S/4HANA Migration: Best Practices for the Program Management Office

When embarking on an SAP S/4HANA business transformation, having a robust Program Management Office (PMO) is essential for effectively managing the inherent challenges and risks. The PMO is responsible for establishing program governance, ensuring delivery quality, and measuring the success of the transformation. While functional and technical designs are important, the PMO's oversight and coordination are crucial for the overall performance and success of the program.

PMO best practices

When establishing a PMO to support an S/4HANA migration, it is important to consider several best practices. Program management primarily focuses on three key aspects: budget, timeline, and scope. The objective of the PMO is to ensure the timely delivery of the program within budget while effectively managing the scope. There are many factors to consider when enabling a PMO to manage a program, but we generally focus on four best practices to enable a PMO for success:

• Define a consistent methodology and governance structure
• Develop an integrated program schedule
• Implement a rigorous scope management and change request process
• Establish a risk management framework

The key to establishing an effective PMO is to establish a consistent methodology and scalable governance model that is easy to follow. It is important to take the time to define and document the project management approach (e.g., agile vs. waterfall), change request process, risk management approach, deliverable approval process, quality gates, program goals and metrics, etc. This will enable the program and various stakeholders to achieve success. Defining key quality gates and the criteria for exiting each quality gate makes it possible to plan and track key milestones and deliverables in the project plan based on the defined criteria, ensuring clear visibility to schedule issues and overall project health.

During the planning phase, it is also important to develop an integrated project plan that incorporates change management, training, data, third-party tools, project management, etc. A well-planned program schedule that considers dependencies, allocates resources at the task level, and takes a holistic view of the program is crucial for understanding schedule risks, monitoring program performance, and identifying resource gaps. Managing third-party activities in the schedule is critical and comes with various challenges, including environment availability, integrations, licensing, and resource allocation, all of which can significantly impact the program schedule. When establishing the schedule, it's important to clearly identify the requirements from these third parties and the expected timelines, enabling clear communication of expectations and early identification of delays for timely implementation of a recovery plan.

Scope: adaptable and agile

Adaptability and agility are essential in the constantly evolving technology and implementation landscape. It is crucial to establish a strong scope management and change request process to effectively manage scope. Additional scope requests often come with impacts on budget, schedule, and resources that may not be fully comprehended. It is common to encounter critical defects or new requirements during testing that are deemed necessary for the project's go-live. Each new requirement should follow the change request process to make sure it can be accommodated within the program’s timeline, scope and budget. To develop effective change request criteria, consider questions such as:

• Does this disrupt the business or is there a manual workaround available?
• Do I need additional resources or funding to support this build?
• Will this item impact our timeline?
• Can another requirement be deprioritized to accommodate the new request?

Defining an effective scope management and change request process with the right level of review and right personnel involved can help reduce this risk significantly.

The big picture view

SAP S/4HANA migration programs often move quickly, leading to new risks arising regularly. The project team is usually deeply involved in detailed tasks, making it challenging for them to step back and see the bigger picture. Implementing a risk management framework that enables team members to promptly and effectively escalate risks will allow them to address critical business concerns while remaining focused on the specific project tasks. The PMO is best positioned to identify mitigation strategies in collaboration with the affected project team members.

It is essential to have a process in place for identifying and addressing risks, as well as documenting the mitigation strategy, tracking its progress, and ensuring resolution. For example, if it is discovered that the business has not obtained all necessary licenses or services for a third-party application, this risk should be escalated and documented. When outlining the mitigation strategy and actions, the team should set a deadline for resolution, monitor the target date, and identify project milestones dependent on this strategy. It is recommended to record these risk mitigation strategies and deadlines in the project plan and directly link related tasks to identify potential schedule impacts.

Establishing a strong PMO is a crucial element in ensuring a successful S/4HANA migration. Adhering to these best practices is essential for defining, measuring, and achieving success. Implementing a PMO methodology and governance structure, creating an integrated project plan, enforcing rigorous scope management and change request processes, and establishing a risk management framework will increase the likelihood of delivering on time and within budget. It will also improve insight into project performance and status, as well as help manage scope, leading to better resource management and driving desired outcomes throughout the program.

Key Takeaways

? SAP S/4HANA migration projects frequently move quickly, and new challenges arise frequently. Project teams may become engrossed in specific tasks, making it challenging to maintain a broader perspective.

? A strong Program Management Office (PMO) can play a critical role in the performance and success of SAP S/4HANA business transformation.

? Careful planning and implementation of key strategies are essential for establishing an effective Project Management Office (PMO) for an S/4HANA migration.