SAP ORGANIZATIONALCHANGE MANAGEMENTTOOLKITStrategic Organizational Alignment andProject-Level Change Management

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3CONTENTS1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5

The Case for Organizational Change Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5Predictable SAP Business Integration Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6The Goal of Organizational Change Management? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6What Successful Organizational Change Looks Like . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9Building Your Team to Match Your Needs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10The Prime Directive: Act with the End in Mind . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10Moving Forward . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11

2. Fundamentals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12Helping Your Organization Understand the Business Case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12Why People Resist Change (And How to Overcome Resistance) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12Levers for Change: Moving Your Organization to Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12The ASAP Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13 Phase 1: Project Preparation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13 Phase 2: Business Blueprint . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13 Phase 3: Realization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 Phase 4: Final Preparation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 Phase 5: Go-Live and Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 Phase 6: Continuous Improvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14Levers for Change and the ASAP Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 Leadership and Sponsorship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15 Skills and Competencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 Organization Design and Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 Communications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19 Governance and Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20 Performance Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22 Incentives and Rewards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23 Hiring and Selection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24 Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25

3. Organizational Change Management and the ASAP Methodology . . . . . . . . . . . . . . . . . . . . . .26Phase 1: Project Preparation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26 OCM Practice: Develop and Communicate a Clear Business Case for Change . . . . . . . . . . . . . . . .27 OCM Practice: Conduct a Business Risk Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27 OCM Practice: Develop and Execute a Leadership Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28

4 OCM Practice: Establish a Steering Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29 OCM Practice: Build and Execute a Project Governance Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . .29 OCM Practice: Develop a Change Communications Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30Phase 2: Business Blueprint . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31 OCM Practice: Devise and Execute a Tactical Communications Plan . . . . . . . . . . . . . . . . . . . . . . . . . .31 OCM Practice: Build a Stakeholder Realization Campaign Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33 OCM Practice: Create a Work-Impact Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33Phase 3: Realization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34 OCM Practice: Organizational Design and Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34 OCM Practice: Complete Role Descriptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35Phase 4: Final Prep . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36 OCM Practice: OCM Practice: Business Readiness Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36 OCM Practice: Do We Have the Right People? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37 OCM Practice: Incentives and Rewards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38Phase 5: Go-Live and Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38OCM Practice: Celebrate Go-Live! . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39Phase 6: Continuous Improvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39 OCM Practice: How Are They Doing? The Performance Management Lever . . . . . . . . . . . . . . . . . . . .39 OCM Practice: Reinforcing Processes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40 OCM Practice: Refining Organization Design and Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40 OCM Practice: Hiring and Selection During Continuous Improvement . . . . . . . . . . . . . . . . . . . . . . .41 OCM Practice: Communications During Continuous Improvement . . . . . . . . . . . . . . . . . . . . . . . . . .41

Appendix: Links to OCM Tools . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Phase 1: Project Preparation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Phase 2: Business Blueprint . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Phase 3: Realization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Phase 4: Final Preparation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Phases 5 and 6: Go-Live, Support, and Continuous Improvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42

5Studies of systems implementations consistently show thathuman performance, not technology, is the leading cause of fail-ure to achieve expected results from a system implementation. Infact, a recent worldwide SAP survey of 186 implementations foundthat two of the leading barriers to successful implementationwere inadequate skills and training and organizational resist-ance.

Experience has shown us that the success of any SAP implementa-tion depends on how the project team addresses three critical ele-ments of project readiness: people, processes, and technology.These three elements dont operate in a vacuum. In fact, theyreintimately related, and success in any one of them depends onwhat you do with the other two. As you go through the varioustasks and processes in this volume, youll find that most of themare interrelated. Few, if any, elements in an OCM project exist in-dependently, or even in an orderly timeline.

1. IntroductionChange. Let it run uncontrolled, and its destructive and costly.Harness it well and its the fuel of success. How change affectsyour company is determined by the way you manage it.

The SAP Education organization has designed this SAP Organiza-tional Change Management (OCM)Toolkit to help your business carryout your change management project. It provides concepts, sug-gested processes, and real-life tools for conducting organizationalchange within your business or agency. Its designed to enableyour OCM team to plan and execute a successful effort and intro-duce your SAP solution with a minimum of disruption.

This chapter introduces the idea of organizational changemanagement, makes a case for its importance for your project,and explains our approach to managing change.

The Case for Organizational Change Management

The effectiveness and success of any organizations strategic pro-gram depends in large part on how that organization manageshuman, technological, and organizational change. Implementingworld-class information technology alone will not achieve the de-sired business results if the people affected arent aware of howchanges to business processes, roles, and responsibilities will affectthem nor will it succeed if they are not ready, willing, and ableto use new skills and tools.

This is not an SAP only phenomenon. Indeed, change manage-ment is a long-standing human need. In 185 B.C., the Roman poetTerrance wrote, There is nothing so easy but that it becomes dif-ficult when you do it with reluctance.

6Its also important to remember that change management is not aone and done operation. While you may reach the end of yourchange management program for a specific implementation orupgrade, youre likely to carry out ongoing OCM procedures aslong as you use your SAP solution. Business is never static, so theneed to manage change doesnt go away.

This toolkit is organized to assist you over the long term. If youhave not done any organizational change management, you maywish to start at the beginning. However, if you have already begunsome change activities, or if you are familiar with OCM, jumpahead to any section you think might be helpful.

The Goal of Organizational Change Management

Your OCM effort has a very simple goal: to make sure personnelchallenges dont get in the way of meeting your SAP implementa-tion business goals. Your OCM effort exists to create and executethe strategy for a minimally disruptive business transition. Itscharge is to explain changes to job roles and tasks, to build accept-ance of the new solution, to redefine departmental boundarieswhere necessary, and even to facilitate required changes to organi-zational structures and teams. The bottom line: your OCM proj-ect works to speed adoption of your SAP solution and accelerateits return of value.

Aspects of Organizational Change

There are two fundamental aspects of organizational change: Strategic organizational alignment Project-level change management

Strategic organizational alignment focuses on enabling a sys-temic shift in organizational behavior and culture. It concentrateson such intangibles as leadership, alignment, commitment, direc-tion, expectations, and messaging. Its purpose is to make sureeveryone in the organization is on the same page and is going inthe same direction. Without strategic organizational alignment,

Predictable Business Integration Challenges

During a typical implementation, an SAP project team appropri-ately focuses on the SAP technology and process aspects ofimproving the business. However, the human dimension of theimplementation needs every bit as much attention as the softwareconfiguration. We cannot underestimate the need for addressingthe human dimension in a business change, both to ensure a suc-cessful launch and to accelerate the business benefits expectedfrom the implementation. To ensure minimal disruption and de-liver a rapid return of value, SAP customers should execute achange management plan involving demonstrated commitmentby leadership, sound governance, effective changecommunications, and efficient training.

Figure 1: Project Preparation

Get the system ready

Get the processes

ready

Get the people ready

Business Integration Considerations

The best-designed improvement strategies, from technol-ogy enhancements to mergers and acquisitions to shared-services arrangements, do not realize benefits expectedunless people across the business are engaged, informed,and prepared to succeed.

The best business processes are ineffective if people in theorganization do not understand and follow them.

The best technology in the world is inadequate if peoplein the organization do not use it.

ELEMENTS OF PROJECT READINESS

7the likelihood of achieving your desired changes and business re-sults will be seriously diminished.

