Capgemini makes a play for Australian SAP market

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In 18 months, Capgemini has grown its SAP practice from one major client and 30 consultants to now boasting 130 consultants, new projects and a prebuilt solution. Freya Purnell spoke to Capgemini vice president and head of SAP ANZ, Clive Ewin, about how they’re ramping up their activities in this area.

ISAP: How have you achieved such impressive growth?

CE: We’ve done that by focusing. We had some good experience in utilities, and we focused hard on that, particularly in transmission and distribution. We decided we would make that a niche, and it is a growth area in Australia. We picked two other areas – food and beverage within consumer products, and social services in the public sector.

The reason for that was they were all growth areas, but there’s also a trend in the market that you need to be able to provide genuine domain expertise. The days when you could just rock up and say, “We have done lots of large SAP implementations elsewhere” are over. You need to be able to say that what you’ve done has been relevant to the client in front of you.

The other side of the coin for us is we’re trying to focus on our domain expertise and being able to present a good business story to the client, because a lot of the time we’re trying to sell transformation more than just SAP implementations.

We developed some momentum in the market, and we worked hard on our employee engagement as well as our client engagement, because people didn’t know that we did SAP. Now it happens to be Capgemini’s largest and fastest growing service line; we’ve grown from fifth to first in a year.

On the employee engagement side, that’s been about improving our channels to market, because talent acquisition is vital, and making sure we have people who not only have technical skills, but who can genuinely consult, because we are trying to sell value.

ISAP: When you’re looking to attract that talent, what does Capgemini offer that is appealing?
CE: Big, successful transformation projects. SAP consultants like big projects and we’ve been able to offer them the full transformation experience. So it’s not just doing an upgrade or banging in a bit of BI, it’s the whole soup to nuts change management and capability uplift story. I think people like that; people have been on enough projects where there’s been a lot of effort expended for very little business value, and I think they want to be part of something successful.

ISAP: What have been some of the customer wins that have driven the growth of the practice?
CE: SAB Miller was a significant win for us. It’s an iconic consumer products brand doing a global rollout, and we’re just going live with that project. Off the back of that, we just picked up the Czech and Slovak Republics in Europe. It’s been a very hard project; CUB has been enormously demanding. We feel battle hardened actually – I’ve got nothing but the A-team left because they couldn’t survive otherwise. You had to be the A-team to come through that program.

ISAP: What prompted Capgemini to push into the Australian market – where did you see the opportunity here?
CE: At the top of the market in Australia, Accenture is really the only SAP consultancy business in Australia that delivers transformation. A market demands alternatives, it demands options, so I’ve always seen that there was a place for a big world-class transformation consultancy to compete directly with Accenture. We do transformation as well as anybody does, and we have the sort of collaboration technique that works well for us.

ISAP: Tell us about the solutions you’re developing.

CE: We’re building our own transmission and distribution system, a private cloud if you will. This is for utilities organisations that perhaps don’t have the budget or the client base to justify a full ERP implementation, so we have something we believe will give an 80 per cent fit. What you get as a small transmission and distribution entity is a world-class ERP that will be around a quarter of the cost of what they may have paid traditionally, with a run contract attached. In that regulated environment, you need an ERP to do battle with a regulator – if you can’t justify your spend, then you can’t justify what you charge to the regulator.

Pre-built solutions are not new, they’ve just not traditionally been very successful. But I think what will make this successful is people are more attuned to the cloud, and the key is it really is industry-specific. You need that 80 per cent fit. We’re almost ready to roll with that, and we have a number of clients lined up.

We can see other potential industries that we would go after in the same way, but this is the first one.

ISAP: What are organisations looking for from you when it comes to business transformation?
CE: They’re looking for speed to value. Nobody wants to do a year of blueprint and two years of delivery any more. You’ve got to get there more quickly. There has to be low-hanging fruit to pick up on the way.

We’re also seeing a lot more brownfield – these are organisations which perhaps put in SAP in the late 90s, and it’s taken them 10 years to get the courage up to have another crack. They’re a little wiser – they’ve probably used a lot of contractors for a lot of years, and now they’re looking for something that accelerates value, and that doesn’t necessarily throw away what they’ve got where that’s practical. That raises all kinds of different delivery issues.

Skin in the game is really important too. I don’t think you can rock up with a T&M proposition. So we’re prepared to take a punt with our clients and run for outcomes, even where we don’t have full control over those outcomes.

ISAP: So that means you need a really good collaborative relationship with the business.
CE: We absolutely do. That means we need to play not just in SAP, we need to play across the business benefit angle, and change and training as well. You need to be full service.

ISAP: In your view, what’s the most exciting new development around SAP?

CE: I know HANA has probably been done to death, but it just does open up a lot of opportunities for analytics. That’s deciding just what we can do in SAP that we couldn’t do before because of the data-crunching constraints. Mobility is also exciting because it makes us far more immediately valuable and relevant to your average employee. The push for useability has been a bit of a revolution within SAP. We’ve gone from being horribly ugly to being very conscious of the user interface and the recognition that that’s where the value is realised.

ISAP: What’s the biggest challenge SAP customers are facing?
CE: There is still a dilemma over services. There are the three possible ways of servicing your SAP needs – in-house, some kind of contractor plus in-house, or fully outsourced – and I think finding the right blend to meet your needs, and being clever about how you acquire and use talent is definitely a dilemma. You don’t want to be stuck with an expensive SAP workforce, but you need to recognise where you have specific value that needs to be protected.

ISAP: Do you think that’s becoming more difficult as the solution portfolio gets more complex and more layered?
CE: I think it does, because you can end up with a lot of niche skills in your business. I think you need to be very careful with what you implement in terms of the cost of ownership in servicing it. So how readily available is the skill set? Are you going to be stuck with the outrageously expensive contractor? I think in terms of portfolio, it’s being smart around the cost of maintaining it and its longevity. SAP has chopped and changed a few times, so you could have been caught out there, and bought something that’s become a redundant product line.

ISAP: Are there any other trends you’re seeing in the way customers are approaching SAP projects?
CE: One of the reasons we started to move down the prebuilt route was the larger clients are expecting a lot more collateral upfront. They expect you to roll up with a fully defined set of processes that will fit their business, they expect all the tools and accelerators, and they expect high quality. You need all that simply to be in the game. That’s why producing a prebuilt solution was an obvious extension of that.
From a recruitment perspective, I’m also seeing people move back into consulting. With the age-old dilemma for the SAP consultant of whether to work as a private contractor or as a consultant, we’re seeing some people come back into consulting at the high end. They see the career value in it, as well as the career satisfaction. A lot of the people I’ve hired are people that I’ve known for years, and I think they’ve enjoyed the collegiate atmosphere that you get in a successful SAP practice that you don’t necessarily get if you’re out there working for yourself.

ISAP: Finally, what are your plans for Capgemini’s SAP practice in the future?

CE: We will maintain our focus, and I would expect public sector to pay dividends in the next 12 months on the back of some significant investment in hiring and training. We will also slowly expand our sector base, adding industries that are aligned, and where we can naturally extend our domain expertise. We will use our global capability to accelerate this. I see cautious but optimistic growth.

This article first appeared in Inside SAP Winter 2014.  

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