In our lat­est ASUG Asks the Authors fea­ture, we con­clude our con­ver­sa­tion with Nitin Singh, a senior prin­ci­pal and direc­tor of the Indus­try Val­ue Advi­so­ry team at SAP Amer­i­ca, and Ger­ry McCool, a val­ue advi­sor with SAP.

Co-authors of the recent SAP Press ​“E‑Bite” pub­li­ca­tion ​“Intro­duc­ing Busi­ness Process Trans­for­ma­tion with SAP Sig­navio,” Singh and McCool pro­vide their read­ers with an overview of the SAP Sig­navio port­fo­lio and dive into each tool. Guid­ing read­ers through SAP Sig­navio’s busi­ness process intel­li­gence, process min­ing and analy­sis, and SAP S/4HANA inte­gra­tion capa­bil­i­ties, their pub­li­ca­tion rep­re­sents one of the first SAP offi­cial guides to the busi­ness process man­age­ment plat­form, which SAP acquired in March 2021.

“We approached it as a non-tech­ni­cal book for busi­ness­peo­ple, to answer those very basic ques­tions about what this tech­nol­o­gy suite does, in very prac­ti­cal terms,” said McCool. ​“We tried to stay true to that.”

You can read the first part of our con­ver­sa­tion here. Below, in the sec­ond half of our inter­view, Singh and McCool dis­cuss the Cus­tomer Val­ue Jour­ney, where SAP Sig­navio sits in, and what mat­ters most in val­ue real­iza­tion for customers. 

This con­ver­sa­tion has been edit­ed and condensed.

ASUG: In intro­duc­ing SAP Sig­navio to read­ers, how did you set a frame and fig­ure out the right struc­ture and tone?

Nitin Singh: As our team was work­ing in the field, lever­ag­ing SAP Sig­navio and dis­cussing trans­for­ma­tion with cus­tomers, things were chang­ing fast for the busi­ness trans­for­ma­tion suite of solu­tions at SAP. There was no point of ref­er­ence for any­one; you’d have to browse 20 dif­fer­ent links to get your ques­tions answered, and even those answers would have to be inter­pret­ed in cer­tain ways. We want­ed to pro­vide the right infor­ma­tion and insights for our cus­tomers; that became our moti­va­tion to write the book. 

Our team touched 500 cus­tomers every year, so we had that col­lec­tive knowl­edge, and we focused on trans­for­ma­tion, both orches­trat­ing it and cre­at­ing a case for it. With SAP Sig­navio, we saw how it could accel­er­ate busi­ness-case cre­ation, time-to-val­ue, and val­ue real­iza­tion for our cus­tomers. I sent a pro­pos­al to SAP Press, and they ini­tial­ly were reluc­tant giv­en that it’s still an evolv­ing top­ic, but they even­tu­al­ly accepted. 

Even though writ­ing the book fell out­side of our day jobs, we com­mit­ted to work­ing on week­ends and late at night, to ensure that we could place this book in the hands of our cus­tomers, col­leagues, and part­ners, who do deserve to sim­pli­fy their life and sim­pli­fy the customer’s life.

ASUG: In what phase of dig­i­tal trans­for­ma­tion should cus­tomers con­sid­er SAP Sig­navio, in your view? Per­haps you can place this in the con­text of the Cus­tomer Val­ue Jour­ney, SAP’s lat­est cus­tomer engage­ment mod­el, which is aimed at allow­ing SAP and its part­ners to col­lab­o­ra­tive­ly achieve opti­mal out­comes for customers.

Ger­ry McCool: From my stand­point, there’s real­ly not a wrong time, oth­er than not to do it at all. It’s rel­e­vant in all the phas­es of the Cus­tomer Val­ue Journey. 

• In the ​‘Dis­cov­er’ phase, as you’re explor­ing that poten­tial, how are you iden­ti­fy­ing oppor­tu­ni­ties and quan­ti­fy­ing those oppor­tu­ni­ties? How are you putting a line of sight to val­ue and the art of the possible?
• In the ​‘Select’ phase and build­ing the vision for change, how are you get­ting spe­cif­ic details around that vision and cre­at­ing that case for change? SAP Sig­navio can pro­vide pow­er­ful detail on improve­ment and inno­va­tion opportunities.
• In the ​‘Adopt’ phase and prepar­ing for deploy­ment, it’s about help­ing with change man­age­ment and the col­lab­o­ra­tion that brings peo­ple togeth­er across geo­gra­phies and busi­ness­es on the top­ic of process.
• ‘Derive’ is all about mea­sur­ing per­for­mance. How are you tak­ing begin­ning mea­sures and then sequen­tial mea­sures down the road through­out that Cus­tomer Val­ue jour­ney? Think val­ue man­age­ment and val­ue assurance.
• ‘Extend’ is about get­ting back into those time­ly, rel­e­vant rec­om­men­da­tions for what a cus­tomer needs and when they need it.

