IFMP Competency Center Overview

August 23, 2004

Where No ERP Has Gone Before: NASA’s SAP Implementation

Where No ERP Has Gone Before: NASA’s SAP Implementation

Donna L. SmithSAP Version Update Project ManagerManager, Business Process and Application SupportIntegrated Enterprise Management Program (IEMP) Competency Center

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Agenda

NASA Background & Future Direction The Need for Business Transformation IEMP: The Prime Enabler for OneNASA Initial SAP Implementation: Core Financial SAP Upgrade Competency Center

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Some Facts about NASA

Established in 1958 Primary mission areas are Space Operations, Science, Aeronautics

Research, and Exploration Systems MSFC a key player in all areas except Aeronautics

Current major emphasis areas are: Completion of the International Space Station Completing and executing the plan to return to the moon and eventually to

send humans to Mars Workforce: 19,000 Civil Servants and ~40,000 contractors

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NASA Center Locations

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Back to the Future

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The Business Problem (prevalent in the 1990s)

Decreasing budgets (in real $)

Lack of financial credibility with external stakeholders

Past failures to successfully implement new

Agencywide business software (particularly financial)

Impending implementation of Full Cost accounting

Contributing Factors:Contributing Factors: NASA cultureNASA culture Extremely decentralized IT structureExtremely decentralized IT structure CIO function traditionally not viewed as being business value contributor CIO function traditionally not viewed as being business value contributor

Contributing Factors:Contributing Factors: NASA cultureNASA culture Extremely decentralized IT structureExtremely decentralized IT structure CIO function traditionally not viewed as being business value contributor CIO function traditionally not viewed as being business value contributor

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Integrated Enterprise Management Program (IEMP) established in April 2000

...IEMP will re-engineer NASA’s business processes in the context of industry “best ...IEMP will re-engineer NASA’s business processes in the context of industry “best

practices” and implement enabling technology to provide necessary management practices” and implement enabling technology to provide necessary management

information to support the Agency’s Mission.information to support the Agency’s Mission.

...IEMP will re-engineer NASA’s business processes in the context of industry “best ...IEMP will re-engineer NASA’s business processes in the context of industry “best

practices” and implement enabling technology to provide necessary management practices” and implement enabling technology to provide necessary management

information to support the Agency’s Mission.information to support the Agency’s Mission.

Initiating and Sustaining Effective Business Process Improvements, not Implementing Software Packages, was the Overriding Objective

The Ultimate Beneficiaries are the Agency Program and Project Managers

Better decision data Consistent information across centers Improved functional efficiency and effectiveness

Enable One NASA with 10 Interdependent Centers Restore credibility with external stakeholders

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Typical IEMP Project Structure (2000 – 2005)

(SAP/Core Financial module project)

IEMP Program Executive Officer

NASA HQ

IEMP Program Director

NASA HQ

Core Financial Project Manager

MSFC

Integration Project Manager

MSFCAgency Process

Team

Core Financial Project Steering

Committee

Implementation ContractorImplementation Contractor Integration ContractorIntegration Contractor

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ERP Implementation Team Composition

Support AreasApproximate

Strength

NASA Subject Matter Experts (SME’s) and Technical Experts from Across the Agency

Ranged from 50 to 150

Implementation Services - Accenture 60

Integration and Technical Services – Computer Sciences Corporation (CSC)

100

Software and Services - SAP 11

Project Management Support – Booz-Allen & Hamilton

8

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Core Financial Project Scope

CostManagementSAP MODULE

Controlling(CO)

BudgetExecution

SAP MODULESFunds Management (FM)

Project Systems (PS)

AccountsPayable

SAP MODULESMaterials

Management(MM)

FinancialAccounting

(FI)

AccountsReceivable

SAP MODULESSales & Distribution (SD)Financial Accounting (FI)

ReportingSAP Business Warehouse (BW)

CostManagementSAP MODULE

Controlling(CO)

BudgetExecution

SAP MODULESFunds Management (FM)

Project Systems (PS)

AccountsPayable

SAP MODULESMaterials

Management(MM)

FinancialAccounting

(FI)

AccountsReceivable

SAP MODULESSales & Distribution (SD)Financial Accounting (FI)

PurchasingSAP MODULE

Materials Management (MM)

