Category: Business & Culture

Business management, corporate culture, leadership

  • Hungry for Change

    How hungry are you for change? – Clearly, ‘change’ is in itself not a serious management approach. Without content and its implementation change remains an empty talk. Successful executives connect therefore contentful imagination with execution. In the recent study “Enterprise of the Future” by IBM (www.ibm.com/enterpriseofthefuture) executive officers, selected all over the world, tell about theirs imaginations of the company in the future.

    • Markets will be actively designed. Innovations are beyond the wishes and needs of customers.
    • The company is globally integrated, inserted into the global economic exchange relations.
    • The inner engine is the transformation of business models, with new partners, customers, with modified performance processes realize new value-added potentials.
    • And companies assume more responsibility for their contributions to the visual world society “Corporate Social Responsibility” as environmental, financial and social sustainability.

    This brings people in the focus, their will and theirs skills to change themselves and others, who take part in the change:

    • “Hungry for change” has therefore the first place in the study. Who led and managed changes in the past successfully, dares to do quite so in future. “The key for successful transformation is the change of mind.” Or as my colleague Hans Rudolf Jost apt to say “Corporate Mind Change”. The desire for change is part of the change itself, courage for improvement potentials and new to exercise. It is about a culture of change: Tomorrow successful companies have already incorporated change, being even an actor of change in the world.

    That makes at least appetite, right?

    About the author:
    Dr. Michael Loebbert is Coach and Management Consultant and author of the montly publication “Change Management Short Cut“.

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  • Poker – Change Management’s Fruit Fly

    As many others amongst my friends, I am addicted to poker. When I say poker, I am referring to the omnipresent Texas Hold´em Poker, and not to one of the Draw Poker versions that to my opinion rank among the games of pure chance.

    In my 2 years poker career, I have gone through the following phases:

    Phase

    Description Remarks
    Beginner So much busy with the framework of rules that nothing seems predictable Players are the others rather than myself
    Knowing the rules Having read a couple of How-to’s I understand the basic principle I am an active player. Amazingly often, I end up being the winner, otherwise my defeat is often dramatic
    Experienced player Discovered formerly hidden mechanisms and „soft factors”, trying to apply them Occasional success in „reading” my opponent, avoiding dramatic losses
    Undefeatable Well equipped with all „tools” Some extraordinary successes, but still avoidable errors
    Wise Am I really using all available tools? In order to be successful in the long run, new findings must permanently be brought to the game

    Each new finding made me feel better prepared to cope with my opponents. But I also understood that any new finding could turn my basic idea of the game inside out. It must be tried out and prove applicable before it gets part of my knowledge repertoire.

    Change Management 1)
    The short life cycle of a poker game is a perfect experimental ground for understanding the mechanisms of change management. But whereas it takes an IT change manager a few weeks or months to more or less successfully complete a project, including observing the effects of the changes to the entire environment – and thus learning from it, the cycle in a poker game takes no longer than a couple of minutes.
    As the fruit fly 2) with its short generation cycle for the geneticists, poker with its short game cycles can be the ideal research subject for change manager.

    Realizations

    • Patience; success can not be enforced. Acquiring change management competence is a process in several phases.
    • You might fail even if all conditions are optimal (AA).
    • As a beginner, playing seems to be easy-going. Your playing style is unusual (to others), courageous, imponderable and aggressive. Unfortunately, only in poker games this is a promising player attribute.
    • Planning to win in poker can be compared to a tree. Your starting point are the roots, from there you follow the branches, one after another. Only few players are aware of this. In most cases, as soon as they see a problem coming up, they first cut off the branches instead of going back to the roots. 3)
    • What is most decisive for a player to play a successful game is neither a good knowledge of mathematics, the ability to analyze the opponent, a good starting selection of cards in his hands nor a profound playing strategy. It is self-control. 3)
    • If you want to become a successful, lucky player, first work on your self-control. And I mean – every day! Nothing is comparably important. 3)

    However, there is a relevant difference between poker and change management. In a poker game, you can do everything right and still lose the game.

