring out how to take advantage of the additional capabilities it provided to implementing better business processes and practices as a central implementation deliverable.

One example the Daiwa team was willing to share was that prior to the SAP implementation, pricing mistakes alone totaled 0.5 percent of overall billing. As the company’s revenue hits $20 billion per year, that’s a number worth paying attention to.

There’s little doubt that fixing errors of this magnitude resulted in an enormous reduction in wasted effort. There’s even less doubt that the impact on customer relationships was immense.

Short version: Daiwa House’s experience validates the principle. In spite of the name, this project wasn’t an SAP implementation. It was a business improvement initiative that relied, in part, on implementing SAP.

Lesson No. 6: Provide a holistic view for all team members
On any project, it’s easy for participants to develop tunnel vision, focusing narrowly on their own task responsibilities. This can result in a collection of parts — each excellent when considered solely on its own merits — that don’t fit together into a coherent whole. The folks at Daiwa House were clear on the importance of making sure everyone on the team maintained a sense of the big picture while addressing their individual responsibilities.

ERP implementations have gained a bad reputation, in which merely late is considered very good, and spiraling out of control is considered common. There are always more ways of doing something wrong than doing something right. Beyond that, the act of defining an effort as an ERP implementation contributes to the likelihood of disappointing results.

Daiwa House’s experience demonstrates that while problem implementations are common, they’re far from inevitable. Even better, it demonstrates that success isn’t a statistical accident. It’s the result of good leadership, management, and technique.

By Bob Lewis    -  Follow Bob Lewis on Twitter @ITCatalysts
This story, “Six lessons from a lightning ERP rollout,” was originally published at InfoWorld.com

NetSuite OneWorld SRP replaced Empired’s six software systems, including Salesforce.com, QuickBooks, Replicon Timesheets and Scheduling, as well as in-house built systems for financial forecasting and project management. The manual integration of these solutions failed to provide Empired with real-time visibility of its resource capacity, business performance and profitability, hindering the company’s ability to react to changes within the business and scale rapidly.

Empired selected NetSuite OneWorld SRP over Oracle, SAP and Microsoft solutions, after a year long investigation of CRM, ERP and financial software solutions specifically tailored to professional services organisations. As a cloud solution, NetSuite OneWorld SRP’s ease of use, simpler and shorter installation process, and significantly reduced market-entry and maintenance costs, made it the clear winner for Empired.

Empired’s timely transition to NetSuite OneWorld SRP is now supporting the 200-strong IT services firm’s continued growth, with current plans for national expansion into the Sydney and Brisbane markets over the next two years, beyond its Perth headquarters and Melbourne office.

NetSuite’s SuiteCloud development platform provides flexible and powerful customisation capabilities, allowing Empired to easily adapt NetSuite to meet its business needs. “NetSuite OneWorld SRP offered one solution that is extremely well tailored to professional services organisations like ours. What little customisation was required, we could do in-house with a small amount of training, as opposed to hiring a software engineer or developer to do it,” said Mark Waller, chief financial officer for Empired Ltd.

Discussing the complexity of Empired’s previous processes, Mr. Waller said: “We were limited by how many projects our consultants and project managers could work on because of the considerable time it took to consolidate and check data housed in separate software systems.  Resources too were often underutilised as we lacked the visibility to quickly see when and where resources might be available.”

“NetSuite OneWorld SRP gives Empired a fully integrated solution that takes us from customer opportunity management through project management to invoice payment, with the appropriate reporting and dashboards throughout the lengthy process,” added Mr. Waller. “And the business lifecycle management tool and resource planning capability can help us take advantage of emerging market growth opportunities.”

“As Empired prepares to continue its national expansion, we’re thrilled it chose NetSuite OneWorld SRP to help power that growth,” said Mark Troselj, managing director of APAC for NetSuite. “By switching to one centralised, modern cloud-based system, Empired now has a tool to see in real-time how every aspect of its business is performing and where opportunities lie. This knowledge clears up the blind spots multiple software systems create and is critical in enabling Empired to maximise its growth opportunities in today’s competitive market.”

Follow NetSuite’s Cloud blog, NetSuite’s Facebook page and @NetSuiteAPAC Twitter handle for real-time updates.

For more information about NetSuite, please visit www.netsuite.com.

Some of the most significant enhancements for this on-premise and optionally hosted enterprise software include: an extension to Business One’ CRM, better management of serialised items, simplified pick and pack processes, and more flexible MRP. On the CRM side, for example, the ne system enables businesses to create, maintain and analyse multi-channel marketing campaign information.

SAP says that manufacturers will be able to manage the entire lifecycle of a campaign by creating and maintaining target groups, managing campaign data, and then generating leads and sales opportunities. As for serial managed items, users can allocate serial numbers to items for sales orders, accounts receivable reserve invoices and inventory transfer requests – so allowing for better control, greater visibility and increased flexibility with inventory allocations.

Moving on to MRP, the new module has a more powerful and flexible wizard, better recommendation reports, new options for calendar week display and improved forecasting. For instance, the new inventory transfer request document recommends transfer between warehouses before initiating purchase or production orders. Other improvements include: recognition of blanket agreements to reflect long-term sales or purchasing agreements; and simplified configuration., with a new express configuration wizard that guides users through settings in the various application areas.

The latter also allows users to compare configuration settings that have been saved previously, in order to detect changes to the configuration that may cause errors.

Computerworld has quoted Siavash Moshiri, consultant and SAP corporate master’s program leader at Sheffield Hallam University as suggesting those currently in this field are often among the older members of the British workforce.

It is therefore imperative that younger people are encouraged to take up a career in SAP solutions.

“The pace of innovation has gathered momentum this year. This means there are skills needs that need to be managed and developed,” added Mr Moshiri.

He noted that developing expertise in SAP ERP software is a “life-long” skill that will boost anybody’s employability – and potentially improve the fortunes of companies in the country.

SAP recently revealed that it is planning to expand over the years to come, with China set to be one key location, as it is due to receive $2 billion (£1.25 billion) in investment.