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Application Management, TCO, ROI, and the Tie That Binds Them

by Matthias Melich | SAPinsider

January 1, 2005

Of course, you want fast ROI and low TCO – but these goals can work at cross-purposes when it comes to implementing and managing applications. This article offers one way to balance ROI and TCO with a platform, a methodology, and preconfigured content to both speed up implementation and prepare you for operations after go-live.

The correlation between good, strong application management and lower TCO is irrefutable. If you faithfully document activities, keep your process models up to date, follow best practices, train the appropriate people at the appropriate times, monitor and optimize operations, and control changes and updates in a fastidious manner, you will achieve lower TCO. You'll find it easier to diagnose and remedy problems. Upgrades will be less painful because you'll be better prepared. You'll keep support costs at a minimum.

An even more interesting, but perhaps less understood, correlation is that which links strong application management with ROI. Think about how much faster, easier, and more effective you can be with continuous improvement endeavors and implementation of additional business processes given perfect knowledge of your current solution landscape. To make sound decisions about how to change an existing IT solution and then actually plan and execute a change, you've got to know what you're dealing with — you've got to achieve transparency.

Clearly, you want fast ROI and low TCO. There are some choices to be made here, though. One way to achieve a fast return is simply to bring some experts on site who customize and configure your application, skip thorough analysis, and then leave without any testing or documentation. Obviously, it gets you a solution, but it is also about the worst way to go about it! What is needed instead is to attain the elusive balance between ROI and TCO — something you can achieve if you have a platform, a methodology, and preconfigured content to speed up your implementation and leave you well prepared for all operational activities after your go-live.

This, in a nutshell, is what SAP Solution Manager offers you — complete knowledge and central command of all the management activities associated with your SAP solutions that also balances quick returns with ongoing support. SAP Solution Manager runs in the solution landscape and facilitates the technical support of distributed systems. It delivers the tools, integrated content, and communication gateway to SAP that you need to implement a solution; to support, operate, and monitor a solution; and to change, test, and update a solution (see Figure 1). The result of this highly efficient and effective management command center, if you will, is markedly better TCO and ROI of the solutions that come under its management.

Figure 1
Components of SAP Solution Manager

So Long, ValueSAP!

SAP is no longer shipping ValueSAP toolset CDs, nor is it developing new content or functions for this platform. All SAP solutions are now being designed to be managed by SAP Solution Manager.

SAP Solution Manager extends and supersedes the ValueSAP toolset in the following ways:

ValueSAP Toolset SAP Solution Manager
Focus on implementation Focus on entire life cycle
Focus on components (e.g., SAP R/3) Focus on complete solution
Lack of information and tool integration Information and tool integration
Lack of consistent process orientation Process orientation

The Link Between SAP Solution Manager and Continuous Improvement of Your SAP Landscape

If you look again at Figure 1, you will see that the basis of SAP Solution Manager is a gateway between the customer and SAP, a foundation that allows for intensive collaboration between SAP and its customers. With SAP Solution Manager, SAP delivers a large improvement package with offerings that help you get the most out of your SAP solution at any time during its life cycle.

How do these offerings support your continuous improvement activities? Let's take a look:

Service Offerings

SAP offers tiered support so that you can choose the level of engagement you need from SAP. You can select the offerings in the standard maintenance fee, or choose packaged services from the empowering, optimization, or safeguarding packages, or opt for SAP MaxAttention, SAP's premium support offering.1 Whatever you choose, all service-related activities are managed by SAP Solution Manager, so you can plan, order, receive, and track the services you need — all from one central location.

Based on the customer's solution configuration, SAP Solution Manager actually triggers dynamic recommendations for beneficial services. Then, through a connection to the SAP Service Marketplace, SAP Solution Manager allows customers to immediately order them online. SAP Solution Manager then continues its work as a platform for service deployment. For example, it helps you determine whether archiving will help optimize your system performance with SAP Solution Management Optimization, or where you can manage the technical risks of an upgrade with SAP Safeguarding to reduce downtime and improve use of existing hardware.


