Panaya

By guest author Jon Reed
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Talent management is a key competitive advantage, yet ERP directors struggle daily with hiring and keeping the best SAP talent. SAP Mentor Jon Reed of JonERP.com clarifies the most critical issues of SAP talent management from hiring, through training, all the way to outsourcing.

Which SAP skills are the most important to keep in-house?
When should you hire an outside SAP consultant or systems integrator?
When does offshoring help and when does it hurt?
How do you retain great SAP employees?

Conventional wisdom has conceded the point: talent management is a key part of competitive advantage in virtually all industries. In an ERP context, "managing SAP talent" sounds pretty impressive, but how do you actually do it? When should you invest in skills internally? When should you outsource? How do you stretch a training budget to maximum effectiveness? And how do you retain that talent you worked so hard to cultivate? In this exclusive brief to Panaya, I'll provide answers to all those questions, drawing on recent interviews I conducted with project-tested veterans of the SAP talent industry.

Which SAP skills are the most important to keep in-house?
The first step in managing SAP talent is to face reality: budget limitations prevent SAP users fro m internally staffing all the skills needed to implement and maintain the vast SAP product line. So who are the key players you must keep? Answer: those with the deepest knowledge of SAP's best practices in your industry. Not all SAP professionals are industry-focused. Many have moved from industry to industry in search of new skills or higher rates. When you have someone on your staff that has a focused background in your industry - someone who can articulate the strengths and weaknesses of SAP's functionality in your industry and how to take best advantage of those solutions - that's a person to prioritize on the depth chart.

Another key player is the technical individual who has moved beyond cranking out SAP code and now understands how to get the most out of SAP's NetWeaver platform. These valuable folks are heading in the "Enterprise Architect" direction. They understand object-oriented practices, ABAP and Java-based approaches, and service composition. You might find them on a lunch break listening to podcasts from the "Enterprise Geeks." Keep those folks!

The third "keeper" skill is that functional expert who is moving towards a process-driven approach to ERP. During a session on Business Suite 7 I attended at Sapphire 2009, SAP's Ann Rosenberg, co-author of Business Process Management: The SAP Roadmap, predicted the end of the classic FI/CO or SD/MM consultant. Their replacements? "Process consultants" who understand complete SAP business processes like pay-to-procure or order-to-cash. SAP is taking this seriously enough to put all their application consultants through their own "BPX" (Business Process Expert) curriculum in the next few years. If you have a budding "SAP process expert" on your staff, and they start talking to anyone who is interested about the SAP BPX community, and how they are really starting to enjoy working with the web developers on your project, connecting the technical to the functional business requirements, bingo! That's another skills profile you want to identify and support.

When should you hire an outside SAP consultant?
The best time to bring an outside consultant onto your project is when you have an immediate need for expertise in a new SAP tool or technology and don't have time to upskill your internal team. But in the long run, you do want your team to pick up that know-how by "rubbing shoulders" with this outside expert. In other words, you bring in consultants when you are pursuing skills you don't want to have to continually outsource. You want to grow from within, but you need a jump start, and the skill set in question is rare enough that it's not easy to hire the person as a
long-term employee.

Examples of good on-site consultant hires we've seen recently: experts in enhanced Solution Manager capabilities like root cause analysis, Identity Management gurus who understand authorizations issues across SAP products, and SAP BusinessObjects experts who have worked in both BusinessObjects and SAP environments. Areas where SAP has acquired new products, such as Business Planning and Consolidation (bolstered by OutlookSoft), and SAP mii (from Lighthammer) are good spots for outside experts. Just make sure the outside experts you hire have a demonstrated ability to train, mentor, and transfer knowledge.

One mistake to avoid: don't assume that the best place to contract an SAP subject matter expert is through a big systems integrator (SI). Secret of the SAP skills marketplace: many of the best subject matter experts placed on projects by SIs are contracted in from smaller boutique firms. You can often get a better rate by going directly to the smaller boutiques, or if you are skilled at evaluating SAP talent, you can even go direct to the independent consultant (keeping in mind that once a resume is presented from one source, it is considered unethical to go around that source directly to the consultant. To "go direct," you have to reach out to such firms and individuals pro- actively).

