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SimEnterprise:
The Video Gamer’s Guide to SAP’s Business-Process Revolution

by Joshua Greenbaum

August 11, 2009

SAP’s vision of the business-process-driven enterprise might best be understood if imagined as a video game. Using the gaming world’s use of a finite set of standard processes to simulate reality, learn what to expect when the best of the business world’s processes are unleashed in SAP’s ESA.
 

Lately I’ve been thinking that SAP needs to get into the video game business. Not because Grand Theft Auto needs the competition, but because SAP’s vision of the business-process-driven enterprise might best be understood if imagined as a video game that I’d call SimEnterprise (with apologies to Maxis and its SimCity games). Like SimCity, SimEnterprise would be a simulation that lets the gamer run the show — in this case, play CEO. The goal of the CEO would be simple, to paraphrase the role of the mayor in SimCity: Create, build, and run the most realistic and successful enterprise you can imagine.

SimEnterprise would give the CEO all the tools of a minor deity, with the power to define the infrastructure, supply chains, markets, customers, partners, and everything else that goes into a business ecosystem. When the ecosystem is finished, the SimEnterprise player would be able to pick from a complete list of possible rules of engagement, also known as the business processes by which the business ecosystem and its individual businesses are run. These processes would define how a particular business functions: how it builds new products, finds new customers, processes and fulfills orders, collects money, pays its employees, and all the other things that make a business run.

Once the setup is done, the CEO turns the ecosystem on and watches the simulation unfold. Products are created and marketed, customers generate purchase orders, partners move supplies back and forth, services are delivered, and businesses thrive or fail. The CEO could throw in a natural disaster or two, an interest-rate hike or exchange-rate drop, or a new disruptive technology, and watch the ecosystem respond. All in all, a fun time would be had by all.

A fantasy? Perhaps, but my SimEnterprise game is based on the fact that SAP actually has the intellectual property to create such a game. What SAP has been working on for the last two years — and spending half of its R&D dollars on — are the very underlying business processes that will let companies create their real-world businesses the way my fictitious SimEnterprise CEO would create a virtual one. It’s an advantage that is unique to SAP’s market position: No other company possesses the libraries of business processes, culled from decades of designing vertical industry functionality, that can be used to create a real-world version of SimEnterprise.

Last spring, I asked SAP Executive Board member Shai Agassi if he could demonstrate just how far along SAP was in realizing its business-process vision. The reason I asked was simple: For SAP to make good on the promises of its enterprise services architecture (ESA), it needs to have a broad palette of business processes — wrapped as services — that can be used as the building blocks for new composite applications, new functionality, and, if necessary, wholly new business processes, as well. My point in asking for this demonstration was that the success of SAP’s ESA — or any other vendor’s ESA-like strategy — would be best measured by the quantity and quality of the underlying business processes available to it.

The next thing I knew, one of Agassi’s assistants was shoving a massive set of what looked like 20 pounds of architectural blueprints under my nose. In front of me were pages and pages of diagrams of well-defined, and very comprehensive, business processes spanning the entire gamut of the 28 industries that SAP supports. The diagrams represented models of how the various businesses use SAP software to accomplish their day-to-day tasks. This, I was told, was what Agassi’s fellow Executive Board member Peter Zencke had been doing for the last two years: decomposing the countless different business processes in SAP R/3 and mySAP into the building blocks for SAP’s ESA.

Individual business processes are the basic units of work, not arcane software code.

The models represented in these diagrams bring up the other reason I think SimEnterprise is a good way to think about SAP’s business-process revolution. The setup portion of my SimEnterprise game is really a process-modeling exercise:

  • What are the initial conditions and assumptions of the ecosystem?

  • What are the (business) rules of engagement?

  • What are the products and services that need to be created to “create, build, and run the most realistic and successful enterprise you can imagine”?

In my SimEnterprise fantasy, the CEO would select the rules of engagement from a vast menu of different options that would define what the simulated enterprise would look like. There would be large-grained processes that help define the line of business, the organization structure, the market, the competitive differentiators, the financial and regulatory reporting requirements, and the business model, among other factors. And there would be more fine-grained processes that define either processes specific to an individual company or processes that are fundamental components of larger processes — the basic building blocks of business, if you will.

Each SimEnterprise company would be built around different combinations of processes that define how they function and how they react to specific internal and external factors — incoming orders, supply chain glitches, new product introductions, and mergers and acquisitions, for example. Running the game would simply be a matter of starting the simulation, selecting some initial inputs, watching the business ecosystem’s interactions unfold, and reacting as various conditions changed and new decisions needed to be reached.

This is the kind of thinking that businesses will need to do in an ESA world, and it represents a significant — but welcome — change from the way in which businesses try to harness the power of technology to run their enterprises today. What is important about this ESA/SimEnterprise world is that individual business processes are the basic units of work, not arcane software code. If SAP and partners like IDS Scheer do their jobs right, assembling these basic units of work into fully functional businesses should look more like the version of SimEnterprise that I’ve described than the complex programmatic processes that we use today.

This change from programming to modeling will require different skill sets than those prevalent in IT shops today. While I don’t advocate that we convert CIOs and IT managers into video gamers, I do believe that the modeling metaphor of SimCity and its spin-offs can offer a valuable insight into the role of the “chief process innovation officer” — Agassi’s vision of what the CIO’s title will eventually become in a process-driven world.

No game will ever truly simulate the vastly complex nature of the real business world. But the next time you’re trying to understand how ESA and its business processes will change how you look at your business, a look at how SimCity works could be instructive. The gaming world’s use of a finite set of standard processes to simulate reality can teach us a lot about what we’ll be able to do when the best of the business world’s processes are unleashed in SAP’s ESA. It may not be as much fun as SimEnterprise would be, but it promises to be much more rewarding.

Joshua Greenbaum is a market research analyst and consultant specializing in the intersection of enterprise applications and e-business. Greenbaum has more than 15 years of experience in the industry as a computer programmer, systems analyst, author, and consultant. Before starting his own firm, Enterprise Applications Consulting (www.eaconsult.com), he was the founding director of the Packaged Software Strategies Service for Hurwitz Group.

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