Creating and Running a SAP Support Organization

1
Creating and Running a SAP Support Organization

• Bryant Bonner, Director - Textron
• September 21, 2004

2
Agenda

• Background on Personal and Work Experience
• Initial Building Blocks for Textrons SAP Program
• Transforming the Textron Organization
• Key Accomplishments and Challenges
• Where to Next
• A Little Advice to Students

3
Background and Personal Experience

• Grew Up in Texas
• Graduated from Tech in 1995
• Met My Beautiful Wife at School
• Now Have Two Great Kids
• Work Experience
• Ernst Young LLP (1995-2001 US/Australia/NZ)
• Verizon (2001-2003 Dallas/Tampa)
• Textron (October 03-Current)

4
Textrons Business Profile (NYSE TXT)

• One of America's largest multi-industry companies
• Ranked 174th on the 2003 FORTUNE 500
• Company founded in 1923
• Revenues of 10 billion
• 43,000 Employees

5
Vs. 1st Quartile, we have 33 more resources
supporting 200 more applications
2001 HACKETT DATA
FTEs supporting applications
Number of applications supported per thousand end
users
To reduce support costs we must dramatically
reduce the number of applications AND source
support resources more cost effectively
6
Enterprise Management

Our Focus on Enterprise Management and Best
Practices Creates the Criteria for Our I.T.
Applications Strategy

• Making our customers successful
• Leveraging our enterprise scale and talent
• Building and deploying
• World-class operating capabilities
• Common processes and tools
• Focusing on high-impact initiatives in 2003
• Textron Six Sigma
• Value Pricing
• Supply Chain Management
• IT Shared Services
• Organizational Design

• What Does an I.T.Application Strategy Need to
  Contain to Support This?
• Common
• Application Systems must be enterprise-wide vs.
  Business Unit
  specific
• Specific solutions must be leveraged across all
  businesses in order to enable common processes
• Flexible
• Applications Strategy must support Business Unit
  unique business strategies and priorities,
  while linking to overall corporate strategy
• Application Systems must be flexible and
  configurable to support evolving business process
  and changes in business portfolio
• Manageable
• Application change must be implemented
  incrementally in order to effectively manage risk
  and cost
• Application support must be consolidated in
  order to control deployment and support costs.

What Does Premier Look Like?

• Customer
• Powerful global brands
• High-value, differentiated products and services
• Successful customers

• Process
• World-class process capabilities providing
  competitive advantage
• Fully leveraged expertise and resources

• People
• Employer of choice
• Customer-first mindset
• Growing and developing self-actualizing people

• Performance
• Lead our peers in key financial metrics such as
  ROIC, NOP, Cash Conversion and Total Shareholder
  Return

7
This strategy will create an application
environment that is flexible and scalable to
Textrons business needs
Fragmented
Integrated
Architected
2003
2007
2005

• Unique applications minimal common data
• Multiple application organizations
• Significant translation / interface applications
• Mainly in-house development
• Cost / time to implement business change is high

• Groups of related applications sharing common
  data
• Centralized deployment organization (COEs)
• Moderate use of offshore outsourcing
• Functional / industry change less costly
• Portfolio management leverage investments

• Core information common and accessible across the
  corporation
• Centralized data / process management
• Centralized sustainment organization (COEs)
• Extensive use of offshore outsourcing
• Companywide change faster / minimal cost

8
My Initial Actions on Job (First 100 Days)

• Educated Self on Textron Business Strategy
• Developed the SAP COE Mission / Business Model
• Hired SAP Core Leadership Team
• Gained Approval on Funding for Operating Budget
• Implemented Key Support Processes
• Where We are Headed Key Lessons Learned

9
My Initial Actions on Job (First 100 Days)

• Educated Self on Textron Business Strategy
• Developed the SAP COE Mission / Business Model
• Hired SAP Core Leadership Team
• Gained Approval on Funding for Operating Budget
• Implemented Key Support Processes
• Where We are Headed Key Lessons Learned

