Business Process Management

Business Process Management (BPM) is the way in which you plan, implement, and ultimately improve the processes that run your business. BPM tools such as SAP NetWeaver BPM, help to model and enable the automation of business processes – these tools  offer a clear view into processes through graphical representations, in-depth analysis and testing, process tracking, and continual process improvement. The beauty and power behind BPM is the capability to deliver the right work to the right people at the right time – everything can be automated and monitored. Key Process Indicators (KPI’s) can be measured and Service Level Agreements (SLA’s) can be enforced with automatic escalation rules – all of this independent of the underlying applications. In other words, a good BPM tool can work seamlessly across all other enterprise applications – including on premise, web, cloud and mobile.

Process Integration

While BPM focuses more on the human interaction of business processes, there are application integration tools such as SAP Process Integration (PI) that bring together various enterprise applications through a unified integration approach. These tools focus specifically on the automated communication between software applications. As an example, you could use SAP PI to facilitate the integration between Oracle Business Suite running Financials and SAP ERP running Human Resources. A well thought out integration product should never be technology or application dependent.

Business Rules Management

A huge problem with most enterprise software is that very often the logical conditions for business logic (business rules) are “hard-coded”. What this means is that if the rules ever change, software developers are required to update all of the effected software components. Often complex rules are difficult to comprehend and implement – it can take days or even weeks for the business and developers to finally understand and correctly code the rules. Typically the developers understand the rules differently to what the business has tried to communicate and the change process takes a lot longer than it should. A risky but very common practice is that many business rules are only mapped out in the minds of specific business owners and very badly documented, if at all. If a key business owner leaves the company for any reason, the understanding of those rules go with him/her.

A solution to this is what we call Business Rules Management (BRM). Essentially, all business rules are stored in the business rules engine and enterprise software simply taps into these rules when required. The rules are managed centrally so that when they change, none of your software components need to be recoded. Once again it is very important that a BRM tool (such as SAP BRM) is not application dependent and that all of your software applications can tap into the rules engine and leverage its power.

A good example of a business rule is the calculation of a customer’s credit limit at banks. It may sound like a simple rule, but there are many aspects taken into consideration – credit ratings, transaction history, age, level of education, current financial commitments, current income, assets and more.

Process Orchestration

The orchestration of business processes can be a complex task – one has to consider human interaction, application integration, rules management, KPI measurement, SLA monitoring, continuous improvement, user experience, business involvement, exception handling, and much more.

The SAP Process Orchestration bundle includes SAP BPM, SAP PI and SAP BRM. These are enabling tools that pass process ownership on to the business and allow IT to support the technology. All of these tools are completely independent and work across any other applications – this bundle is something that even non-SAP customers should be considering.

SAP has built their BPM and BRM tools in a way that the business can design the processes and rules with graphic modelling. Once a BPM model has been designed, it is simply passed on to the developer who quickly ties up application functionality to the process. The processes and rules that the business designs are the processes and rules that are ultimately executed. No more miscommunications or misunderstandings – simple.

In speaking with K5 about the partnership and what it means for South Africa, Operations Director David Bann commented – “SAP BPM is relatively new to the South African market – up until now, most local companies have been slow to adopt BPM because of uncertainty and confusion about the benefits. Customers are confused as to where SAP BPM fits into the product suite, and how it can become a business enabler and drastically reduce operational costs”.

Bann continues, “Our focus is on generating a local awareness, and in building confidence in this extremely robust and feature rich product. We will work closely with SAP in delivering world class SAP BPM solutions, not only in South Africa, but in the whole of Sub-Saharan Africa”.

This is a big step forward for the South African SAP market – there have been very few skilled SAP BPM consultants available locally, which drives up implementation costs, and weakens confidence in the product. K5 have allied with Incture Technologies in bringing highly skilled resources into the country in order to achieve the impressive growth planned over the next 12 months. These off-shore resources will in turn be part of a skills development plan so that the South African market will benefit and develop.

Incture is a leading SAP BPM partner in the “Asia Pacific Japan” (APJ) region – Through working closely with SAP APJ over the last few years, they have been instrumental in evolving the SAP BPM suite into what it is today. “They know SAP BPM backwards – they have helped SAP iron out bugs in the product through multiple global BPM roll-out projects. They have really pushed the limits and produced inspiring results”, says Bann.

