While there are many dif­fer­ent paths tech­nol­o­gy lead­ers can take toward estab­lish­ing a Cen­ter of Excel­lence (CoE) for their orga­ni­za­tions, the ben­e­fits of doing so are clear — espe­cial­ly for those in the midst of dig­i­tal transformation. 

Accord­ing to ASUG research con­duct­ed in col­lab­o­ra­tion with SAP Sig­navio in 2023, orga­ni­za­tions with CoE teams in place to pro­vide lead­er­ship, best prac­tices, research, train­ing, and sup­port for tech­nol­o­gy mod­ern­iza­tion are gen­er­al­ly fur­ther ahead with their SAP tech­nol­o­gy imple­men­ta­tion initiatives. 

45% of orga­ni­za­tions with CoEs are already live on SAP S/4HANA, com­pared to just 29% of orga­ni­za­tions with­out CoEs, accord­ing to research that sur­veyed 148 ASUG mem­bers about the role and ben­e­fits of CoEs at orga­ni­za­tions pur­su­ing busi­ness trans­for­ma­tion. This marks ASUG’s sec­ond year of col­lab­o­ra­tion with SAP on research around this topic.

Orga­ni­za­tions with CoEs are more like­ly to be in the lat­er stages of their busi­ness trans­for­ma­tion jour­neys, accord­ing to the research, which also indi­cat­ed the impor­tance of CoEs to the effec­tive imple­men­ta­tion and uti­liza­tion of com­plex soft­ware solu­tions, includ­ing the SAP Sig­navio suite for busi­ness process transformation. 

While 47% of ASUG mem­ber orga­ni­za­tions sur­veyed have CoEs, the research reveals that orga­ni­za­tions take diverse approach­es to estab­lish­ing them. ASUG mem­bers also iden­ti­fied key steps to con­sid­er in estab­lish­ing a CoE, such as: 

1. Form­ing a team by first iden­ti­fy­ing exist­ing exper­tise with­in the orga­ni­za­tion, then look­ing exter­nal­ly to address any skill or knowl­edge deficits. 
2. Align­ing the goals of the CoE with the over­ar­ch­ing trans­for­ma­tion goals of the business.
3. Con­tin­u­ous­ly mak­ing improve­ments to the CoE as fur­ther busi­ness needs are identified. 
4. Ensur­ing col­lab­o­ra­tion across the organization. 

Wide-rang­ing teams by design, CoEs are most like­ly to include SAP ana­lysts, sub­ject mat­ter experts (SMEs), SAP solu­tions archi­tects, process own­ers, and SAP Basis or data­base admin­is­tra­tor (DBA) leads. Giv­en how diverse the roles rep­re­sent­ed with­in an organization’s CoE can be, based on busi­ness needs, our research indi­cates that suc­cess is all about find­ing the right peo­ple, rather than the right titles. 

ASUG research also offers insights into the ben­e­fits orga­ni­za­tions have real­ized from estab­lish­ing CoEs:

From oper­a­tional effi­cien­cy to improved cus­tomer sat­is­fac­tion and user pro­duc­tiv­i­ty, CoEs con­tribute mul­ti­fac­eted advan­tages to SAP busi­ness process trans­for­ma­tion. Of note: 77% of respon­dents indi­cat­ed the impor­tance of a CoE serv­ing as a cen­tral point of con­tact for all SAP-relat­ed mat­ters, uni­fy­ing var­i­ous tech­nol­o­gy mod­ern­iza­tion efforts through­out an organization. 

Broad­er busi­ness chal­lenges can pre­vent orga­ni­za­tions from effec­tive­ly estab­lish­ing a CoE, accord­ing to ASUG research into top obsta­cles encoun­tered dur­ing mod­ern­iza­tion ini­tia­tives. As in oth­er tech­nol­o­gy ini­tia­tives, staff short­ages (55%) and bud­get con­cerns (45%) present hur­dles to estab­lish­ing a CoE. Oth­er chal­lenges include the exis­tence of too many man­u­al workarounds (35%), an abun­dance of bro­ken or flawed busi­ness process­es (35%), and a lack of com­pa­ny-wide commitment/​prioritization (34%).

Such chal­lenges empha­size the need for effec­tive change man­age­ment and resource plan­ning when embark­ing on busi­ness trans­for­ma­tion jour­neys. Address­ing these chal­lenges requires a holis­tic approach that com­bines tech­nol­o­gy, process­es, and peo­ple. But the research shows that ben­e­fits of estab­lish­ing a CoE are com­pelling and help orga­ni­za­tions nav­i­gate the com­plex­i­ties of poten­tial­ly trans­for­ma­tive technologies.

Maris­sa Gilbert is Direc­tor of Research at ASUG.