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Enterprise Applications Center of Excellence

Enterprise Applications Center of Excellence. A Maturity Model Michael Doane META Group. Why an ERP Center of Excellence?. An optimization of business processes that drive business benefit continually An optimization of end user competency and employee fulfillment of business processes

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Enterprise Applications Center of Excellence

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  1. Enterprise Applications Center of Excellence A Maturity ModelMichael DoaneMETA Group

  2. Why an ERP Center of Excellence? • An optimization of business processes that drive business benefit continually • An optimization of end user competency and employee fulfillment of business processes • Continued coherence and integration of functionality and data through all process chains

  3. Center of Excellence Functions Business Prepare the company for transformational change (all the time) To Be Continuous business improvement Optimization of current system usage As Is Maintenance and support of ERP and related functions (ERP/CRM/SCM) IT Parameters: Business Applications Span (ERP is the backbone)

  4. The Enterprise Applications Value Chain Profit & Loss Key Performance Indicators • Sample Business Performance KPI’s • Return on sales • Return on assets • Net sales per employee • Ratio of Assets/Liabilities • It is imperative to link end users to profit & loss • Without measurement, you cannot begin • Business process improvement is the source of measurable business improvement • IT also has its ‘business processes’: reduction of IT costs applies to this value chain Business Process Drivers Sample Major Business Processes Order Fulfillment Process Procurement Process Production Process SAP User Competency Software

  5. Foundation of Organization Planning • Two aspects of “IT” • Business-specific activities = the Center of Excellence • Infrastructure/support ~ “Foundation Services” Center of Excellence IT Resource/ Governance Infrastructure/ Operations Architecture

  6. Enterprise Program Management Multi-site Virtual CoE Remote Process Owners Process Oversight Users Users Users Users Users Users Users Users Help Desk Continuous Education Continuous Education Production Logistics Finance Sales Functional Oversight Software Configuration & Support Custom Applications Custom Applications Integration Management (Functional, Cross-Application) Integration Management (Technical) Production Control/Change Management

  7. META Group Maturity Modeling Levels 1-5 Elements or best practices (weighted) Up to 10 per maturity level Categories METAmap (META Group Maturity Assessment Program)

  8. Business/ Enterprise End Level IT Alignment Applications Users Infrastructure There is a link between ERP is not overly Basic end user training is ERP infrastructure is Core ERP 1 business and IT for customized; core complete. adequate. configuration updates. implementation is complete ERP is the backbone of End users fulfill ERP The role of business in ERP enterprise applications. Stable ERP 2 functions without excessive ERP infrastructure is stable. evolution is defined. Applications interfacing is help desk or support. complete. Business has active ERP infrastructure is flexible. ownership of business The applications portfolio is End users receive periodic CoE Defined 3 Apps data is generally processes. Current KPI is inventoried. refresher training synchronized. measured. KPI measures and targets are End users are trained to in the system. EPMO directs The applications portfolio has business processes and Enterprise applications CoE Managed 4 business process been rationalized. continuous training is in infrastructure is flexible. transformation. place. Business process change is End user job performance is Enterprise applications guided by KPI performance The applications portfolio has CoE Evolving 5 linked to business process infrastructure is adaptive to and configuration is in the been optimized. performance applications changes. hands of business. Center of Excellence Maturity Model

  9. Scale 1=Unimportant, 5=Very Important The Consequences of Implementation Concerns Pre Implementation Mistakes Noted After Implementation Source: The State of ERP Services Multi-Client Study, META Group 2003

  10. 0 / 10 Do you have some form of a CoE? • Yes • No Cross-Tab Label

  11. Level 1 Core ERP • ERP is at the center of an applications portfolio • The elements for this level are generally identical to those of a successfully completed implementation • It is imperative to keep the project team intact and ready for transfer to the Center of Excellence

  12. Level 2 Stable ERP • Most new ERP installations take 3 to 4 months to achieve a state of stability • In this period, project staff transitions to the Center of Excellence

  13. Level 3 CoE Defined • After stabilization of ERP, the Center of Excellence is functional • Attention turns to measures & benefits

  14. Level 4 CoE Managed

  15. Level 5 Evolving CoE

  16. End Users

  17. Business/IT Alignment

  18. Infrastructure

  19. Enterprise Applications

  20. Results by Maturity Elements Results by Category

  21. Overall Results METAmap (META Group Maturity Assessment Program)

  22. 0 / 10 Of those who have a CoE, which level have you attained? • Core ERP • Stable ERP • Defined CoE • Managed CoE • Evolving CoE Cross-Tab Label

  23. Keys to CoE headcount control: • Support given to Business Process Owners • Direct software configuration by CoE (business-led) • 3. Active competency management/continuing knowledge transfer

  24. Conclusion/Recommendations • The CoE must be led by business staff and business concerns (measurable) • A CoE will be sustained if measurement and business benefit are at the foundation • People/processes tend to decay through time • Maturity is accelerated when benefits are achieved

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