issue no. 1
june 2011
meet us in Barcelona - in September 2011 (see page 62)
360°
the business transformation journal
in collaboration with
METHODOLOGY | RESEARCH
TRANSDISCIPLINARY
KNOWLEDGE FOR
BUSINESS
TRANSFORMATION
The Diverse Potential of a Global
Network of Experts
by Axel Uhl and Christoph Pimmer
This translated article is used by courtesy of „OrganisationsEntwicklung – Zeitschrift für Unternehmensentwicklung und Change
Management“ (ZOE Nr. 1/2011).
Business Transformation:
Complex Change Projects As a
Challenge for Managers
The rapidly changing general economic, social, and ecological conditions require an increase in (pro-)
active reactions from managers. In
one study, for example, 85% of the
respondents claim that their company has frequently had to deal with
major changes (KPMG, 2009).
The fundamental and complex
change projects are often not restricted to company limitations but
have an effect on the entire value
chain. Radical changes can be
subsumed under the term “business transformation“. In this context, business transformation (also
abbreviated to “transformation“ in
the following) can also be seen as
a radical form of organizational development. Typical transformation
projects include mergers and acquisitions, the introduction of Shared
Service Centers, business process
outsourcing, the introduction of
enterprise software, or initiatives
that are motivated by sustainability requirements. Unlike business
process re-engineering (Hammer,
1990), which focused closely on
the business processes, a holistic
view is taken here, whereby the actual implementation of transformations plays a key role. In contrast to
change management (e.g. Harmon,
2003), it does not deal solely with individual change projects. The focus
is precisely on the general “transformation capability“ of organizations,
which includes several factors, such
as technological competency, professional competency, and social
competency (vom Brocke, Rosemann, 2010).
21
METHODOLOGY | RESEARCH
Despite the frequency and major
significance of such transformations,
managers rate their companies‘
competencies rather poorly in this
respect (Capgemini, 2007, 2009).
The success quota of business
transformation projects is also correspondingly low, with one survey, for
example, putting it at less than 40%
(Isern, Meaney, & Wilson, 2009).
22
Role of IT and Business Transformation: Close Integration
Through Business Processes
Besides a host of other factors, Information Technology (IT) is seen as
a possible trigger of business transformation, an example of this being
the introduction of enterprise software, such as an ERP (Enterprise
Resource Planning) system. Due to
its close integration with business
processes, IT is also an important
part of almost any transformation.
For example, when Hilti, a global supplier of leading technological products, systems, and services for the
construction industry, transformed
itself from a producer and seller to
a context-appropriate provider of
its products and services (Johnson,
Christensen, & Kagermann, 2008),
the change to its IT environment assumed a central and strategic role.
Dr. Martin Petry, CIO at Hilti: “The
global introduction of standardized
data structures and business processes as well as the supporting IT
systems created a new basis for our
business model and will enable us
to continue to optimize our business
processes flexibly and with our customers constantly in mind.”
The mutual dependence of IT and
business processes requires considerable flexibility in enterprise software to be able to react quickly to
changes.
SAP: Transformation from
Software Vendor to Strategic
IT Partner
SAP, market leader in the field of
enterprise software, also sees the
need for greater flexibility in its
products. With the integrated applications from SAP Business Suite,
business and IT strategies can be
coordinated and implemented, and
thanks to their modular design, the
solutions can be combined flexibly
with other solutions as required.
SAP Business Suite applications
are based on the principles of an
open, service-oriented architecture
(SOA) and the SAP NetWeaver
technology platform.
While classic SAP consulting concentrated on the introduction of
such technologies, the company observed how customers’ needs were
expanding from technical functions
to business benefits. As an initial
response to this, a team comprising 12 business consultants was
assembled at SAP in 2000 with the
purpose of focusing more closely on
business requirements when introducing software solutions. Lars Gollenia (Global Head Business Transformation Services, SAP): “That
was the signal for our consulting organization to stop considering SAP
projects as purely IT centric and
start taking greater responsibility for
the business units. To achieve this,
however, we needed consultants
