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Change Management for SAP projects (Whitepaper)

The example of an SAP implementation illustrates how a change management consultant can contribute to a project by identifying changes and supporting managers in their transformative role.

Companies create flexible IT environments so that they can react to the rapidly changing demands of a highly competitive global market. But this is not just a technical challenge: you also have to keep employees on board as they experience the impact of innovation and change. Successful change management is therefore one of the critical success factors for an IT project.

There are certainly many reasons why a system implementation or upgrade can fail. However, a key feature of such a failure is that companies underestimate the far-reaching effects technology changes can have on an organization and its employees. Likewise, companies take too little care to ensure that management (especially lower-level management) can actively support change processes.

Innovation at the technical level

Senior management set the project team the challenge to implement an SAP system customized to the needs of the company within a given time and budgetary framework. Legacy systems were to be terminated, and new processes and system functions documented.

Internal and external IT consultants worked on the project. They had excellent knowledge of the current system, its interfaces and how it fitted into the company’s broader IT landscape. They also knew the functional scope of the new SAP system. In agreement with the business units, they customized the business processes and set up the future system. To ensure that this was achieved to optimal effect, the project was supported by key users from the various user departments, who brought their internal experience and know-how of the previous workflows to bear on the project activities, together with their professional requirements.

Internal and external consultants were both focused on the system-related and other technical aspects of the project: for example, how must the master data be structured? Which data can be taken from the old systems? Which reports must be made available? What can already be modelled as standard, and what must be individually programmed on demand? How should roles and authorizations be defined in the system?  

Risks of an exclusively technical focus

IT has clear repercussions for people, their work processes and the collaborative environment in which they operate. But this was only taken into account by the consultants and project specialists a short time before the system Go Live. This is understandable, since the project’s spotlights were (of necessity) directed towards the technical aspects of the implementation. When the system is largely complete, training material can be defined and it becomes clearer what retraining is needed for the employees. However, at that stage it is often too late for accompanying change management activities.

Managers who have not learned about the repercussions of a system are hardly in a position to inform and prepare their teams. Employees who have not learned what will change for them personally lack orientation and become preoccupied with worries and doubts. They spread rumours about (assumed) disadvantages of the system – and this wastes energy for everybody involved. 

In any system training that follows, such employees are likely to focus their attention accordingly: they will hunt for mistakes and shortcomings in the system, which means they will learn with less motivation and success. 

Yet one factor above all is critical to the success of an IT project: future users must not only be able to master the system, but must also have confidence in the changes that are implemented through technology. Timely employee training in the new application is a necessary, but not sufficient, condition of success.

It is significantly important that management should develop a consistent and coherent understanding of the objectives behind the new SAP system. They should be able to evaluate the changes and get involved with them. To do this, they need detailed knowledge of what changes will follow the system implementation and how these will impact the employees under their management and their department. Armed with this knowledge they can inform employees about the concrete nature of the changes, the purposes and the background – which means they can also invite employees to constructively debate and participate in the change process.

Any necessary organizational steps can then be undertaken in a timely manner. An SAP implementation is thus a matter for management, from C-level down.

Change at the process and role-level

The warehouseman was responsible for order picking before the system implementation – but previously he was not responsible for recording goods outwards in the system.

In a system implementation, task assignments change for existing roles, while new roles (for example master data management) come into being. It is important for managers to know whether the roles and tasks are the same before and after the implementation, and if not, where exactly the differences are.

By contrast, as far as the people directly engaged on the implementation project are concerned, only the future boundaries of each role are important, as these determine the access rights to the system.

Change at the level of personal work organization and customary practice

The warehouseman must in future book goods inwards himself, and immediately; simply collecting the delivery notes and letting the temp book deliveries once a week is no longer acceptable, when we are working with a real-time system.  The order picker, who formerly decided for himself in which order he should pick up articles, will now have this prescribed by the system – though he would from time to time proceed differently, if he could.

For employees, the really noticeable changes take place at the level of the process; this is the level of individual work organization and customary ways of doing things. Some customary workflows and ways of thinking have to change, and sometimes the familiar day-to-day collaborative work with colleagues will also change.

When this kind of change has not been foreseen and employees experience them at first as a deterioration of their personal situations, resistance is nourished. “IT has implemented another new system, but nobody has a clue what that means for me” is a complaint you will might then hear from the affected users.

Change managers on the project

It pays to appoint people to be responsible for change management if you wish to ensure that the impact of the implementation is seen as early as possible, that management can support the process, that employees are involved in a timely manner and that the project thus proceeds to the desired successful conclusion.

The change management team work as a second spotlight on the project, one that illuminates the impact of the new solution on human resources and thus makes them visible for employees, managers and the project team, earlier than would otherwise be the case. Change management puts the person centre-stage.

In an SAP project, the change management function has some important tasks. These include taking care of regular and reliable communication, together with ensuring the system and process-related training of future users.

The change management team has further tasks relating to the system’s impact on people and strengthening the role of management.

Achieving a common understanding within management

A common understanding of the SAP implementation can be developed around the following points in management workshops:

  • What is the company’s current situation?
  • What are the reasons for the change (of IT system)? Why is it necessary?
  • What objectives will be achieved with the new system and how?
  •  What changes for employees? And what doesn’t?

With the resolution of these questions you’ll get management consensus and the foundation for effective communications with the workforce.

Identifying changes

Managers who want to win their colleagues’ support for change need information about how the new (or upgraded) system can affect and impinge upon individuals. To do this it isn’t really necessary to understand every change in advance and down to the last detail. What’s important is to be able to foresee and calculate the impact.  One of the challenges for change managers is to work through these topics with the organization’s leadership.

  • What roles existed up to now, and what roles will exist in future?
  • Do existing roles need to be tailored differently?
  • Do the same employees fulfil these particular roles?
  • Where is there more work, and where less?
  • Who will have to reorganise his/her work routines?
  • In which respects is collaborative work with other departments changed?

Key Users and management can identify these changes. Managers can further identify what adjustments lie ahead at the level of their own departments. Any doubts – or opposition – that may arise within the workforce will then become clearer. As a result management can direct their attentions to how they can effectively support their colleagues.

Change management is a distinct task within the project and should be staffed accordingly: for example, with employees who are well connected across the company, are well respected among management, have experience with change management and project work generally and – ideally – bring knowledge of SAP and business processes. To supplement this in-house know-how, an external change management consultant can coach internal change managers and relieve them of some of the workload pressures; alternatively, they can take charge of the entire change management function.

Summary

Many IT projects, and above all SAP implementations, change more than just the system landscape. However the project team doesn’t have change management on its own radar because project team members are focused on technical issues. In order to broaden the scope of the project it is important to make somebody responsible for change management early on. The important challenge is to strengthen the organization’s managerial team so they can proactively support the workforce throughout the transition.

Some employees fear change and greet it with resistance. However, being able to assess the concrete impact at the personal level in advance has a positive effect on employees’ readiness for change. By attending to these issues management signals the value it places on the workforce – and this, above all, is the key to successful change management. 

Tasks for Change Managers on an SAP project

  • Get all managers on the same page about  the objectives of the SAP implementation
  • Promote understanding of the concrete changes for managers and employees
  • Support managers in their leadership role in the change management process
  • Ensure that there is a regular and bidirectional flow of information and communication
  • Organize process and system-oriented training of the workforce