SAP and change management

Change management is very important when implementing an enterprise resource planning (ERP)  management software into a company's business.  It is a large investment, but can be a very large benefit to the company.  A communications chair of the Indiana chapter of the Americas SAP users group, Lester Burch, recently was a guest lecturer for an Information Systems class at Ball State, and he gave insight into the benefits and the difficulties with implementing an ERP into a business..  There are many benefits to using an ERP such as streamlining essential business processes, tracking financials, supply chain management, and many others.  It increases the efficiency and effectiveness of a company.  However, planning and implementation are very important to the success of the system.  The keys to the implementation are planning and employee buy-i.  It forces many business processes to change because it is different, and customizing the system to fit the old business practices are much more difficult to achieve than changing the business practices to fit the system (Burch).  This is where change management comes into play for making this system successful to the company.  The implementation is difficult because it usually takes over a year to stabilize (be a functional working system, with little issues), and the initial implementation usually involves a lot of technical issues and hurts productivity (Burch).  Many employees will want to revert back to the old practices because of the initial negative impacts it has on them (Burch).  Management, at this point, needs to keep up the encouragement and continue moving forward. It would be very costly to cancel a multimillion dollar project.  The state of California spent $254 million on an SAP (an ERP software development company) software system, then cancelled the contract due to the many issues that were having with the implementation of the system (Kanaracus).  There is nothing wrong with the system, as evidenced by the fact the nearly 80% of the Fortune 500 companies use SAP (Lev-Ram).  However, the planning and implementation cost the state a lot of money.  Once their is trust in the system and employees have bought into it, then it is a good time to start adding more functionality to the system.  It is important for the employees to have already bought-in to the system before implementing new things.  These additions are easier to manage because the employees have already experienced a change that they have bought into, and now, they are just doing the same type of change (from old business process to ERP process), but in another part of the business.  So they have seen success in a change, and they can better react to the new change.

Kotter's 8 step model for change is application in this situation (Kotter).  First, they start with having a sense of urgency by communicating how ERPs can streamline their business practices and connect everything together in this efficiency driven and information rich world.   Second, the would need a group to push an ERP and generate interest and buy-in in the new system.  Third, they would clarify how this ERP system will be utilized and the benefits and changes that will need to take place, such as changing the business processes to fit with the way the system is setup.  Fourth, they would communicate the vision for ERP, how activities will change, and the many benefits from the new system, and how the ERP will make each individuals jobs easier and more enjoyable.  Fifth, empower action and be in line with the vision .  Sixth, the short-term wins would be really easy to quantify in the ERP implementation because it is a tracking system, so they could look at getting certain business processes through the new system in a certain time or counting how many times a certain type of process is completed by an employee, or they could track how many tickets are created overtime with the company's help desk, then reward those involved if the ticket frequency goes down.  Seventh, they would keep pushing through the resistance to keep moving forward with the ERP implementation as well as introducing new functionality. Finally, prove how the ERP system has increased efficiency, reduced costs, and made employees jobs easier, then reinforce the new norms that come with the changes that took place to adapt to the new ERP system making the system a part of the culture (Kotter). 


Burch, Lester.  MBA 621.  Ball State University.  Muncie, IN.  24 Nov 2013. 
Kanaracus, Chris.  "California Ends Contract with SAP Over Troubled IT Project." 8 Feb 2013.  Computer World. http://www.computerworld.com/s/article/9236662/California_ends_contract_with_SAP_over_troubled_IT_project
Lev-Ram, Michal.  "Inside SAP's radical makeover." Fortune.  29 March 2012. http://tech.fortune.cnn.com/2012/03/29/sap-makeover-mcdermott-hagemann/

Kotter, John (1996). Leading Change.  Boston, MA: Harvard Business School.

Human Resource Management using Analytics

Human Resource Management is very important for an organization in selecting and retaining the right employees for the right jobs.  There are many strategies for human resource management, and an innovative company, Google, has been using analytics for human resource management (Sullivan). A company that continues to gain and sustain competitive advantages in the marketplace through innovation, and so the company has focused on recruiting and retaining innovative employees.  Analytics has been a part of business for some time now, but the focus has been on finance, the supply chain, marketing, and operations, and not HR. 

