Enterprise Solution: CSC Helps Chemicals and Healthcare Company Drive Business Transformation
Client
A Fortune 500 multinational chemicals and health care company
Challenge
The company needed to change its business processes to match best practices used by other SAP deployments of the client. It needed to roll out SAP without losing an order or stopping the systems
Solution
Organizational change management techniques that brought the client’s business people into the process and detailed transition plans that made sure nothing fell through the cracks
Results
An SAP deployment with high involvement from users and better visibility into inventory for planning
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The client and CSC had a big advantage when they embarked on an SAP deployment: corporate IT and other strategic business units of the client had developed a robust methodology and had created an inventory of configuration and technical objects that could be leveraged by the client. The problem became ensuring that business processes and the SAP solution were aligned.
"Our business units didn’t have common business processes when we started this project," the CIO of the company, which manufactures chemicals for industrial use. "We wanted to modify current business processes to meet SAP, rather than the reverse." In order to gain business acceptance of new processes, organizational change management became an intrinsic part of the project.
The company has dozens of products and 21 supply chains. So the CSC-led implementation to replace the strategic business unit's legacy financial, production planning, plant maintenance and supply chain systems with SAP was a complex project by itself. But because the company works with hazardous chemicals and has a higher demand for many of its products than it can fulfill, CSC had to deactivate the old systems and install the new without shutting down the company’s manufacturing systems or dropping a single order.
Anticipating issues
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The people component is often the hardest part of any enterprise application deployment. Because there were gaps between the way the client’s people did business and the way SAP wanted them to do business, the client’s change management was even harder.
CSC used survey tools to identify where problems were likely to emerge. "It's not anecdotal, it's based on a methodology," says Dennis Zajac, a CSC consulting principal and CSC's organizational change manager for the project. Surveys are frequently used on ERP projects, but an important difference on this project was that the surveys asked SAP end users and their supervisors what they needed from their sponsors and whether they were ready. This contrasts to other projects where measurements focus on the completion of certain activities, such as the number of trained end users.
The surveys, which identified the behaviors that had the biggest impact on individual readiness, were administered multiple times before the system went live. Each survey highlighted issues that required additional focus from CSC and the client. These issues changed over time. For example, at one site, early in the project the data showed that people did not fully understand the business case for implementing SAP, nor did they understand what they specifically needed to do differently. This feedback was provided to the sponsors, who took actions to address those concerns. When the survey was subsequently readministered, the data showed that end users’ understanding of both points had increased significantly.
For Butler, such feedback to executives and their involvement was one of the most important factors in the success of the SAP project. "There's more to executive sponsorship than signing a check," he says.
The project's site implementation leads had initially resisted the surveys because they highlighted issues that needed to be fixed—more work for already busy people. But they brought improvement because they gave advance notice of problems. By the third survey, the leads themselves were reporting survey results. "Oftentimes, we just wait for people to find these issues and trip on them," Zajac says. "This got the issues on the table more rapidly so they could be resolved more quickly."
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Mapping out processes
The client paid close attention to the changing processes. According to Butler, the key to changing the way employees of the company did business was shifting them from a focus on specific functions to a process orientation. "Simply knowing their function is not enough," Butler says. "You have to know how the company flows and how you fit into the overall process."
While more than 95 percent of the SAP implementation was replicated from other units, CSC still had a lot of application work to do as it rolled out the system to 30 locations and more than a thousand users. It added new modules unique to the company such as forecasting, and built bridges to manufacturing and other systems. In all, says Scott Schindler, head of the project implementation for CSC, more than 130,000 CSC and 250,000 hours of the client went into the rollout.
CSC faced one of its biggest challenges when it had to bring SAP online without shutting down the factory systems to which it would connect, a procedure Butler likens to changing tires while the car is moving. "It's always preferable to bring the business up in a quiet state, but that wasn't a luxury that was available to us," Butler says. With its plants at capacity, the client couldn't afford to miss or even slow down an order.
The client and CSC created a detailed cutover plan that described each person's tasks literally minute-by-minute. They mapped out processes that would be affected by the system rollout, and had people perform tasks such as logging inventory movement manually during the rollout week. By the time management came in on Monday, all orders had been entered into SAP. "We even had a power outage and people were still working during the weekend," Schindler says. "It went flawlessly because we had our processes down pat."
Better planning means more sales
The deployment and its aftermath have both gone smoothly, Butler says. The client has not had to alter a single process since SAP rolled out in April 2005. User adoption has been high, in part because of the extensive change management CSC and the client conducted during the implementation. Both day-to-day functions and monthly closing activities have gone well.
"We're receiving more credible data," Butler says. "We've seen some return on our investment already in areas where we wouldn't have anticipated that."
One area where the SAP deployment is helping the client is in business planning and inventory reduction. SAP gives the business unit better insight into what products customers want, and what products it currently has in inventory. That lets the company take better advantage of its existing inventory and frees up capacity to build more products. The more the company builds, the more it can sell. Goods can also be delivered on a more timely basis.
The SAP implementation lays the groundwork for supply chain transformation. The client wants to integrate its supply chains, not only in the client but across product lines and strategic business units as well. "We're taking a more holistic view of supply chains," Butler says.
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