StandardGeneralLedger

SAP MODULEFinancial Accounting (FI)

ReportingSAP Business Warehouse (BW)

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ReadinessReview

Contracts in place

Period ofUnderstanding

Agency Design Phase

Pilot Center (MSFC)Implementation

Pilot Center Cutover 10/2002

End Stabilization

Wave 1: GRC

Wave 2: HQ, ARC, JSC, KSC

Wave 3: DFRC, GSFC, LaRC, SSC

End StabilizationWave 1 Cutover 10/2002

End StabilizationWave 2 Cutover 2/2003

End Stabilization

Agency Process Design Defined

Begin Project Execution

Pilot Center DesignComplete

TRR*

ReadinessReview

ReadinessReview

Core Financial Implementation: Pilot Center and Agency Rollout

Agency RolloutPlanning

Wave 3 Cutover 6/2003

Implementation UP**

UP**

UP**

Implementation

Implementation

Agency CommitmentFor Pilot

Agency CommitmentFor Rollout

*TRR = Test Readiness Review**UP = Understanding Phase

3/2004

Peak Workload Window

FY '04Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 1 Q 2 Q 3 Q 4 Q 1

2000 2001FY '00 FY '01 FY '02

Q 2 Q 3FY '03

2002 2003

Q 4

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IEMP Challenges

External pressure/scrutiny NASA already a target of Congress, GAO, OMB, IG, etc. Corporate financial scandal quickly raised the audit standard (see Sarbanes-Oxley)

eGov Mandate Immaturity of ERP in the US Federal Sector Learning to navigate the SAP Organization for Support NASA ERP Inexperience

Contractor NASA IT and business staff

Agency undergoing significant change Unrealistic Expectations Installing effective governance structure

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What We Did Well

Established clear governance structure with strong executive sponsorship

Established single instance strategy Integrated right mix of NASA subject matter expertise (business

and IT) with consultants Focused on rigorous project management Minimized customization Established central integration team and enterprise application

integration strategy Planned and implemented information delivery strategy along

with transactional system deployment Planned for long term sustaining support early in the project Benchmarked early and often Leveraged independent IT research firm (Gartner) to validate

critical technology decisions

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What We Didn’t Do Well

Allowed other business system initiatives to “fly under the radar” Implemented single instance, but maintained 10 business

operations Training: inadequate, inconsistently delivered & didn’t certify

users Governance structure lacked representation from 2 key groups

Program/Project managers Procurement

Overestimated demand for analytical reporting capabilities Didn’t catch data integrity issues (from legacy apps) during

conversion Failed to establish strong executive level relationship with primary

software vendor (SAP)

A recent Gartner Research note on “Why Projects Fail” found the A recent Gartner Research note on “Why Projects Fail” found the following:following:

A problem with organizational change management was cited in A problem with organizational change management was cited in 45%45% of of casescases

In In 31%31% of cases, respondents stated that the IT system was delivered of cases, respondents stated that the IT system was delivered and used, but that the benefits were not obtainedand used, but that the benefits were not obtained

A recent Gartner Research note on “Why Projects Fail” found the A recent Gartner Research note on “Why Projects Fail” found the following:following:

A problem with organizational change management was cited in A problem with organizational change management was cited in 45%45% of of casescases

In In 31%31% of cases, respondents stated that the IT system was delivered of cases, respondents stated that the IT system was delivered and used, but that the benefits were not obtainedand used, but that the benefits were not obtained

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UNDERWAY e-Travel Asset Management Human Capital Information

Environment (Reporting) Aircraft Management

Projects (Modules)

OPERATIONAL Resume Management Position Description Mgmt Travel Manager Core Financial / Data Warehouse* ERASMUS e-Payroll i-View (IEMP Portal)* Recruitment OneStop Agency Labor Distribution System* Project Management Information

Improvement (PMII)* SAP Version Update Contract Management Module

* SAP-enabled capability* SAP enabled capability

*

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SAP Upgrade

4.6C mySAP ERP ECC 6.0(upgraded to BW 3.5 March ’06)

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Summary Version Comparison = does not support functionality = 1st generation code = 2nd generation w/corrections