10
Our SAP Strategy Must Align to Our Business
Strategy and IT Direction

• To be the premier multi-industry company
• Ensure Industry-Leading Operational and Customer
  Performance
• Promote an integrated application environment
  that is flexible and scalable
• Integrated (2005)
• Architected (2007)

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Our SAP Strategy Should Support Textrons Core
Competencies / Key Initiatives
BU Brand Management
Portfolio Management (Diversity)

• JIT Inventory Systems
• Cost Reductions Through Capital Investments
• Forum for Continuous Improvement Ideas
• Drive the BPx3
• Best Practice
• Best Process
• Best Performance

Lean Operations
Integrated Supply Chain
Service Support
Product Dev / RD
Smart Technology Spend and Shared Services
Textron 6 ?
Supports
SAP Strategy
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My Initial Actions on Job (First 100 Days)

• Educated Self on Textron Business Strategy
• Developed the SAP COE Mission / Business Model
• Hired SAP Core Leadership Team
• Gained Approval on Funding for Operating Budget
• Implemented Key Support Processes
• Where We are Headed Key Lessons Learned

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SAP COE Mission and Business Model
Ensuring efficient application delivery and
support to enable the smooth flow and continuous
improvement of business operations for Textron
business units using SAP by

• Ensure operational support service levels, and
  key business KPIs/metrics are being met or
  exceeded while continuously improving business
  processes (by leveraging SAP)
• Leveraging best practices for SAP implementation
  and ongoing support in order to reduce risk,
  improve project quality, and reduce costs
• Promoting common business processes across the
  enterprise
• Providing cross project coordination among
  concurrent and planned SAP projects
• Defining and maintaining standards for key SAP
  architectural design elements.
• Leveraging internal and external resources and
  expertise

14
SAP Post Implementation Support Charter

• Textron has embarked on deploying an SAP Post
  Implementation Support Model to deliver and
  sustain maximum reuse and support leverage for
  the SAP enterprise application
• This support model will focus on ensuring
  operational service levels, key business KPIs,
  and functional transaction metrics are being met
  or exceeded while continuously improving business
  processes

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My Initial Actions on Job (First 100 Days)

• Educated Self on Textron Business Strategy
• Developed the SAP COE Mission / Business Model
• Hired SAP Core Leadership Team
• Gained Approval on Funding for Operating Budget
• Implemented Key Support Processes
• Where We are Headed Key Lessons Learned

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Staffing Strategy

• A Learning Community
• Educated Employees to Cope with Change and
  Competition
• Utilize Internal Staff for Strategic
  Knowledge-Capital
• Leverage External Staff for Commodity Support

17
SAP COE Organizational Chart
Currently 15 Individuals hired into SAP COE with
17 by end of 2004
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Cumulative SAP Experience within the COE

• 80 Years of SAP Experience
• 65 SAP Projects Implemented
• SAP implementation experience spans across 23
  Countries
• Cross industry expertise in 15 Industries
  (including AD and Industrials)
• SAP Module Expertise and Certifications in
• ASAP Methodology
• FI/CO/TR
• SD/SIS/LIS/SOP
• BW
• MM/PP/WM/PM/PS
• ABAP Workbench
• Basis Administration
• Security Administration

We have Built a Solid Foundation
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Key Staffing Lessons Learned

• Hire Highly Qualified Candidates and Pay 15
  Higher than Market Rate
• Set Travel Expectations with Candidates during
  Interview Process
• Gain Business Unit Buy-in on Candidates
• Look to Supplement Your Weaknesses with
  Candidates Strengths
• Develop a Fun, Well-Rounded Team

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My Initial Actions on Job (First 100 Days)

• Educated Self on Textron Business Strategy
• Developed the SAP COE Mission / Business Model
• Hired SAP Core Leadership Team
• Gained Approval on Funding for Operating Budget
• Implemented Key Support Processes
• Where We are Headed Key Lessons Learned