    In poker, you know your own cards and you know your opponents from the start. The latter are quite obviously determined to win, just like you. In change management, cards and opponents have to be agreed upon first.

    Sources
    1) beteo Blog: Change Management Posts
    2) Wikipedia: Dropsophila melanogaster
    3) Steve Badger: Poker Discipline

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  • How not to Disclose a Secret – HP´s ERP4IT

    Whereas ERP is a synonym for software-supported Enterprise Planning and Controlling, ERP4IT stands for software-supported IT Planning and Controlling (ITPC).

    Those who are looking for solutions will without much doubt check out the ERP4IT offerings of the leading ERP system manufacturer SAP. SAP seems to be the only ERP software vendor for managing one´s own customer IT organization and IT products through SAP Solution Manager. Theoretically In view of the special requirements of IT planning and controlling frameworks and standards, SAP scores quite well. But judging the Patchwork of SAP Solution Manager from real ERP4IT requirements´perspective, which includes comprehensive application lifecycle management, the SAP Solution Manager will at most suit to support the management of SAP customizing.

    While in general the market seems to focus on trying to define the IT processes mainly by means of frameworks and standards. Because of the missing tool support or incomplete offering several large SAP users have already started their own projects to tackle diverse ERP4IT challenges building their own solutions. Like that already more than ten years ago, the first management platforms targeting SAP change und configuration management using ABAP and workflows have been built.

    Meanwhile, in the context of digitization and automation of IT processes including testing, Mercury products had provided the logical supplement of the above mentioned basic ”ERP4IT“ platforms. HP acquired and integrated these products into their portfolio.

    HP today is capable of offering a comprehensive solution „HP Best Technology for Optimization“ (HP BTO). HP BTO is a very useful compilation of software components. In suitable combinations it can fully meet the requirements for a real solution management solution, i.e. a comprehensive Application Lifecycle Management system, as well as those of an SAP ERP4IT system, even more so if combined with some basic functionalities of SAP Solution Manager.

    However, HP seems to primarily promote its software in the form of individual products, missing the opportunity of offering the integrated solution as HP BTO ERP4IT to customers more emphatically. Should the market success of the separate software components be an obstacle to a broad positioning of the comprehensive HP BTO solution? Too bad for IT organizations which are (still) left beyond the reach of this enormous potential value.

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  • Can a Classic CMDB Cope With Business Service Management?

    Today´s IT in its role as service provider for the enterprise requires an immediate rethinking with regard to resources and configurations data management.

    If the datastore is not flexible enough, requirements resulting from service lifecycle management (SLM) might not be met to a satifactory degree and the provisioning of the CMDB services might not be as expected or as efficient as wanted.

    Configuration management databases (CMDB) used nowadays serve as rudimentary data pools and threaten to exist mainly for marketing reasons.

    A Sound Data Collection – Highly Exceeding Today´s Standard – is Necessary!
    A useful, efficient and active service lifecycle management (SLM) calls for a comprehensive enterprise service orientation and cross-company service management.

    To reach this goal, a homogenous and sound service database with an emphasis on „service“ is fundamental. Building up this database, the first step is to define a service catalog that allows all services including their relations to be identified. It is most important that all IT services are assigned to business services. This enables business service management (BSM) to execute impact analyses to an extent that would have been unthinkable ever before.

    From this perspective, a business service is an IT Service that creates direct value which becomes right away visible outside IT– due its obvious benefit to the business.

    At least one service access point per business service provides the point of entry to the targeted service and to the connection between business service and technical service.

    When collecting data for the service catalog, preferably by interviewing a number of steakholders, it is recommended to divide the service structure of the data collection into at least business, applications and infruastructure services from the beginning. The interviewer should always take the perspective of the interviewed person, as the service comsumer is the only one to tell if the provided service meets his/her requirements.

    There is more to a Service CMDB (S-CMDB)
    The data collected for the service catalog must be stored together with the usual data from other IT areas such as project portfolio management (PPM), IT development, and IT service management (ITSM).