Summary Criteria SAP R/3 4.7, EA-PS 2.0

mySAPERP 2004

mySAPERP 2005

1. Support for federal reporting requirements (e.g. FACTS, SF-133, SF-224)

2. Ability to interface with Central Contractor Register

3. Ability to control timing of FM update for commitments and obligations

4. Ability to “park” commitments and obligations and perform mass posting at later date

5. Enhancements to split processor – removal of S200, multiple funding sources

6. Budgetary Control System – new distribution functions, lower-level AVC checking, overall budget concept

7. Budgetary Ledger Enhancements – S200 no longer needed; BL postings enforced (FI/FM sync); simpler configuration

8. Automated support for prior year upward / downward adjustments

9. Year end processing – no budget and document carry forward required

10. Prompt Pay Act Enhancements – invoice returns, lost discount tracking, payment due date revisions

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Decision

Selection of mySAP ERP 2005 as the target version Most mature & robust functionality Foundation of future SAP Development Enhanced support for the update with SAP’s Ramp-Up

Program

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Oct '07Sep

Oct '06Oct

Stabilization

Realization

ApplicationDevelopment

Mock Data Update Tests

Formulation

Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecFY05

Final Prep

Release 7.1 Go-Live

Prototype/ CRP

Functional & TechnicalEvaluations

Training DeliveryTraining Development

Preliminary Design Review

Critical Design Review

Test Readiness Review

Operational Readiness Review

Evaluation/Design Working Sessions

Center Readiness Reviews

Information Delivery Development

Initial Scope Document

SAP Version Update Project Timeline High Level Milestones

Blueprint

Review / FinalizeDesign

Data Update Planning & Preparation

Communications & Change Management

Test (SIT / Performance / Release 7.1 Regression)

End User Procedures Development/Test

Updated Scope Document

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Nov 30

Production Close /SAP Version

Update

Apr 30 Jun 30 Jul 31Month Ending

Oct 31May 31 Sep 30

Integration Test

Pass 1

Year End Close TechUpdate

5/15 5/29 6/5

Integration Test

Pass 2

6/14

Integration Test

Pass 3

CMMExtract& Load

InternalValid-ation

CMMExtract& Load

InternalValid-ation

CenterValid-ation

6/12 6/266/19 6/30

CMM Mock 2

Year End Close TechUpdate

DataMigr.

Integration Test

6/26 7/17 7/24 9/1

Year End Entries &Financial Statement

7/10

CMMExtract

CMMLoad

InternalValid-ation

6/19 6/306/26 7/14

8/7

Y.E. Close

TechUpdate

DataMigr.

Integration Test

8/14 9/4 9/11 9/29

Year End Entries &Financial Statement

8/28

NewClose

Extract& Load

InternalValid-ation

8/9 8/218/14 9/1

CenterValid-ation

TechUpdate

Y.E. Close

10/4 10/7

Year End Entries &Financial Statement

Generation

10/19

Technical Update and Data Migration

1st Draft of Financial

Statements to Auditors

Auditor Review &Audit-Requested

Adjustments

11/15Final Financial Statements to Auditors

Extract& Load

InternalValid-ation

10/16 10/2710/19

10/20

7/10-mySAP ERP Patch 57/10-Netweaver 2004s Patch 7

Go-Live SAP Patch Levels

5/17 - CMM Service Pack

6/6 - CMM S.P.

NOTE: Dates of CMM Service Packs and SAP Patches is approximate. These dates can only be confirmed as the date approaches.

5/10 – Pass 1 TRR6/13 – SIT 1 Delta TRR

6/13 – Pass 2 TRR

7/19 – SIT 2 Delta TRR

8/2 – Pass 3 TRR

9/7-9/8 –SIT 3 Delta TRR

10/11 ORR

6/30 - CMM S.P.

DataMigr.

Integration Test

6/15 7/14

BWExtract

6/21 6/26

Will finalize SIT 2 BW extract once SIT 1 BW extract has completed

Test FY07 year end close using new system

/ procedures

10/28

DataMigr.