In recent years, companies have avoided hiring independent SAP contractors directly due to perceived liability issues or "lock in" with select "approved" vendors, but even in cases where the consultant doesn't carry enough insurance to qualify as a vendor, we are seeing a growing trend to bring in such experts as "W-2 contractors," routed through the HR department. This can be a more affordable way to obtain the same caliber of resource that companies sometimes pay a premium for due to several "layers" of firms between the consultant and the vendor of record. Another option is to arrange a deal where the consultant you recruit contracts through your vendor of record (thereby not rocking the procurement boat and obtaining the bonded insurance if necessary). The vendor may ask for a premium on top of the base rate, but a skillful negotiation can keep that premium to a minimum since in this case, you recruited and screened the consultant. A $10 an hour override by the vendor is a pretty good deal for the hiring manager, any markup over $20 an hour in this scenario should be contested loudly.

So when should you use a systems integrator?
SIs like to deliver the following sales pitch: "use us because we have the best SAP talent." But we have already questioned that notion. With a bit of savvy, you can source SAP talent in a variety of ways, including the use of social networking sites like LinkedIn. In many cases, you can acquire that talent at cheaper rates than what the SIs have to offer. So when does an SI come in handy? A systems integrator adds real value to an SAP project in two instances: when there is a need for a structured methodology for managing the next phase in your SAP project, or when there is a need for a blended rate service that combines on-site and off-site delivery.

During a recent podcast I conducted with Michael Doane, author of The New SAP Blue Book and the upcoming SAP Green Book: Thrive After Go-Live, Doane issued the following warning from his research on SIs: just because an SI has a well-defined ERP methodology doesn't mean they are always following through on it. If you adopt an outside methodology, make sure it comes with a trusted supervisor from the SI side that will be a regular presence on your project site.

When does offshoring help and when does it hurt?
Offshoring is no longer an unknown. Enough studies have proven that properly used, "global sourcing" of skills saves money, and SAP projects are no exception. But some approaches work better than others. Outsourcing gets the highest marks when it comes to well-defined technical development projects. Non-differentiating "back office" processes like payroll management are often good candidates - if regional tax and compliance variations aren't too complex. Another winning approach: offshoring the skills that you know you don't want to maintain in-house (or that have proven hard to recruit).

Smaller SAP customers, or those in remote locations, sometimes outsource the bulk of their IT operations rather than struggle to staff those positions internally. But here's where it gets interesting: some companies are pushing the envelope on offshoring. At least one SI has experimented with the option of offshoring the "blueprinting" phase of an SAP implementation - something that should be approached with a great deal of caution due to the importance of involving the on-site team in that phase. Percentages matter also. In my podcast with Michael Doane, he warned not to outsource more than 35 percent of an SAP project. "I'm seeing teams configured with 30 percent on-site and 70 percent remote, and that plan just doesn't work...when you see 40 or 50 percent off-site and beyond, you're going to be seeing a troubled implementation."

What is the best approach to SAP training in the on-demand era?
Companies are quickly learning that on-demand training options can help ease a difficult tension between the need to upskill employees on the one hand, and the financial difficulty of sending them all to the SAP Academy on the other. Even SAP has gotten in on the action, recently launching its own Learning on Demand web site.

Investing in SAP training is easier than ever, which should help companies resolve the contradiction between knowing training is important and struggling to find the resources to live up to that statement. SAP training works because in most cases, those who are skilled in older SAP releases can be transitioned into key contributors on new releases - if they are given the right skills exposure.

The best approach to training is to mix virtual events and on-demand sessions with classroom training as needed. Understanding the strengths of each for your business should dictate your approach. Example: if your technical environment is not heavily customized, sending a team member to a NetWeaver basics course or to SAP TechEd could reap dividends. On the other hand, an SAP environment that is heavily customized to your industry might make a basic SAP module training class less useful. In that case, a customized on-site class or even an on-demand session geared towards your industry could be a better investment.