    In order to do justice to a comprehensive service portfolio management approach, the data collection must contain all information, including their relations, needed for business as well as projects.

    Enabler of Comprehensive Service Portfolio Management
    The common data collection created for project portfolio management, IT development, and IT service management enables an efficient  holistic view of all IT and other projects and, in turn, serves as a basis for the targeted service portfolio management.

    Service Lifecycle

    The above figure illustrates that within the life cycle of a service, depending on the nature of the change, the currently prevailing requirement is considered either a project request or an operational issue. Through a holistic view, all service changes can be re-prioritized and grouped according to business requirements and users. This reduces risk within the implementation or problem solving cycle and ensures a seamless transition into business.

    Conventional CMDBs need to be extended if they want to meet the requirements of S-CMDBs and to achieve the high expected benefit to IT.

    About the author:
    Andreas Schegg, ITIL and Configuration Management Expert, is Senior Consultant at Ontrex AG, Winterthur, Switzerland.

  • HP BTO Software Centers – Overview

    HP offers a number of BTO Centers. These software packages support in the context of a BTO strategy specific phases of the application lifecycle. The following overview is meant to shed light on the HP BTO jungle.

    HP BTO Centers

    IT STRATEGY

    • Project and Portfolio Management Center (CIO Office)
      The IT management solution enables control and documentation of the enterprise processes, particularly with regard to an optimization of priorities, staff members and processes in IT organizations. For this purpose, modules for the management of portfolio, demand, time, changes, projects, resources, finances and programs are available. Upon coordination with business processes and enterprise requirements, the distribution and use of resources are optimized and processes are standardized (IT Governance).
    • SOA Center (CTO Office)
      The HP BTO solutions for governance, quality and management of service-oriented architectures (SOA) are designed to help customers to minimize economical risks in SOA project phases and to create a comprehensively controlled, business-oriented SOA basis. HP SOA Center enables registry/repository, policy management, consumer management, policy enforcement, performance monitoring und problem solving.

    APPLICATION DEVELOPMENT

    • Quality Center
      With HP Quality Center, a cross-enterprise exchange of information about test requirements, test planning, test execution and error reporting is possible, as well as checking for web security issues covering the entire testing and development team. Through functional test runs, GUI interfaces are automatically tested in applications and various release cycles.
    • Performance Center
      HP Performance Center features a real-time simulation of the maximum access demanded by customer requests using active virtual user input of the applications. This enables system optimization before „going live“ and ensures the desired steady availability. A required optimization can be controlled and accomplished under system load by help of an analysis program. Thus, new web or SAP applications are made secure before going into production.
    • Application Security Center
      By using the technologies of HP Applications Security Center, security gaps in web applications can be identified and judged all across the lifecycle: from development and quality control up to operation. Also applications that are already running in a productive system, can be checked for security gaps. In addition, audit and compliance requirements such as Sarbanes-Oxley, HIP AA or PCI can be met.

    (IT) OPERATIONS

    • HP Universal CMDB
      HP Universal CMDB is a configuration management database for IT organizations planning to implement business service management and ITIL-based initiatives. This software allows you to take up, document and store – in addition to physical configuration elements – logical elements. It also provides extended functionality such as an effects analysis and access control for building up and maintaining CMDB.

    Business Service Management

    • Business Availability Center
      This solution allows you to monitor the availability and performance of applications in operation for 24 hours a day and 7 days a week. Business processes, service levels, applications an the underlying infrastructure are coordinated to one another. The infrastructure is visualized by a graphical view with the traffic light set of colors red, orange and green showing the state of operation. A drill down is available for detailed view and error analysis. BAC is used to ensure the active operation of all business-relevant applications and to verify internal or external SLA agreements.
    • Operations Center
      This solution features a comprehensive, service-oriented access to IT management. Information is integrated and synchronized across management silos, IT and business are connected to one another. This distributed, scalable management solution which also includes security features allows you to monitor, control and record the status and performance of different IT environments, covering network, system, databases, applications, services and Internet.
    • Network Management Center
      This network management solution is considered a strategic and particularly important investment. In the last few years it has been established as an indispensible component of error and event management as well as visualization of network topologies. Network configuration, network events, application performance, and network analysis are the main areas involved.

