Please note that this content is also published on https://justperform.com/sap-epm-implementation-automated-and-accelerated/.
In this world of “Survival of the Fittest,” business agility is no more a luxury but a must-have for any organization. The Covid19 pandemic just showed the importance of businesses being nimble and responsive.
Agility is developed when businesses are highly responsive to the ever-changing VUCA (Volatility, Uncertainty, Complexity and Ambiguity) world. This even helps businesses gain a competitive advantage over others.
Enterprise Performance Management (EPM) plays a crucial role in fostering business agility. EPM processes in an organization include Budgeting, Planning, and Consolidation. They connect every part of the business to aid in better decision-making and nurture flexibility.
There are quite a few Enterprise Performance Management (EPM) software that helps organizations build and execute these business processes and SAP is one of the leading players.
No matter how advanced and technically sophisticated a software is, it delivers results only when business processes are effectively defined.
The goal of this blog post is to help you understand:
- The Traditional Approach to SAP EPM implementation
- Challenges of the traditional approach
- Key focus areas that can eliminate these challenges
Before dwelling deep into the listed topics, let us first understand Enterprise Performance Management (EPM)?
According to Gartner, EPM is a process of monitoring enterprise performance to improve it through better decision making. Typically, planning, budgeting, forecasting, and reporting processes are considered as EPM processes. EPM is also known as Corporate Performance Management or CPM
So, now let us understand,
What is SAP EPM?
SAP Enterprise Performance Management or SAP EPM solutions provide streamlined enterprise planning, budgeting, forecasting and consolidation. They include SAP Analytics Cloud, S/4 HANA Group Reporting and SAP Business Planning and Consolidation (SAP BPC) solutions.
Now, the next question is how these SAP EPM systems are adopted and implemented within an organization?
The Traditional Approach to SAP EPM implementation
The traditional approach to SAP EPM implementation starts with hiring a SI (System Integrator) to help with the implementation process. The System Integrator provides an army of EPM consultants for both technical and functional requirements.
Once the System Integrator is chosen, the company implementing the SAP EPM and the SI will go through the following steps:
Business capabilities Design: A business capability is an expression of the capacity, materials, and expertise an organization needs to perform core functions. The business capabilities are designed over a series of meetings and workshops with business users.
Business requirements Documentation: Once business capabilities are designed, all the process modelling components are manually documented. A detailed blueprint covering the overall business process requirements is manually generated.
Technical Configuration and Coding: The digital blueprint is then translated into technical code and configuration, i.e., what the system needs to accomplish to achieve the business requirements. So, all the process components are manually translated into codes to be deployed into EPM solutions.
Deployment of the code to SAP EPM implementation: Once the coding and configuration are done, it is deployed into any SAP EPM solutions for the final usage.
This is a brief overview of the typical steps in the SAP EPM implementation process
The traditional approach looks systematic and organized, but is it effective and efficient? Does it deliver SAP EPM business processes that foster agility to match the ever-changing business landscape?
These are some pertinent questions to ask yourselves at this point.
Now let us have a quick look at the challenges in the traditional approach to SAP EPM implementation.
Challenges of the Traditional Approach
There are quite a few significant drawbacks of this approach to SAP EPM adoptions.
- IT Led rather than Business Driven: Optimum and streamlined processes are core factors for effective EPM implementations. An IT dominant consulting team may not necessarily have the required EPM knowledge. Moreover, a manual translation of the business needs by non-EPM expert consultants may result in uncaptured requirements. This would finally result in EPM solutions that are ineffective for an enterprise.
- Resource Intensive & People Dependent: Traditional approach demands a large number of man-days, long timelines, and highly technical steps. It is executed manually, creating roadblocks for efficiency.
- Lack of Benchmarked EPM Processes: With a shortage of experts, there is no clear documentation of best practices in the EPM space. Hence, a technically dominant consultant team may not have the required expertise to create robust processes for SAP EPM solutions.
- Stretched timelines and Escalated costs: Manual and IT-led implementation leads to an ineffective SAP EPM system that might not reflect actual business requirements. This invokes a series of change requests by the business users, which stretches timelines and escalates costs affecting ROI.
- Low Scalability and Flexibility: With an ever-changing business landscape, the company’s needs and requirements do change. A series of tedious steps to undergo a minor change in existing processes may result in low scalability.
Key focus areas that can eliminate these challenges
These series of challenges put this conventional approach on a backfoot in delivering successful EPM implementation.
The ever-changing business landscape demands agile EPM solutions. However, the conventional adoptions approach fails to establish an effective EPM solution in an organization.
So, the key aspects that can help drive agile SAP EPM solution adoptions are as follows:
Focus on Process Design
Processes are the key drivers of Enterprise performance. They should be optimally defined for an EPM solution to deliver results. This demand shifting the focus of implementations from ineffective application configuration to value add process design.
Hence, unlike too much emphasis on coding and configuring the SAP EPM solution, organizations need to define scalable and streamlined processes for effective EPM solution adoptions.
High Business User Involvement
An EPM solution can deliver successful results only if it reflects real business requirements. However, it cannot be possible without involving relevant business users and maintaining transparency in solution implementation.
Hence, business users should be involved not just in collecting data but also in defining key metrics, business rules and processes modelling components.
An IT- dominant consultant team may not possess the required finance expertise to drive the SAP EPM implementations. Therefore, relevant business users should be in the driver’s seat to establish a risk-free SAP EPM solution.
Leveraging the power of Automation
While the first two aspects dwell in improving the EPM implementations’ effectiveness, enhancing the efficiency is equally essential for increased ROI.
Automating the tedious coding and configuration activities can help organizations enhance their efficiency in EPM implementations. This also helps businesses focus on important process design.
Moreover, automated coding and configurations fasten changes or iterations to be made to the target solutions and improves scalability of the solution.
To conclude, an implementation approach that focuses on the above-mentioned areas can make way for an agile and future-proof SAP EPM implementations.
P.S: Applications that can help organizations embark this implementation approach are available on SAP App Center. https://www.sapappcenter.com/en/search/justperform