All mySAP Business Suite 2004 scenarios — along with all scenarios of mySAP CRM 3.0, 3.1, and 4.0, upgrade content, implementation guidelines, and operational best practices — are made available to customers in a centralized format through SAP Solution Manager. For each scenario, we provide configuration guides — step-by-step descriptions of what you have to do to implement a scenario or group of scenarios. This is especially important for implementation of the newest solutions out there, which are so fresh on the market that very few experts are ready to install them. And in the future, all information about support packages and notes tailored to the specific needs of a customer will also be provided to customers through SAP Solution Manager.


SAP follows and enhances the IT Service and Application Management (IT S&AM) methodology,2 which is based on the de facto ITIL standard, as well as on best practices and reference architectures. SAP IT S&AM helps reduce TCO, with end-to-end support for application management tasks — from implementation and continuous improvement through upgrades — and ensures quick ROI through integration, so you'll protect your previous investments in SAP.

SAP IT S&AM includes AcceleratedSAP (ASAP) — SAP's proven, comprehensive, and repeatable methodology that SAP continuously improves and enhances with content to provide state-of-the-art methods and processes for managing all aspects of the implementation project or program. ASAP Implementation Roadmap now fully aligns with industry project management practices documented in the PMI PMBOK Guide and provides enhanced content for SAP solutions.

SAP Solution Manager is the basis for following the SAP IT S&AM methodology. When you use SAP Solution Manager, you help guarantee that you are in line with SAP's recommendations for a standard approach to implementation and operation.


In the comprehensive set of tools provided with SAP Solution Manager, integration and process orientation are key. With Business Blueprint functionality, for example, you select processes from SAP's content and adapt them to your needs, paving the way for customizing, testing, knowledge transfer, and monitoring, which are all especially important during global rollouts and upgrades. By fully taking advantage of SAP Solution Manager's tool suite, you'll avoid entering the same information twice — information gathered during a particular phase is available in all later phases.

Yet another example of an SAP Solution Manager tool is the Service Desk, which handles issues inside your company and in cooperation with SAP. What's more, with SAP Solution Manager 3.2, which is generally available in early 2005, Change Request Management functionality is provided for keeping tight control over all changes made to your solution.

In SAP Solution Manager's model approach to application management, costs are reduced through central access to all tools and content, and through accelerated change and implementation projects.3

Limits to Solution TCO and ROI

Every organization needs an up-to-date and comprehensive understanding of its solution landscape. The amount of benefit that support and services can generate for any customer is directly proportional to that understanding. This is exactly where SAP Solution Manager comes in — the more SAP Solution Manager knows about your solution, the greater the level of transparency across its management activities (see Figure 2), and the bigger the benefits. It's that simple.

Figure 2
Transparency at All Levels Through SAP Solution Manager

This also means that you cannot simply install SAP Solution Manager and expect optimized IT efficiency, reduced TCO over the long term, or faster ROI without participation across your organization. Once SAP Solution Manager is in place, teams within your enterprise must be prepared to take an active role in the ongoing use of the same application management solution. After all, SAP Solution Manager introduces new tools that impact a number of stakeholders:

  • Your Basis teams have a new tool for monitoring and for controlling transports once change request management is live

  • Your implementation teams have a new tool and content to work with

  • Your support team has a new support desk and a new method of managing SAP services

The success and maximum benefit of SAP Solution Manager in your landscape is highly correlated to how it is embraced across your organization — not just for the length of one project, but for the long term, over the lifetime of your solution.

So How Do You Achieve "Transparency"?

What is the best starting point? How can you most quickly benefit from SAP Solution Manager? In general, we see three typical paths to using SAP Solution Manager:

  1. Customers, many of whom are already using SAP Solution Manager as a channel for EarlyWatch Alerts to stay up-to-date on the stability and performance of their solutions through periodic reports, take the next step by using SAP Solution Manager's Monitoring functionality. SAP Solution Manager can centrally monitor their systems, business processes, and interfaces proactively and in real time, reducing administration efforts with a central point of access to all monitoring data.

