Step two in your journey to catalyse change in back-office transformation

Delivering the future

In this blog post, I cover how government and public sector organisations can make the most of what they have today and discuss ’no regrets’ activities while clearing new pathways for a better future state.

Transformation to cloud Enterprise Resource Planning (ERP) can be a long journey. From initial inception, internal agreement on the outcomes, through to the business case and out the other side of procurement can take years. It may be quicker in commercial businesses but in government circles this process can take time and require stamina. Do you stand still while the process completes, and if you do what happens to the organisation in the meantime?

Keeping the momentum going

Markets move and force innovation in the private sector. In government, political change or leadership often reprioritises the departments’ focus.  While the formalities of the decision-making process in transforming to cloud ERP take time and the implementation delivery can be many months away, the business still must operate. The support organisation needs to support the BAU (business as usual) activities at the same time as addressing the proactive tasks that can help clear the ground for the upcoming program.

We know that programs that can achieve early momentum are able to tackle the big issues head-on and ultimately minimise risk, and deliver a quicker return on investment. Here, we look at three aspects that improve where you are today, de-risk the delivery and prepare for the future.

Optimise existing cloud capabilities

Eighty-five per cent of organizations that have moved to the cloud have adopted less than 50 per cent of the new features since going live. Most top quadrant vendors continue to deliver incremental features to their ‘sustaining’ platforms, building a large back catalogue of features that have never been considered.  On-premise platforms that may have been in place for years will have latent capability.

Commonly underused functions include:

  • Supplier portals – allowing suppliers to own their own data and resolve their own queries. This can help save time for the payables team resolving invoice queries and ensuring more accurate supplier data.
  • Online appraisals – empowering the employee to own their own development by placing them at the centre of the appraisal process. The simplified processes on the system allow the current stage is visible to all parties, helping to improve compliance.

Proving the cloud ERP case may also require the organization to ‘try’ the technology, to help demonstrate that the security policies, end-user devices and external network access are ready. It can pay dividends to implement some new cloud technology early, co-existing with the current state. 

The cost-benefit case for BAU work may at times be slim, but it is important to consider if this supports readying the users for change and establishing a change culture as a by-product. Support functions will also be refreshing their knowledge of the existing business systems in scope.

It is important to review your existing licensed modules and how much capability you are using.

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Data preparation

Data migration is on the critical path of most IT programs.  Whether or not it’s identified early, it eventually becomes a major focus. The program moves to integration testing (requiring sample data to prove data flows), user testing (requiring meaningful data for users that represents the new world) and reconciliation (requiring accurately mapped ledger transactions and balances).

What all these requirements have in common is the need to address data that is:

  1. relevant to the needs of the business moving forward;
  2. cleansed, de-duplicated, updated, accurate, and;
  3. compliant to retention policies.

A program can de-risk this stream of activity by bringing the existing data up to standard in the current systems in advance. Few organizations have a rolling data improvement program, but those who do are able to help ensure that data ownership is part of BAU and the accountability for accurate input and updates is with the appropriate function. A master data management strategy is as good a place as any to start a review.

Structure for the future

In an operating model where some services are outsourced (could be either an internal shared service centre or commercial entity), it is useful to think about the operational structure in the context of a client service. What is it that the clients/departments/users need to enable effective operation of the services?  What measurement is required to prove processes are delivering the service? How can it be confirmed that process maturity is being achieved?

Technology oversight across the new platform is required to ensure that control is established for future changes and development. This oversight should be at the business level to maintain the outcome-led focus on the system. With cloud providers taking accountability for large elements of the day-to-day service, the balance moves from the back-office platform being an IT system to business users being in control of the processes and future development. Establishing user advocates and forums will help the organization continue to evolve and take advantage of the latest features. After all, the cloud subscriptions are funding that future development effort.

Ecosystem oversight led by IT that brings the external cloud into the consideration of the other internal systems requires understanding the end-to-end system processes. With external systems on varying release schedules that are no longer fully in the control of the organisation, keeping a watching brief on the many cogs in the system can feel like constantly spinning plates.

It will be important to understand the roles that the organisation has today and how these will change under a new operating model. Consider what this means for the changing roles and support required to make the transition.

Proactive interaction with the supplier will help the organisation gain some level of control back in the innovation of the platform. Being engaged in customer forums and strategy development can help provide leverage with the cloud suppliers to focus future R&D spend on items that have relevance.

Actions to take now

Maintain the momentum of your program by keeping your internal stakeholders engaged with activities that deliver incremental benefit to them today, while showing them that working on path-clearing is moving them forward. With this, you’re building skills in the organization and an understanding of your future processes and the data that supports it.

What is the next step?

To discuss your journey, contact us to understand how KPMG can assist you in identifying short-term optimisation benefits. Identifying, cleansing, and preparing your data ahead of the migration and the creation of an Intelligent Client Function – all of these are tailored to your organisation and to where you are in the journey today.  Look out for the next blog post on ‘preparing for better procurement outcomes’ to understand what you do next in your journey to the Cloud.

About the ‘Transform to the Cloud’ article series

A series of blogs that look at the common steps in a Journey to the Cloud.  Making the right choices at the beginning to preparing for a continuing innovation culture that harnesses the benefits of the back-office transformation for the long term.