who were fluent in ‘business language’ as well as in ‘IT language’.”
Following extensive and controversial debates about the core
competencies of SAP, Business
Transformation Consulting, SAP’s
organizational unit for business
transformation – later renamed
Business Transformation Services
(BTS) – was finally set up in 2007.
METHODOLOGY | RESEARCH
BTS’s mission is to bridge the gap
between strategy and IT. One of the
key aims of BTS is to provide the
customer with more comprehensive
support and advice when transforming their processes and organization.
Nicolas Steib, Senior Vice President at SAP Consulting: “We need a
more holistic approach to consulting
because the greatest challenges in
transformation projects do not involve technology (any more) but the
control of people-related, or “soft”,
factors.” Here, SAP found itself confronted by a lack of suitable internal
consultants for topics of business
transformation. Gollenia: “There
was a lack of experts capable of
dealing with the topic of business
transformation and IT at a senior
management level.”
Within this context, the lack of explicit knowledge about business
transformation also represents a
further challenge. Dr. Roberto Klimmek, Director in the Finance sector
at Daimler, with extensive experience launching SAP projects: “Usually, experiences gained from the
projects remain in the minds of the
transformation managers and consultants responsible. Knowledge
from these projects is seldom systematically collected and processed
in a valid, scientific manner.”
Business Transformation
Academy: The Generation of
Unique Knowledge
To address these challenges, the
concept of the Business Transformation Academy (BTA) was developed in 2009. The aim of this new
organizational unit is to generate
knowledge about the triggers, strategies, and practices of major business transformation projects. For
this purpose, the BTA coordinates
and manages a transdisciplinary,
interdisciplinary, and intercultural
Thought Leadership Network. This
international community of experts
consists of senior management
representatives from major SAP
customers, and also leading scientists and experienced SAP consultants. It embraces experts from a
broad range of subject areas and
disciplines, such as strategy development, business process management, personnel and change
management, strategy, psychology,
sociology, or IT.
Apart from incorporating existing
literature, this knowledge development is based primarily on the cooperation of the network members involved. Professor Jan vom Brocke,
Director of the Institute of Information Systems at the University of
Liechtenstein: “Cooperation within
the network is not based on paid
services but on the intrinsic interest
of its individual members in the topic
of business transformation. Together with experienced and dedicated
people from science and practice,
we can make significant progress.
For this, the Thought Leadership
Network provides a unique platform
and the members quickly notice that
the knowledge they have contributed is repaid to them many times
over.”
Another typical characteristic of the
network’s knowledge work is the diversity of approaches and perspectives. The work carried out in the
Business Transformation Academy
can be defined as different individuals from numerous disciplines collaborating to generate knowledge
using a variety of methods and in
consideration of different concepts.
These experts work together on is-
23
METHODOLOGY | RESEARCH
Business Transformation Management Methodology (BTM²)
BTM2: Iterative process of phases and disciplines
“Reality is made of circles but we see straight lines“
Peter M. Senge (The Fifth Discipline: The Art & Practice of The Learning Organization)
Envision
Engage
Transform
Optimize
Nevertheless, every Business Transformation is an iterative process that goes through different phases in recurring cycles.
Phases
Envision
Engage
Create case for change, sense of urgency,
strategy/ vision
Empower people to act on the
vision and plan the effort
Iterative process
24
Disciplines
Optimize
Transform
Internalize, institutionalize and optimize
transformation; create stability
Change behavior, processes,
technology, culture, values …
© 2011 SAP AG. All rights reserved.
sues, using a variety of approaches.
Firstly, qualitatively oriented case
studies about transformation projects are written. These transformation cases are contributed and prepared by network members, and the
studies focus on the main challenges in a completed or ongoing transformation project and how they can
be overcome. The data is collected
on the basis of interviews with the
managers responsible for the transformation project. When choosing
the interview partners, they try to
cover as many different perspectives as possible, such as local,