Sullivan's article investigates how Google using information system technologies and analytics to increase the effectiveness of human resource management and thus the effectiveness of the business.  First of all, they do not call in human resources, instead they call it "people operations."  Google has many employee perks that are very enticing to prospective employees and current employees such as free food, allowing 20% of employee time to be spent on special projects, and fun activities.  These perks were implemented and are maintained based on data and analytics.  They also used this to determine the eight characteristics of good leaders within the company.  They found that periodic one-on-one coaching, interest in the employee and feedback were the most important things to be a successful leader in the company.  Managers get rated twice a year by their employees.  They have even developed a retention algorithm, which predicts which employees are most likely to become a retention problem, so that managers can react and try to retain the employee.  They have developed a hiring algorithm, which predicts which candidates has the highest probability of succeeding in the company.  They have calculated that the value of an exceptional technology employee versus an average one is as much as 300 times higher.  This is a great example of why Google has such an involved human resource management technology infrastructure and utilize such a large amount of resources to hire, retain and develop their employees.  It makes fiscal sense to do this.  They also make sure to introduce fun and learning into the work environment.  The great thing about this analytic approach is that programs and initiatives do not have to be persuaded to the managers of the company because the data and analysis alone convinces the managers of the potential successes (Sullivan). 

This type of human resource management is very exciting because it uses information on the employees of the company to analyze and develop solutions.  Since technology has streamlined so many other parts of the business, it makes sense that it also streamlines human resources as well.  Google's enormous success can be tracked back to this analytical way of recruiting, hiring, retaining and developing employees.  A company that thrives on their internal innovation and this innovation is their key to their competitive advantage in so many ways.  This is the most likely format for human resource management to function in all business in the future.  Google's success shows that this is a very beneficial format and works for so many reasons. 

Companies really should consider this analytic approach to human resource management.  The challenges for management of business would be decided if, how, and when to implement this analytic approach to human resource management.  They will have to decide whether or not to use a contract company to provide the service, or just provide the implementation, but leave it up to the business to maintain it.  There are many considerations into how they would develop and implement the new system.  People in human resources and software/database developers would need to collaborate to develop the systems to work best for their company.  The key to success would be the correct development and implementation of the system so that it works best for the organization.


Sullivan, John.  "How Google Became the #3 Most Valuable Firm by Using People Analytics to Reinvent HR." ERE Media.  25 Feb 2013. 
http://www.ere.net/2013/02/25/how-google-became-the-3-most-valuable-firm-by-using-people-analytics-to-reinvent-hr/

Peyton Manning Leadership

Peyton Manning, one of the greatest NFL quarterbacks of all time, is also one of the greatest sports role models and great example of a leader.  Peyton Manning has the respect of fans, teammates, coaches, opponents, opponent-fans, sport-fans, commentators, non-sports fans, and others.  He is not only a great quarterback, but also a great leader for his team on and off the field.  There is great trust in him among his coaches and teammates.  Below are some of the key traits that make him a great leader. 
Vision: he has great vision for what his goals for the himself and the team, and how he is going to achieve those goals
Focus: he has tremendous focus on his team, and football is his life during the time from pre-season to post-season.
Shows passion for making his team better and winning.
Communication: Peyton is in constant communication with his teammates and coaches during every play of every game as well as during practices and meetings.  He is always making sure everyone is on the same page.
High Expectations: Peyton expects his team to win and does not make excuses. Even the Denver Broncos head coach John Fox has stated that Peyton's high expectations has made him a better coach (North).  High expectations leads to higher performance.  His attitude develops a culture of accountability and attention to results.
Does not dwell on past, but learns from past: he always seems to move on quickly from his mistakes and learns from them, and he makes sure to practice whatever things that caused him to make those mistakes.
Asks for help: Peyton has had coaches and players that are younger than him with less success than him, but he takes in information and teachings from others in order to improve himself and his team
Takes responsibility: after every loss he is always first to blame himself for the loss and his performance, he never publicly attacks another teammate for their mistakes, but lets them know of their mistakes and low performance, and creates action plans for them.
Acknowledge and rewards performance: A team needs to know that their work is appreciated and valued.  Great leaders both praise and reward their team.  Peyton Manning always acknowledges his teammates and coaches for their hard work, dedication, and performance.  Peyton Manning buys expensive watches, custom suits and various other gifts for his offensive linemen to show his appreciation for their blocking abilities (Fletcher).  It does not matter how good a quarterback is, if the offensive line does not give him protection, then he is in trouble.

