Enterprise Resource Planning (ERP) systems like SAP R/3 support the business processes of a company and let the company share common data and practices across the entire enterprise. Providing a real-time environment for generating and retrieving information, the ERP system speeds up the processes and allows a closer monitoring of the activities of the company. Most ERP systems today integrate different organizational units, business processes, and geographical sites into a single international architecture, though parts of that architecture may be configured to specific organizational units or geographical sites. However, implementing SAP in multi-cultural organizations is still quite a challenge. The functionality of SAP may provide some means for dealing with multicultural organizations, though this only partly solves the problem. The SAP implementation is usually part of a reengineering project, and multi-cultural issues arise at many stages and in many parts of a large-scale reengineering project.
Business Reengineering in Multi-Cultural OrganizationsMulti-cultural organizations are geographically dispersed across cultural or/and national borders. Reengineering these organizations can be extremely difficult. Harmonizing business processes and organizational structures requires that a common understanding of the future business can be developed. Implementing SAP in multi-cultural organizations assumes the same activities as other SAP reengineering projects. The two most important analysis activities are Fit Analysis and Job Analysis. During fit analysis, the local business processes are integrated into harmonized SAP-supported processes and the local organizational structures are mapped onto SAP’s organizational structures. In an integrated SAP system, a harmonization of jobs and user profiles might be just as important as the harmonization of processes. Technically, site-independent tasks representing separate units of responsibilities are defined in terms of SAP transaction codes. Harmonized site-independent jobs make the complete organization more transparent, simplify the administration of user profiles and training programs, and open for a more efficient exchange of personnel across sites.
Experience shows that harmonization of business processes and organizational structures in multi-cultural organizations is challenging due to
differences in legal systems
differences in business practices from one culture to the other
Cultural conflicts and prestige, and
differences in business culture with regard to management authority, openness, formality, control mechanisms, etc.
In the following, we discuss the approach adopted our client for dealing with multicultural aspects in the project.
1) Project Preparation
The project organization included a central team in client’s head office and smaller local teams at each of the other sites. To support the part of the reengineering project focusing on streamlining business processes, project owners were appointed for all main business areas. Any issues related to business processes were led and controlled by the process owners. This helped us to achieve a distinct split between the business related part of a process and the technical solution to it within SAP R/3.
2) Project OrganizationThe project was managed by a multi-cultural group of project managers and team leaders. Informal communication across nationalities was restricted, and people tended to use the formal documentation channels when dealing with people of other nationalities.
3) Change Management
Studies led by an organizational impact group had the objective of dividing all tasks into units of responsibility and group tasks together in job descriptions. The goal of this study was to unify the job descriptions across sites, aiming at defining certain number of different job descriptions that would be valid for all units. Due to organizational differences among the different countries, local resistance, and time constraints put on the group, the studies led to a number 4 times the expected number of different job descriptions. The huge number of site-specific jobs complicated the construction of job profiles in the system and made it difficult to run common training sessions for several sites, as the training courses allocated to the employees depended on the jobs assigned to them.
4) System Configuration
English was chosen as the single company language, serving as the only official language for system log-on and preparation of the original system and user documentation. Sales orders, shipping documents and billing documents in the sales area, and requests for quotation, contracts and purchase orders in the procurement area were maintained in all languages for all the countries. As a limiting measure, the different legal entities were only allowed to maintain their documents in maximum two languages: English and the local language.
An interesting point is that all site specific configuration was handled by the central project team. Apart from end-user training, master data conversion was the only part of the implementation work that was done locally at the sites. Still, this work was also controlled, planned and monitored by the central team. Master data conversion was decentralized mainly due to the fact that SAP was replacing a wide range of legacy systems that required local expertise to allow accurate data extraction. The same conversion programs were however used at all sites when uploading data to SAP. This helped to ensure master data consistency throughout the division.
5) System Documentation
All user documentation and training material delivered by the project was prepared in English only. Local instructors were educated to train employees from their own countries, thus facilitating teaching in the local language and discussions beyond the curriculum of the standard training courses. Two training systems, one for uploading local training data and one for running the courses, were established, and a centrally controlled routine for copying data from the first system to the other was set up.
Among the positive experiences of the project we would like to accentuate the benefits of working in international teams and using local instructors for training. Furthermore, the decision to use only one official log-on language proved to make the implementation more efficient than it otherwise would have been. The linguistic side of the project also gave rise to one of the negative experiences. The effort associated with maintaining all external documents in local languages turned out to be greater than initially expected.