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jonerpdemojam.jpg Jon has been tackling key SAP issues (like SAP certification and HANA) since 1995. Get the latest from his blogs, YouTube channel, and iTunes feed.

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Podcast: The Evolution of SAP Consulting - Interview with Greg Tomb of Vivido Labs Print E-mail

podcastlogo_jonerp.gif"On the Changes in SAP Consulting, What Individuals and SAP Services Firms Need to do to Stay Relevant, and the Issues SAP Customers Face After Go-Live"
Podcast Interview Date: December 7, 2009
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What is the future of SAP consulting? Why do SAP customers struggle with SAP after go live? Where are the gaps in service that traditional Systems Integrators can't fill? To get to the bottom of these questions, I asked Greg Tomb, founder and CEO of Vivido Labs and former CEO of SAP North America, to join our podcast series and give us his take on how SAP consulting is changing.

During this thirty minute podcast, Greg also explains why he started a new company (Vivido Labs) in a recession and how companies like Vivido can impact SAP consulting and also knowledge on demand via knowledge marketplaces (in Vivido's case, the Knowledge Exchange). We also get Greg's advice on how SAP consultants should adapt to these changing circumstances.

Podcast Highlights

1:25 Why Greg started Vivido Labs, and what Greg thinks SAP users need after go-live. Users have made a huge investment in SAP, but are they getting the most out of it? Also: the economic environment is dramatically different than it was 12 months ago. This has forced every company to look at IT investments differently. Leaner, shorter, faster products have taken over. SAP users also want to be more self-sufficient in their implementation.

4:10 Anatomy of the problem: The circumstances that companies such as Vivido address - the challenges SAP customers face after go-live. Why do SAP customers struggle after go live? The go-live is really in the "first quarter" of an SAP install. Then the consulting companies leaves. It's a parting of ways as the SAP consultancy goes after more full time engagements.

Now the customer is responsible. These aren't issues around the product not working, but they are issues around optimizing the install, tweaking the configuration for business needs, and all the hundreds of little issues that need to be addressed. And once they get the SAP system stabilized, they want to put more features in place, for example expanding pricing functionality to incorporate new marketing campaigns - and they don't tend to have the skills to do that. But: customers can't afford to hire full time SAP consultants for this, and they don't want to. They want to empower their own people. Something needs to "flex" to fill that gap, and bring the knowledge in-house. Companies like Vivido offer "on call" services from SAP experts, in chunks as small as an hour.

8:55 So how does SAP support fit into the picture? Enterprise Support is a very hot button issue in the SAP community right now. Why is that? What do customers need in terms of SAP support that they are not getting? Greg: support is for product-related issues. Issues with configuration, design, reporting - those are not SAP support issues. SAP leaves those post go-live issues to the hundreds of SAP consultancies in the market, large and small. From a support standpoint, you have to define what it is. There is a place in the world for SAP product support and the type of remote services Vivido provides.

11:05 Shameless plug time: how can companies like Vivido fill a gap in services that other firms aren't providing? Greg: SAP customers have a big need to get SAP consultants in for rapid and immediate advice. The existing service firms are focused on bigger projects. Vivido is focused on providing "remote expert services" to bring Platinum-level (12 plus years experience) consultants to bear on SAP customer sites on a moment's notice. Both smaller and larger SAP shops need this kind of service, as they look to assume more control and become self-sufficient with their SAP installs. Reasonable costs are another big part of this new value proposition.

14:00 The SAP consulting market is changing rapidly. SAP users want more value out of consulting, and are looking at spot consulting models - it's rare for a big Tier One firm to sign a big consulting project these days - we hear about more targeted approaches, more offshoring, global sourcing - and new remote consulting options. What is sparking the changes in the traditional SAP consulting models?

Greg: two things: first, cost is a big factor.Offshore can deliver huge cost savings - often 1/8 or 1/10 the cost of on site services. But there are issues: sometimes the offshore consultants are less experienced, or there is a need for direct collaboration that can't be met due to the time difference. There are some areas that are good for offshoring: areas where you can live with less experience, or work with a communication gap, or manage a time zone difference. Report writing, data conversions, product extensions - post-production baseline activities. These are viable areas for offshoring, but it's not ideal for all types of SAP service work.

The other change is the type of project. Companies don't want 24 month projects, they want more immediate benefits. They want to see four six month programs instead. Once they see the value, they can move onto the next project or the next phase. Another trend: customers that have SAP in place are choosing to add new applications they can get value out of quickly. Example: SAP BusinessObjects applications, which have much shorter implementation cycles and bring in new areas of visibility. 

24:34 What advice does Greg have for SAP consultants who want to stay marketable and relevant in this economy? Are there skills they should be seeking, or new marketing approaches they should be pursuing? For the individual consultant, a big challenge is moving on to the next piece of work. There aren't as many projects right now. You can't just slap a resume up on Monster and easily get a gig. Consultants can define themselves by a piece of work they post online. A white paper on SAP Treasury Management, posted on a knowledge marketplace like Vivido, can position the consultant as a real expert. These are new channels beyond job boards.

From the vantage point of SAP services firms, they need to be willing to do smaller projects. You can't just seek out the big 24-36 month projects. Once you get those shorter projects and demonstrate value to customers, you can build momentum for new engagements. Firms also can't expect to get the phone call to come and do an RFP. You need to go to customers, demonstrate the value of the services you can deliver. The consulting company that will win in today's market knocks on the customer's door with a couple of good ideas, such as: "If you put in BusinessObjects, you can do it in three months and here are the returns you are going to see," or "If you put in XMI for shop floor visibility, here are the types of returns that you'll see." Those are the types of consulting firms that will get business in the next couple of years and survive this tough economy.

28:15 Greg's final words of advice for listeners: change is a good thing. This is not a forgiving work environment, but it forces us to innovate. Everybody will get better because of this. The advice is: open your mind to it, open the way you do business to it, accept change as a catalyst - it is going to make you better. 

 

 

 

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