October, 13th, 2010
SPEER
Commodore Jan Vos M.Sc.
Programme Manager SPEER
Ministerie van Defensie
The SPEER programme
Implementation of ERP in the logistic and financial domain of the Dutch Armed Forces
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Content
• Programme overview: Business Case, Scope, goals• Programme characteristics • Programme approach• Programme results• Experiences / Lessons learned• Conclusions
SPEER: STRATEGIC PROCESS ERP-ENABLED RE-ENGINEERING
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Like most of the world’s defense forces, the Dutch saw a major change over the past 15 years
New focus: world wide missions for international peace and stability
The SPEER Programme context
Wider mission spectrum, flexible expeditionary capabilities, cooperation between services, use of common assets
Joint operations
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Restructured NL Defence Organization
MINDEF
Navy ARMY Air Force
BEFORE 2005
To
MODNL
Defence Material Organisation
Defence Services
Navy
Army
Air Force
OPERATIONALCOMMANDS
SERVICECENTERS
MP
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Why is change inevitable ?
JOINT LOGISTIC SUPPORT FOR JOINT OPERATIONS
Improve efficiency(phase 1 668 FTE / 20 M€/yr)
Support new business model (costs visibility, shared service centres)
Phase out legacy,Improve IT management
Improve asset management & financial control structurally
The world changes …
Policies are changing …
The Dutch Mod is changing …
Technology is changing …
Program goals
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SPEER Programme: Scope, facts and figures
Program scope:• All Logistical & Financial Processes• Entire defence organization• Ca. 8000-9.000 users (first phase)• Investment budget M€ 268 (first phase)• Timeframe: 2005 -2014• Programme organization: 200 - 300 Def. Employees
Strategic partners
ERP: SAP
Programme control & kernel design & custimization
Cap gemini\Logica
Implementation partners:Atos Origin, IBM, Ordina, PA Consulting, PWC
Auditing & Second Opinion: HEC / SAP
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Core processes of Defence: Value chain
FOR
M U
NIT
S
(Onderhouden/Bevoorraden)(Onderhouden/Bevoorraden)
OPERATIONALEXERICISES &TRAINING
EXECUTE
OPERATIONS
MANAGEMENT CONTROL
MISSIONS &OPERATIONAL READINESS
LOGISTICS(SUPPLY AND MAINTAIN)
PERSONNEL
EQUIPMENT OPERATIONALLOGISTICS
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Joint missions require joint support: Possible scenario
42 Tankbat
301 SQN
130 CL-CIE
Marns-batDepot AGB
DepotODC
Ops Theatre
VC
APACHEDET
VC-DET
MARNS-DET
TKPEL
HRSTGPTKPEL
APACHEOHDGP
Foreign Unit
LocalSupplier
933 SQN
Formation TF & NSE
SPOD/APOD
SPOE
APOE
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Programma characteristics (1):Best practice processes or defence specific
Identical to other businesses / government- Basic processes on procurement, supply, maintenance, configuration
management, ILS- Finance (cash/committments)
Specific for military• Flexible organizational structure (mission structure)• Non-static / flexible supply chains• Mobile units /deployed technology in remote area’s
Good news:• Defence uses many common components• Additional SAP components are available for specific military
processes
The bad news:• Diversity in processes leads to a complex cocktail of SAP-solutions• Most individual SAP-components are proven technology, however an
integrated cocktail of all these components has never been implemented
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Programme characteristics (2):Best practice migration or defence specific
What makes up the challenge:• quantity and diversity of processes• number of organizational units • a defence wide standardization and
integration• unclear ownership process chains• unclear ownership business benefits
Consequences:• The system too big to customize in
one step(?)• A big-bang roll out impossible ->
multiple migration steps• Long timeframes (!)
Rough ride expected, escorts are needed, minefields to be avoided ..
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Programme Characteristics (3) SPEER as a bridge between two worlds
Transparency: sharing information
Government
Checks & balances
Focus on efficiency & conformance
Security: protecting information
Operations
Focus on effectivity
Defence
Modern business processes:supply, logistics, ILS,
maintenance, procurement, finance
Public governance MilitaryCommand and control
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Key elements in approach
One ‘standard’ SAP kernel fits all:•One standardized proces design•One overarching architecture derived from Defence IT architecture•One kernel to be customized•Control costs and enforce proces standardization•Implemented in two phases (basic processes first, proces chain optimization second)
Combination of proces standardization over ‘business units’ and integration over functional domains •Combines benefits of standaardization and integration in one migration step•Maximizes change management riscs
Think big, act small•No big bang implementation: trial, learn and expand•Large timeframe•Takes longer time before legacy systems are taken out of service
Parallel implementation projects
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To beCurrent Practices
StandardizedProcesses
OneStandardizedInformation
system
StandardizedData
Migration
Migration
Processes
Informationsystems
Data
Processes
Informationsystems
Data
Processes
Informationsystems
Data
Navy AirforceArmy
Proces Standardization as a key element: It symbolizes both change and joint operations
Processes
Info Systems
Data
Finance
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procurement
Service centers Operational Commands
Depots MaintenanceDepots
SPEER Programme results
Finance, Integrated Logistic Support
VSPK JUN 2009
NH 90 MAR 2010
MATLOG 320 NOV 2010
JUNI 2008
Transport
Supply chain management
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What problems to expect? Insights from NL national audit office (& others)
Projects are often too complex•Grand designs•(political) fantasy deadlines•Winners curse.
Evaluation and redirection are neccessary
Strong governance needed
ICT is no quick fix
Business – IT alignment is poor
Business – IT architecture = basis of IT governance
Demand and supply of ICT need to be better organized
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SPEER experience:Lessons identified, measures taken
Measures to complexity:• Stepwise improvement of kernel (High Level Design !).• Stepwise migration approach.• Periodic programme evaluation.•Ambitions & ability to change need to be balanced.
Governance:• Strategic: SG & CDS primary sponsors• Tactical: SPEER supervisor with direct mandate
Change management:• ICT is just an enabler• Importance of Business benefits•Ownership of business benefits never passes form line to
programme organization.
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SPEER experience:Lessons identified, measures taken
• Risks, cost and benefits of simultaneous standardization and integration.
• Don’t shoot at a moving target: Simultaneous Reorganization & implementation of ERP.
• Establish / organize procesownership and its tasks and responsibilities.
Integral business process management required Architecture: From ‘surplus of abstract documents’ to ‘tight fit harnass’.
• A vision is not enough to guide proces design and business re-engineering.
• Don’t forget the IT-complexity (SAP cocktail, interim landscapes, interfaces, data).
• Knowledge management and competence managementReorganize internal ICT service provider
• Speed of implementation: Changes can be too slow.
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Conclusions
1. The programme is vital for the Dutch MOD.
2. The size of the SPEER programme is unique for (MOD)NL
3. … Thus, SPEER faced many common problems
4. …………. And SPEER learned many ordinary lessons
5. But the unique size causes also some new problems
6. ……… And SPEER gained some additional insights and produced secondary results
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QUESTIONS ?
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