As an internal person tasked with creating systemic changes, youface a big challenge in dealing with internal culture, politics, andtraditions. Change in these areas can be difficult, as employees orgroups fight to hold on to the familiar ways of doing things. Thistoolkit will help you by recommending techniques to motivateeven the most resistant members of your organization.

Project-level change management identifies the specific tasks bydepartment, role, and person necessary for your organization to

execute your new processes successfully. Because neither can besuccessful without the other, you must include both strategic or-ganizational alignment and project-level change management inyour OCM efforts. Project-level change management representsthe tactical portion of your OCM effort, and a typical mistake is tofocus solely on these tactical activities. However, simply complet-ing the checklist of project-level change management tasks doesnot mean your organization is aligned with its vision.

The table on the following page summarizes the characteristics ofthese two aspects of organizational change.

8Objective

Duration

Application

Components

Outputs/focus

Strategic and Project-Level Change Management at a Glance

Long-term transformation

Enterprise focus business transformation(years)

When a systemic shift in business behavior andculture change is required to achieve organiza-tional awareness, understanding, commitment,and action

Focused on ongoing activities to support busi-ness strategy and long-term objectives: Executives lead drive to achieve a business suc-

cess story and provide role models for how tosucceed in the new setting.

Managers are well informed and actively workto establish new business practices within theirteams.

Business design is integrated at the enterpriselevel, enabling delivery of a consistent operat-ing platform for "good" growth.

Employee ability to succeed in the new envi-ronment is supported by a collection of inte-grated people, processes, management prac-tices, performance systems, and rewardstrategies.

Staff demonstrates new work behaviors, whichare supported by leadership, to realize a newset of operating values.

Work norms necessary to realize maximumbenefit are demonstrated by people at all levelsof the business.

Executive communications Governance/leadership strategy Sponsorship alignment plan Incentives and rewards Staffing and resource strategy

Project launch success

Tactical focus ERP implementation(months)

When designed to enhance people's ability tomove from a current way of thinking andconducting work to a new way of applyingtools, systems, and process to increase flexibili-ty, quality, productivity, and innovation andreduce cost

Focused on activities to support successfulimplementation of project objectives that ful-fill the business requirements and businesscase: Project has built a guiding coalition of lead-

ers who support deployment and areindividually and collectively accountable todrive specific project goals.

Key executives are well prepared to leadchange, supported by individual plans, activ-ities, and a robust tool set.

People are in the right jobs with the rightskills and supported by preparations andtools that set them up for success.

A systematic transition strategy minimizesbusiness disruption and shortens time toachieve full project benefits.

Every employee is prepared to succeed onday one of launch.

People understand new work requirements,which their leadership supports to realizefull benefits expected.

Communication actions Training activities Organization structure analysis Governance (steering committee process) Local site-readiness preparations

9 Manage resistance from any business managers who are vestedin continuing existing work practices and process.

Solicit the right mix of stakeholder participation and feedbackduring the project.

Secure the right number and type of extended team resourcesto involve in the operations readiness teams and in businesspreparation for go-live.

Position the implementation project to complement other criti-cal business programs.

Establish a committed steering committee that takes an activerole in supporting the new SAP solution, helps removeobstacles, and provides resources where critical to maintain theimplementation schedule.

Help staff transition from their current roles to new SAP projectroles and work practices in a way that accelerates the transitionand minimizes business disruption.

In Chapter 3 of the SAP OCM Toolkit youll find tools and strate-gies for addressing typical OCM challenges and meeting therequirements of your implementation.

What Successful Organizational Change Looks Like

A successful organizational change combines a collection of com-plementary activities working together to ensure a smooth shift incritical items, such as (but not limited to): Organizational work practices Corporate policies Decision-making procedures Operating values and behavior

As a result of your change management activities, the workforceunderstands and accepts the reasons for change and acts togetherto achieve a common set of performance improvement goals. Asuccessful organizational change campaign enables business teamsto use their new SAP solution or upgrade to work smarter andfaster and create more valuable, more accurate, and more cost-efficient results.

Typical OCM Challenges

Business change driven by an implementation of SAP software canbe comprehensive; if youre going to manage the risk it involves,you need to understand the challenges it can bring. The goodnews is that you can anticipate many of the typical transitionissues that may arise, such as: Your employees may see their leaders as out of touch with the

implementation program and not focused on program impera-tives.

Your organizations business units may have limited participa-tion during program design and cutover preparations and mayresist them.

Your program may not be able to identify or resolve implemen-tation issues quickly or completely.

The business may feel unclear regarding new work roles and re-sponsibilities the program creates.

Your workforce may be unprepared and ill equipped to succeedin the new work setting.

Anticipating and addressing these challenges within the SAP im-plementation effort is essential to fostering a smooth, successfulbusiness transition. Recognizing which of these symptoms has thepotential to affect your projects success and addressing their un-derlying causes is critical, both to go-live success in the shortterm and the stability of your new SAP solution in the long run.

Common Enterprise Software Implementation

Requirements

Most enterprise software implementations require you to do thefollowing: Deploy new business processes to diverse business units consis-

tently and efficiently. Prepare each significant business segment for transition and

manage activities in a way that both accelerates acceptance andminimizes local work-arounds and resistance.

Make the best use of business resources, particularly end-usertools and new manager roles and activities, in preparing theworkforce for changes to operations systems and processes.

Three Common Organizational Outcomes

The most successful SAP implementations achieve threecommon organizational outcomes:

The business is mobilized to make the change. The OCM effort has engaged everyone in theorganization with a stake in attaining a high-performanceand competitive advantage for the business.

The business is prepared to perform in the new set-ting. The OCM effort has provided employees the infor-mation and tools they need to embrace change and inte-grate it into everyday work practice. In addition, OCM isintegrated with employee training and support.

All transitions are managed so the affected peopleknow where the program is and whats next. The OCM effort gives everyone in the organization a logi-cal path for moving from the old ways to the new ones.The core project team, the business process owners, thecritical third parties everyone involved knows how totransition from current operational procedures andadopt the new SAP technology.

We will drill down into each of these three organizationaloutcomes a bit more in Chapter 3.

10

Building Your Team to Match Your Needs

As you build your OCM initiative team, keep the objectives ofyour project clearly in sight and create a team to meet them. Thesize of your team and the roles of individuals will vary dependingon a number of variables. For example: Size of the overall project team Number of sites involved in the project Number of business functions impacted by the change Number of end users impacted by the change

Large OCM teams may consist of a dozen or more staffers. A smallorganization in which the business changes will impact only 50 to200 end users might ask a single individual to own the total OCMeffort. Indeed, the OCM effort in smaller operations may not haveits own dedicated staff; rather, it might take up a percentage of an-other teams time. For example, the project management officeitself might handle it; or it might be spread across the projectsprocess teams, each team owning the management of change forits respective functional organizations and end users.

In all situations, however, and for companies of all sizes, the scopeof an OCM effort is the same: Mobilize the business. Prepare people to perform. Manage everyones transition.

Your OCM team should feel free to adapt the concepts and toolspresented in this toolkit to its unique situation and business case.While the OCM approach we present here is consistently action-oriented, its designed to be flexible. You can adapt the concepts tothe tactics, delivery channels, and audiences most relevant toyour specific situation and transition priorities.

The Prime Directive: Act with the End in Mind

Theres one critical rule of thumb above all others: act with theend in mind. As discussed earlier, you have successfully managedyour OCM effort if youve mobilized the business, prepared peopleto perform, and managed everyones transition. Following arehigh-level activities that will enable you to reach this successfulend state.

