With nearly one million retail customers, Energy Harbor is the second largest non-regulated nuclear energy company in the United States, serving both residents and businesses across the Mid-Atlantic region. A long-time SAP customer, dating back to its implementation of an SAP R/2 mainframe in 1972, Energy Harbor has been committed to excellence in technology—and to moving its landscape forward—throughout its existence.
At the SAP for Utilities, Presented by ASUG conference, held Oct. 9–11 in Chicago, IL, attendees heard from Mandi Grose, Manager of Applications for Energy Harbor, who discussed the company’s transformation from SAP ERP Central Component (ECC) to SAP S/4HANA alongside Prakash Gidvani, Enterprise Architect at SAP.
By successfully migrating from SAP ERP Central Component (ECC) to SAP S/4HANA on RISE with SAP, and doing so within a nine-month timeframe, Energy Harbor displayed its dedication to customers as one of the largest producers of carbon-free electricity and accelerated its transformation into a fully integrated retail energy provider. In recognition of this achievement, Energy Harbor was awarded the title of Purpose-Driven Utility at the SAP Innovation Awards, announced during the conference.
Front and center during Grose’s discussion of the journey was comprehensive guidance around how to successfully undertake ERP transformation. Leading audiences through every facet of Energy Harbor’s transformation strategy, from planning to execution and what’s next for the organization, Grose offered valuable insights into the key processes to consider in project management.
Align on the “Why” Behind Your Project
Grose emphasized the importance of sharing with key stakeholders the main reasons for Energy Harbor’s transition from SAP ECC to SAP S/4HANA. Contractual obligations, as part of Energy Harbor’s separation from a prior company, played a role in the decision, as did the impending expiration of its ECC licenses. With this key factor for transformation in mind, Grose asked, “Why wouldn’t we?”
Moreover, Energy Harbor was running on a legacy SAP ECC system with years of accumulated custom code, much of it under-utilized. As Grose’s team discovered, the SAP S/4HANA transformation could allow the organization to gain transparency into this legacy system and establish a baseline for its enterprise SAP landscape and integrated systems. The transformation was also future facing, allowing Energy Harbor to align its existing business operations and technical runbooks to a cloud operating model and future transformation model.
Understanding the underlying reasons for embarking on a technology transformation journey is crucial, Grose noted. Beyond ensuring alignment with internal team members, that shared, organization-wide understanding facilitated a unified mission and vision throughout planning and execution.
Aligning existing partners to the vision and implementation strategy, Energy Harbor took a tools-driven approach, successfully leveraging its existing partnerships, and focused on technical migration and reducing system overhead to improve long-term operations, via technical IT debt reduction. To streamline its IT spend, Energy Harbor sought to adopt a consolidated operating model across software licensing, infrastructure, and application management services.
Pre-Planning Can Be a Differentiator
Equally vital to the success of the transformation, Grose said, was the creation of an implementation strategy that harmonized with Energy Harbor’s vision while adhering to specified timelines.
Grose described Energy Harbor’s three-phased approach, which focused on ensuring that team members could meet transformation project goals while still supporting the business from a functional and operational perspective:
- Phase 1: This phase, which focused on Unicode conversion and unused code removal, took approximately six months to complete and ensured Energy Harbor would be technically ready to move forward with its transformation.
- Phase 2: Across the first three months of its second phase, Energy Harbor centered its efforts on preparation and planning for S/4HANA migration and code remediation, making final project scope decisions (around its systems landscape, integrations, data clean-up assessment, reporting, and more). Decisions made included selecting RISE to accelerate cloud migration over an on-premises or Microsoft Azure environment and deciding whether to include or exclude additional SAP systems. Across the remaining nine months of its second phase, Energy Harbor focused on execution of its SAP S/4HANA migration and code remediation, beginning by managing migration requirements, setting up reference architecture to support migration, developing its project plan, and later proceeding to SAP S/4HANA conversion. 2,000 users migrated to SAP S/4HANA, along with a 1.5T database; custom code was reduced from 20,000 to 10,000 and remediated for SAP S/4HANA, among other accomplishments.
- Phase 3: Energy Harbor is currently focused on business transformation and process improvement.
All three phases incorporated pivotal decision points and carried forward lessons learned throughout the transformation. However, Grose’s paramount takeaway was that the upfront time investment in planning not only facilitated the formulation and communication of Energy Harbor’s program vision but also enabled the company to construct a model that worked for its existing and future operations.
Identify the Team Players
Grose highlighted the importance of building a team that incorporated experienced project managers and had leadership support, which allowed for seamless collaboration with all stakeholders. Energy Harbor's team comprised of approximately 14 IT members, internal business users, a managed service provider and systems integrator, SAP experts for solution guidance, a partner focused on build and execution, and a partner focused on discovery, technical analysis, code assessment, and remediation.
Grose stressed the vital involvement of both technical and business users from the project's inception, the establishment of a weekly steering committee, and daily synchronization between the project manager and all other internal “super users.”
Furthermore, she discussed the crucial aspect of maintaining a robust relationship with SAP and other partners, emphasizing the need to keep communication lines open with them nearly as much as they did internally.
Grose underscored the imperative of identifying a well-rounded team early in the process and ensuring ongoing communication to keep all members well-informed.
Take Advantage of SAP Resources Already Out There
In addition to seeking guidance, validation, and governance from SAP, Grose underscored the importance of being aware of the SAP resources available through Enterprise Support as part of the SAP S/4HANA journey. One such resource utilized by Energy Harbor during its first phase was an SAP Readiness Check; more information on the supported scenarios can be found here.
Another valuable tool was Energy Harbor’s utilization of SAP S/4HANA Trusted Authorization Review (STAR) Service. Through this service, Energy Harbor could analyze its usage and security authorizations, gaining insights into user access levels, potential over-authorization, and instances of unauthorized access. This effort resulted in an impressive 85% reduction in licensing and significant cost savings, revealing aspects that might have remained undiscovered.
As Grose pointed out, these resources exemplify "how a tools-driven approach is an accelerator" in the context of an SAP S/4HANA project.
Key Considerations and Factors to Success
Finally, Grose and the Energy Harbor team shared many factors they deem crucial, and various considerations they learned the importance of evaluating before initiating a technology transformation journey:
- Involve the business early and consistently
- Establish a centralized communication hub with a regular schedule
- Strategically plan mock cutovers and grasp the acceptance of downtime
- Verify compatibility of non-SAP systems with SAP S/4HANA
- Set a definitive go-live date and adhere to it without alterations
For more coverage from the SAP for Utilities, Presented by ASUG conference, read customer stories from Southern California Edison, Lincoln Electric System, and DTE Energy, as well as our coverage of sessions on the SAP Innovation Awards, SAP Field Service Management (FSM), and exclusive interviews with keynote speakers Mel Robbins and Michael Sullivan, North America's newly appointed National Vice President – Renewable Energy & Utilities at SAP.