Written by Cameron Berkman: Asia-Pacific SAP Sales, Alliances and BD Leader at EY
SAP plans to switch off support for its ECC6 Enterprise Resource Planning (ERP) solution in 2025. This is pushing some companies to scramble and update their legacy systems, while others take a ‘wait and watch’ approach. However, what most are missing is a significant opportunity to renovate and repair their business operating model and business processes along with their software.
There’s a well-known adage in technology circles: ‘There’s never time to do it right, but always time to do it twice’. A software upgrade is rarely quick, easy or cheap. But time and again, businesses fall into the trap of thinking that software is a simple band-aid that will solve all their problems. That’s their first big mistake.
Solving business problems is hard and it’s in our nature as humans to look for shortcuts. Software promises to be that shortcut – a way to avoid the underlying imperative to reengineer processes, reorganize structures, reinvigorate teams or rethink the very reason a business exists. The board and executive team buy into the quick fix only to discover that a technology migration is anything but a quick fix. Most companies then set about customizing their new software to suit their business processes or try to jam their existing processes into the new software. It’s like squeezing a series of round pegs into square holes. Parts of these processes usually can’t be made to fit, and so off-system ’helpers’ are engaged to take up the slack – data is taken off the system and eventually finds its way into spreadsheets but cut off and isolated from the ‘data mothership’.
The board and executive team buy into the quick fix only to discover that a technology migration is anything but a quick fix.Cameron Berkman
Every client I meet for the first time has a similar story. And who can blame them? Transforming how we do business takes time – and the process can involve some pain.
I’m reminded of that classic cartoon that does the rounds. ’Hands up who wants change?’ the leader behind the lectern asks a sea of elevated arms. ‘Who wants to change?’ he then asks of an audience looking down and downcast.
Change is hard – which is why the software salesperson can sell the band aid, despite the business suffering from the equivalent of a broken leg. However, the real fix for the ailment is, in reality, not that hard. Changing structures, job roles and processes to be ready for new software can be challenging for businesses that operate on the ‘snowflake principle’, where people are convinced that the way they do each individual part of the business process is really special and unique. Now, business processes that touch the company’s purpose, the core of their ‘why’, absolutely should be special and unique – it is these parts of a company that truly differentiate it. For example, the way a large retailer researches consumer behavior and designs new features is often at the core of their success. However the way they run accounts receivable probably isn’t. Processes that directly affect their value proposition, their brand, their staff, how they come up with new ideas or the way they engage with their customers should be treated with immense respect and care.
The better question that I would encourage any organization to ask themselves is: How do your processes reflect your company’s purpose? If you can’t make a connection between process and purpose, rather than trying to change the software to suit the process, it’s time to change the process.Cameron Berkman
But I challenge my clients to explain why some of their core business processes, such as accounts payable, accounts receivable, bank reconciliations, journal postings and so on, should be special or why their software should be customized to suit what should be standard, leading-practice processes.
In the end, it’s just change – and it can be managed. There are structured, straightforward approaches to take your people on the journey of change so that you can tackle the root causes of business process friction, and get your business ready for the software rather than the other way around. The end result is immense improvement in business agility, responsiveness to change, valued business insights, with greater efficiency.
The better question that I would encourage any organization to ask themselves is: How do your processes reflect your company’s purpose? If you can’t make a connection between process and purpose, rather than trying to change the software to suit the process, it’s time to change the process.As SAP’s 2025 deadline draws near, the EY message is clear: tackle the changes and transformation you need, upgrade early and start reaping the transformative benefits now.
The views reflected in this article are the views of the author and do not necessarily reflect the views of the global EY organization or its member firms.