Agility Meets SAP

The modern business world is characterized by continuous change. In this era of digital transformation, companies face the challenge of quickly adapting to changing market requirements while implementing complex enterprise solutions like SAP (Systems, Applications, and Products in Data Processing). What is an SAP business process? A typical SAP business process consists of various steps aimed at achieving specific operational goals. For example, a procurement process can be implemented in SAP within a company. This business process begins with a demand request, continues with supplier selection and ordering, delivery of goods or services, invoicing, and ultimately payment. Various SAP modules, such as Materials Management (MM) and Financial Accounting (FI), are integrated throughout this process to ensure smooth execution. Applying agile methods in an SAP project is recommended, as they provide flexibility, quicker adaptation to business requirements, and better customer engagement, resulting in successful implementations and increased customer satisfaction.

Agile methods, originally developed for software development, have proven to be an effective tool for quickly responding to uncertainty and dynamism. Applying agile principles that emphasize collaboration, flexibility, and continuous improvement is appealing to companies looking to accelerate and make their SAP implementations more adaptable. However, this agile transformation in SAP projects presents both opportunities and challenges.

In this blog post, we will delve into the opportunities and challenges of applying agile methods in the SAP environment. Understanding these aspects deeply enables companies to make informed decisions on how to integrate agility into their SAP projects to maximize their investment.

Opportunities of Applying Agile Methods in the SAP Environment:

1. Accelerated Delivery and Flexibility: Agile methods like Scrum and Kanban each have their own approaches to addressing challenges. While Scrum focuses on short development cycles, known as sprints, producing an incremental result in each sprint, Kanban emphasizes continuously improving the process flow. SAP solutions often consist of complex enterprise software divided into various modules. Incremental development allows companies to implement features as needed and incrementally. This is especially important because it provides flexibility for companies to focus on the most critical requirements and add new features incrementally, rather than having to conduct a comprehensive, costly upgrade.
2. Better Adaptation to Business Requirements and Improved User-Friendliness: Agile approaches support continuous product adaptation and optimization through ongoing stakeholder feedback. SAP projects are often deeply integrated into a company’s business processes. Requirements and workflows in an SAP project are unique and can vary from one company to another. Involving end-users continually helps ensure that the SAP solution is tailored specifically to the individual requirements and processes of the company.
3. Enhanced Communication and Collaboration: Agile methods promote regular communication and collaboration among team members and stakeholders. Given the complexity of SAP projects, misunderstandings can easily arise, particularly when dealing with technical dependencies. Regular communication and collaboration minimize the risk of misunderstandings and help detect and resolve issues early.
4. Reduced Risk and Early Error Detection: Agile methods rely on continuous testing and feedback, allowing for early error detection and resolution. In the SAP environment, this helps avoid potentially costly errors in later development cycles and improves the overall solution quality. Integration testing is particularly relevant. As SAP implementations consist of various modules and systems, it’s crucial to ensure they work seamlessly together. Agile methods enable continuous integration testing to ensure all modules are compatible and interact smoothly.

Challenges of applying Agile Methods in the SAP Environment:

1. Time-Consuming: SAP implementations are highly complex and often consist of a multitude of modules and systems. Agile methods can be advantageous in complex environments as they help generate adaptive solutions for complex problems. However, it’s essential to note that the frequent changes associated with agile methods can complicate the integration and coordination between these modules. This can occasionally lead to conflicts, incompatibilities, and increased testing efforts. Thus, developers and teams must spend more time ensuring that all modules interact correctly.
2. Testing Effort: projects require extensive testing to ensure smooth integration. Due to the frequent changes in agile projects, it’s crucial to conduct tests at short intervals. In the SAP context, integration tests can be particularly challenging due to the complexity of the modules and business processes. Therefore, it is of great importance in such situations to conduct tests early, continuously, and automatically to ensure everything works seamlessly.
3. Risk of Conflicts and Incompatibilities: SAP solutions are highly configurable and can be quickly adapted. In agile projects, where changes are frequent, this adaptability allows for rapid feedback and helps ensure that the desired requirements are implemented correctly. This close feedback loop can contribute to minimizing conflicts and incompatibilities between different SAP components rather than increasing them.
4. Implementation Delays: Due to the complexity of SAP integration, the implementation of new features or requirements can be delayed. While agile methods are excellent for responding quickly to market changes, the extensive adaptability of SAP can lead companies to get too deeply involved in details, striving for perfection. This pursuit of perfection can slow down the overall product implementation and increase the risk of delays.