11/10

Go Live(11/13)

(using existing funds & documents)

Go Live (11/20)(using new funding)

Release 7.1 SIT Testing Timeline

10/2 – 10/6 CORRs

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Current SAP Systems Environment

Financials R/3 4.6c Going to MyERP 2005 (Patch 7) in October 2006 with Netweaver 2004s

(Patch 4) Solution Manager 3.2 12,000 named users R/3; 4,000 measured actual in R/3; 400 concurrent R/3 is 1TB actual size

Business Warehouse BW 3.5 12,800 named users in BW; 2,000 measured actual in BW; 170 concurrent BW is 1.4TB actual size

Desktop Summary Windows XP

GUI = v6.40 patch 18 HTML = IE 6+ (IE 7 testing is currently underway) or FF 1.0 Java 1.4.2+

Macintosh OSX 10.3+ GUI = Java 6.4 rev 4 or 6 with Java Run Time 1.4.2 HTML = FF 1.0 or FF 1.5 (conditional with potential performance issues)

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Post 7.1 Release Landscape (CMM, R/3, BW)

PrismY/E Supp

QA2

TEST STAGING PRODUCTION TRAINING YEAR END/6.1

4.6C

Ref

eren

ceS

yste

ms

NE

W P

rod

uct

ion

Lan

dsc

ape

Solution MgrSMP

SM2

4 way15K

LB1/LB2

Perf. Lab600

8 way25K

Prism DEV2

DEV

BWD

4 way25K

4 way25K

Prism QA1

QA24 way25K

Prism TST

TST

BT1

4 way25K

4 way25K

P0116 way15K

Prism CFG./SBX

Prism PROD

BWP16 way15K

600 Prod

app01

BWPAPP

app02

BWPAPP

as05

P01APP

msfc27

P01APP

as03

P01APP

Prism TRN2

SANDBOX DEVELOPMENT

D01

AS1

OCFO supp600

8 way10K

BW1

100 Config120 ABAP150 SBX151 CMM

8 way10K

X01

TEC SBX600

8 way10K

Prism TRN1

TRN

BW3

4 way25K

4 way15K

QA1

BW2

4 way20K

US2

CenterSandbox

4 way25K

Prism Prod Supp

as04

P01APP

4 way25K

4.6c/BW Referencesystems to retireJune 1, 2007

BQ24 way25K

BW SVU Training (BW3) will retire Nov 30, 2006

IA1

IAM SBX

4 way15K

AR1

BI1

Archive SBX

4 way15K

4 way25K

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Realized IT Advancements

IEMP Competency Center

Achieve efficiencies and operate effectivelyAchieve efficiencies and operate effectively

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What is a Competency Center?

Competency Centers are a “best practice” organizational model for providing sustaining support for Enterprise Resource Planning (ERP) systems like SAP

A Competency Center allows resources to be pooled and shared across all business functions. This is critical for ERP systems which are highly integrated

A fundamental component of the Competency Center is the tight integration of IT professionals and business professionals into a a single service-oriented unit

The Competency Center is built with a combination of expertise in an organization’s business processes and expertise in the software that implements those processes

These skills are developed through the implementation projects and then applied to the long term sustaining support and continuous evolution of the new processes and system

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InfrastructureSupport

ApplicationOperations

Support

ApplicationDevelopment

Support

ApplicationFunctional

Support

UserInterfaceSupport

BusinessProcess Support

IFMP Competency CenterIFMP Competency CenterHQ & NASA CentersHQ & NASA Centers InfrastructureService Providers

InfrastructureService Providers

OLAOLAOLAOLA

“An SAP Competency Center is a permanent center of expertise that supports the efficient implementation, enhancement, and maintenance of common business processes built around SAP” - Gartner

IEMP Competency Model

Co

mp

ete

ncy

Ce

nte

r

Ag

en

cy

Ce

nte

r

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IEMP Competency Center(Office of the MSFC CIO)

Technical Architecture and

Operations

Business Process & Application Support

E-Travel ProjectAsset Management

Project

Application Development & Software

Assurance

IEMP Competency Center Organization

Human Capital Information Environment

FinancialHuman Capital

andWorkforce

ApplicationTechnical Support

ProcurementInternal Controls

And Audit

Module Projects

Module Projects In-Flight

Aircraft Management

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Backup

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IEMP Server Virtualization Activities

IEMP applications are currently supported by 80+ Sun/Solaris instances and 100+ Windows server instances

IEMP has implemented server “virtualization” techniques on both platforms Reduces cost Increases flexibility Maximizes utilization of computing resources

Windows IEMP has adopted “VMware” as a platform of choice for non-production Windows

server installations VMware Server is virtual infrastructure software for partitioning, consolidating and

managing Windows environments IEMP has 6 (IBM 366) Quad processors that hosting 60 Windows instances