    Service Automation

    • Data Center Automation Center
      Process automation in IT centers can be effectively supported by HP Data Center Automation Center allowing IT organizations to easily increase cost efficiency and to better meet quality and compliance requirements.
    • Client Automation Center
      More and more security risks, increasing availability requirements, and the rapidly growing number of mobile and remote staff members make it more difficult to effectively and efficiently manage client computers – a requirement, however, which every modern success-oriented enterprise should focus upon. HP Client Automation Center allows you to automate relevant IT processes across the lifecycle of the client computers, no matter where their physical locations are.

    IT Service Management

    • Service Management Center
      HP Service Manager is a comprehensive, fully integrated IT service desk solution targeted to reduce the time spent on problem solving. Thanks to ITIL-based best practice processes and a scalable, service-oriented architecture, consistent, integrated processes can be rolled out all across IT organizations. Event, problem, change, and release management processes can be automated. Service level management and catalog-based service requests are supported. All processes are coordinated by means of configuration management.
  • Business Technology Optimization (BTO)

    The New Role of IT
    For many years, all IT departments seem to have taken up the cause of cost reducing. This has changed. Business managers more and more consider IT a lever for boosting growth. Particularly, this means for IT departments to implement new business models and concepts as fast as possible.

    In most cases, IT departments are not prepared to cope with rapid changes. They utilize a major part of their capacity, sometimes 90 %, for routine work such as the operation of the data center. Very often, this means that no capacity is left for implementing the ideas and business processes the CEOs have in mind (source: Handelsblatt April 14, 2007).

    BTO Solutions
    Business Technology Optimization (BTO) solutions support enterprises in optimizing the business value created by IT. The goal is to consistently extend – by using suitable methods and tools – IT´s contribution in areas such as securing competitive advantages, increasing customer satisfaction and minimizing risks and costs.

    The combination of Business and IT perspectives may raise new questions as to the benefit, quality and reliability of an IT service.

    The focus should be on taking into account and improving the effects of IT on business results. The most important issues are: How flexible, fast and effectively do we want IT to react on enterprise decisions, corporate mergers and changed market situations? In which way do we want it to support the control of the product portfolio or the implementation of marketing strategies, and what should IT´s role of a communication platform for enterprise an customers be like?

    These requirements reach far beyond the conventional IT goals: Accounting for a number of bugfixes in development, reaching defined project milestones, or efficiently utilizing the helpdesk may be evidence of successful IT, but not necessarily of a successful business.

    BTO solutions are meant to support the enterprise with methods and tools to plan IT´s contribution to the business more accurately, to increase it efficiently, and to make it visible.

    By no means, BTO is just a project to be applied to one area of IT. Using BTO successfully means to consistently take into consideration the effects of business on IT operation, IT strategy, IT controlling, IT revision, IT process optimization and IT risk management, and, likewise, observe the influence of IT activities in these areas on business. To reach this goal, new methods and technologies must be introduced and efficiently applied.

    About the author:
    Klaus Otto is Sales Manager HP Software Commercial Accounts at HP Germany (Hewlett-Packard GmbH). This article only contains personal comments on the subject.

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  • Project Roadmap: Quick Wins with Iterations

    My blog Scoping – A Guarantee for Success through Harmonized Expectations describes how to identify factors that are most relevant to the success of the project:

    • Expectations of all key roles are defined and synchronized from the start
    • The technical system architecture is designed
    • The functional requirements are defined
    • An implementation roadmap comprising project contents, required organizations and project procedure is set up

    Harmonized Expectations and Step-by-Step Implementation Targeted at Partial Success
    Experience has shown that defining and synchronizing expectations is of great importance. With regard to expectations, the project scope plays a major role. Unfortunately, project team members as well as clients often fail to define the project precisely enough, including a variety of options and features into the project. Limited time and budget available for a maximum content are part of everyday business. Teams are getting unfocussed and bogged down in details loosing sight oft the project target. The project clients get impatient, failures mute motivation, and the original business cases are questioned.