Companies in the lead on training have realized that training is more than just choosing the right format. It's about shifting the internal culture to that of a "learning organization." This means creating opportunities for mentorship inside and outside the company, supporting employees as they build better SAP social networks. Employees with better networks have more options to turn to when troubleshooting problems, and more resources to draw on beyond organizational walls. In some cases, loosening restrictions on online activities (such as accessing the SAP Community Network or even Twitter), can pay off for companies - as long as the rules around online conduct and the objectives for participation are well-articulated. Even trade show attendance can be better utilized with the establishment of reporting practices to share the knowledge gained internally after the show is over.

So how do you retain these great SAP employees you've cultivated?
So you've fostered the skills, invested in the training, supported your employees as they build better SAP networks - now how do you keep them? In times like these, the traditional answer to "hot skills" retention, dispensing big SAP skills bonuses across the board, is not always a feasible one. Nor do SAP team members require exotic company vacations (though they won't protest about a week in Maui on the company dime).

Fortunately, those SAP professionals who are truly outstanding tend to be genuinely passionate about the SAP field and are therefore motivated by more than money. Here's what they want: exposure to new SAP tools and skills, the chance to be visible contributors in their SAP niche beyond company walls, and a clearly-defined career path within the company.

Defining the terms of employee visibility is difficult. It's not easy to grapple with questions such as: "Do we let our employees blog on their time or the company's time? Is it a benefit to our company for them to mentio n us? Should they be blogging at all?" Or, in regards to trade shows: "Can we spare while she works on a presentation for ASUG or SAP TechEd? Will we pay for her travel and expenses to have her present at an industry showcase?" The answers to these questions are not the same for all companies, but employees greatly appreciate when questions on visibility are openly grappled with. Smart policies are also appreciated - especially if those policies do include some opportunity to make visible contributions to the field. SAP recently issued its own social media participation guidelines for employees that were generally well received. Yes, you will lose an employee or two by raising their profile in their industry. But your resulting reputation will continue to attract the so-called top performers that have provoked all this discussion about talent management and intellectual capital in the first place.

Conclusion
"Managing SAP Talent" is never as simple as it sounds. But with a well-thought approach to SAP skills development, remote sourcing, in-house training, and employee retention, you should have a well rounded team. A solid grasp of SAP's product evolution (and the skills needed to support it, including the relative demand for each skill) is fundamental to achieving these aims. All these years after SAP's first "Enjoy SAP" initiative, it still sounds a bit strange to talk about enjoying SAP. But if you give real attention to cultivating SAP talent, they WILL enjoy working on your project. And if they thrive on the work, they just might take you that extra mile your competitors can't go.

Author Bio
Jon Reed, JonERP.com, Twitter: @jonerp
Jon Reed is an independent SAP analyst and SAP Mentor who writes on SAP skills and market trends. Recently, Jon was recognized as a Top Contributor for the SAP Community Network 2008-2009 in the Business Process Expert Category. Jon is the driving force behind JonERP.com, an interactive web site that features Jon's SAP Career Blog and his podcasts for SAP professionals. Jon has been publishing SAP career and market analysis for almost 15 years, and he is the author of the SAP Consultant Handbook. Jon serves as a "PAC Fellow" with PAC's SAP Services Research Program, and he is a frequent contributor to PAC's "Feeding the SAP Ecosystem" blog.

Many SAP experts provided insights to this piece, but Jon Reed would like to extend a special thanks to Wade Walla of group:basis for his above-and-beyond feedback on this article.

About Panaya
Established in 2006, Panaya Inc. provides software tools that save SAP customers up to 50% of their software upgrade and maintenance costs, while minimizing risks and proving a clear ROI. Provided as Software as a Service (SaaS), Panaya's SAP environment simulation shows which custom SAP programs will break as a result of an upgrade, explains how to fix them, derives the most efficient test plan and calculates the required budget and resources for the project.

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