Mobilizing the Business

Build a guiding coalition of leaders who can furnish resources,drive key messages, remove roadblocks, and help solve problemsthat challenge implementation success.

11

Promote the SAP program to all your stakeholders executives,managers, and end users alike so everyone understands thevalue of the process changes and SAP technology and has confi-dence that the SAP program can improve operations results. Inaddition, stakeholders should recognize how they cancontribute to business integration success.

Preparing People to Perform

Work with your business teams and operations managers to ful-ly prepare the staff to be impacted by any new practices. Createthe tools and transition planning needed to help your staff suc-ceed in the new setting and achieve the productivity gains madepossible by new SAP solutions.

Work with your project design teams, process owners, and othersubject-matter experts to analyze how process changes will im-pact their work. In addition, explain to your business staff hownew roles and skill requirements will affect them.

Provide detailed recommendations for how to manage the tran-sition for each significant business organization or geographicsite.

Managing Everyones Transition

Develop a clear, consistent business vision and gain buy-infrom all levels of the business early on and throughout the de-ployment. To achieve these goals, youll need to work closelywith business sponsors and executives as well as members of theSAP program steering committees.

Set up systems to involve stakeholders in key decisions and toresolve problems or issues related to organizational change. Usethese systems to identify issues that challenge operational suc-cess, and work with the program teams and business leaders toaddress them.

Use a systematic, proactive organizational change assessmentapproach to recognize problems early and apply appropriate re-sources to resolve obstacles quickly. Continue to apply and ex-pand these practices as part of your site cutover planning.

Recognizing Change Management as an Art,

Not an Exact Science

The OCM process described in this toolkit draws upon best prac-tices from hundreds of successful projects. One of the lessonsweve learned from these projects is that managing OCMinitiatives is a balancing act that requires flexibility and improvisa-tion. As we mentioned earlier, the steps in an OCM effort dont al-ways follow a linear pattern. Often there is overlap between thetasks you perform and team members may be asked to start anew activity before finishing the previous ones.

For example, at the start of the project your communicationsteam may engage employees with a set of communications initia-tives. Before theyve finished, individuals handling communica-tion may be pulled away to work on stakeholder alignment activi-ties. Later, they will revisit communications to ensure thatemployees are still engaged.

As a result, it may seem as though there is no end to certain OCMactivities. But in reality, the team is achieving its goals by engagingand reengaging the workforce at key points in theimplementation project. The art of organizational change man-agement is balancing these activities to be successful, improvisingwhen necessary.

Moving Forward

In the next chapter, well examine some change management fun-damentals. Then in Chapter 3, well discuss best practices forOCM and introduce a series of tools and accelerators you can useto develop your own change management project.

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Why People Resist Change (And How to Overcome

Resistance)

Change management theory tells us there are four reasons whypeople resist change: They didnt know about the change. They werent able to do whatever the change required. They felt they werent included or involved in the change. They didnt see the change as a priority.

As Figure 2 shows, appropriately timed OCM activities can accel-erate and encourage the acceptance of change. At a high level,heres how your OCM effort can overcome resistance: For people who dont know, your OCM effort should provide

information and communication. For people who feel unable, your OCM effort should integrate

with your training processes to ensure relevant training is pro-vided.

For people who dont feel included, your OCM effort shouldprovide a sense of shared ownership.

For people who dont see the change as a priority, your OCM ef-fort should make sure your leaders are exercising active and visi-ble advocacy.

Our change management approach provides the techniques toolsneeded to overcome resistance and enable individuals and the or-ganization to adopt change.

Levers for Change: Moving Your Organization to

Change

Earlier in this toolkit we quoted the Roman poet Terrance. Letsreturn to the classics for a moment and remember the opinion ofArchimedes: Give me a fulcrum on which to rest, he is reportedto have said, and I will move the earth.

A successful OCM strategy gives you the levers to do a little earthmoving. Within and across the four phases of our OCM approach,

2. FundamentalsThe major objective of your OCM effort is to get your end users toaccept and become competent with your new SAP solution asquickly as possible. The result will be a more rapid realization ofvalue from your SAP solution. In this chapter, well describe thefundamental tasks your OCM effort must accomplish to gain useracceptance and begin realizing the benefits of your SAP initiative.

Helping Your Organization Understand the Business

Case

To ensure the overall success of your SAP project, everyone in yourorganization must understand the business case driving it. Its thejob of your OCM effort to make sure that happens. A successfullyexecuted organizational change management plan creates a con-text that makes business drivers meaningful for employees.

The change adoption curve (Figure 2) reinforces this point. The first two milestones on the road to organizational adoptionare awareness and understanding. Once you achieve these, it ispossible to gain acceptance, individual adoption, and eventuallyfull organizational adoption.

Figure 2: The Change Adoption Curve1

1Adapted from Remy S. Leeuwin, Organizational Change with input from Guy Couillard, OTA

Figure 3: ASAP Implementation Road Map

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Lets take a moment to examine the methodology itself. As youreprobably aware, it consists of six phases, usually depicted in theroad map shown in Figure 3.

Phase 1: Project Preparation

During Phase 1, youll be carrying out your planning and prepara-tion for your SAP project. Your OCM activities will primarily con-sist of gathering the information you need to create a workablechange management strategy. Youll identify your stakeholders,plan your communications, and establish your OCM project gov-ernance structure.

Phase 2: Business Blueprint

Your objective during the business blueprint phase is to achieve acommon vision and understanding of how the company intendsto support its business with SAP. The result will be your business

we make extensive use of critical levers for change mechanismsthat can work within your organization to define, describe, or in-fluence the way it behaves. If you properly apply a given leverwithin a given phase, you have a powerful tool for influencingpositive change. The SAP approach to OCM addresses these eightlevers for change: Leadership and sponsorship develops a culture of change

leadership that aims to build commitment through accounta-bility, role clarity, and executive development.

Governance and compliance assigns roles andresponsibilities, including decision-making responsibility, andcreates a culture of compliance based on measurement andconsequences.

Skills and competencies incorporate competency assessmentand skill development for all employees. This lever incorporateslearning, training, and succession planning into all OCM initia-tives.

Performance management establishes and measures individ-ual and group performance, ensuring alignment withenterprise strategies, goals, and objectives.

Organizational design and structure aligns business andprocess metrics with process roles and management structures.

Incentives and rewards provide clarity of desired performanceand compensation, bonuses, and promotions consistent withgood performance and client successes.

Communications enable change through frequent and factualinformation flow, and clearly explained impacts, roles andresponsibilities, benefits, and rewards.

Hiring and selection provides personnel strategies (such as re-train or hire; grow organically or acquire) that ensures individu-als possess the right skills and competencies at the right time,resulting in program success.

In fact, these levers are at work within your organization rightnow. If you wish to effect change, youll need to find a way to usethem. And youll need to decide which of them require additional

development and when youre going to apply them. Chapter 3 ex-plains how you can do this by integrating the levers into the ASAPmethodology.

The ASAP Methodology

As an SAP customer, youre likely familiar with the ASAP methodology, a proven, repeatable, and successful approach toimplementing or upgrading an SAP solution. Based on best prac-tices culled from hundreds of projects, ASAP has demonstrated itsworth for customer projects of all sizes.

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processes and skills youve introduced, capturing the lessonsyouve learned, and supporting ongoing user development andskill mastery.