global, or business and IT. Michael
Brandenburg, Director of the IESE
Business School in Barcelona: “The
case studies concentrate on the issue of the principal challenges and
Internal
how to overcome them. We make
selective use of case studies in our
management seminars because
experience of transformation from
previous projects in the form of “lessons learned” and “better practices”
can make an important contribution
to the success of current and future
projects.”
However, the case studies not only
relate to customer projects but also
examine internal SAP transformations, such as transforming the
company into a role model for sustainable business operations. Within this context, the Academy is also
seen as an important instrument for
internal transformation. “It was as if
someone held a mirror up in front
of me and I relived and reflected on
all the important decisions. As I did
1
Fig. 1:
Iterative Process
of Phases and
Disciplines in
BTM2
METHODOLOGY | RESEARCH
Business Transformation Management Methodology (BTM²)
BTM²: The big picture
Meta
Management
Orchestration of individual disciplines: Guidelines, Leadership, Culture, Values and Communication
Direction
Enablement
Value
Management
Risk
Management
Processes
Management
Program/Project
Management
IT
Transformation
Management
Organizational
Change
Management
Competence &
Training
Management
AS-ISData
Collection
Baseline
analysis
360° Strategic
Risk
Assessment
Determine
scope of
analysis
Program
Planning and
Governance
Business and IT
Capability
Assessment
Set-up &
governance
Competence
strategy
Analysis of
needs &
maturity level
Value
estimation
Deep dives for
strategic risk
areas
From template
to bespoke
inventory
Program &
Proj.-Integr.
Mgmt
To-be analysis
Stakeholder
management
Training need
analysis
Design
business vision
Detailed
business case
Assess
transformation
business case
Identify
improvements /
add attributes
Program &
Project Scope
Mgmt
Gap analysis
Change agent
network
As-is analysis
Design
Business Model
Agree
ownership for
realization
Define risk
strategy
Map selected
processes
Program &
Project Time &
Cost Mgmt
IT roadmap
plan
Communication
management
Gap analysis
Integrated
transformation
plan
Plan benefit
realization
Risk
Management
Execution
Plan process
implementation
Program
Quality Mgmt
Solution
architecture
design
Performance
management Project team
Curriculum
development
Business Case
Execute benefit
realization
Risk Monitoring
Implement
processes
Program
Human
Resource Mgmt
IT Deployment
plan
Performance
management Business
Training
preparation
Organizational
model
Review and
evaluate results
Identify
additional
improvement
Evaluate
processes
Program
Procurement
Mgmt
IT Operations &
Service
Optimization
Change
readiness
assessment
Training
Risk analysis
Establish
potentials for
further benefits
Risk Mgmt. as
part of Board
Governance
Establish CIP
Program
Reporting
IT Lifecycle
Management
Change
monitoring
Evaluation &
improvement
Strategy
Management
© 2011 SAP AG. All rights reserved.
Fig. 2:
The Big Picture of
BTM2
so, I realized just how little time we
usually invest in such things,” says
Daniel Schmid, Head of Sustainability Operations in the Sustainability department at SAP.
Besides the qualitatively oriented
case studies, statistical surveys on
transformation topics are also being
conducted, including, for example,
a business transformation study to
be carried out on a regular basis.
This diversity of roles, competencies, methods, and disciplines
represents both a strength and
a challenge: “The various concepts, interests, and expectations
of the individual internal and external (groups of) members must be
brought into line with one another,”
says Paul Stratil, CIO at SAS Automotive. But only by doing so can the
complex challenges associated with
a company transformation be overcome.
Internal
25
2
BTM2: Developing a Holistic
Method for Business
Transformation
Correspondingly, a holistic business
transformation management method – the BTM2 – has been developed by the network experts on the
basis of the generated case studies,
existing models, and transformation
literature. Based on the phases of
envision, engage, transform, and
optimize, this involves collecting
and integrating discipline-specific
technical and methodological expertise from the transformation-relevant
subject areas (see Fig. 1). The BTM2
provides practice-oriented guidance and support for transformation
consultants and SAP customers,
integrating the disciplines of strategy, value, risk, IT transformation,
program, project, change, process,
and competency management (see
Fig. 2). While strategy, value, and
METHODOLOGY | RESEARCH
The BTM2 – Meta Management
Management layers and key management roles
Formal Management roles
Informal Management roles
Executive Steering Committee
Power promoter (sponsor)

