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Beware of Black Swans

by Gary Byrne

September 20, 2011

An article in the September issue of the Harvard Business Review discusses why IT projects may entail more risks than you think. This article cites an example of Levi Strauss’ decision to install an SAP system in 2003 that on paper seemed well planned, but in actuality, turned into a black swan, a term that according to the article, “was coined by … Nassim Nicholas Taleb [a renowned expert on risk and author of the bestselling book titled The Black Swan: The Impact of the Highly Improbable] to describe high-impact events that are rare and unpredictable but in retrospect seem not so improbable.”

The article states that during the switch over to the SAP system, Levi Strauss could not fulfill its orders and ended up having to shut down three of its distribution centers for a week. In the second quarter of 2008, according to the article, the company had to post a $192.5 million charge against earnings to account for the ill-planned project and its CIO resigned. The Levi Strauss black swan evokes the case of Hershey’s, which after switching to a new order and fulfillment system (a system that included SAP R/3 along with other software), could not fulfill $150 million worth of orders in time for the Halloween season, according to the HBR article.

While reading this article I thought of the infamous Tocoma Narrows bridge in Washington state — a bridge that was completed in July 1940 and collapsed four months later during high winds. The collapse of the bridge prompted research into bridge aerodynamics. Hershey’s and Levi Strauss are the Tocoma Narrows bridge cases of the business software industry.

As an IT manager, you’re probably not building a bridge, but SAP BusinessObjects GRC 10.0 applications have been generally available for more than a month, and perhaps your organization is planning to implement these solutions. If you are, you’ll need to plan your implementation carefully and be prepared for any unexpected twists and turns that may occur during the project.

In his article for GRC Expert titled “How to Migrate Your Current SAP BusinessObjects Access Control Deployment to Version 10.0,” Frank Rambo states that a migration of SAP BusinessObjects Access Control 5.3 to SAP BusinessObjects Access Control 10.0 comprises three stages: preparation, transition, and cutover. According to this article, during the preparation stage, your focus is on “meeting the technical requirements of the transition stage.” Frank adds that “[t]his phase affects the following systems:

• Your current installations of version 5.3 of SAP BusinessObjects Access Control
• All your SAP back-end systems to keep connected to SAP BusinessObjects Access Control
• Installation of version 10.0 of SAP BusinessObjects Access Control instances

With respect to your current installations of version 5.3 of SAP BusinessObjects Access Control, you’re shooting for two goals: (1) you need to deploy the Java data export tool and (2) during the transition phase, you want to keep your installations of SAP BusinessObjects Access Control version 5.3 connected to SAP back-end systems that are connected in parallel to a version 10.0 installation of SAP BusinessObjects Access Control ... The first goal requires Java 5.3 Support Package 13 only, whereas the second one requires Java 5.3 Support Package 15.”
 
During the transition phase, Frank states that “… you keep all your target systems connected to your installations of both versions of SAP BusinessObjects Access Control until all data is migrated and all functionality is verified. You proceed as follows:

• Use the Java data export tool to selectively export data from your SAP BusinessObjects Access Control 5.3 instances
• Use the ABAP data export tool to export firefighter tables and reason codes from your SAP back-end systems
• Use the import program delivered with version 10.0 of SAP BusinessObjects Access Control to import the export files
• Execute required post-migration tasks
• Verify imported data and test all scenarios in scope”

With regard to the cutover phase, Frank states that this stage “refers to the execution of the following activities in your version 5.3 installation:

• Disable all user access
• Complete all background jobs
• Close all open workflow tasks
• Export historic transaction data using the Java data export tool  and keep it available upon request from your auditors
• Shut down the instance”

Although his article only addresses upgrading to SAP BusinessObjects Access Control 10.0, I think the same three-stage process would apply to upgrading to other SAP BusinessObjects GRC solutions or implementing the complete line of SAP BusinessObjects GRC 10.0 applications.

During each of these stages remember to account for “rare and unpredictable” events during the project. If a crisis occurs, handle it with aplomb and honesty. Perhaps it would be good advice to remember the words of Paul “Bear” Bryant, coach of the University of Alabama’s football team from 1958 until 1982: “In a crisis, don’t hide behind anything or anybody. They’re going to find you anyway.”

 

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