Phase 6: Continuous Improvement

During this phase, youll carry out such activities as validating theadoption of the new processes and skills youve introduced, cap-turing the lessons youve learned, and supporting ongoing userdevelopment and skill mastery.

Now that weve summarized the change levers and the ASAPphases, lets take a look at how they integrate with each other. Asyou go through the pages that follow, please remember that theactivities we discuss arent necessarily linear. Youll likely find agreat deal of overlap among the activities we recommend. If itdrives you a little crazy, remember that in this line of work, crazyis normal.

Levers for Change and the ASAP Methodology

Your business project is a dynamic organism. Like the parts of aliving body, your levers for change operate constantly, and eachone keeps going independently of the others. Just as we think anddigest and breathe as we walk, so the various levers operate simul-taneously throughout your project. There will be times when onelever is in the foreground, and youll need to provide deliverablesor carry out activities. There will be other times when that samechange lever will apparently seem inactive but itll still be there,quietly digesting lunch.

In the pages that follow, well look at each of these levers as theypass through the ASAP phases of project preparation, businessblueprint, realization, final preparation, go-live and support, andcontinuous improvement. In Chapter 3 well also introduce a se-ries of OCM practices to help you manage change within eachphase.

blueprint: a detailed description of how you plan to achieve yourgoals. Your OCM activities will focus around making concreteplans based on the information you gathered doing the projectpreparation phase. During this phase youll be working collabora-tively with the people who define your business processes to iden-tify the roles involved in your SAP implementation and theimpact your project will have on them. Your work here will serveas input for your organizational design and structurerequirements and will also help identify necessary skills and com-petencies.

Phase 3: Realization

The realization phase is where youll specifically identify the link-ages between your user population and the business processrequirements defined in your business blueprint. During realiza-tion youll begin carrying out the OCM activities that will takeyou through final preparation and go-live. Among other things,youll make sure you have leadership and sponsorship activitiescovered on the local level and ensure youve mapped actual peo-ple to all the roles you identified in Phase 2.

Phase 4: Final Preparation

Final preparation is the last step before you go live. In this phaseyour organization will complete testing, end-user training, systemmanagement, and all cutover activities to finalize your readinessto go into production with your SAP solution. During final prepa-ration youll have a number of critical OCM activities, includinglast-minute communications to your users and stakeholders.

Phase 5: Go-Live and Support

The go-live phase moves you from a project-oriented, preproduc-tion environment to a live production operation. But just becauseyour project is nominally completed during Phase 5, change management activities dont stop. Phase 5 requires partic-ular OCM focus on enabling leaders and managers to supportuser productivity and performance. During this phase, youll car-ry out such activities as validating the adoption of the new

One of the greatest benefits in smaller organizations is thattypically leaders and managers can have more directcontact with the organization as a result of their smallersize. Take full advantage of the reach and access available toyour organization; direct contact is the most powerfulmethod of messaging and leading change. More complexsolutions become necessary when geographic scope ornumbers of employees increases.

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During the blueprint phase, youll put the stakeholder manage-ment plan you created during the project preparation phase intoaction. Your activities here will help ensure that you engage andenable leaders and stakeholders at various levels to fulfill theirrole in driving change. Your change leaders will generally be thepeople who lead your business now; what change managementdoes is ensure that your employees are doing the right things atthe right time over the course of your implementation. Essential-ly, organizational change management is applying discipline tocommon sense.

Your job during realization and final preparation is to ensure thatyour leaders, managers, and sponsors clearly communicate theroles, responsibilities, and changes expected for the people whowork with them. Youll also further develop your changenetwork, which is your extended change team. These are individ-uals across the organization who are not tasked with doing changemanagement full-time, but who are going to be your connectionswithin the organization for feedback, communication,requirements, and so forth.

During the realization and final preparation phases, your leadersand sponsors should proactively display readily visibleinvolvement. As part of their role in leading change and managingrisk, your leaders will coach the workforce. They will need tospeak proactively with stakeholders, listen to their questions, andmanage risk by understanding and acting on employee concernsand issues. There are many ways you can accomplish this: round-tables or fireside chats, lunch-and-learn sessions, or any activitythat regularly and directly connects with employees and allowsyou to hear their concerns and to build their trust.

Leaders and managers also need to raise issues, work through theappropriate governance process, and be visible in a supportivemanner for any item related to the project. Each leader will havean individual change leadership action plan (outlined in Chapter

Leadership and Sponsorship

When your corporate leaders from your executives to your linemanagers visibly model the behaviors necessary to encourageand advocate your new solution, your employees are more likelyto follow suit. In a 2006 survey, members of the Americas SAPUsers Group (ASUG) cited executive sponsorship and projectleadership as the top factors influencing an organizations abilityto receive value from an SAP investment. Just to remind you ofhow effective executive endorsement can be, remember that IanFlemings James Bond novels were only mildly successful untilsomeone asked President Kennedy what he liked to read.

Every organization has leaders and sponsors you can leverage tosupport and encourage your initiative. Their roles may be officialor unofficial, formal or informal, but their influence can be pow-erful either way. It is essential that leaders continue to lead andmanage through and beyond go-live and develop a strong sense ofownership of the project outcomes.

During the project preparation phase its important to identifyyour key leaders and stakeholders. You also need to confirm thatyouve aligned those stakeholders across your organization sotheyre supporting your project and creating shared ownership ofproject results. It will also be critical for your leaders to visibly en-dorse the business case for change, which well discuss below aspart of the communications lever.

In many organizations, employees jobs include multipleroles. The challenge with such jack of all trades situationsis that this broad expertise is typically developed over timethrough informal cross-training and knowledge transfer. Inthese cases, consider the critical elements of each role andfocus on the near-term requirements while developing asupport process for additional skills that will gradually re-build this diversified skill set in your people.

Normally, we dont consider training or knowledge transfer to bea formal part of the change management initiative, so we wontgo into creating a training plan here. However, the informationyouve gathered during the project preparation phase will serve asimportant input for the people building your skill-developmentplan during blueprint and realization.

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need for your implementation or do you need new ones? Andhow do you supplement them?

Earlier we discussed the need to identify leaders and businessstakeholders in the project preparation phase. This activity servesas the initial audience analysis that you can use to outline skilland competency requirements for your user population.

Your goal from a change management perspective is tounderstand the impact your SAP solution will have on yourorganization, then to examine your workforce, determine its cur-rent skills, and identify any gaps between your current state andyour upcoming requirements. This will help you create the tran-sition plan, a complete listing of the tasks and activities yourworkforce will experience as part of the transition to your SAP so-lution. When combined with your learning plan, youll have astrategy for preparing them for the tasks theyll encounter whenthey go live and beyond.

3), which should be confirmed and revisited if necessary to main-tain the engagement, participation, and visibility of all key leaders.

During the go-live phase youll leverage the cross-business proj-ect ownership you created during the project preparation andblueprint phases. Its during go-live where the accountability forresults comes into play. It rests with the leaders and businessstakeholders who took ownership and those business leaders,stakeholders, and managers who did the coaching. Your leaderswill continue reinforcing the changes and coaching the organiza-tion for continued adoption until what was new and different be-comes very familiar and comfortable.

As we mentioned earlier, your continuous improvement activitieswill extend beyond your implementation project. By the time youreach continuous improvement, your organization will be man-aging user performance on an ongoing basis. Your leaders shouldbe making sure people are doing what they should, and makingchanges and suggestions to tweak and improve your processes. Bythis time, big change should become a regular way of life. Wearent teaching leaders and managers to lead and manage butare expecting them to do that.