SAP South Africa is excited about this new partnership, as it is the beginning of an aggressive awareness drive aimed at enlightening the local SAP market on the features and capabilities of SAP BPM. It will catapult Sub-Sahara African enterprises into alignment with the rest of the world from a business process automation perspective.

K5, Incture and SAP will be conducting the first round of SAP BPM workshops across the country between 15 and 19 August 2011. Morning workshops will give an executive overview of SAP BPM, and include real world use cases. The afternoon workshops will cover more technical aspects of the product. Invitations to the workshops will be sent out over the next few weeks.

ABOUT K5 ERP SOLUTIONS

K5 ERP is a SAP South Africa Special Expertise BPM Partner, and Incture’s BPM alliance partner in the South African region. K5 focuses on streamlining and automating business processes, thus realising improved process efficiency, reduced process costs, and increased profitability. (Additional information at http://www.k5erp.com)

ABOUT INCTURE TECHNOLOGIES

Incture is a leading SAP NW BPM implementation partner in Asia with strong focus on TCO, time and risk reduction for BPM based innovation and transformation projects. Incture has demonstrated thought leadership in SOA-BPM, Mobile and SAP NetWeaver space and has been pioneer in building “Business Process Optimization” solutions for fortune 500 companies. Having combined advantage of deep skills and competitive cost, Incture has helped customers to transform their business processes and increase competitiveness through remarkable process improvements. In addition, being a member of SAP Design Partner Council, Incture helps SAP to build and improve SOA-BPM products. (Additional information at http://www.incture.com)

ABOUT SAP

SAP is the world’s leading provider of business software solutions. SAP® solutions are designed to meet the demands of companies of all sizes — from small and midsize businesses to global enterprises. Powered by the SAP NetWeaver™ open integration and application platform to reduce complexity and total cost of ownership and empower business change and innovation, mySAP™ Business Suite solutions are helping enterprises around the world improve customer relationships, enhance partner collaboration and create efficiencies across their supply chains and business operations. The unique core processes of various industries, from aerospace to utilities, are supported by more than 25 industry-specific SAP solution portfolios. Today, more than 22,600 customers in over 120 countries run more than 76,100 installations of SAP® software. With subsidiaries in more than 50 countries, the company is listed on several exchanges, including the Frankfurt stock exchange and NYSE under the symbol “SAP.” (Additional information at http://www.sap.com)

Gartner has published a forecast on the sales of mobile phones for 2010 – It is quite obvious that the future is in mobility. Mobile phone prices are decreasing and network service providers are having to compete more and provide extended services in order to get the edge on sales.

Mobile access to SAP introduces endless possibilities to an organization – Just to name a few, some use-case examples of accessing SAP through a mobile device follow:

- Empower managers on the move with the ability to action approval requests from their mobile phones
- Capture data directly into SAP using mobile phones – no more paper forms out on the field or on the road
- Provide SAP reporting to employees and managers
- Share SAP system data externally with extended multi-enterprise supply chains (i.e alerts, updates, reports, etc.)
- Provide mobile “proof-of-delivery” applications to your truck drivers
- Plant maintenance managers can use mobile inspection applications to feed SAP – this data can then be used for management reporting
- Allow employees to submit leave requests via mobile phones
- Allow employees to access electronic payslips on their mobile phones
- Allow customers to keep track of orders via their mobile phones
- Other areas such as security, asset management, inspections, compliance, job estimating, fleet management, engineering, construction, logistics, etc.

Without doubt, the above points have sparked some sort of an idea in your mind about how having access to SAP from a mobile phone could drastically benefit your business.

This is the age of information – To keep the lead in any market, your business processes need to flow smoothly; your corporate information needs to be available to the right people without delay; managers must be informed when quick decisions need to be made – they must then be given the ability to make those decisions on the spot; duplicate data capture must be reduced; legacy interfaces into SAP must be phased out. All of this will increase efficiency of processes and drastically decrease the total cost of ownership of your SAP systems.

If SAP mobility has not been considered yet, then it is time – Empower your managers, impress your customers, leverage your employees.

Traditionally SAP has been contained within the IT department. Break down the barriers and enable your business to do what it does best.

