Creating a single global SAP® system instance
Accenture shares its journey and guiding principles to attaining ERP flexibility, quality, system performance and cost-effectiveness
Transitioning from a private partnership to a global public company gave Accenture the opportunity to create an ERP strategy from a blank slate and lay a new IT foundation.
At the time, Accenture made the strategic decision to create a single, global SAP system instance and undertook a journey to maximize this instance and determine how to operate on it. From the beginning, the approach was less about the technology and more about how Accenture wanted to operate its business. Accenture made decisions that have served it well and gained valuable insights along the way. Today, its ERP operations are better, faster and more cost-effective than ever.
A look at Accenture’s journey to creating a single, global SAP system instance reveals 10 guiding principles that continue to steer the company today.
1. Align business strategy with IT and ERP strategies
The first critical step Accenture took was to align business and IT strategies. Accenture decided that it would need to align and operate its IT in a globally consistent way and to enable IT to provide the applications to support the business. The next step was to define Accenture’s ERP strategy, which emerged from discussions with the business at many levels, particularly leaders and internal customers throughout the organization. From these discussions, the decision was made to operate Accenture’s business with a single, global SAP system instance.
Defining the ERP strategy helped establish what Accenture wanted to accomplish with its investment in SAP applications in line with the company’s overall business strategy. The ERP strategy was developed with the understanding that it would evolve with future growth and change. The resulting ERP strategy has remained flexible enough to adjust with Accenture’s changing go-to-market approaches and changing economic conditions.
2. Establish one global governance
Accenture’s services—strategy and consulting, interactive, technology and operations—are different in many respects, but all rely on shared, global core processes. For this reason, it made sense for Accenture to strive for a single, global technology footprint, governed by a single, centralized governance structure that closely mirrors the way the company works.
The governance structure for ERP includes business leaders from Accenture’s Finance, Sales, and Geographic Services organizations in addition to IT leadership. Together, these members are responsible for strategy, planning, programs and projects, and operations. Rounding out the governance model is a cross-operations team composed of business process and IT people, which works across three support tiers: tracking service level agreements, measuring production support effectiveness and monitoring benefits.
3. Standardize business processes
To achieve efficiency across Accenture’s core functions, global IT worked with the business to undertake a comprehensive business process standardization effort. Business processes such as record-to-report, order-to-cash, time and expense, and the close process were rigorously standardized across business units and countries to arrive at a set of global business processes and global data model to enable the single-instance ERP.
Where necessary, global IT built upon the standardized processes where the business needed a fit-for-purpose solution. The resulting standardization has driven consistency across the diverse internal functions that use the SAP system today. It also provides much greater visibility into the business at a greater level of granularity. Standard processes also facilitate more rigorous internal control procedures.
4. Strive for one instance of SAP applications
Many organizations believe they need best-of-breed solutions in each major area of operations. Accenture experience shows that, while the best-of-breed philosophy can be right in some instances, it imposes complexity and reduces flexibility over time. Accenture’s legacy environment had roughly 600 global applications, more than 1,500 local applications, multiple networks, many data centers and multiple technology platforms. Global IT knew Accenture had to rationalize and standardize because it saw how burdensome this complexity already was, and that the problems would only keep multiplying over time.
This is why Accenture strives for a "theme of one" in every area of SAP applications and operations. Less is always more, and one is always preferred. Rationalizing applications enabled a single source of the truth, as opposed to multiple applications with different data. Streamlining enabled Accenture to become leaner and lighter, which translates into a faster and more flexible operation that is more responsive to the business and to changing business needs.
5. Minimize modifications to core SAP code
Accenture minimizes modifications to the core SAP code. Having a single instance and minimizing modifications help Accenture to maintain the ability to maximize its investment in SAP applications. Minimizing modifications also helps to reduce operating costs, perform faster and cheaper upgrades ensuring Accenture is keeping its solution current. It also enables greater flexibility to support the dynamic nature of Accenture’s business, such as integration of new business areas and acquisitions, organizational restructures and expansion to new locations.
6. Start as a fast follower, move to leading edge
Initially, Accenture deliberately chose to be a fast follower of SAP versus leading edge. This was done to manage risk by waiting until new solutions were tested and proven before implementing them. Today, with the fast pace of technological change and Accenture’s growth, Accenture has chosen to be leading edge in implementing SAP capabilities. Now, Accenture often breaks new ground in implementing SAP solutions, such as moving SAP Business Warehouse on SAP HANA® to Microsoft Azure, upgrading to SAP S4/HANA®, and moving all of Accenture’s SAP production landscape to Microsoft Azure.
7. Treat SAP as an asset
Accenture knew that leveraging a world-class ERP system could become an asset for Accenture to leverage for the future. As such, Accenture treats its SAP system as an asset, and looks at the power that a global, single SAP system instance can bring to bear to successfully operate and manage the business.