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Gained Approval on Funding for Operating Budget

• Developed Value Proposition
• Look for Leveraging Opportunities
• Focused on Items that Drive Early Successes
• Built Credibility by Delivering as Promised

22
My Initial Actions on Job (First 100 Days)

• Educated Self on Textron Business Strategy
• Developed the SAP COE Mission / Business Model
• Hired SAP Core Leadership Team
• Gained Approval on Funding for Operating Budget
• Implemented Key Support Processes
• Where We are Headed Key Lessons Learned

23
SAP Post Implementation Process Flow
Process
Inputs
Outputs
Supporting Business Operations

Break/Fix Requests (End-Users)
Business Process Owner (BPO) Sets Strategic
Direction for Business Process

• Executed Business Transactions
• Satisfied End Users
• Meeting Application SLAs / Metrics
• Uninterrupted Application Support
• Business Process Improvement
• Resolution of Incident Reports
• TCO Reduction

Enhancement Requests (BPO, Super User, Functional
Analysts)
Strategy
Process Support
End User Executes Process
Super User Supports End User
Project Go-Live Deferred Work (Project Teams)
Support
Support
Support
Technical Support
Functional Support
Help Desk Support
IT Ops Support
Change Mgt Support
SAP Apps Mgmt
System Maintenance (SAP COE)
3rd Party Supplemental SAP Support
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A Triad of Processes for Post Implementation
Support

• Problem Management (Break-Fix) Support improves
  enterprise performance by increasing end-user
  productivity and satisfaction associated with
  timely resolution of SAP related problems
• Enhancement Support provides a standardized way
  to identify, prioritize, add, and track
  additional functionality or processes to the
  system based on new and changing business
  requirements
• Change Control Support addresses the need to
  request, evaluate, communicate, schedule, and
  migrate changes to the SAP production environment

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My Initial Actions on Job (First 100 Days)

• Educated Self on Textron Business Strategy
• Developed the SAP COE Mission / Business Model
• Hired SAP Core Leadership Team
• Gained Approval on Funding for Operating Budget
• Implemented Key Support Processes
• Where We are Headed Key Lessons Learned

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3-Year Strategy for Textrons SAP ProgramLinking
US and EU Solutions
Improvement (BPx3)
Alignment
BP Improvement
BP Improvement
Aerospace Defense
Automotive
Industrial
Selective
BP Improvement
Value
Disparate
Klauke
Maag
TFS DE - TVD
Greenlee
TFS UK - CSG
TFS DE - CSG
DB Guinard
Bell
Cessna
Systems
Kautex
2004
2005
2006
2007
Phase I 9 Scattered Instances 1 Appl. Service
Provider
Current 9 Scattered Instances (by
colors) Multiple Appl. Service Providers
Phase II 3 Instances 1 Appl. Service Provider
Phase III Ongoing Improvement 1 Appl. Service
Provider
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Supplier Strategy

• Use a Target Costing Approach
• Create Strategic Relationships with Key Service
  Providers
• Take Advantage of Off-Shore Models
• Utilize Pooled Resource-on-Demand Models

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Key Challenges

• Worldwide Program Management
• Rapid Delivery of SAP Solutions
• Business Unit Solution Alignment by Industry
• BPx3 Focus

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Succeeding in College

• Go to Class
• Be Well-Rounded
• Work Hard but Play Hard
• Look to Learn not Make a Grade

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Succeeding in Your Career

• Join an Organization that Makes You Better
• Leave the Nest Take on Overseas Assignments
• Be a Team Player The first shall be last, and
  the last shall be first (Matthew 2016)
• Find Good Mentors for Career Guidance
• Choose Your Direct Reports Wisely
• Ensure Work / Life Balance

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Succeeding in Life

• Never Lose Your Integrity
• Aim High in Life by Setting Stretch Objectives
• Seek Wisdom
• Care More for Others than Yourself
• Give and You Shall Receive (Acts 2035)