Skills and Competencies

The skills and competencies lever is critical for a very simple rea-son: as good as your SAP software is, it wont deliver its promisedvalue unless your people have the knowledge and skills to use it.Consider, for example, an article from CIO Magazine regardingthe real reason for failure of ERP projects. The author states, In-creasingly, experts reckon that they've found the smoking gun:poor training. Not the technical training of the core team of peo-ple who are installing the software, but the education of the broaduser community of managers and employees who are supposed toactually run the business with it.2

The members of your organization already have a variety of skillsand competencies. But are these the skills and competencies you

2 Malcolm Wheatly, ERP Training Stinks, CIO Magazine, June 2000

Your employees need to be fully prepared as well as trainedon how their jobs will be executed. For example, letsassume that a given plant manager at a construction mate-rials company has been carrying out a goods receiptprocess for raw materials every Friday when the plant is qui-et. With the new business processes the company has identi-fied, however, he will need to enter the goods received in-formation into the SAP application immediately uponreceiving them. This would need to be communicated priorto the training, or as part it, thus providing a day in thelife for this work role versus purely transactional training.

Your training department needs to build more than trans-actional competence; it has to build understanding of thecomplete business processes behind the transactions,including all who, what, when, where, and how issues. Itis OCMs job to make sure the training people know whatthose issues are.

During the blueprint and realization phases, youll completeyour work-impact analysis: youll specifically indicate whateach role in your organization must be capable of doing andwhether or not the people in that role have the skills appro-priate to execute against that work. This helps determinewhat kind of knowledge transfer and skill development youllneed to accomplish.

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While your OCM team is at work with that, the people responsiblefor training should be developing and delivering their content.Also in parallel, your organization should begin executingbusiness readiness activities these are those activities outlined inthe Individual Leadership Action Plans to ensure each site isready. Such activities will continue right up to go-live and con-tinue beyond.

Training will typically occur both pre-go-live and post-go-live, asclose to use as possible. Indeed, during the continuous improve-ment phase, its important to focus on reinforcing the skills thatyour workforce needs on a regular basis. Learning is more of ause it or lose it phenomenon than wed like to admit. Be sure toanalyze exactly how and what your users are doing during themanagement phase. (Tools such as Knoa User Performance Man-agement for SAP are useful during this period.) Find out whereyour users are having problems and provide them with perform-ance support to address those problems.

However, a training plan is still something with which you shouldbe intimately familiar. Youll want to review the plan and makesure it addresses the skill sets your employees need, and establishaccountability for addressing those skills. Make certain to identifythe necessary skills or procedural changes that should be includedin training, but which are not directly software-related.

Performance management wont just keep your users work-ing more efficiently; it will also save your company a smallfortune. For example, an IDC study at a large consumercompany in 2006 estimated that each help-desk call tookemployees away from their tasks by an average of eight min-utes. Multiply those eight minutes by the number of work-ers calling the help desk and the costs of maintaining thehelp-desk staff, and you have an idea of how much moneycan be saved by even a fractional reduction of these calls.

Regardless of the size or scale of your organization, the timespent supporting employees is significant. By creating pre-dictable patterns of support it is possible to minimize the in-vestment and effort associated with ongoing performancesupport.

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In the final preparation phase, youll develop organizational mod-els and roles and responsibility definitions to support the identi-fied business processes and goals. Youll also help initiate the busi-ness transition to your new solution, usually in partnership withthe leaders of your organization and your HR team.

The nature of the business process changes will dictate how orga-nizational structure and individual roles change. For example, ifyou are converting a business process dispersed throughout theorganization to one that is centralized, roles and organizationalstructure will likely change significantly. You will have to reviseyour organizational structure, establish new roles for individuals,and create a new flow of information and work processes. Thistype of change is considerably more significant than if you weresimply asking an individual to execute the same business processwith a new tool.

In the continuous improvement phase, youll be constantly work-ing with leaders and managers to be sure your employees are per-forming the tasks theyve been assigned and that the appropriatehandoffs are taking place between team members. In addition,you must verify that the organizational structures and supportsystems are in place to keep the process moving efficiently.

In a way, each process within your organization is like a crazy relayrace; or rather, several relay crazy races running at the same time.Batons can sometimes pass from one role to another (and thenback again) at a dizzying pace. Managers must act like gatekeeperswho communicate not only the individual roles and responsibili-ties of each runner, but also where the handoffs occur acrossmultiple processes happening simultaneously. Clear definition ofroles and responsibilities and metrics is essential to have the infor-mation available to users and managers to be clear onexpectations.

Organizational Design and Structure

Like all organizations, yours has some kind of design andstructure; but is it aligned with the new processes and technologyyou are implementing? Or do you need to make changes?

Youll use your organizational design and structure lever to alignbusiness and process requirements and metrics with process rolesand management structures.

Right at the start of your project beginning in project prepara-tion phase and continuing into blueprint youll want to have anaccurate view of your organizations business goals and opportu-nities. Youll need a snapshot of the current state of your business,up-to-date organizational charts, and accurate role and jobdescriptions. When you examine this documentation in light ofyour business case and any other drivers for your project, youllget a much clearer view of what may or may not have to change.

Early in the ASAP process, your SAP project team will have met todesign new business processes. Their results will be veryimportant for your change initiative. As part of the blueprintphase, make sure you understand any impacts the new processeswill have on user roles. During realization, youll need to assessthe anticipated changes in skill requirements, roles, and account-abilities resulting from the new processes and determine whetheryour personnel will be responsible for doing the same things in adifferent way or doing different things entirely.

Its important to consider the scale of change for each role orgroup of people and what support they need in making thechanges. For example, in our earlier discussion of skills andcompetencies we examined the training needs of the plantmanager who handled the goods receipt process. Its a truestory: when the manager was unclear about when he neededto process the goods-receipt transaction, pallets of raw mate-rials were arriving on schedule but manufacturing shutdown because the SAP software indicated no raw materialsavailable. Good planning could have avoided the situation.

Having a clear business case will ensure the expectedoutcomes of your project, avoiding missed objectives, over-spending, or an overly complex and cumbersome process.

The people in your organization dont expect that you arechanging things for the sake of change. They want and needto understand the business drivers behind the initiative.Why does this implementation need to occur? Is it toimprove the way you do business? To reduce costs? Promotegrowth? This context can provide the rationale that will

encourage user acceptance and ultimately adoption,both individually and organizationally. Resistance tochange is typically higher if these business drivers are notcommunicated.

Once youve defined the business drivers, youll be able tocommunicate your vision. Your messaging should includeanticipated project outcomes and a clear statement of thebenefits the organization expects to derive from its newSAP solution.

Communications

Almost everything depends on communications. How effectivelyyou deliver your various messages can make or break your changeproject. A clear, well-crafted, and factual information flow canbuild trust and acceptance. Infrequent, ambiguous, or misleadinginformation can cause resistance and suspicion. Your communi-cation to your organization should include clearly explained busi-ness impacts and process changes, roles and responsibilities, andinformation about the benefits of the new solution.

If you have strong leaders who provide an equally strong commu-nication channel, your OCM efforts should assist them by provid-ing messaging they can deliver throughout your SAP project.Lacking a strong communication mechanism, however, you willneed to create one. Youll also need to develop the infrastructureto support the messaging and expectations set in the individualleadership action plans regarding communication.

