In Search Of Business Value: How to Achieve the Benefits of ERP Technology

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In Search Of Business Value How to Achieve the
Benefits of ERP Technology

• www.panorama-consulting.com
• Presented by Aida Zakaria

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Outline

• Introduction
• The Need for Benefits Realization
• What is Benefits Realization
• Benefits Realization Activities
• Benefits Realization Tools
• The Value of Benefits Realization
• Conclusion

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Introduction

• Significant investments in IT is a source of
  competitive advantage
• Companies invest millions of dollars to implement
  SAP, Siebel, or other ERP or CRM
• ERP is a tool used to achieve a business objective

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Introduction (Contd)

• Paper Scope
• Discuss obstacles and drivers of technology
  benefits realization
• Discuss how managers can optimize the potential
  of IT
• Discuss how managers can leverage people to
  achieve the maximum benefits of IT

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The Need for Benefits Realization

• Why companies introduce cutting-edge tech as part
  of their IT strategies?
• Cost pressure
• Address inefficiencies
• Image
• Benefits realization is concerned with measuring
  and evaluating the actual benefits of IT

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What is Benefits Realization

• A comprehensive project approach that focuses on
  identifying, measuring and ensuring the business
  benefits achievable through technology
• Breaks benefits into manageable chunks
• Utilizes tools to ensure the true benefits
• Consists of activities from inception through
  implementation

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Benefits Realization Activities

• Development of Business Case, Corporate Metrics,
  and Benchmark justifies, identify and quantify
  the potential benefits and compare to costs
• Organizational Change Management Cultural
  Assessment identify cultural areas to be
  addressed with the change

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Benefits Realization Activities (Contd)

• Cultural Change focus on large gaps not all
  aspects
• Communications effectively communicate changes
  to end users though various channels
• Business Process Modeling ensure IT improves the
  process

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Benefits Realization Activities (Contd)

• Development of Operational Metrics and
  Benchmarks translate metrics into measured
  operational numbers for middle management
• Organizational Job Design and Planning change
  job descriptions, reporting relationships to
  support the new technology

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Benefits Realization Activities (Contd)

• Detailed Process Design complete design
  addressing who will do what and how. Helps direct
  training courses
• Individual Metrics, Processes, and Benchmarks
  for individuals to understand how their
  performance contributes to the success of the
  project

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Benefits Realization Activities (Contd)

• Organizational Job Design Implementation
  translating documentation to reality
• End-User Training helps users understand and
  perform tasks
• Reward Design and Implementation to motivate.
  Introduce KPIs in annual reviews

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Benefits Realization Activities (Contd)

• Benefits Measurement compare actual to projected
  results
• Root Cause Analysis of Benefits Gaps understand
  why gaps exist
• Implementation of Corrective Action activities
  to address the root cause analysis

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Benefits Realization Tools

• Tools used to perform the tasks effectively
• Business Case and Metrics financial and
  cost-benefit analysis
• OCI Tools Organizational Culture Inventory tools
  to identify gaps between current and ideal
  cultures
• Process Modeling Tools modeling the before and
  after processes

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Benefits Realization Tools (Contd)

• Skills Gap Matrices identify required skills.
  Helps in arranging for training
• Benefits Realization Scorecards to track actual
  benefits performance after go-live. Useful in
  disseminating information in the company

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The Value of Benefits Realization

• Why should a company implement benefits
  realization approach?
• Reduce project risk
• Achieve close alignment between business and
  technical activities
• Identify and addresses obstacles to realizing
  benefits
• Provide more thorough understanding of lesons
  learned
• Provide better justification for future IT
  project approvals

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Conclusion

• Investing in IT without compelling justification
  is not acceptable.
• There is a need to ensure that companies realize
  the potential benefits of technology
• The Benefits Realization approach into IT ensures
  reaching wise investment decisions and successful
  IT implementation