NS: SAP Sig­navio is sys­tem agnos­tic. Most of the Sig­navio suite of solu­tions work with both SAP and non-SAP tech­nol­o­gy stacks. You don’t have to be an S/4HANA cus­tomer. You could start lever­ag­ing most of its com­po­nents at any time to get that end-to-end pic­ture. That said, if you are plan­ning for S/4, it becomes a must to invest in fig­ur­ing out how to best use S/4; that’s why Sig­navio is embed­ded in RISE with SAP, as an addi­tion­al ben­e­fit for those customers. 

Amid plan­ning for an S/4 migra­tion, one of my cus­tomers was recent­ly ana­lyz­ing the over­all busi­ness case for their CFO. When we start­ed look­ing at the sys­tem, they had an automa­tion rate of their pur­chase orders not­ed as 2 – 3%. We asked, ​“Why do you have such a low rate of automa­tion?” It was not because they could­n’t auto­mate in the sys­tem; they had some pro­grams they could quick­ly write to auto­mate. It was more that they didn’t trust their pur­chase req­ui­si­tions (PRs), which were cre­at­ed from Mate­ri­als Require­ments Plan­ning (MRP) run every morn­ing. MRP came from their demand fore­cast­ing, and their fore­cast accu­ra­cy was 50%, so they did not trust the fore­cast accu­ra­cy and there­fore did not trust the quan­ti­ties on pur­chase req­ui­si­tions and there­fore intro­duced a man­u­al inter­ven­tion while con­vert­ing those PRs to pur­chase orders.

So, the root cause was not automa­tion; until they improved their demand fore­cast­ing, they couldn’t improve their automa­tion rate. The inter­con­nect­ed­ness of mul­ti­ple appli­ca­tions and mul­ti­ple process­es becomes crit­i­cal at the mod­ern enter­prise. That’s why we always rec­om­mend lever­ag­ing both SAP Sig­navio and experts who under­stand it, to fig­ure out which areas need to be invest­ed in and pri­or­i­tized amid dig­i­tal transformation. 

ASUG: Can you pro­vide a few exam­ples of cus­tomers who have oper­a­tional­ized their way of work­ing with SAP Sig­navio? What lessons can be learned from their success?

NS: Every cus­tomer is unique. Some are cus­tomers are going through merg­ers and acqui­si­tions, and they want to know what syn­er­gy they have in process­es across two dif­fer­ent com­pa­ny types. Oth­er cus­tomers are look­ing to move to the cloud and lever­age best prac­tices, rather than just tak­ing their tech­ni­cal debt with them. Oth­er cus­tomers are already on their S/4HANA jour­neys but want to lever­age tools so that they can see what oth­er ERP sys­tems offer, how close­ly aligned they are with what they cur­rent­ly have and what they want to do in the future; they want a busi­ness-process-man­age­ment tool for that analy­sis. And oth­er cus­tomers are sim­ply not aware of SAP Sig­navio and how it can be lever­aged to cre­ate busi­ness cas­es for transformation. 

Cus­tomer exec­u­tives, today, need to quick­ly piv­ot based on chang­ing mar­ket dynam­ics. In the last three years, they have seen all the ups and downs: when COVID hit, they went down, and they had to meet pent-up demand amid inven­to­ry and infla­tion issues. In these cir­cum­stances, they need quick insights to deter­mine what’s going on with their busi­ness­es. How can they move quick­ly? What capa­bil­i­ties do they need to pri­or­i­tize? To answer those ques­tions, they need a tech­nol­o­gy lay­er, with­out doing expen­sive and time-con­sum­ing busi­ness process reengi­neer­ing exer­cis­es, through which they can quick­ly apply these tools. Lever­ag­ing those tools, exec­u­tives can gain those insights and start tak­ing cor­rec­tive action. 

GM: Many of the chal­lenges are age-old. Where can we get detailed infor­ma­tion about how to improve our busi­ness: where to improve, and what to improve? How do we trans­form, fun­da­men­tal­ly, or de-risk trans­for­ma­tion? You say the word ​“trans­for­ma­tion,” and it sounds expen­sive, risky, and scary, as if peo­ple are going to lose their jobs. How do you put wood behind the arrow and put real fact into trans­for­ma­tion, using objec­tive infor­ma­tion? And how do we get the most out of our invest­ments, in gen­er­al? SAP Sig­navio is a valu­able response to those challenges.

