New Florence. New Renaissance.

SAP Nation Excerpt: Customer Strategy B3 – Tiers of Joy

I have been excerpting here from the book’s case studies. They profile 12 strategies across four groupings of customers A) Un-adopters B) Diversifiers C) Pragmatists and D) Committed.

The customers profiled below are part of the second group which has four strategies in the book:

In the 1980s, as AS/400s and LANs matured, many multinationals adopted two- or three-tier application strategies — a mainframe-based application for corporate and domestic subsidiaries and regional hubs, with decentralized versions for international subsidiaries. J.D. Edwards (now part of Oracle), Platinum (now Epicor), Sage, and other vendors were beneficiaries of such tiering. Things have evolved quite a bit since — now companies can go with SaaS systems for smaller subsidiaries, and as a result not even need local IT support.

Procter & Gamble, a major SAP shop, rolled out NetSuite to its major distributors in the Philippines. Conversely, ABS-CBN Global, a Filipino company, kept SAP at its headquarters, but adopted NetSuite for global operations.

Lexmark is a major SAP customer using BusinessObjects, HANA and many other SAP products. It is also an SAP partner helping its customers with print solutions. In 2010, it acquired Perceptive Software, a leading
provider of Enterprise Content Management solutions. Perceptive was using, and has continued to use Professional Services Automation functionality from FinancialForce.

The Würth Group, a German distributor of a variety of furniture and construction fittings, has more than three million customers across 400 subsidiaries in over 80 countries with global revenues of over €10 billion. The Würth Phoenix Group, the company’s IT sub, developed Trade+, a template based on Microsoft Dynamics AX with customized inventory functionality and reporting. The template has been deployed in 65 of those subsidiaries so far (55 running AX, ten running CRM). The distributed architecture allows efficient local handling of low-value, high-volume customer orders with centralized finance and materials management on the SAP system in Germany. The CIO has asserted that they now can “integrate new businesses into the group practically at the touch of a button.”

SAP Nation Excerpt: Customer Strategy D2 – Make SAP Dance to Your Business Tune

Over the next few weeks I am excerpting here from the book’s case studies. They profile 12 strategies across four groupings of customers A) Un-adopters B) Diversifiers C) Pragmatists and D) Committed.

The customer profiled below is part of the fourth group which has two strategies in the book:

Kustoff saw right away that separate ERP solutions— SAP, MAPICS, Epicor, and J.D. Edwards — across the divisions offered a major opportunity for IT efficiency. He quickly recommended consolidating to SAP as the
logical path. He had previously worked with other pharma companies which had implemented SAP. The other packages at Endo were approaching end of support life or could not scale to support the entire Endo family.

The project itself innovated in a number of areas. Given the range of integration plus end-user training needs across the four ERP environments, they used tools like WebMethods and uPerform (a training platform).

An acquisition of Canadian drug company, Paladin Labs, allowed Endo to redomicile in Dublin. The operating efficiencies, tax savings and corporate flexibility enabled by this redomiciling are expected to be significant, but it required SAP to now accommodate a new set of accounting, tax, and regulatory requirements. Endo has also divested the HealthTronics unit and is considering other restructuring moves, so the original consolidation project has changed considerably.

The Endo story is about not letting SAP constrain you, but instead making it help you adjust to rapidly changing business scenarios.

SAP Nation Excerpt: Customer Strategy C2 – Keep Projects Low Hype

Over the next few weeks I am excerpting here from the book’s case studies. They profile 12 strategies across four groupings of customers A) Un-adopters B) Diversifiers C) Pragmatists and D) Committed.

The customer profiled below is part of the third group which has four strategies in the book:

in 2009, DeVry bought a majority stake in a Brazilian higher-education company, Fanor Group. It enrolled 10,000 students in three schools — Fanor, FRB (Faculdade Ruy Barbosa) and Área1, located in two cities, Fortaleza and Salvador in Northeast Brazil.

Over six months, the company implemented SAP accounting, finance, and payroll modules with an aggressive budget of $2 million. It was a single instance running at the DeVry Brasil data center in Salvador.

Black concludes: “The macro-level results of this one year investment in this program of IT initiatives was that our Brazil operation grew by 24 percent in revenue, while increasing student satisfaction by 10.6 points, growing our local gross profit by 85.8 percent and operating income by 122 percent in a year.”

So, by itself, the implementation was run efficiently, but measured with business metrics, the results look even more impressive.

SAP Nation Excerpt: Customer Strategy A2 – Freeze and shrink

Over the next few weeks I am excerpting here from the book’s case studies. They profile 12 strategies across four groupings of customers A) Un-adopters B) Diversifiers C) Pragmatists and D) Committed.