Responsible for the creation of the meta management
framework: facilitates capability, culture and environment to
change

Owner of Business Transformation; takes strategic decisions
Sponsorship at the highest level of leadership and the most
powerful lever for change
  (Very) high hierarchical position



Business Transformation Manager
Manages the overall transformation program from the beginning
to the end
  Reports in the role of a key adviser to the executive steering
committee.
  Has complete overview of all programs; plans programs together
with program managers and considers dependencies between
programs
Formal power and credibility
Empower program and project managers. But never mix
sponsorship with project management

26
Relationship promoter
Social competence, charisma and persuasive power
  Strong network


Certain level of expert knowledge
Program Management
Functional promoter
Tailors a program in alignment with business transformation
goals
  Decides on policy, governance, reporting, document standards
and program structures; accountable for finance, controlling and
resource management of program


Very high level of expert knowledge
High interest (and experience) in transformation topic

Works in the line

Project Management

Initiates, plans, executes and closes a project

Accountable for accomplishing the stated project objectives with
respect to quality, cost, time and scope.
Internal
3
© 2011 SAP AG. All rights reserved.
risk management set the course for
a business transformation, the other
disciplines are attributed with providing support functions. The discipline
of meta management, incorporating
such topics as culture, values, and
standards, as well as formal and informal structures and roles (see Fig.
3) also make up the framework of
a business transformation project.
The method was devised on the basis of a specially created case study
that describes a fictitious transformation project, and nine different
teams comprising SAP experts, university professors, and managers
have developed and coordinated
the above-mentioned disciplines.
The BTM2 serves as a method for
the consultants of SAP’s BTS unit
and it will also be available to the
network partners and customers.
Sharing Knowledge in the
Academy: Internal and External
Dissemination
Besides the generation of knowledge, the sharing of knowledge and
“networking” are also key elements
of the Business Transformation
Academy. For this purpose, events
are held several times a year at
which the participants get to meet
each other in person.
Fig. 3:
Management
Layers and Key
Management
Roles
METHODOLOGY | RESEARCH
Dominic Houlder, Strategy Professor at the London Business School:
“The BTA events are a good forum
for finding out about the latest case
studies and discussing their results
together. I had the opportunity of
working together with network members who provided important information and contacts. For example,
we wrote a case study about one
of the biggest transformation projects at Shell and we interviewed the
global Chair for Human Resources
and his immediate representative.”
In between these events, various
small groups carry out work in “think
tanks”. Most of this work is done together “virtually” and is coordinated
by the Business Transformation
Academy.
The knowledge is not only shared
internally, but also made available to
a wider audience in the form of conferences or through publications in
journals as well as in scientific media and handbooks. Concrete plans
include the publication of this BTA
e-Journal and the development of a
business transformation handbook
that contains important work by the
network members and consolidates
important findings. Plans are also
underway to organize a Business
Transformation Management Conference in 2011, at which network
experts will share their thoughts with
other practitioners and scientists.
Transformation Training: Transfer of Comprehensive Transformation Competencies
Lars Gollenia sees the transfer of
knowledge as one of the BTA key
aims: “We can only help our customers with their transformations
if we pass the know-how onto our
consultants and partners.”
For this purpose, training and certifi-
cation to become a Global Business
Transformation Manager have been
developed together with SAP Education.
Arno Onnen, Global Portfolio Manager at SAP Education: “We were