As experienced managers will tell you, people issues are the rootof most project failures. And the typical root cause of these issuesis that the business leaders executives, process owners,operations staff dont agree on what business problem theyretrying to solve, or what the best technology solution is, or eventhat the problem needs fixing at all. Within the projectpreparation phase, you need to establish a clear business case forchange.

During project preparation, you should start communicatingthis information through a formal project kickoff. This will allowthe vision of leaders to be shared and subsequently developed intogoals that will translate into concrete plans for project execution.At this stage of the change management effort, we recommendthat you develop a change communications strategy to addressthese requirements.

You can think of the communications lever as a marketing cam-paign for your project. It includes both internal and external au-diences, but especially targets your key stakeholders. The dual ob-jectives are to develop a plan to engage stakeholders and to createa strategy for ongoing communications with your internal andexternal audiences.

Note: A stakeholder mobilization campaign is an effectivetechnique for engaging key stakeholders and will be reviewed inChapter 3.

Gaining the stakeholders acceptance and commitment is criticalto a successful launch. This effort will involve explaining to eachindividual what to expect from this project, what is expected ofhim or her, and what constitutes your vision of success.

In the blueprint phase, you build upon your initial framework toset up a tactical plan for communicating across your

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may need to communicate at a training event at one of your facili-ties or at a particular location for a site-specific go-live.

During realization and final preparation, be sure that the timelyand consistent execution of communication continues at boththe broad, organizational level and the more specific local level foreach site or group. Its also particularly important to allow forfeedback; two-way communication will enable you to refine mes-saging to address core issues for each relevant audience.

Communication becomes primarily site-specific as you focus onthe final preparation and go-live and support stages of yourimplementation and post-go-live improvement activities. Duringcontinuous improvement, particularly if your project involvesmultiple implementations or upgrades, be prepared for questionsfrom the people handling the rest of it. Once youve reached theexalted state of go-live, youll likely be peppered with requestsfor advice, reaction, and opinions. Remember that your answersbecome part of the communications process for their part of theproject, and that by default, youve become one of their changeleaders; so make sure your answers are consistent with your com-munications plans. Youll also want to communicate proactivelywith the people on the other part of the project: make sure you letthem know the process improvements youve discovered and thelessons youve learned.

Governance and Compliance

Your organization will need clear assignments, roles, and respon-sibilities regarding decision making and decision escalation. Thegovernance and compliance lever will help you create this struc-ture and a culture of process compliance based on a specific, well-defined set of standards.

Consider this: is your organization more bureaucraticorganization or is it fairly flexible? Is governance formal or infor-mal? Is your organization process-compliant or varying inapproach? Whatever its style, the way your organization ismanaged and functions will influence the way you make decisions

organization. Referring to your change communications strategy,you must now decide how to approach each of your intended au-diences. Which messages apply to which audiences? Whats thetiming of the messaging? What is the best delivery mechanism?

You have many delivery options, from face-to-face interaction towritten communications to multimedia. You must also take intoconsideration the needs of your audiences for example,language or cultural differences when selecting means of deliv-ery. In some cultures, receiving major communications from thecorporate or head office is deemed more significant; in others,employees find it more meaningful to receive communicationsdirectly from their managers. Understand your culture and pro-vide communications from the most trusted source, which is of-ten the direct line manager. Create your tactical communicationsplan early in your communications planning. Such a plan focuseson these audience and logistical questions, helping you executeyour strategy for communications.

There are many vehicles available for communication. In asmaller organization be sure to take advantage of directcontact with employees. This will minimize cost in terms ofcommunication processes and infrastructure while utiliz-ing the most potent change vehicle available direct com-munication between leadership and the organization.

As you enter the realization phase, focus on two important levelsof communication. First, create the standard messaging that youdeliver to the entire organization. This messaging focuses onbroad-based information for example, the business rationale forproject activities, actual milestones, or project success stories.The second level focuses on communications targeted to the lo-cal or site level. Youll typically create these messages for specificaudiences rather than your entire organization. For example, you

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Lets take a look at an example of how your steeringcommittee or leadership team might act to clarify roles andresponsibility changes resulting from your project. Not longago SAP Education worked with an organization that hadmanufacturing plants all over the world. Each plantemployed forklift operators, but in Europe the operatorswere classified by the local union into three different posi-tions: forklift operators who moved raw materials, thosewho transported work in progress, and those who movedfinished goods. In North America, on the other hand, therewas only a single role.

At first glance, this did not appear to be a big issue. But theproject team was unable to agree on how to define the posi-tions, which could have resulted in lot of additional work, aseach role required unique security definitions, training andsupport planning, hiring plans, and so forth. But after con-sulting with business process owners and business leaders,the steering committee found that a single job definitionwould be sufficient, even given the European requirements.The European branches were happy as long as the three em-ployee groups were trained separately. The steering commit-tees ability to balance local needs with efficient operationsmade the difference and prevented a good deal of unneces-sary redundancy.

While this example is global in nature, often organizationsdevelop with different processes being used at different loca-tions as close to each other as across the street. Reconcilingdifferences and selecting a shared path forward is what willallow and afford your organization a simpler path forward.These decisions will require alignment of leadership and de-cision makers as they will be accountable for reinforcing andcoaching the organization through change.

and put new business processes in place, both during your projectand in the long term.

When you set project roles and responsibilities, youre using a keyfunction of your governance and compliance lever. Its somethingthat should be completed very early in the project preparationphase. Its during project preparation that youll align groups andtheir leaders to specific components of the project and establishtheir accountability for the success of those components. Youllalso want to establish who has decision-making authority forwhich steps along the way so there is no question later if indeedthe road gets bumpy.

Youll also want to put together an issue escalation process just incase one of those bumps turns into a mountain. For example,when you are defining business processes during the blueprintphase, you may discover that there are duplicate or conflictingways of performing the same task. Typically the project team is re-sponsible for developing a common approach; however, someonein your organization must be responsible for making the final de-cision. Here, in the project preparation phase, you need to decidewho is responsible for making, implementing, and enforcing thesechoices.

As you begin to align people and groups with project roles and re-sponsibilities, make sure to keep leaders aware of the implicationsof their decisions and actions. You should also make sure yourbusiness owners stay abreast of process changes and understandthe escalation process while youre still in the project preparationphase. If they dont, your blueprint process could be impeded withunclear decision making or lengthy and confusing escalations.

In the blueprint and realization phases, the steering committeemeets regularly to provide direction and reinforce progress.

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phase to determine what KPIs (or other performance measures)your organization will use to measure performance. Are theyconnected to the same business goals that are driving this project?If so, you can align the KPIs with specific user roles and responsi-bilities. By aligning the success of the project with individual orgroup performance measures, youll encourage individuals andgroups to behave in a way that will lead to your projects success.

As you begin development in the realization phase, make sure toengage the extended change network youve developed for yourproject. Your network, which includes subject-matter experts(SMEs), user groups, and other stakeholders, can assist you withtesting, acceptance procedures, and performance support. By in-volving this extended network, you reinforce shared ownershipacross the organization and emphasize that project success doesntjust reside with the project team or the change team.

An important part of your work with your performance manage-ment lever will be to build user-performance requirements andexpectations into your role impacts your definition of how

As the nature of the upcoming changes in your organization be-come more apparent during the realization phase, youll continueto clarify expectations for the-post go-live environment for bothleaders and users. At this point, leaders must effectively (but po-litely) reinforce the view that change is going to occur and it isntoptional. This reinforces direction and encourages useracceptance and adoption. The organization will continue to assisteach person with adoption as the project moves forward to go-liveand beyond.