The customers profiled below are part of the first group which has two strategies in the book:

Just because you buy a Porsche does not mean you are required to buy service at their dealers. If anything, Consumer Reports surveys show independent garages often offer better value and service than many auto manufacturers’ dealers. That principle has long been known to IT shops. When a piece of packaged software matures, it is often better to freeze it in place and seek support from a cheaper source for bug fixes and regulatory updates. Some SAP shops are starting to reapply this principle in its updated incarnation.

As with Color Spot, the United Biscuits maintenance budget dropped by using 3PM, but it got an added bonus. While SAP just supports the vanilla application, Rimini also supports its customizations for the price. That may sound trivial, till you realize SAP support staff is not required to understand unique nuances of a customer’s business. The Rimini support engineer, however, does — with fast response, clear SLAs and regular reviews. Rimini Street also delivers, for the lower price, U.K. SAP payroll tax, legal and regulatory updates.

Embraer’s SAP system is highly customized to accommodate many specific aerospace and defense requirements, as well as Brazilian tax specifics and the country’s Public Digital Bookkeeping System (SPED). As a major exporter (with its planes operating in over 80 countries), it faces additional regulatory scrutiny. This complexity has challenged Rimini to work on over 70 localization projects.

Freeze the SAP application in place at its current stable level and reduce your maintenance budget while improving service levels. That’s a triple dip, which over a hundred SAP customers are now enjoying. This comes with the assurance that Rimini Street will support their SAP version for at least a decade.

SAP Nation Excerpt: Customer Strategy D1 – Align with SAP’s Future

Over the next few weeks I am excerpting here from the book’s case studies. They profile 12 strategies across four groupings of customers A) Un-adopters B) Diversifiers C) Pragmatists and D) Committed.

The customers profiled below are part of the fourth group which has two strategies in the book:

• Actually, Ahrendts has moved on to manage Apple’s retail empire, but Burberry’s is an example of a company which is tightly aligned with SAP’s past and future. It runs a single instance of the SAP Business Suite. It jointly developed with SAP a point-of-sale (POS) app that puts product and customer information into sales associates’ tablets at the store. It uses HANA to blend transactional, customer, POS, and social media data. And, it next plans to swap out its Oracle database and put the Business Suite on HANA.
• John Deere was one of SAP’s earliest customers, going back to the mid-1970s. Now, it is aligned with SAP’s HANA future. Deere is driven by a goal that the world needs to double its food production by 2050. With shrinking arable land, technology has to help agriculture become much more efficient.

Gutenberg 6

Modern day authors get plenty of feedback in the form of media reviews and customer scoring on Amazon, Goodreads and other sites. But as an author I can tell you there is nothing more gratifying than specific reader feedback. A few years ago, students at Arizona State gifted me a copy of The New Polymath with their markings from a class assignment (see photo below) Pink markings = surprised; Green = useful at work, orange = disagree and yellow = learned. And they had specific comments inside the book. It was truly a marvelous gift.

A similarly fascinating  new source of feedback comes from a Amazon Kindle feature called Popular Highlights. That aggregates the highlights of all Kindle customers and reports the most highlighted passages in a book (and for a reader highlights them as you read your copy ). I periodically check The Kindle app on my iPad for the evolving set of highlights.

It’s not perfect, of course. Many readers still buy print  copies and their Post-IT and yellow marker highlights cannot be captured. Some readers turn off annotations for privacy or other reasons so their input is absent.

As an author, though, it is granular and constantly evolving crowd feedback. And a humbling reminder that in our busy lives, many readers only read bits and pieces of books- not cover to cover :)

Gutenberg would be fascinated with the growing democratization of book publishing.

SAP Nation Excerpt: Customer Strategy C1 - Keep Relationship Analytical

Over the next few weeks I am excerpting here from the book’s case studies. They profile 12 strategies across four groupings of customers A) Un-adopters B) Diversifiers C) Pragmatists and D) Committed.

The customer profiled below is part of the third group which has four strategies in the book, keeping relationship with SAP analytical being the first:

SAS scores at CLP are a composite of a variety of safety, quality, cost, delivery, and support attributes. They are meant to give a supplier a 360-degree view on how it is performing. It also gives the supplier, in return, an opportunity to score CLP. Even though SAP is a strategic supplier to many of its customers, it is rare to see the detailed analytical feedback that CLP provides….Even more telling, CLP also shared with the SAP executives the many IT initiatives it had missed out on in the previous couple of years. Mobile enterprise application platform, predictive maintenance, emission management, work clearance, safety document management, and advanced analytics opportunities were awarded to other vendors. Fuel and commodity management functionality was custom developed….The analytical bent continued when CLP recently evaluated HANA as a platform to consolidate its sprawl of SAP landscapes. It also wanted to reduce its infrastructure costs compared to the Microsoft SQL Server database environment it currently runs on….Over and over again, CLP has shown a willingness to evaluate new SAP features and innovations, but it analyzes them thoroughly before it adopts them. Conversely, it is always pushing SAP for more innovation and better support, and openly shares its research findings. In many ways, it is a model customer-vendor relationship — one based on fair, fact-based interaction.