Despite the inevitability of having to upgrade their ERP software periodically, many organizations hesitate to approach the upgrade task, possibly because of the potential for prolonged downtime or problematic cutover that can severely disrupt an organization’s critical business functions. Accenture prefers to view an upgrade as a key step on its SAP system’s strategic road map—an opportunity to deliver value to the business and to establish new capabilities sooner than the competition, while maintaining full security at all times. Accenture applies all hot fixes in a separate release on a periodic basis.
8. Achieve low cost
The way in which Accenture designed its ERP system and business with standard structures, toolsets and business processes leveraging standard SAP application functionality wherever possible produced benefits by driving efficiencies. For example, selecting one instance of SAP applications reduces the number of applications, which in turn simplifies the environment, enabling lower costs.
Efficiencies are achieved across functions by having a single source of the truth. It takes less time and effort to bring new businesses online. Even though Accenture has added significantly more capability and increased usage of the SAP system over time, IT costs have been reduced by reducing the number and size of the support team. In addition, about 85 percent of the support team is drawn from cost-efficient locations across Accenture’s Advanced Technology Centers.
9. Acknowledge that a single ERP does not fit all
Organizations are challenged in deciding when and when not to use an ERP for the business. There are times when a single instance is a fit and times when a multiple instance is a fit. Whichever is the case, it is important to have the organization’s instance strategy aligned to its business strategy.
Different business situations drive the decision. If an organization has diverse business units, for example, it might want to have multiple instances. Multiple instances of SAP applications provide flexibility to address diverse business needs, but compromise on cost, control and process efficiency. If an organization has a situation similar to Accenture’s (one global process, one economic model and globally defined business processes), it may want to consider a single SAP system instance.
Having a single instance does not necessarily mean the impossibility of having applications to support diverse business needs. Where one SAP system instance does not meet an organization’s needs, the organization needs to add on to it. Accenture has one instance of SAP applications but supports legal and regulatory items through items that bolt on to its one instance, such as one instance of time and expense, and local tax bolt-ons for compliance. Too often, however, the one-size-does-not-fit-all situation leads to organizations developing multiple ERPs, which potentially creates complexity and problems over time.
10. Let the application strategy drive decisions
To guide its decision making, Accenture relies on its application strategy, which is to use global solutions (by capability) where possible to respond quickly to Accenture-wide changes and to operate efficiently as a global organization. This strategy includes three guiding architecture principles to help make the right decisions: 1) Allow one “solution” per business capability (as defined by the business), 2) Loosely couple solutions to enable the flexibility to make changes without significant collateral impact, and 3) Look to use solutions Accenture already has before considering buying something and build when a vendor product that meets the core requirements is not available.
“Many organizations believe that attaining a single instance involves making significant trade-offs. Accenture’s experience, however, has shown that we can attain high flexibility, quality and performance at a low cost. Today, we can position Accenture for the future better, faster and cheaper.”
Accenture’s global IT organization moved the company to a single-instance global SAP platform for its internal business functions—starting with Finance, followed by Sales; Denied Party Screenings; Governance, Risk and Compliance (GRC); and others. Other capabilities have been added over time along with business acquisitions as well as SAP system upgrades and updates.
Today, Accenture’s ERP system integrates most of its internal business functions and users, powering the core functions of the organization. It is supported by a single support model as well. A single instance also provides the platform that allows Accenture to implement analytics and business intelligence capabilities very quickly by leveraging a single repository of critical business information.
From the start, Accenture’s approach to a global, single SAP system instance has really been about governance and a mindset that it was possible to attain flexibility, quality, system performance and cost-effectiveness. These outcomes contribute to Accenture being a Living Business, that is, one that continuously adapts to the evolving needs of its customers, and market conditions, with speed and at scale, to achieve total relevance. They also enabled Accenture to operate with a resilient system with minimal disruption to the business during the COVID-19 pandemic.
The journey to a global, single instance has been transformative, but also an ongoing one. Regular and proactive SAP software upgrades help Accenture to improve operational cost-effectiveness to continually gain value from its ERP as well as prepare for future needs as Accenture continues to change.
For Accenture, a single SAP system instance:
Enables Accenture’s single economic model and standard global processes to facilitate the business with access to consistent, highly accurate information that drives decision making across the enterprise.
Helped reduce costs: IT costs fell by 64%, IT spend per person was cut by 73%, global applications fell from 600 to 246, and local applications dropped from 1,500 to 249—savings that were reinvested.
Enables Accenture’s financial processes and other core business functions to work in an integrated way.
Enables robust internal controls and reporting.
Reduced Accenture’s cost to serve for SAP solution support activities by more than 30% at the time.
Enables Accenture to accelerate the adoption of new SAP business capabilities.
Enables global IT to keep pace with operating and economic model changes.
Provides the ability to enable enterprise change and support future business growth.