These challenges are particularly relevant in the SAP context, where SAP implementations typically exhibit high complexity and specificity. Integration challenges can potentially hinder the benefits of agility if not adequately considered and managed. Therefore, it is crucial for companies adopting agile methods in SAP projects to develop specific strategies and measures to address these challenges and ensure effective utilization of agility. Below, you will find some advice for companies considering agile SAP implementation..

Recommendations for companies:

• Avoid over-customization: In SAP projects, there is often a temptation to heavily customize the system. Instead, make sure to use standardized solution as much as possible and make customizations only based on clear business requirements. This helps reduce complexity and avoid potential incompatibilities, and follows the principle of “fit to standard” as much as possible.
• Prioritize integration testing: Since the integration of SAP modules is critical, prioritize comprehensive integration testing. In agile SAP projects, automated integration tests should be performed continuously to ensure that all modules work together seamlessly.
• Iterative planning and roadmapping: Use iterative planning and roadmapping techniques to manage project progress. As complex SAP implementations often have many components and dependencies, ongoing adaptation of the plan is essential.
• Prioritize based on business value: Business value refers to the benefit or value that a particular function or requirement has for the business. This value can be measured in several dimensions, including financial impact, strategic importance, customer satisfaction, or increased efficiency. Let’s say a company wants to optimize its procurement process with the help of SAP. As part of this optimization, various functions and requirements need to be prioritized. Business value measurement can be applied in this context as follows:
  • Reducing costs: a function that helps to reduce procurement costs has a high financial business value. For example, implementing a supplier evaluation and management function could help negotiate prices and reduce the cost of procured goods and services.
  • Increasing efficiency: functions that speed up and automate the procurement process can increase process efficiency. Implementing e-procurement capabilities in SAP that allow employees to easily place purchase orders electronically can reduce processing time and thus increase efficiency.
• Cross-functionality in the team: It is of great importance to ensure that the agile team has a broad range of skills and competencies. This is particularly crucial in SAP projects, not only because of the technical aspects, but above all because of the functional complexity that often characterizes such projects. In the context of SAP projects, the technical dimension is relevant, as SAP systems usually require a complex technical infrastructure. Nevertheless, it is the technical complexity that makes SAP projects particularly challenging. These projects often involve a wide range of business processes and requirements that need to be understood and effectively implemented. The functional depth and breadth, combined with the technical requirements, requires an agile team that is able not only to develop technical solutions, but also to understand and implement the business requirements.
• Risk management: Identify potential risks and challenges in SAP implementation at an early stage. Develop strategies to manage and minimize these risks. It is important to emphasize that agile already includes implicit risk management at its core, as it promotes early validation of assumptions and rapid feedback. Therefore, regular risk assessments should be an integral part of the agile process to ensure that potential risks and challenges are adequately considered and addressed.
• Retrospectives: Conduct regular retrospectives to assess project progress and identify improvements. This allows you to continuously optimize the agile process and respond to changes in implementation.

It must be highlighted that there is no one-size-fits-all solution when it comes to implementing agile methods in the SAP environment. Flexibility and an open mindset are key components for success, as each company has its own challenges and requirements.

Conclusion: Find the balance

The use of agile methods in the SAP environment undoubtedly offers many benefits such as accelerated delivery, flexibility and better adaptability. Nevertheless, companies should also keep an eye on the challenges, especially in terms of integration and risk management. Finding the right balance between agility and stability is critical to getting the maximum benefit from SAP implementation.