Youll continue to reinforce user expectations and build processchange acceptance during the final preparation and go-live phas-es. Its particularly important for your leaders to visibly reinforceprocess change during this period. With any new change therewill be a settling-in period when users feel uncomfortable doingnew work or working in a new way. Once the new work becomessecond nature, however, it will be more comfortable and perform-ance will improve. Its critically important for managers tosupport their teams and team members during the transition.

Performance Management

The performance management lever ensures alignment of indi-vidual performance with the organizations strategies, goals, andobjectives.

Some organizations have mechanisms to measure and manageperformance on the job; others have very few. How will your or-ganization measure performance after this change project?Whether formal or informal, performance management processeswithin a company tell employees what is important, what isacceptable and desirable in work performance, and where to puttheir effort and attention.

Most organizations use some type key performance indicators, orKPIs, to measure the performance of their business processes andsubprocesses. Its important to have a clear view of them; work intandem with your business process teams during the blueprint

However you measure performance and project accounta-bility, make sure you include the entire organization. Suchinclusion makes everyone accountable for the success ofyour project not just the project team. It also has anothereffect: when the organization shares accountability, it alsofeels a sense of shared ownership. As the old saying goes,people dont hurt what they own. People with a sense ofownership are far more likely to be committed to the suc-cess of your project than those who feel the new solution isbeing forced on them.

Very simply, people pay attention to activities that engageothers. So be aware that the focus and attention by your or-ganization guides the focus and attention of each employee.

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Use the project preparation phase to examine your project scopeand its expected results and benefits. Then assess how youll moti-vate individuals and groups to achieve the desired projectoutcomes. You may or may not require a change in financial re-wards, but youll almost certainly require nonfinancial rewardsand recognition.

You can use the incentives and rewards lever in tandem with per-formance management to motivate employees, encouragingthem to do what needs to be done quickly and effectively. In therealization phase, review how youve defined your desired behav-ior shifts and make sure youve clearly established responsibilities,accountability, and the metrics to measure performance.

the impending changes will affect user roles. (Youve already donepart of that work if youve defined work impacts.) This will helpyou establish the criteria by which youll determine that an indi-vidual user or group has successfully transitioned to the new solu-tion. After the go-live phase and during continuous improve-ment, youll do performance checks on users or user groups tofind out how theyre doing against the KPIs you established earlier.

Note that some KPIs may have changed over time. Its a wise prac-tice to check your KPIs every time you change a business processand to communicate any KPI changes to anyone who will beaffected.

You may also want to consider using actual user-performancedata to support your post-go-live coaching and reinforcement.Products such as Knoa User Performance Management for SAPcan give you accurate metrics regarding how your users are doingwith their new responsibilities or tasks, right down to the individ-ual user level if necessary. The more data you have, the better youcan manage user performance and the more easily you can identi-fy the areas in which they need to improve.

Incentives and Rewards

Use the incentives and rewards lever to motivate individuals with-in your organization to act in ways that will further your businessobjectives. Incentives and rewards provide reward and recognitionand bonuses, promotions, and compensation consistent withgood performance.

How do you really motivate and reward your people? Its not justwith money; there are other measures that drive behavior. If peo-ple are clear whats going to be measured and whats important toyour company, they can focus on those things and behave accord-ingly.

Create positive momentum in your organization bypromoting and publicizing actions and behaviors that mod-el the changes you are looking for: bulletin boards, photos,contests, newsletters, and so on are all useful to engage andmotivate performance.

As you move into final preparation and go-live, ensure that yourleaders and managers fully understand your incentive programsand the goals theyre meant to achieve. Youll also want to be cer-tain to align any existing incentive programs with your new busi-ness processes. The last thing you need is an incentive to dothings the old way!

Review your incentive program during continuousimprovement. Is the system now in place helping your organiza-tion reach its desired results? Youll need to check your businessmetrics to make sure. If so, congratulations! If not, its time to re-examine and redefine the program.

Many SAP customers successfully use super userprograms to offer user support. Typically, such programsdevelop as an extension of the group, frequently called acenter of excellence (CoE), that provides ongoing userand system support.

This network of super users will often create itself naturallyeven if it is not formally managed or officially utilized. Anygroup will find its go-to people and make use of them onan informal basis. A formal, company-supported super-userprogram, on the other hand, allows the official project andsupport groups to leverage such go-to people or local ex-perts as a mechanism for feedback and information flow. Italso allows for recognition of their efforts, an importantpart of the incentives and rewards lever.

A May 2006 survey of SAP customers found that the compa-nies that had the most successful support organizations hada super-user program in place. These networks were organ-ized either by business process or by functionality.

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Hiring and Selection

Your hiring and selection activities (for example, retrain or hire;grow organically or acquire) should focus on a single goal: build-ing project success by building the right team at the right time.

Depending on your projects scope and scale of impact, you mayneed to employ a variety of strategies to successfully transitionand prepare your workforce. Are you bringing in the right peopleto complement the skill sets of individuals already in your organi-zation? Together, will they be able to execute the new businessprocesses and successfully operate the new systems youre puttingin place?

Given your work with other levers through project preparationand blueprint, you should have a clear, current snapshot of yourorganization and its capabilities during the realization phase. Youshould also have a very clear picture of how the project could im-pact your organization. Use that picture to help you determinepersonnel shifts or transitions youll have to make to achieve yourproject and business goals.

In the realization phase, you should make sure that yourtransition plan for new and existing employees has beendeveloped. Your plan should anticipate how any transitions willchange your organization and institute policies and procedures toset expectations and deal with changes.

During design, you should also consider your super user strate-gy. For example, you may want to create super-user skill setsacross the organization to reinforce and support the changes thatare coming until they become sustained and adopted across theorganization.

Figure 4: Super-User Programs in Successful Support Organizations

62%

86%

Levels 4 and 5All companies

50%57%

Levels 4 and 5All companies

Most successful COEs have aKey/Power User program in place% of companies with Key/Power

User programs in place

...but are aligned by businessprocess rather than functionality

by only a small margin% of companies aligned by

business process

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3. Create incentives and rewards that focus the sales organizationon implementing the new process.

4. Ensure strong leadership of your initiative, both from a sponsor-ship and day-to-day leadership perspective

5. Select individuals within the organization who have the skills tosupport the initiative, or hire individuals with these skills. (Or,you may choose to do both.)

6. Track the performance of your organization in implementingthe new process, both from a user progress and developmentstandpoint and a results standpoint.

7. Through appropriate governance and compliance, make surethat the right work is being done and measured. If your initia-tive is successful, your measures will show a shift in behavior asyour sales organization integrates the new process into its dailywork.

In realization and final preparation, youre looking for confirma-tion of any HR policies and practices that may be needed to sup-port your business transition requirements. Will there be a reduc-tion in workforce? Will you be transferring responsibilities to adifferent area of the company that could result in relocation? Willthere be additional hiring or different skill-set requirements? Haveany jobs been reclassified through organization design and struc-ture? Does your current staff have the necessary skills and compe-tencies? For any of these, you should ensure that you have all ofyour HR processes in place, either nationally, regionally or global-ly, as appropriate for your organization.

