Enabling Value Engineering

Date:   Sunday , August 05, 2012

SAP Labs India is SAP's second largest Research & Development and Global Services & Support center in the world. Founded in November 1998, SAP Labs India is one of the four global development hubs
(Germany, US and Israel being others) of SAP that contribute to all areas of the SAP product value chain - Research & Breakthrough Innovation, Product Development, Global Services & Support and Customer
Solutions & Operations. Bridging the gap between local market demands and SAP's development organization, SAP Labs has set standards for excellence in innovation, efficiency, and reliability.

Shailendra Sahay is the Program Director of Value Engineering (VE) Best Practices Center and Global
Benchmarking. His organization runs the SAP Benchmarking Program globally. The organization helps SAP customers assess their business process maturity and gap to industry best practices. Last year, the team in India launched a new self-service benchmarking tool that has made it much easier and faster for organizations to participate in this program. The VE Center, based in Gurgaon is also responsible for rolling-out VE tools and best practices globally in order to standardize and scale VE offerings across all SAP market units.

In a candid chat with Shailendra, we explore SAPís benchmarking offering that has helped more than 3,000 organizations across the world.

SAP's Benchmarking and Value management Service

Business Performance Benchmarking is the first step to understand the health of an organization's business processes. As a trusted vendor to the customer, our objective has always been to solve our customer's real business issues. It is always important for us to first understand the customer's pain points, before offering an IT solution. And our benchmarking program is the perfect toolset to make this happen. Companies can choose to participate in one or more of our 20 plus business process assessments. At the end of the benchmarking exercise, they will get a customized report which will help them understand where they are doing good and the areas they need to improve. This also helps us understand the real pain points in our customer's business, and articulate an IT solution that will help them run better as an organization.

Our Benchmarking program has grown exponentially over the years. This has now transformed the way our customers approach benchmarking. This program is available through the self-service VMC (Value Management Center) platform. The VMC platform has a database of more than 10,000 benchmarking survey submissions from 3,000 plus companies across 24 industries. It provides 20 plus business process assessments and 12 industry-specific business process assessments (e.g. demand planning for retail, asset management for utilities, etc).

Organizations can use the VMC tool to benchmark against one of the 300 plus available industry/process combinations (e.g. supply chain planning in retail industry). Our customers and select prospects can register themselves on this platform, and choose the survey they want to take, and can get to see real time results after successfully completing the survey. This service is available absolutely free of cost and our team of Value Engineers can help you interpret the results.

Our Learning through the Journey

We first launched the benchmarking program in North America, and then slowly expanded it to cover the rest of the world. There have been several challenges along the way, which has only helped to strengthen the quality of our program. For example, we soon realized that many companies in emerging and less mature financial markets do not track all the KPIs that we ask in our benchmarking surveys. It was a learning experience for both the parties, where these companies realized what they were missing by not tracking all KPIs that are critical to a successful business. We also learned on how we could make our surveys easier so as not too appear too overwhelming to companies which are still ramping up on the best practices curve.

Often, we learn a lot of new trends from our customers. Lately, our customers have started to track a lot of new and innovative KPIs in order to keep pace with the changing business landscape. We keep updating our surveys to maintain their relevance to the current business reality.

Integrating to DNA

Benchmarking and Value Management is not a one-time exercise. This is a continuous process so that an organization can continue to grow and innovate. To inculcate the Value Management DNA, we invite our customers and prospects to attend our Value Academy sessions. Ranging in length from half a day to two days, these sessions provide an introduction to the key disciplines required to establish value management as a strategic competence in an organization. SAP Value Academy sessions are delivered in a variety of formats, including practitioner, customer, industry, and line of business. SAP Value Academy offers interactive sessions, providing companies with an introduction to the strategy, methodology, and tools that support value management adoption.

As many organizations have shown, it is possible to apply value management practices consistently across the IT project portfolio.

To make successes visible to the entire organization, one needs to foster an approach of performance-based thinking, and enable management visibility and discipline, in order to create and deliver a culture of value throughout the organization.

Future Plans

The vision would be to go on and enable value management to be more effective and to reach a stage where it becomes a part of customers' DNA. We want to make it a self sustaining discipline which runs on its own because customers see value in it.

With regards to our VMC platform, we want to extend its functionality and include business case building capability into it. Going forward, organizations can do benchmarking using this tool and then use the output of benchmarking to build an end-to-end business case using the extended features of the current tool. This would make this platform a one-stop shop, which organizations use not only for benchmarking, but also to calculate value and ROI of closing the gap to best performers.