SAP Nation Excerpt: Customer Strategy B1 – “Ring Fence” with clouds

Over the next few weeks I am excerpting here from the book’s case studies. They profile 12 strategies across four groupings of customers A) Un-adopters B) Diversifiers C) Pragmatists and D) Committed.

The customers profiled below are part of the second group which has four strategies in the book, “ring fencing” SAP being the first:

• The systems to support that transformation will make HP the largest Salesforce.com implementation in the world. It also boasts some of the largest Workday (for HR functions), Fieldglass (for contract
  labor procurement), and DocuSign (for electronic contracts) implementations. The Workday implementation at HP covers almost twice as many employees as the Flextronics project discussed in Chapter 1 and was accomplished in just 14 months….Salesforce.com is facilitating consolidation of customer profiles, and directly generating sales quotes rather than handing them to another system for processing. Workday is replacing PeopleSoft software, as well as over 150 customizations. Fieldglass (which was acquired by SAP after the HP project started) is replacing home-grown services contracting capabilities and related payments to subcontractors. DocuSign, with its electronic signature capabilities, is streamlining many contracting processes….“When we would sign up a new reseller, it used to take five weeks in the whole transaction process. Now it’s five days. HP Financial Services would take two or three days of paperwork back and forth. Now it’s 10 minutes.”
• (Dave) Smoley is widely considered a cloud pioneer, having worked with Workday at Flextronics and with Salesforce. com and Service-now.com in other roles. In the regulated industry that AstraZeneca is part of, he knows it will continue to depend on validated processes that SAP supports, but he is looking for cloud applications at various parts in the enterprise….To reflect this “whole different world”, he recruited Shobie Ramakrishnan as CTO. Ramakrishnan had previously implemented several cloud applications, including a large Google Apps deployment, at Genentech, the pioneering genomics company, and now a Roche subsidiary. She also ran portions of technology operations at Salesforce.com

SAP Nation Excerpt: Customer Strategy A1 – Flip It Off

Over the next few weeks I will excerpt here from the book’s case studies. They profile 12 strategies across four groupings of customers A) Un-adopters B) Diversifiers C) Pragmatists and D) Committed. These three customers are part of the first strategy.

“In corporate parlance, “life events,” such as a spin-off, give you a rare chance to revisit your IT landscape. In 2008, Delphi Corp, a major Tier 1 supplier to the auto industry, sold off its Interiors and Closures business unit as Inteva Products to a private investment company, The Renco Group…. at Delphi, we had found the SAP manufacturing functionality lacking. We had separate sequencing, traceability, and other functionality with batch interfaces to SAP. Everything in the middle was a black hole. We determined what amount of product we needed to order about once a week. If there was a change in schedule, we could run out
of parts or we could have too many…At Delphi, IT was 2.5 percent of revenues. Here, we are under 1 percent, and Plex is not even our biggest budget line item — our outsourced network is.” That does not even include operational savings such as better scrap reporting, inventory controls and other Plex supported functionality. In the next wave, Plex will move from the shop floor and core modules into enhanced quality
management, business intelligence and other operational areas.”

Jefferson County is the most populous in the southern U.S. state of Alabama. In September 2014, the county commission decided to move away from SAP, merely seven years after it implemented the software for financial functions. In fact, news stories as far back as 2010 show the county ready to move on even earlier….The county had fallen three years behind on its audits as a result of inadequate reporting from the SAP system. The CFO, George Tablack, has estimated that the lag cost the county another $1.3 million in audit fees.21 That is in addition to the estimated $20 million the county is estimated to have spent on the SAP implementation and maintenance….Commissioner Bowman summarizes: “SAP may be fine for manufacturing companies, but we found it inadequate for our municipal needs.”

The economics of SAP — and the Mouchel costs related to supporting SAP — caught immediate attention as part of the streamlining (at Middlesbrough Council in the UK)…It helped that UNIT4, with its Agresso ERP platform, has had plenty of traction with public sector organizations across the U.K. and Europe, particularly in local government. With over 110 U.K. local authorities using UNIT4 Agresso, there was already serious momentum with larger councils, such as Lincolnshire County’s and neighboring council Redcar & Cleveland, moving away from other “big ERP” packages, largely due to their high costs and inflexibility.

Gutenberg - 4

In previous posts in this series I have written about the technology in the Kindle distribution process, on-demand printing, cover and interior book design that has helped generate eBook and paperback formats of SAP Nation. This week, Bang Printing in Minnesota has been processing a large batch of the final format – hardcovers.

Phil Wagner of Bang kindly emailed me photos of the technology used in that process. A few years ago, only big publishing houses had access to such “factories” – now they are within reach of authors whose audiences still expect content in this durable format.

MAN Roland 500 PLV Press for the color covers

Timson T-Print digital printing system for the text pages

Cutting, binding, finishing and boxing technology from providers like Polar and Kolbus