Winning the ERP Marathon

May 21, 2008 by Sarah Z. Sleeper

“It’s a marathon and not a sprint.” So says Rodney Masney, ASUG’s board chairman and O-I’s global director of IT Infrastructure Services. “An ERP implementation is just the beginning,” he says. Companies should not only commit to deploying ERP, but also to optimizing it over time. And they should use all available tools to help do so. Our collaboration with SAP with the Benchmarking and Best Practices Program is proving to be one of the most value-add tools for organizations of all sizes.”

That concept was the impetus behind the newest ASUG and SAP Best Practice survey, offered in partnership with Florida State University. “Running the ERP Marathon” is one of 10 surveys – free, online questionnaires that take just 20 to 30 minutes to complete. Along with 18 in-depth Benchmarking studies, the surveys are part of an initiative to help participants answer a key question: “Is my company managing technology as well as it should be?”

Not just data, but how to use it

Survey and benchmarking results contain “actionable data,” Masney says. Participants learn exactly what to do to improve IT performance, cut costs and optimize their SAP systems. If they do a survey, they get immediate feedback. If they participate in benchmarking it takes longer, but they get deeper analysis of their business and IT practices.

“The problem with other benchmarking studies offered by analysts, for example, is that they provide a big book of data but not enough feedback about how to use it to boost business performance. ASUG is the first user group to offer benchmarking that truly helps companies become the best of the best,” Masney says.

To date, ASUG members from more than 1,000 organizations have completed nearly 4,000 unique surveys. Masney says he’d love to see that number grow, he pointed out at ASUG Annual Conference at the beginning of May.

New insights reveal peak performance

Over the last few months ASUG and SAP have released some compelling data points obtained in the benchmarking studies. First, leading companies in the Supplier Relationship Management and Procurement study have 49 percent higher savings and 51 percent lower costs than average companies. Second, leading companies in the Transportation Management study achieve nine percent better on-time delivery performance at 67 percent lower cost than average companies.

The Human Capital Management (HCM) study offered noteworthy data as well. It analyzes the human resources performance of companies with revenue ranging from less than $200 million to more than $40 billion. Participants come from consumer products, manufacturing, high-tech, utilities and other industries.

Results showed that HCM leaders train nearly 100 percent of employees annually, while average companies train just 57 percent of employees annually. The data shows a positive correlation between a company’s investment in talent management and employee productivity.

The Finance study showed that shared services adoption can improve finance efficiency significantly, reducing finance operational costs by more than half. Systems integration was proven to be a key driver of performance, for example, reducing the time to close the books or invoice errors by two thirds.

The supply chain study showed that sales and operations planning is the single most important capability for most companies today. The availability of a robust forecasting system helps a company to achieve top-notch order fill rates and order fulfillment lead times.

Growing toolset or SAP customers

“The data lets companies rate themselves against their peers. They use their results to find opportunities for improvement and to achieve best-in-class performance,” Masney says.

On top of the new ERP survey, ASUG and SAP have also created six new Benchmarking studies for this year, in response to market demand. It’s too soon to cite results. But ASUG members now can participate in “Contract-to-Cash,” “CRM Sales Effectiveness,” “Enterprise Health Check,” “Merchandise/Category Management,” “Order-to-Cash” and “Talent Management” studies.
Masney is watching closely. “We would love to have more participation,” he says.

Whether it’s the instant gratification of the Best Practices surveys or the detailed analysis of the Benchmarking studies, Masney says future participants are bound to get a few “A-ha!” moments, just as current ones do. For instance, some may be surprised to learn that companies with the best total cost of ownership (TCO) results are also best at doing technology upgrades. ASUG data can help companies understand the correlation and set realistic goals for TCO improvement, Masney says.

Masney is more excited than ever about ASUG’s long list of valuable member services. Benchmarking, networking, education and opportunities to influence the future direction of the organization – it’s a growing toolset for SAP customers aiming to win the ERP race.

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