The Future of SAP HR

I work with SAP HCM and I am always looking for the direction this solution is taking. I found this article that explains very well the situation of the product and the road-map.

For me and my customer, the summary is:

  • My customer can preserve SAP HCM till 2025, they are legally covered.
  • SAP is investing on SuccessFactors, so new features will be implemented there.
  • SAP SuccessFactors have to provide payroll solution in a robust way as today on SAP HCM.
  • My customer is investing on Workday, so they can wait and see how Workday payroll solution works: they have 10 years to move SAP HCM processes to Workday (more than enough).
  • The only planned investment at this moment is the EPh6.
  • EPh6 has new features that can be activated, but in the environment we work, we will first upgrade it, then on the development environment we will test and show these new features to the BPOs and we will decide the final configuration of these new features.

The challenges for traditional banks

Traditional banks have so many challenges with their conversion to the digital world. Same thing is happening with the newspapers and other industries.FBATopics1

With the banks the bottom-line is that they come from a very regulated market with big barriers for the penetration of new competitors. They have an ecosystem who has been changing so much during the last 30 years, and they have been the first ones to take the advantage of the IT, so the challenges they are facing today is not a new situation for them (for instance, the newspaper companies are not used to have these type of dynamics where the market completely changes).

The new ingredient to the banking market is that some IT companies wants to become banks. Paypal, Google, Facebook…. they have started to manage so many volume of payments. Payments who are not managed by traditional banks anymore.

The next step can be that with a good volume of treasury, these IT companies, can request to the central bank of a country to be able to extend credits, loans… as the major supermarkets are already doing.

So this is the situation, there are so many different reactions the banks have had and they are managing it in different ways. I can only write about 2 cases that I know.

Case one, the bank identified these threads so much time ago (2000) and they took the determination that the IT was not an auxiliary department of the bank, it has to be considered as a core capability that the organization has to define, nurture and mature. In this situation they started to acquire niche small companies, they started to in-source capabilities that in the new map of capabilities were considered as core capabilities, and they started to define a strategy where the end consumer is demanding “more” in terms of accessibility, products…

Case two, the bank has continued their expansion buying other banks, acquiring with them new IT departments, people with knowledge in their own areas and making the complexity of the IT organization to be so much complex. They have integration plans that are not always completed properly, so they are not able to take the competitive advantage that they where assuming during the acquisition analysis. They also have a strong dependency on third parties who has the knowledge of the processes and these vendors are only interested on the T&M contracts, that’s it. They were too much far away in terms of percentage of outsourced consulting services.

In this situation, the second bank has an organization with low costs of operations, but their time response to evolve their solutions is slow, their ability to change and adapt the organization and the operations are very poor. They know they can compete in the next quarters and be operationally efficient, but the 5 years road map they draw in 2007 is obsolete and they as organization have not been able to react to the changes that were coming.

This is my personal view, if you type “traditional banks challenges” in a search engine, you will read more! For instance this one.

How mature is your framework?

I have already worked with different customer frameworks, and the companies I worked, they also have their own.Everybody has one, and they all are more or less aligned with the standards: PMI, ITIL, Cobit, Togaf…

Every time I start with a new customer and I dig in the rules of the game (their framework), I ask some basic questions:

  • Does it cover management or it also includes technical and architecture sides of the work?
  • Has it templates? How good are these templates?
  • Do they describe standard processes?
  • Is there supporting tools for working in alignment with the framework? For instance, on management processes, a EPMO environment enables the people to track and report about the different subjects of the project.
  • And the last one: How mature is the utilization of the framework in the organization?

The answer to the last question is the more interesting to me, here is where you can see how committed is an organization in terms of governance and management of all the aspects of the IT activities in an organization.

Not all companies are committed and “married” with their frameworks, and the use demanded to the vendors is not always equal.

In an environment where different vendors are competing and you want to ensure the quality and coordination of the whole implementation of the IT activities, the exhaustive use of a framework is key to promote equal competition and avoid low quality.

This sounds basic, but I have seen this sequence so many times:

  • In short term they accept cheap proposals assuming lower levels of quality in terms of documentation. In the short term, there is not high impact
  • In medium term, when they want to offer new RFPs, they find the situation where the lack of documentation limits the number of providers to compete. The price increases and the quality decreases as in the next projects the lack of updated documentation extends all phases of the projects.
  • Finally, in the long term, you can see how the company decides that it is better to pay to the vendor who has the knowledge to update the documentation, being this process more expensive than the individual update every time you change something.

Finance terms

Learning some basic finance terms:

Credit support Annex (CSA)

It is is a legal document which regulates credit support for derivative transactions. It is one of the four parts that make up an ISDA Master Agreement but is not mandatory. It is possible to have an ISDA agreement without a CSA but normally not a CSA without an ISDA.

Global Master Repurchase Agreement (GMRA)

It is a model legal agreement designed for parties transacting repos and is published by the International Capital Market Association (ICMA), which is the body representing the  bond and repo markets in Europe. The GMRA is the principal master agreement for cross-border repos globally, as well as for many domestic repo markets.

ISDA master agreement

It is the most commonly used master service agreement for Over-the-counter (OTC) derivative transactions internationally. It is part of a framework of documents, designed to enable OTC derivatives to be documented fully and flexibly.

Over-the-counter (OTC)

Also known as “off-exchange” trading is done directly between two parties, without any supervision of an exchange. It is contrasted with exchange trading, which occurs via exchanges. In an OTC trade, the price is not necessarily published for the public.

Office of Foreign Assets Control (OFAC)

The OFAC is a financial intelligence and enforcement agency of the U.S. government charged with planning and execution of economic and trade sanctions in support of U.S. national security and foreign policy objectives. Very interesting the history of this institution.

QMS software

The project to complete my Bachelor Sciences Degree I was a QMS software, build in Lotus Notes, with reporting done using XML, and on LN5. In 2001 was a good project for my university. I built my modules based on total quality management principles that during the last 13 years have not changed so much.

This is the reason I was smiling when I found that Quality Collaboration By Design has similar modules that my project. I find the software interesting in terms of content, but they should move the solution to the cloud.

The only solution as a service I found it was ZenDoc. The major companies works on QMS implementing their own solutions based on the collaboration platform they have in the company. At the end of the day, every Quality Department has their own templates and their own processes based on the standards, to implement it on JIRA, SharePoint, Lotus Notes, .NET, or even it’s not relevant at all.

Dashboard for organizational changes

In the improvement program I’ve worked, we have done a set of improvements and definition of processes for the different areas of the business we decided to work on.

Every aspect of each process has their details, and they also are linked with the others.

I created this chart to represent how they are going on in terms of evolution, try to discuss and prioritize next steps.

Process-improvement-DashboardWe could not put in place all the improvement actions at the same time as operations and business day to day do not stop, so we planned it in this way: launching each improving at different quarters and introducing others once the previous ones were matured enough.

Process-improvement-Dashboard-calendarIn some areas we have advanced a lot, in some others we still have to improve, but in general the adoption of these standards have improved the efficiency of the operations and the understanding of “what the others are doing”.

The 100-day Corporate get fit plan

I need to remind this article which contains so much valuable details about how to discover the situation of a corporation through mapping the different areas of the company.

The phases are simple:

  • Day 1 – Let us be Honest
  • Day 2 to Day 20  – Map it!
  • Day 21 to Day 40 – Analyse & challenge
  • Day 41 to Day 60 – Doctrine
  • Day 61 to Day 80 – Flow
  • Day 81 to Day 100 – Keep it steady

The table below is a check list that helps you to gain a lot of understanding of what you should be looking for.