The Human Side of SAP Implementation: Podcast Transcription
Jon Reed with Dan Lubin, Director of IT for Abiomed
Hosted by Jon Franke, News Editor, SearchSAP.com
Podcast Interview Date: July 20, 2007
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Jon Franke:  Hi, I'm Jon Franke for SearchSAP.com. Today we're speaking with SearchSAP.com career expert Jon Reed of JonERP.com, and Dan Lubin, Director of IT for Abiomed, a medical devices manufacturer. Thank you both for joining us. Jon, Dan, and I are going to be talking about SAP implementations from a slightly different angle. And with that, I'll turn it over to Jon Reed to explain a little more.

Jon Reed: Welcome to this podcast interview with our special guest Daniel Lubin, who is the Director of Information Technology at Abiomed. We're going to talk with Dan about the human side of SAP implementations at Abiomed, and how they address those challenges. This podcast is hosted by SearchSAP.com, and was made possible by a joint collaboration between SeachSAP.com, my site, JonERP.com, and B to B Workforce, an SAP Premier partner.

Daniel, thanks for joining us today. Why don't we kick off with a broader view, and tell us a bit about your company and how SAP supports your corporate services.

We also developed the Abiocore implantable, replaceable heart, and in Europe we offer the minimally invasive Impella, circulatory support system under CE Mark approval. The Impella 5.0 and 2.5 are investigational devices, not sold in the U.S. currently. We have other Impella devices that aren't yet available for sale in the U.S. either. Obviously, as you can imagine, a big focus of our efforts this year is bringing those devices around the globe.

Reed: And how does SAP fit into your efforts promoting those products?

Lubin: As a manufacturer we have the same requirements that any manufacturing company does, with the added areas of compliance and, obviously, quality being the thing that we all hold dear, especially in medical devices. So, SAP supports our finance and manufacturing functions, it supports our supply chain, it helps us manage our people with the human resources module, it ensures that we have the highest quality, through the quality management system in SAP. In addition to allowing us to analyze and measure key performance indicators for our business, using SAP's business warehouse and business intelligence tools.

Reed: So now we're going to get into the nitty-gritty a little bit. I understand that you guys implemented SAP's all-in-one package in 26 weeks. So, how the heck did you pull that off?

Lubin: Well, it was 26 long weeks, and certainly, as you can imagine, Jon, they weren't 8-hour days. But we implemented with - again in 26 weeks - with no full-time resources from an Abiomed perspective. So, my team was comprised of folks from every function that was impacted by SAP.  But all of those folks had full-time jobs and we gave them another full-time job, which was the conversion from our 30+, 20-year-old legacy environment to the all-in-one system. Helping us, obviously, was a team of consultants aligned with the different functional areas, and I think a whole lot of luck as well.

Reed: I first met you on a CIO panel that you appeared on at SAPPHIRE, and what struck a cord with me - and I think what will interest a lot of our listeners today - was how your company, which is a midsized company implementing SAP, was able to pursue all of the latest SAP technologies that you needed on your project, and yet you found a way to staff those new technical areas where often there aren't a lot of experienced consultants. So, how did you make that happen?

Lubin: We were lucky in terms of the partner that we worked with. I think that a big part of the selection process when you're looking to implement ERP isn't just selecting the software, but also selecting the right implementation provider, and making sure they bring their best and brightest to bear on your project.

At the same time, as we looked at managing what clearly was a larger environment than we had prior to SAP (and any system would have  been larger because we were moving from a number of stove-piper, individual applications, to one integrated system), we realized that we had two choices. We could either bring in a large technical team - in other words, we could create the empire of IT, so to speak - or we could look at strategically how we could partner with other companies that were experts at different areas of the SAP environment, to ensure that we had our risk, obviously, mitigated properly, but at the same time still retain the flexibility within the business that you tend to lose if you try and hire 20 people overnight to run your environment.

So, it was a combination of, from an implementation standpoint, great consultants with a good process as dictated by SAP, their ASAP process; and then, from an operational standpoint, leveraging some of the experts that are out there in areas of basis administration. So, managing the application landscape, SAP security, and then both on- and offshore development, to ensure that when we had something that needed to change, we had the experts out there to do it for us, without having to worry about the bandwidth issues that any company has when they try and use their internal team for everything.

Reed: I'm glad you brought up the offshore piece. How did you find a way to work the offshore model into your implementation, and did you find that it really did reduce your costs to provide the value that you were looking for?

Lubin: Yes. We use offshore resources really in two areas. We use them for some of our validation and compliance testing. In other words, as a company that produces products regulated by the FDA, we have to not only - as every company would - get SAP, or get their ERP to work. But, we also have to ensure that it's fully validated. And as a public company, we have to make sure that we're compliant with Sarbanes-Oxley.  One of the ways that we've outsourced is, on a project basis, by using a firm with a U.S. presence, but with offshore resources to do some of that testing.

The other way is for ad hoc development, that complex report; that area of the human resources module where we don't have expertise, we use teams offshore as well in different parts of the world. What's worked for us is working with U.S. companies that have that offshore capability. I think that coming from a larger company background in a big company environment you can manage offshore teams directly, and, I think, have great success.

But in a smaller company environment - which, obviously, Abiomed is firmly in the midmarket - we really need to have that local presence, or that U.S. presence, and let them be the experts of managing their resources offshore. So we didn't really look to offshore, Jon. What we looked for was to bring the blended rate for services down. In our opinion, in a way we're really not offshoring, we're just getting a lower rate because the companies we work with here in the U.S. are leveraging resources offshore.