VMWare FY 07 strategic plan identifies 48 new VM instances

Windows Linux

Sun IEMP continues to extensively leverage the hardware “domain” capabilities of the

SUN Enterprise class server platform IEMP has implemented a pilot set of Solaris 10 instances with containers and will

develop a more comprehensive rollout plan

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Realized IT Advancements

Information Delivery

Provide timely, consistent, and reliable information for management decisions

Provide timely, consistent, and reliable information for management decisions

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Guiding Principles for IFMP Information Delivery

Maximize value of information created within IFMP applications Implement Information Delivery incrementally in sequence with

IFM module delivery Promote information quality and efficiency by utilizing a single,

centralized BW instance Deliver information via web technology Drive information quality through the standardization of key data

attributes and reporting formats for Agency decision making

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Transactional Workers

Analysts

Program/Project Managers

Senior Executives

Extended

NASA financial information requirements are driven by five general categories of users: Extended stakeholders such as

Congress, OMB, the public, and business partners

Senior Executives who require financial information in order to manage Agency and Center portfolios of Programs and institutional services

Program/Project Managers who require financial information to monitor and act on indicators of program/project financial performance

Analysts who work with detailed financial information to supply managers with detailed insight for better decision

Transactional Workers whose primary role is execution of financial business processes on a daily basis

Classification of Financial Reporting users at NASA

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Why BW for NASA and Why in Parallel with R/3? Wanted to define and implement a sound information delivery

capability from the outset of our ERP deployment Without BW, would have created a large volume of ABAP reports Would be difficult to break the cycle and move to BW after the fact BW was SAP’s strategic direction for reporting

NASA didn’t have an existing Enterprise Data Warehouse BW is tightly integrated with SAP R/3 transactional system

Predefined / extendible business content based on R/3

Data extractors, including delta change data extractors

Drill down support from BW query to R/3 transactional data. All users that needed access to report information did not need access

to R/3 (non- transactional users) The implementation of R/3 and future SAP modules created the

possibility of developing a NASA-wide data warehouse that could satisfy the majority of Business Intelligence requirements

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Application Development: Reports

A number of factors determine the best approach to resolve a Center reporting requirement

A number of factors determine the best approach to resolve a Center reporting requirement

Reporting Decision Tree

Identify application area(s)

Does it exist?

Search in R/3 for the report

Use R/3 standard reporting

Requires current day’s data?

Type of report?

Does it exist?

Type of data?

Develop the report in R/3

Use Business Warehouse content

Execute the generic extractor

Create custom ABAP extractor

Review Business WarehouseDelivered business content

Define custom BusinessWarehouse objects

Yes

Operational/Management

Transactional/ExternallyMandated

Yes

No

Yes

No

No

Advancedtransformationlogic needed

Infoset queryor database

viewaccessible

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Current Status Overall the BW Implementation has been very successful Currently averaging 400-500 unique BW users per day, 1000 per week

and 1500 per month We have enhanced our BW solution since go-live:

Integrated Non-SAP data sources Added new and enhanced queries

Users are still adjusting to the new processes and learning to trust the data

Recently selected 3rd party tool (Actuate) to augment our BW implementation for stronger formatted reporting capability

72%

67%66% 65%

64%

58%

60%

62%

64%

66%

68%

70%

72% User Developed KeyFigures

Schedule Jobs

Formatted Reporting

Join SAP BW data &Non SAP BW

AdHoc Reporting

Requested Reporting Enhancements

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Integration Project (IT arm of IEMP)Roles and Responsibilities

Define and maintain the IEMP business and applications architecture Work with Agency Process Teams to define business processes and points of integration Facilitate resolution of issues across business processes Provide meta-repository for NASA processes and data Describe the “as-is” and “go-to” applications that automate the business processes defined

within the business architecture Define and maintain the technical infrastructure on which the applications

architecture executes Work with each module project to define technical requirements Acquire hardware and infrastructure software for each project Deploy and operate system environments during testing and implementation Work with Agency CIO to ensure the IFM technical architecture is compliant with Agency IT

standards Define and implement an integration backbone at all layers of the architecture Define and implement an information delivery strategy Plan and implement transition of each module to operations (Competency

Center)