Contact K5 ERP Solutions if you would like an obligation free analysis of areas in your business that would benefit from SAP mobility.

One of my recent projects included an HR Leave workflow that had already been worked on by 4 other consultants – none of them managed to complete the job ; no one in the business knew “who did what” ; transports were a mess ; the wheel was reinvented far too many times. I landed up undoing a lot of their work, and reverted to using standard business objects, steered clear of using custom tables, and added meaningful and valuable descriptions to tasks and workflow templates. By the end of it the client had a working leave workflow, which was a lot simpler in design but achieved exactly what was needed – Not only that, but the end users love the fact that more meaningful content is now being delivered to them. In the big scheme of things, user acceptance is everything – Why didn’t the previous consultants emphasize this? Even more importantly, why didn’t the previous workflow consultants finish the job properly? Because they didn’t know how to.

Another typical example recently popped up with a client of mine – I was asked to quote on the design and development of 11 QM Notification workflows. The consultant that previously worked on the project adopted a very rigid design that did not allow for any change to the business process. They also told the client that certain things could not be done. After my initial assessment, I proposed a generic workflow design that would mean one workflow for all notification types. My design included the flexibility for business change and growth – It was not restricted to particular notification types. QM configuration was used to manage deadlines and task processing. In the end, instead of creating eleven new workflows, only one was needed – It had a much simpler design, and achieved a lot more, while still reducing future maintenance costs.

The moral of the story:

• Inexperience = Low initial cost, future redesign,lower business value, less return on investment, higher overall cost of ownership.
• Experience = Higher initial cost, higher business value, higher return on investment, lower overall cost of ownership.

Experience conquers all!

Benefits of SAP Workflow:

• Eliminate human error
• Reduce process times
• Increase vendor / customer satisfaction
• Improve the SAP user experience
• Reduce business process costs
• Measurable return on investment
• Full audit trails

If you don’t know much about SAP Workflow, have a quick read here to get an overview.

The IT world has already been affected by news of the global recession with CIOs facing shrinking budgets, limiting new projects, and prospects of staff layoffs. CFOs increasingly cast their critical eyes on the till to realise most IT shops are behemoths on the spending front. For large companies, SAP budget/spend often runs into 10s or even 100s millions of rands which takes up a significant portion of the overall IT budget. As a result, it gets special attention/scrutiny from CFOs. Their conversations with their IT counterparts often involve a butcher knife in one hand and ready to slice IT budget on the fly.

While seasoned SAP & IT professionals who have been through the early-90s recession and the more recent Internet bubble have seen all this before, there’s a need across the board to re-think strategy in the face of radically reduced budgets.

Ironically this can be a time of enormous opportunity for IT departments: cutting costs, increasing flexibility and proving an ability to generate returns while others are wringing their hands will mark out winners from losers over the next 18-24 months, and IT is at the heart of this internal efficiency transformation.

Listen carefully to the needs of the business

Economic downturns create a tighter focus on value, which means IT departments are under more pressure than ever to demonstrate quantifiable improvements for money spent. Business users often feel victimised through the process of SAP implementation which often forces the business to adapt to a generic set of business processes. It is at these times, their complaints become more vocal than ever.

It is now the time to listen to their needs and address their concerns and negative perception of IT as during tough times, unpopular and costly SAP department can be a toxic combination. Usability is often a key issue for the majority of SAP users, addressing key areas of pain in usability can go a long way to improve user productivity, perception and cut training costs.

It is time for innovation and flexibility

During time of recession, successful businesses do not just slash their IT budgets – they look for investments in IT innovations to create new efficiencies and to be first out of the traps when market conditions change. The key to survival in the current environment is characterised by much shorter innovation cycles and the requirement to get goods and services to market more quickly.

SAP traditionally positions its products as tools to provide enterprises with a competitive edge. With many large enterprises now running SAP, your organisation may not be all that different from competitors in terms of its IT infrastructure. The time to innovate is now.

Engage smaller SAP consultancies

Business advantage can prove short-lived as economies contract, dramatically increasing competition. This drives a need for radical change without the budgets normally associated with this kind of re-invention.

