Why is SAP such a vital piece of technology for so many organizations? Why, because senior leadership in large, mid-sized and even small companies are engaged in all out warfare for survival – every day. To use a military metaphor – SAP is not a luxury cruise ship; it is an aircraft carrier, a warship designed for use in combat! Please excuse the reference to war and fighting, but the similarities between an army engaged with an enemy that is bent on inflicting maximum damage and a company squaring off against a competitor that is trying to gobble up as much market-share as possible, is all too real. In both cases, the need for clear communications, precise information, agility to make adjustments, and having critical provisions delivered where and when they are needed, is usually the difference between pushing up daisies and pushing up high-5’s all around.
How big is our supply chain? How connected are our core business systems to our suppliers? Can we trace the history of a sales order from start to finish? What is the fastest way to source a major component in our production process?
These are reasonably intelligent questions that any CEO, CFO, CIO, or even a Field General might ask. However, getting reasonably intelligent responses back might not be so straightforward. In fact, it might be impossible for some companies to come up with answers they trust.
Just three generations ago, in the middle of the 20th century, when the CEO and COO were usually one and same person (the owner) and the CFO was his wife or brother-in-law, those questions were not complex; in fact it wasn’t even necessary to ask them. But in a business environment where survival means we must constantly scale up to meet the needs of growing markets and access crucial information at a moments notice, it is impossible to have first-hand knowledge of all the key indicators and processes we depend upon. And we certainly cannot open up an old ‘shoe box’ and pull out the information needed to answer the more complex and strategic questions required in the 21st century. We need technology!
The late Dr. Michael Hammer, who was a professor at the Massachusetts Institute of Technology in the department of Computer Science as well as a lecturer within the MIT Sloan School of Management, shocked many people when he said:
“… enterprise applications are emerging as a corporation’s most strategic asset – possibly more so than any software sold by Microsoft. Microsoft’s applications are trivial compared to SAP. If all of Microsoft’s applications got wiped out, we would have to type our documents manually. But if SAP’s applications were to disappear, the worldwide industrial complex would grind to a halt.”
Keep in mind this quote was made back in the mid 1990’s. Now, with nearly 20 years hindsight, we know that Microsoft was destined to have an enormous impact on almost all people here on planet Earth, certainly comparable to the impact of SAP. But when Dr. Hammer made this remark, Microsoft was known for its word processing software (Word) more than for anything else. The main point of his comment is still valid. If SAP disappeared, the worldwide industrial complex would not only grind to a halt, it would have a very tough time getting started again.
Keeping Michael Hammer’s comments in mind; having access to a powerful application like SAP is not the answer. Being able to skillfully operate SAP to manage a business enterprise more efficiently and effectively is the answer. Just because someone goes to Home Depot and buys the best carpentry tools doesn’t make them a good carpenter. Similarly, SAP requires more skill from its users than most software programs, because SAP is capable of delivering far more value.
To lean on the wisdom of Michael Hammer once again, “Implementing SAP is not a technology exercise, it is an organizational revolution.” Truer words were never spoken.
So why compare SAP to an aircraft carrier? The similarities are telling. The most obvious similarity is that both SAP and an aircraft carrier can have thousands of people, processes and equipment that depend on them. If the aircraft carrier goes down, we know what happens. If SAP goes down, the entire commercial enterprise can cease to function.
The purpose of an aircraft carrier is to safely move equipment, people and fighter jets to and from a combat zone. An aircraft carrier will also provide centralized support while stationed within striking distance of the conflagration. Strategically, an aircraft carrier has mobility, range, speed, stability and enormous firepower.
In many respects SAP also has mobility, range, speed, stability and enormous power. SAP’s purpose is also to centralize and store business information for the entire enterprise. This enables the organization to categorize that information so it is logical and understandable, enable that information to be accessed by or deployed to whoever needs it, and add any new information back into the central database so that educated planning and decision-making can take place.
In much the same way, the carrier’s job is to organize all the airplanes and equipment so that they can be stored safely and deployed quickly, arrive at their targets in a timely manner, successfully complete their missions, and safely return back to the carrier with new information. The aircraft carrier is the actual ‘mother ship’ upon which life depends for the people living on it. SAP is the virtual mother ship upon which a commercial enterprise depends.
Ok, you may be thinking it is quite a stretch to compare an aircraft carrier to SAP. However, it would be more of a stretch to compare SAP to a luxury liner that is designed to sail in calm waters carrying passengers that are focused on having fun. Ask yourself this question – what happens if your SAP system just stops? You might be leveraging an SAP cloud computing solution, which can minimize your risk, but if SAP does crash and burn, how can you ship products, or invoice your customers, maintain your general ledger, or provide the latest sales reports? If SAP goes down, most companies do too.