happy to take up the issue of Global
Business Transformation Manager
certification even though we were
immediately breaking new ground in
two respects. Firstly, after Associate
and Professional levels, it will be our
first Master certification. Secondly,
it is the first of our further training
products with which we are embarking on management training. Our
contacts with the various business
schools were very useful for developing the training curriculum.”
These training and education programs should provide those in positions of responsibility for business
transformation projects with the right
qualifications for their complex task.
The training will enable experienced
consultants and program managers
to work as “trusted advisors” (senior
management consultants) within the
scope of transformation projects.
The training will also build on technical and methodological as well
as behavioral competencies. While
the former can be developed using
e-learning-based electronic, mediarelevant presentations, mostly in
the form of self-study, behavioral
competencies are communicated by
way of seminars, using role plays,
for example. The final certification
exam will test both competency areas integratively in the form of theory tests and assessments. The first
program pilot has been carried out
internally at SAP in cooperation with
SAP Education, although in future,
participation in the training sessions
will be open to all network members
and partners of SAP.
27
METHODOLOGY | RESEARCH
Service
BIBLIOGRAPHY
Capgemini, 2007. Trends in Business Transformation. Survey of European
Executives. Consulting in co-operation with The Economist Intelligence Unit.
ᐅᐅ Capgemini, 2009. Consulting’s Trends in Business Transformation.
ᐅᐅ Isern, J., Meaney, M. C., & Wilson, S., 2009. Corporate transformation under
pressure. MCKINSEY QUARTERLY, 24.
ᐅᐅ Johnson, M. W., Christensen, C. M., & Kagermann, H., 2008. Reinventing
Your Business Model. Harvard Business Review, 1-12.
ᐅᐅ KPMG, 2009. Ziele definieren - sicher ankommen. Professionelle Steuerung
von Veränderunsprozessen und der Beitrag des Human Resource Managements. KPMG Studie.
ᐅᐅ Hammer M., 1990 Reengineering work: Don’t automate, obliterate. Harv Bus
Rev 68:104–112.
ᐅᐅ Harmon, P., 2003. Business process change management – a manager’s
guide to improving, redesigning, and automating processes. Morgan
Kaufmann, San Francisco, CA.
ᐅᐅ vom Brocke, J., Rosemann, M., 2010. Handbook on Business Process Management, Vol 1. Springer, Heidelberg, 2010.
ᐅᐅ
28
AUTHOR
Christoph Pimmer is a research associate at the University of
Applied Sciences Northwestern Switzerland (FHNW). He studied
social and economic sciences. He worked on a number of transdisciplinary projects in Austria, Switzerland and Central America
in the area of education, technology-enhanced, mobile learning and information management in a university and corporate
context. He has also had a number of works published in these
areas and is a member of several international practical and scientific networks such as the London Mobile Learning Group. His
current work and research activities focus on the area of mobile
learning, work-based and medical learning.
christoph.pimmer[at]fhnw.ch
Axel Uhl: Professor Dr. Axel Uhl is heading the Business Transformation Academy at SAP. Furthermore, he is a Professor at
the University of Applied Sciences Northwestern Switzerland
since 2009. Axel Uhl received his doctorate in economics and
did his master’s in business information systems. He started
his career at Allianz, worked for DaimlerChrysler IT Services,
KPMG, and Novartis. His main research and areas of interest
are sustainability and IT, leadership, and business transformation management.
a.uhl[at]sap.com
360° - The Business Transformation Journal
Publisher: Business Transformation Academy. Published four times a year in electronic format. | The Business Transformation Academy (BTA) is currently a research project of the University of Applied Sciences Northwestern Switzerland (FHNW) supported by SAP,
and will soon be transformed into a Swiss non-profit association. | Note to the reader: The opinions expressed in the articles in this
journal do not necessarily reflect the views of the BTA. | Picture Credits: By courtesy of Sorin A. Matei (7), by courtesy of SAP image
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