    It is well known that projects promise to be successful only if sub-goals are defined ensuring step-by-step success and continuously producing a visible benefit. This is particularly true for long-lasting projects. The main issue here is to focus on the most important and prioritized requirements and functions and adhere to their consistent implementation.

    Implementation Roadmap and Iterations
    One oft he main issues of the scoping phase is to generate a practice-oriented implementation roadmap. This includes clearly defined targeted project objects, a time schedule, and the organization implied. Experience has shown that dividing the project into several iterations with clearly defined targeted objects leads to business quick wins and to a successful completion of the project. To follow this strategy, the most relevant requirements and core functions are identified and implemented in iterations.

    The main goal is to provide constant benefit for the project client and the users as soon as possible. Quick wins are achieved by first implementing those functions which are most suitable to ensure the highest possible benefit. In further iterations, more functions are added to those successfully implied to finally integrate the solution step by step into further processes, methods, systems and organizations. At the same time, a consistent project management und project marketing support the roadmap implementation. Management, client, and users know at any time which functions are available to them, and when.

    Iterations Optimized by Quick Wins
    Dividing projects into several iterations provides decisive advantages. They vary depending on context and task, but in most cases, the following advantages are ensured:

    • System with core functionality which rather soon works efficiently
    • Systematic knowledge transfer to users and business by targeted training at the right time.
    • Quick benefit as a basis and guideline for further procedure
    • Early integration of business organization and building up support services
    • Optimistic attitude towards the project by successfully completing iterations and meeting the expectations
    • Flexibility in structuring the functional requirements and a manageable basis for Scope Change Management
    • Organziational changes are implemented step by step and associated with achieving success
    • Short feedback loops, „lessons learned“, can be implemented in the next iteration

    The Challenge of Implementing Iterations
    Very frequently, a rigid project procedure is set forth by large enterprises. In addition to document templates, this includes specified and standardized rules of phase acceptance. The project passes through several phases, comprising preliminary studies, rough and detailed concept, realization, implementation, and operation. A new phase can only be started, after the preceding phase has been completed. This approach is often contrary to the basic idea and the immense benefit achieved by an iterative procedure.

    It is true that dividing the project into several iterations results in quick wins. But if all iterations, i.e. new functions, are repeatedly forced to pass through all project phases from the preliminary studies to operation,  this necessarily implies disprofit by loss of time and additional effort. The great benefit is given away!

    It is quite important to find common solutions in collaboration with the responsible persons, for example, from the project management office (PMO) or from quality control. Experience has shown that it is recommendable to have the most prominent mile stones approved „officially“, whereas the individual iterations can be approved by project members and application of quality assurance measures. A step-by-step extension of this approach to include scoping and phase acceptance which is attuned to an iterative concept would be useful.

    beteo Iterations

    Summary
    The benefit of an iterative approach is enormously high. In the context of standardized and rigid project implementation, this can be quite a challenge. However, addressing it at an early stage, iterations can easily be integrated into the existing environment. In a further step, this concept can be extended to include scoping and phase acceptance particularly attuned to iterations.

    After harmonizing the expectations of all key roles and prioritizing the requirements, all functions should be divided into individual iterations according to their importance. This allows you to focus on the core features and the highest possible benefit. Systems are available to users at an early stage, providing efficiently working core functionality. There is a fast and well-structured knowledge transfer leaving more time for the organization to implement changes. Quickly and successfully completed iterations result in a sense of achievement and promote an affirmative attitude  towards the project.

    In addition, the iterative approach allows you to carry out faster feedback loops and more flexibility in planning further iterations. This ensures quick wins and step-by-step success of the project.

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  • A Strategy is a Story

    As a reminder of what a strategy is and what it should provide:

    • It organizes and coordinates a variety of acts and decisions of one or more persons to a common goal,
    • it makes this in a deliberate contrast to other perhaps possible approaches, takes a conscious decision and risk.
    • Effectiveness is achieved not only with orientation, concentration and determination, but also by the “surprising” innovative difference in the competition.