Traditionally CIOs have felt secure using large SAP consultancies with the ability to pull together large project teams to support R multi-million installations often with 2-3 year time frames. In the current economic climate there are a number of factors that undermine this approach:

1. Large consultancies often won’t engage in smaller, sub-R500k SAP projects. With massive overheads and large teams from pre-sales to account management to project delivery, they just can’t mobilise the right resources for smaller more nimble deliveries. With a limited SAP budget, smaller consultancies are far better positioned to respond to your needs.
2. With a skills investment strategy often defined years in advance, bigger consultancies build large resource pools around established technologies. This acts as a block to innovation, where more agile consultancies are free to explore new techniques as soon as they become available and compete on innovation rather than raw manpower.
3. Smaller companies tend to be more responsive and focused on client needs. Demanding projects more quickly for less investment is exactly the sort of challenge growing consultancies relish, where larger businesses may simply refuse.

Smaller companies are typically more responsive, flexible and innovative. Due to their low overheads, they can also be very cost effective with smaller projects. If you’re looking for SAP innovation delivered in the shortest possible timeframe and at lowest possible cost, it is time to engage smaller SAP consultancies.

Rethink/reprioritise your SAP upgrade strategy

SAP has traditionally released products and made major changes to underlying functionality on a 5-year schedule. However in recent years, this cycle has shortened to 2-3 years due to their diversification in products such as CRM and Enterprise Portal – there have been 5 major releases of CRM in the space of just 8 years.

For companies with global deployments, multi-terabyte databases, and tens of thousands of users, an upgrade project is often disruptive, expensive and deeply unpopular. SAP recognised and acknowledged this problem in the recent years. With the shipment of its ERP 6.0 product, instead of bundling 2-3 years of product enhancements and technology improvements into one massive release, SAP has now moved to what it calls a continuous innovation strategy by releasing smaller enhancement packages.

But what if you’re not on ERP 6.0 and have other SAP products? In the current tough business conditions, businesses are less likely to have the appetite to spend large sum of money and face significant business disruption to take on major upgrade projects just to take advantage of some functionality improvements. There is an alternative.

You could build solutions on top of your existing SAP platform to provide the additional functionality that the business demands, without embarking on a major upgrade programme. More functionality in a fraction of the time and at far lower cost leads to vastly reduced risk and much faster return on investment.

Maximise your existing SAP investment

CIOs who worked with SAP before 1999 would know that SAP was known as a one-product company, which had a much less confusing naming convention for its products and releases (R/1, R/2 and R/3). Since then, SAP has accumulated dozens of products with a large set of options, variants and names such as Customer Relationship Management, Product Life Cycle Management, and Business Intelligence etc. This diversification strategy aimed to sell new products and licenses to new and existing customers. SAP product licenses are not cheap. With the recent hike in maintenance cost, a business case which involves buying product licences, cost of implementing and customising the standard product, deployment, getting new infrastructure/support capabilities and paying annual maintenance cost can be an extremely difficult proposition to present to the board.

Therefore, similar to the upgrade question, you can/should look to maximise your investment in existing SAP solutions. With introduction of NetWeaver and Web Application Server, SAP has effectively exposed itself as a technology platform. With its support for Service Oriented Architecture (SOA), it allows customers and partners to use it to extend SAP applications or even build brand-new application. This provides the opportunity for SAP customers to develop new functionalities utilising innovative technology on top of your existing SAP platforms such as ERP rather than making new product acquisitions. The list of potential savings include: no additional license/maintenance cost, infrastructure and you can leverage existing skills. Adding these up, the savings should start to make a lot of sense.

Apart from utilising your SAP solution as a technology platform for extending existing functionality, another quick win can come from a simple audit of your existing SAP products and licenses. Unless you have done one recently, you may be surprised how many shelfware products and licenses you have got and been paying for which your business is not utilising. With the recent SAP maintenance cost hike, you can potentially save your business a lot of money just by doing a simple audit.

Change before you have to – Jack Welsh

CIOs have an opportunity to act now before the recessionary economy forces them to. The easy option is to stop projects, get rid of contractors, layoff staff and go into ‘maintenance mode’, but this won’t help your business gain competitive advantage, which it critically needs to survive and emerge stronger.

Adopting a more flexible approach and strategy for different times to continue to deliver value to the business can help making SAP/IT the true differentiator in supporting the business to remain competitive during the time of recession.

Reference: Recession Proof Your SAP Strategy