Peyton Manning's leadership can and should be studied on how to become a great leader.


Fletcher, Molly. "Team Leadership Tips from Peyton Manning." Exerpt from "The Business of Being the Best: Inside the World of Go-Getters and Game Changers."  Wiley, 2012.  Exerpt from Monster.com
http://hiring.monster.com/hr/hr-best-practices/workforce-management/employee-performance-
management/team-leadership.aspx
Marot, Michael.  "Colts teammates respect Manning's leadership style." bleacher report. 2009 Dec.

http://bleacherreport.com/articles/305745-colts-teammates-respect-mannings-leadership-style
Ferguson, Christine.  "Leadership and Life Lessons from Peyton Manning." 2011 Jan.

http://christinenferguson.com/leadership-and-life-lessons-from-peyton-manning/
North, TC  "Nine Great Peyton Manning Traits" Colorado Biz. 2013 Oct.

http://www.cobizmag.com/articles/nine-great-peyton-manning-traits

Motivating Employees Close to Retirement

It appears that as many employees are getting closer to retirement they really start to lose motivation, especially once they announce their retirement date.  This can be a very difficult situation for a manager to motivate the employee to continue their work at the same energy level as before.  They know that their performance will not lead to any desirable outcomes.  They will not get any bonuses, no promotions, or increases in pay for their efforts.  They are at the point where they are only there to be utilized as a resource and give some time for the company to find a replacement before they retire.  Perhaps, in this case, expectancy theory is not a good theory to utilize when trying to motivate this employee.  Since these employees close to retire seem to be unmotivated, the first thought may be to try to get them to retire earlier so there will be room for younger more energized and cheaper employees.  However, sometimes it would be better to try to keep them past retirement, as from study from P. Matthijs Bal, Simon B. De Jong, Paul G. W. Jansen and Arnold B. Bakker.  They argue that the baby boomer population, which is nearing retirement age is full of knowledge and expertise that cannot be matched in many companies.  Old research on individuals have concluded that people would work past retirement age when in good health, attached to work, and have a poor financial situation (Matthijs).  Also, if the organization has high support, it may influence the employee to stay. Their research was focused on the role of I-deals (the idiosyncratic deals made between employees and their organization).  There are two types of I-deals: development and flexibility to motivate employees to work past retirement.  With development being knowledge and skill development and flexibility being scheduling flexibility.  Their research indicated that flexibility I-deals contribute to higher motivation without regard to the work climate.  Also, for the development I-deals higher motivation is contributed to encouragement to develop themselves and use their knowledge and experience.  In a work environment where the close to retirement employees are not encouraged to use new skills or take up new and challenging tasks, they do not have the motivation to continue working (Matthijs).

There are a few instances that I have heard, that involve the two conclusions of flexible scheduling and/or developmental encouragement.   One person had high expertise in a few programs that no one within the company had and the programs were older programs that younger employees would not have any experience with, and he was about to retire.  However, management wanted him to stay, so they offered him a very flexible schedule.  He worked about 20 hours per week, basically anytime, mostly 2 10 hour days.  And he got just as much work done as before.  His energy levels and happiness were up very much when he started that 20 hour per week flexible schedule.  Another employee was a manager that was about to retire, but he had a lot of experience and knowledge working in various sections of the company.  So he was given a special assignment to increase the efficiency of the business practices that he had experience with.  He was no longer doing the day to day activities, and he was motivated and energized to continue working.  Another employee that was about to retire was given no encouragement to stay, and only given the simplest jobs, since everyone knew he was about to retire.  He had no energy and took naps during the workday.  He was not motivated.

Managers really need to be conscious of employees entering retirement, and it seems that given them more responsibilities or more flexibility will continue to motivate them.


P. Matthijs Bal, Simon B. De Jong, Paul G. W. Jansen and Arnold B. Bakker.  "Motivating Employees to Work Beyond Retirement: A Multi-Level Study of the Role of I-Deals and Unit Climatejoms" March 2012. Journal of Management Studies.