NS: We also speak with cus­tomers at $2 – 5 bil­lion com­pa­nies that want to become $10 – 20 bil­lion com­pa­nies. If they want to scale quick­ly, based on their growth rates, they will hit road­blocks where they’re throw­ing more bod­ies at work and using a Band-Aid approach. Once they start cus­tomiz­ing sys­tems, those sys­tems won’t be able to scale fur­ther. If 100 peo­ple are man­ag­ing a $10 bil­lion company’s finances, and the com­pa­ny wants to be a $20 bil­lion com­pa­ny, it could need 200 more peo­ple. Will that give them economies of scale? Per­haps not. 

So, the ques­tion becomes, ​“How can com­pa­nies scale fur­ther by opti­miz­ing the way they oper­ate?” Cus­tomers are strug­gling with this. How do we opti­mize the val­ue deliv­ered to cus­tomers, with few­er resources? And do we scale that for the future state? How many more resources will we need if we con­tin­ue doing what we’re doing today and don’t trans­form? Cus­tomers reach these lim­its where they can’t scale fur­ther with­out tak­ing urgent action aimed at opti­miz­ing how they operate. 

In those sit­u­a­tions, cus­tomers are try­ing to lever­age a busi­ness process man­age­ment approach and then see where to pri­or­i­tize, where they can con­tin­ue to improve, where they can out­source, where can we invest more, where we can adopt new capa­bil­i­ties, and where they can apply robot­ic process automa­tion (RPA) or AI Inno­va­tions to sim­pli­fy process­es. Scale, merg­ers and acqui­si­tions, sys­tem con­sol­i­da­tions, and cloud trans­for­ma­tion are four key use cas­es you could think about for SAP Signavio.

ASUG: Any part­ing thoughts on SAP Sig­navio and its role in the SAP suite of solutions? 

NS: We want to enhance the val­ue real­iza­tion that’s front-and-cen­ter in trans­for­ma­tion. We want to ensure that cus­tomers, when sign­ing up for large cloud trans­for­ma­tion projects, are reach­ing the right outcomes. 

In one of the last chap­ters of our E‑bite, we dis­cuss set­ting a frame­work for trans­for­ma­tion and iden­ti­fy­ing areas that become the back­bone of busi­ness cas­es. You want to mea­sure the suc­cess rate, and you want to mea­sure improve­ments in process per­for­mance indi­ca­tors (PPIs) and key per­for­mance indi­ca­tors (KPIs) in an iter­a­tive fash­ion, every six months or so. 

You can do this using Sig­navio tools that direct­ly plug into your sys­tems, whether that’s S/4HANA or anoth­er sys­tem, and give you insights into which of those PPIs or KPIs are improv­ing and which are not. What are the capa­bil­i­ties you need to acti­vate, and what action plan do you need to take, to address those areas that are not improving? 

ASUG: What else would you say to the ASUG community? 

NS: Ger­ry and I have been part of the SAP fam­i­ly for a long time. Our pas­sion is to ensure our cus­tomers are suc­cess­ful. That’s what our pur­pose is. As val­ue advi­sors, we feel that our job is not done until cus­tomers see real val­ue from their trans­for­ma­tion. The chap­ter of val­ue real­iza­tion is includ­ed in our book, because we went back and forth with SAP Press and pushed the point that we need­ed that chap­ter, believ­ing our cus­tomers need to read about it. 

Val­ue real­iza­tion is key to our cus­tomer val­ue jour­ney frame­work which ensures our cus­tomers are get­ting the desired val­ue from their SAP invest­ment. It is impor­tant for our cus­tomers to under­stand how key it is to our approach. I would like to con­clude by thank­ing our cus­tomers and part­ners for adopt­ing process trans­for­ma­tion and val­ue mind­set and we are very excit­ed for the future!

GM: We see that the busi­ness process improve­ment space is under­served. It is under­served in the sense that there are a lot of mis­con­cep­tions about throw­ing tools at prob­lems, whether cus­tomers think it’s just about process min­ing or mod­els or bots. At the end of the day, what tends to be prob­lem­at­ic is that orga­ni­za­tions lack a sys­temic approach to change, improve­ment, and transformation. 

Only by real­ly con­sid­er­ing how sys­tems, tools, prin­ci­ples, and results all inter­act and come togeth­er cohe­sive­ly can you real­ly get to the right kinds of answers. That’s what brings us togeth­er every day to do what we do for our cus­tomers and help to man­age val­ue through­out that journey.

“Intro­duc­ing Busi­ness Process Trans­for­ma­tion with SAP Sig­navio” is now avail­able from SAP Press.

For more on SAP Sig­navio, explore our curat­ed insights and check out our Busi­ness Trans­for­ma­tion Man­age­ment and SAP Sig­navio con­tent col­lec­tion.