    If a strategy works, it must be told as a thrilling story. The people involved with the company need to understand the strategy, reproduce it in theirs experiences and realize it in theirs actions.

    1. What decisions have to be made in the overall context and to implement in action? What is the difference before and after? How do I know when I’m the right track?
    2. What are the obstacles, risks, resistors, which must be overcome? What “adventure” must be dealt with? With what result?
    3. What is the key difference to the competitors? What is the pivotal point for success of the strategy? When exactly does the strategy come into reality?
    4. How does the strategy fit to our company, the characters and the temperaments of people, to our values and cultural patterns, which are available for the necessary decisions and actions?
    5. Is the designed suspense conducive and full with power? Is it overstraining or subchallenging for the development of company? Must there something be added?
    6. Is the story, which tells the strategy, in total  coherent and credible? The people involved can they identify? Which adapters still need to be supplemented?

    The narrative review of your strategy improves the effectiveness and power. Weaknesses can be found and the risk of miscarriage is reduced. And the strategy is processed for the systematic communication within the company.

    About the author:
    Dr. Michael Loebbert is Coach and Management Consultant and author of the montly publication “Change Management Short Cut“.

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  • Project Scoping – Aligning Expectations

    Projects often fail to be successful due to diverging, badly aligned expectations
    Dozens of statistics seem to suggest that there are dozens of reasons why projects fail to be successful. However, a great deal of them are attributable to vaguely defined objectives, problems related to technical architecture and a lack of management support. These causes, in turn, are in most cases due to either too optimistic or diverging expectations of the parties involved. Very often, projects are initiated without having identified and documented expectations as well as requirements on the part of all expert and management key roles.

    Scoping: Efficient approach to defining project content
    This is where scoping comes into play. This approach is extremely helpful when it comes to describing the functional requirements, defining project content and an adequate proceeding, and designing the technical architecture. The scoping phase targets at mapping the relevant context, ideas, requirements and prerequisites of all parties involved in the project in a well-structured way, reaching an agreement upon the project scope and establishing the project guidelines. Fixing an order of priority and laying down a clear structure makes the demanded objects transparent, well-defined, and synchronises the expectations of all persons involved. Experience has shown that syntonized expectations are one of the most important factors to ensure the success of a project.

    Scoping Ansatz

    Scoping phase in practice
    Several steps are necessary to reach these goals. Most of them must be executed in close collaboration with the client. This includes:

    • Defining a common objective and selecting relevant persons for workshops and interviews
    • Informing or training the project team members in order to create a common basis
    • Recording of business-related and functional requirements, needs and ideas during workshops and interviews
    • Understanding the technical requirements and challenges, the system landscape, and the necessary integrations
    • Prioritization with regard to quick wins and a high payback
    • Attending to a common understanding and identifying the points where the project gains momentum
    • Elaborating a detailed implementation roadmap, including time management and organizational planning, split up in iterations optimized by quick wins
    • Presentation of the results to the management

    Implementation Roadmap
    One of the most significant results from the scoping phase is the roadmap for implementation. The roadmap includes not only project content and proceeding, but also a time schedule and organizational planning, and provides a basis for the project. It is recommended to split up the project scope into several implementation iterations in favor of a clearly structured step-by-step planning and in order to immediately provide maximum benefit to the project client.

    Core factor of success
    Principally, scoping should be a closely integrated part of the project methodology. If, for example, there are no interviews, this will cause lead to a sign of alarm at the quality gate. If necessary, this item must be re-worked – or there is a clear decision not to do so.
    Experience has shown that the choice of persons involved in the scoping phase is of great importance. The key roles might vary depending on the task and the context, but it is indispensable to involve the client, the top management, the users, and the experts as regards content and technical issues. As soon as the participants are selected, the core factor of success are their availability as well as competent scheduling. We also recommend to have two persons hold the interviews in order not to loose sight of important aspects and to ensure complete documentation.

