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Successful SAP ERP implementation includes Value Engineering tools

by Scott Priest, Managing Editor

September 1, 2010

Chris Kanaracus of Yahoo! has a story sure to put a smile on SAP's face, profiling a successful implementation after a couple of recent difficult stories surfaced. Kanaracus focused on Airgas, an equipment manufacturing company, which expects to gain $75-$125 million a year based on improved processes and operations with its SAP system.

The project hit a milestone in July, when Airgas switched its hard-goods supply chain operation over to SAP. The supply chain "touches nearly every area" of Airgas, and judging by the success of the transition, Airgas is confident the full project will provide a "substantial" economic upside, according to a statement.

The company plans to speed up the implementation, finishing most of the work by mid-2012 and completing it by the end of that year. The accelerated schedule will cost another $20 million over the original $85 million budget, but the overrun will "be more than offset by the economic benefits that will begin to accrue during the conversion process," Airgas said.

SAP also used its Value Engineering tools within the implementation, though the article doesn't explain specifically which tools or how they were used. SAP doesn't have a lot of information about its Value Engineering tools -- other than a high-level explanation that they look to create value in IT -- so it would be interesting to see specifically what they are and how they helped.

Meanwhile, SAP recently rolled out a number of Value Engineering tools and services, some of which are available at no cost, for benchmarking system performance and developing business cases for new projects.

"We believe that customers' continued success depends on obtaining measurable return from IT investments," SAP spokesman Andy Kendzie said in an e-mail. "Through our Value Engineering program, we are sharing the necessary information to help customers achieve these results."

 

 

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COMMENTS

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William Newman

9/25/2013 8:47:07 PM

SAP Value Engineering has come a long way in the past 10 years since the initial concepts have been rolled out. It's not a substitute for system integration or organization consulting, but a great way to tap into the mindsets of very senior SAP practitioners as well as millions of person-hours of benchmarking data (which is why that service is free, based on the quid-pro-quo of benchmarking data exchange).

One of the services sold as a product in the VE portfolio is a Solution Design Review (SDR). An SDR is a great checkpoint option particularly as blueprint is under development and review. I worked with a client in 2008 and saw this process first hand (working with the SAP lead SDR auditor). There are strengths and limitations to what an SDR can provide SAP customers.

For more on this and to read a full article on the topic of "How and When to Conduct a Solution Design Review" visit bit.ly/awR6Zs.

Best regards.


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