When you complete your transition to go-live and move into thecontinuous improvement phase, you should have a clear businessprocesses for developing, placing, or recruiting employees. Withroles defined and personnel processes in place, you can supportyour organization when you need to add new skills andcompetencies. Whether you provide these skills through newhires or via transition work with existing employees, youll be sup-porting your business goals with the appropriate individuals.

Summary

As you can see, there is a strong integration across all of the eightlevers for change, enabling you to move smoothly from projectpreparation through blueprint, realization, final preparation, go-live and support, and continuous improvement. As a result, muchof the work youre doing in each stream actually ends up beingleveraged across many areas.

Lets look at an example. If your task were to introduce a newprocess to a sales organization, your activities might involve thefollowing steps, though not necessarily in linear order:1. Announce to everyone, through your leadership team, that the

goal of the sales organization is to implement and integrate thenew process and the technology that supports it.

2. Communicate requirements and expectations so that each indi-vidual will understand what you are trying to achieve.

Leadership and Sponsorship Competencies and Skills Organizational Design Governance and Compliance

Performance Management Systems Incentives and Rewards Hiring and Selection Communication Campaign

Change Leadership Business Readiness Training & Go Live Support

Stakeholder Mgt. Organization Design

Change Communications

OCM Migrates Risk and Advances Success

Corporate Strategies Lead Change

ImprovementFocus

Business Drivers

PeopleProcess

Technology

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Also for the purposes of this document, well structure our pres-entation around a new SAP implementation. But the phases andthe change activities within them will remain the same whetheryoure just getting started with a new SAP implementation or be-ginning an upgrade.

Phase 1: Project Preparation

Key activities are to organize program leaders, key stakeholders,and team resources around a clear success vision, program struc-ture, and implementation plan, as follows: Assess organizational change history and transition risks

learned in prior implementations. Define the program business case and customize for each major

stakeholder audience. Define a charter that empowers change leaders with authority

needed to promote a common platform to source business staffand participation from other management.

Identify business factions critical to program success. Develop a systematic organizational change strategy. Define clear SAP team roles and project-team training plan. Define a program governance process. Prepare leader messaging and startup communications Create an agreed way of collaborating with the sponsors who

fund, authorize, and promote program actions. Plan individual team activities and actions by implementation

role.

During Phase 1 of your change project, youre going to be creatingthe foundation for everything that follows. Its during this phasethat you will determine your leadership teams, project strategy,and communications and governance processes. Pay close atten-tion: while each phase of our model is critical, the work you do

3. Organizational ChangeManagement and the ASAP MethodologyIn this section of the SAP OCM Toolkit, well follow the ASAProad map as a way of organizing an OCM plan. As we look ateach of its phases, well discuss appropriate OCM practices andpresent tools you can use to help focus and direct your project.Even if youre not following ASAP for your SAP implementationor upgrade, youll find it a good structure for organizing yourOCM plan.

Figure 5 summarizes what we discussed in Chapter 2. As you gothrough the ASAP phases, your OCM activities should leveragethe levers to lead change, reduce risk, and help ensure a smoothtransition to your new SAP solution.

In this chapter well present a series of common OCM practicesthat will help you accomplish your objectives. But dont assumethat theres a discrete, self-contained set of OCM actions for eachphase: there wont be. The change management activities we pres-ent here may begin in one phase and extend well into the others.In fact, they will probably continue beyond the confines of yourproject. Youll see some of the tools listed more than once, as they

Figure 5: The ASAP Methodology and OCM

apply to more than one phase of the message. The ASAP method-ology gives us a familiar foundation for describing what youll bedoing, but dont attempt to handcuff your activities to the phasesthemselves.

In addition to the ASAP Roadmap, the SAP ASAP Focus approachfor packaged solutions fits the time lines and budgets of mid-marketcompanies choosing to implement their world-class mySAP ERPsolution in 15 weeks or less. Leveraging best practices in bothscenarios, all elements of the OCM Toolkit have been aligned withthe standard SAP ASAP and Focus methodologies.

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OCM Practice:

Conduct a Business Risk Assessment

SAP OCM ToolkitThe links below provide a series of models and tools for creating abusiness risk assessment.Conducting a Business Risk AssessmentConducting a Business Risk Assessment InterviewScoring Your Business Risk Assessment InterviewSample Business Risk Assessment Invitation Letter

Your project implementers have likely already created a riskassessment for your overall SAP project. Your OCM business riskassessment, while similar, has a slightly different focus. Your busi-ness risk assessment process creates an understanding of the busi-ness challenges, obstacles, and complications (both real and imag-ined) your project faces based on the views of a representativecross-section of its stakeholders. As a first step, youll poll mem-bers of your senior management team to identify their issues andconcerns. Then youll work with key personnel representing oth-er business segments, such as process owners, site management,and deployment teams.

You can use the information gathered in the business risk assess-ment as input to the leadership action plans (described underleadership and sponsorship) in an effort to build consensus aboutitems that could delay integration across business teams andactions to mitigate these risks.

Actions1. Develop business risk assessment interview questions.2. Identify interview participants who represent a cross-section of

major stakeholders.3. Interview senior management during the blueprint phase. (Re-

member that these efforts are not locked into individual phases;this is an example, and more follow below.)

during project preparation will have the most far-reaching conse-quences and the greatest effect on your projects outcome.

OCM Practice:

Develop and Communicate a Clear Business Case for Change

SAP OCM ToolkitA Business Case for ChangeActions1. Collect business case documentation produced to date.2. Interview senior business leaders regarding strategic business

context, business drivers, and the overall strategy for gaining acompetitive advantage.

3. Identify significant business drivers behind the initiative andbenefits expected from this change.

4. Document the business case by creating a clear rationale cover-ing both technology and business perspectives and justifying thecase for change.

5. Refine or expand the business case where needed to address rel-evance for each significant stakeholder group.

6. Create a standard story line articulating the business case forchange.

7. Share the standard story line across senior leaders; adjust or refine the story line so that each leader is comfortable explaining it.

Results: Clear Business Case for ChangeThis practice produces the following: A business case for transition that is explained in relevant

and compelling terms for each significant business group A strong, clearly defined platform for transition A clear vision for success that is articulated and shared

across the senior management ranks

For Further ReadingA Sample Project Kickoff Announcement

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time to create a viable strategy and identify real leaders. While cor-porate politics will always be a factor, try to involve those peoplewho truly have the power and influence to really lead.

A successful leadership strategy will do the following: Identify the leadership team Set expectations and identifies possible constraints Establish agreement on leadership roles and processes to create

a guiding coalition of leaders a group of identified people whowill be the top-level owners of the business change process.

Actions1. Review business case documentation.2. Identify the leadership team members, critical sponsors, and in-

formal leaders for your initiative who will lead and influencechange.

3. Clarify leaders expectations.4. Define decision-making roles and the level and type of partici-

pation.5. Conduct individual work sessions to confirm agreement on

leadership roles, decision-making process steps, and method toresolve implementation issues during the course of the project.

4. Analyze feedback and document findings and determine addi-tional information to be gathered during the realization and fi-nal preparation phase.

5. Update your initial list of interview participants to include otherbusiness segments and roles (for example, process owners, sitemanagement, deployment teams) during the realization andfinal preparation project phase.

6. Conduct additional interviews. Analyze feedback, documentfindings, and provide risk mitigation recommendations.

7. Conduct follow-up interviews or focus groups as needed tomanage complex implementation obstacles.

8. Conduct ongoing interviews at each implementation site (gen-erally three to four months prior to