    Summary
    Scoping is a good way of fine-tuning project ideas and analyze the approaches to solution finding. Preferably, the scoping phase is an integral part of the typical procedure of all projects. As all information is collected by relevant key roles, the required data can be accessed, translated into requirements, and given a defined level of priority. From this, the concrete implementation roadmap is derived. Thus, the project idea is clearly defined, and the project scope is fixed with consideration of processes, organization, systems, including required system integrations, and other dependent processes. All persons involved in the project have a common interest in and are focused on the same issues. Their expectations are synchronized. The momentum gained by this common basis is the most significant stimulus for all to make the project a success story.

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  • Proof of Concept – Less Risk for System Implementations

    Scoping for defined requirements and harmonized expectations
    The scoping approach allows you to define requirements, expectations and project scopes when systems, methods and processes are implemented. This results in aligned expectations, a well-designed system architecture, defined requirements as well as a structured implementation roadmap. If the roadmap is implemented in several iterations, quick wins are achieved in addition to a direct benefit to the project client and the users.

    Technically complex problems as a challenge
    If system implementations are planned in technically complex environments, in addition to the purely technical requirements that have to be met, the following questions should be addressed:

    • Is a clean system installation possible?
    • Can the solution be integrated into the existing system landscape?
    • Which is the best way to coordinate the installation and integration with the IT organization
    • Are all used technologies compatible?
    • Which interfaces are affected, and in which way?
    • Can the described functions really be implemented?
    • How does the system behave with regard to usability?
    • Will the system be accepted by the users?
    • Which are the actual costs to be faced?
    • Which technical capabilities and roles are required for the implementation?
    • Can the planned benefit really be achieved?
    • How about the capabilities of partners, manufacturers and providers, and what characterizes collaboration with them?

    The above questions are only part of the criteria which are relevant to success. To answer them, further activities are necessary. Very often, there is a great deal of uncertainty about the technical and organizational feasability of the project as well as about the time and costs involved.

    Proof of concept: minimization of risk in decision-making process
    In the context of system implementations, proof of concept (POC) equals a technical feasability study. POC can be used as a part of scoping to check for technical and organizational feasability of projects. Prior to execution, the criteria relevant to success and the subsequent steps must be clearly defined in order to ensure maximum benefit. For working out a POC, it is recommendable to implement a mock-up or a prototype comprising the core functionality. This allows to test the functions, define them accurately and involve the users in the planned project at an early stage. Proof of concept reveals which requirements can be met in which way and which functionality demand workarounds or additional solutions. Thus, time and cost expenditure for installation and integration into the existing system landscape can later be well estimated and planned in agreement with the responsible IT organization.

    Pilot pojects as a performance indicator
    Experience has shown that working with pilot projects significantly adds to success. The prototype is used in productive systems on a limited scale. There are various alternatives to proceed:

    • limited user group
    • limited functionality
    • limited process scope
    • limited and/or isolated system environment

    Working with a pilot project allows you to rather accurately pre-estimate if the system in action meets all requirements, covers the planned functionality and proves to provide the expected benefit.

    Summary

    Proof of concept allows you to find out if the implementation of a system can be technically realized, and to evaluate the capabilities of manufacturers, partners and providers as well as the quality of collaboration with them. In addition, the expected time and cost expenditure for installation and integration into the existing system landscape are made calculable and can be planned in accordance with the responsible IT organization. Prior to execution, the criteria relevant to success and the subsequent steps must be defined.

    It is recommended to create a prototype which includes the core functionality, i.e. those functions from which the greatest benefit is derived. This allows the users to be involved at an early stage of the project; as a positive result, user-friendliness and acceptance by users can be evaluated and taken into account. If the prototype is tested in the context of a pilot project with either a limited user group, limited functionality, limited process scope, or on a separate system, this will result in a realistic view of the potential of benefit. Proof of concept is used to work out facts and foundations in order to minimize the risk of making inappropriate decisions in the process of system deployment.