  2. Another common starting point is to implement SAP Solution Manager's Service Desk functionality to provide end-user support within your organization while streamlining communication with SAP. This leads to faster and higher-quality issue resolution, as well as central handling of all support-related issues within your organization.

  3. Some organizations find implementation and upgrade projects to be the most effective time to start using SAP Solution Manager functionality. This is your next best chance to build in a 360-degree view of your solution and environment from the beginning.
  A fourth way into SAP Solution Manager is through Change Request Management functionality, available early in 2005.

Monitoring and Service Desk tools are solid introductory methods for familiarizing your company and your support organization with the tools, content, and communication gateway that SAP Solution Manager provides. But these approaches alone do not lead to complete transparency across management activities. To achieve this level of transparency, implementations and upgrades are ideal starting points. The information that is needed in SAP Solution Manager is already generated and captured as customers determine:

  • Which scenarios they want to implement/upgrade

  • Which systems they want to use

  • Where to put the project documentation (including specifications for extensions)

  • How to handle problems

  • Where to store test cases and how to administer testing

  • How to handle the knowledge transfer to users outside of the project

  • The services they are receiving from SAP (safeguarding, go-live checks, etc.)

Because this information is needed or created with any implementation or upgrade project, it only makes sense to feed this information into SAP Solution Manager, which is designed to help you gather and capture all this information, then keep and maintain this information throughout the lifetime of your solutions with SAP Solution Manager's Change Request Management. By incorporating this information into a central platform for ongoing improvement and future upgrades, you can avoid duplicating time and effort, and set up future projects for success.

Solution Management Assessment (SMA) services are yet another good starting point for achieving transparency. During this service, the customer's core business processes and systems are documented and analyzed with SAP Solution Manager. This is also an ideal starting point for all future application management activities.

Don't Wait, and Don't Go It Alone

We've seen that upgrade or implementation projects are the best starting points for achieving transparency, but you simply can't afford to wait until your upgrade or implementation project is slated to begin to start using SAP Solution Manager. If your organization has an implementation or upgrade project anywhere on the horizon, you would be well served to start readying your teams today for SAP Solution Manager.

SAP Solution Manager is part of SAP Standard Support and is therefore available at no extra cost, which makes the decision to implement and start using SAP Solution Manager one that can be supported by top management within your organization. This is critical, as with any solution, especially when it will affect so many areas of your company.

For quick success, the best advice is to prepare your organization. If you haven't already done so, install and channel EarlyWatch Alerts to SAP via Solution Manager and then convince your Basis people to try SAP Solution Manager's Monitoring functionality. Or, start with a more substantial Support Desk implementation or with Change Request Management projects, with the understanding that your complete organization — including workflow for authorizations and budget, project management done with cProjects, all implementation projects, and all transportation — will then be centered on SAP Solution Manager.

Wherever you choose to start taking advantage of SAP Solution Manager functionality, you won't have to go it alone. SAP supports customers at all steps along the way with Ramp-Up Knowledge Transfer (RKT) learning maps, a comprehensive starter pack service for installing SAP Solution Manager, empowering services for change request management, training courses, and much more.

For more information, consult

1 For more on SAP's MaxAttention program, see "Dedicated SAP Expertise for the Most Demanding Solution Landscapes" by Oliver Huschke in this issue of SAP Insider (

2 For more information on the IT Service and Application Management methodology, see

3 For an introduction to SAP Solution Manager tools, see "Looking for Ways Your IT Organization Can Contain Costs Without Sacrificing Services?" by Cay Rademann in this issue of SAP Insider (

Dr. Matthias Melich joined SAP in 1995. In January 2004, he became part of the Active Global Support organization, where he is Manager of the Global SAP Solution Manager Product Management team. Matthias studied English Literature at the University of Rochester (New York), and Mathematics and English Philology at the University of Cologne. He also received his Ph.D. in Computer-Based Language Learning at the University of Cologne in 1993. You can reach him at

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