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How to eliminate the hidden processing costs of your SAP solution

Eliminate hidden processing costs in SAP and S/4HANA

This is part of our "8 ways to reduce costs in SAP series". You can return to the first article here.

In Part 4 of our series of ways to cut SAP running costs we explain why you should become self-sufficient in two key areas, Architecture and Vendor Management

Your Systems Integrator or Outsourcer is an over-processing machine. They are not charities - they are commercial organisations, driven by growth - and you are a source of purchase orders.

They will take an opportunity where it exists and when they propose a solution, you need to consider whether it is the simplest or cheapest option. Who is the solution benefitting?

Similarly, if you are using Contractors, does human psychology suggest that they are more likely to provide a quick fix that takes a day or something that nudges their extension over the line.

Also be wary of contractors that propose technical solutions that may be their way to get a ‘badge’ on their resume. If there is a way to increase their net worth in the market, some contractors may steer solutions to meet their own ends.

The best way to counter both of these things is to make sure that you have the right skills and capabilities in house to be able to challenge experts . Many companies have gone too far in outsourcing capabilities and become too dependent upon their suppliers. This has left them without the skills in house to properly manage the solution.

There are two areas that you should invest in to impact cost reduction it should be Vendor Management and Architecture.

A strong in-house Architecture capability will enable a customer to challenge and push back on experts, come up with simpler ways to do things and help the business to make informed decisions. This may not always mean you have to employ a full-time Architect. What is key is that you have access to people with these skills, who are working on your side and can help you face off to your Systems Integrator and ask the difficult questions.

If you are going to outsource, investing in effective Vendor Management is crucial. When you sign a contract with a Systems Integrator, you need to hold them to account on their service commitments and deliverables and you need to watch out for common traps and tricks such as increasing the rate of resources due to promotions that you have no say in.

Resulting are the UK’s only business-side SAP consulting firm which means that we’re best placed to help you get the most out of your relationship with your SAP technology partners. The Resulting CoE Toolkit details the key capabilities that a mature SAP COE requires and goes into more detail on these areas.

Next: Your SAP cloud hosting isn’t saving you as much as you thought. Here’s why.

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The team at Resulting have designed, built and optimised more SAP Centre of Excellence than any other independent consulting firm.

We've distilled our 20 years of experience into a simple guide to help SAP customers design, build and optimise their SAP delivery organisations.

The Ultimate Best Practice Guide to SAP Centres of Excellence