Issue

Currently, there are multiple applications to manage Sysenqo's portfolio of projects. In principle, all these applications ( COLMAR, WEGO, BIARRITZ, WAVE) provide the ability to manage the lifecycle of a project from idea stage to its closure. However, these systems do not automatically integrate with the financial ERP systems to get the complete monitoring and tracking of projects.  Some of these applications (such as COLMAR) are at the end of their life and require improvements and upgrades.  Existence of multiple applications pose following challenges in overall Portfolio and Project Management

• No single source of truth
• Inconsistent reporting
• Manual and disintegrated processes
• No audit trail

Recommendation

Based on the detailed analysis of evaluation criteria for efficient Portfolio and Project management, Option A - SAP S/4Hana EPPM (Enterprise Portfolio and Project Management) is recommended

Background & Context

Syensqo’s project portfolio is largely comprised of the Capex related projects. Capex management is detailed in the CAPEX 01 procedure based on the project classification (Current, Medium, Major and Major > 50 M€). The Group Investment Committee provides the ELT with recommendations for approval of major projects (> 7M€)  but some approvals and challenges are nevertheless mandatory for projects < 7M€.  Capex01 procedure defines the process and guidelines for prioritizing and ranking the Capital projects based on the investment reasons that are aligned with the Group and GBU strategic objectives and envelops.

Small projects can be managed (for realization) by GBU/Sites without the help of the GEC (Group Engineering and Construction) but it is not systematic.
OPEX are not managed by projects and OPEX costs are booked to specific cost centers

GBUs use different application to manage their own portfolio and project lifecycle. There is no strict mandate to manage all projects in single application/system. Below are the portfolio and project management applications in Syensqo.

 It is evident from above analysis that there is a lack of standardized and integrated Portfolio and Project management tool in Syensqo. This KDD intends to evaluate an integrated and consistent tool for the management of the portfolio of projects.

Assumptions

Syensqo's objective is to apply a core and common procedure across all GBUs for managing portfolio of projects. It is assumed that all financial and non financial information resides in SAP S/4Hana for seamless integration and informed decision making process for prioritization, ranking and budget allocation of projects across all GBUs.

Constraints

No constraints identified in this phase

Impacts

Implementation of SAP S/4Hana EPPM as following impacts

• Requires separate license to use EPPM
• Requires integration with other SAP modules such as Finance (FI), Procurement (MM), Human resources (HR), Enterprise Asset management (EAM), Reporting systems, Budgeting and planning
• Requires consolidation of data from various applications for consolidated portfolio management
• Other projects - There are other projects to upgrade the existing applications ( such as COLMAR) will be impacted by this decision. Timelines need to be assessed
• Requires change management to get business buy in for adoption of core and common solution across the board.

Business Rules

Existing business rules and procedure such as Phase/gates and CAPEX01 procedure and guidelines can be adopted in implementation of SAP EPPM.  Further details will be analyzed in detailed design phase.

Options considered

Option A: SAP S/4Hana Enterprise Portfolio and Project Management (EPPM)

SAP S/4Hana Enterprise Portfolio and Project Management (EPPM) is an integrated module that helps organizations to manage their projects and portfolio of projects effectively. It provides the ability to manage enterprise wide portfolio across each lifecycle phase to align project investments and activities with strategic objectives of the organization. EPPM allows management of different kinds of projects portfolios.

• Capital portfolios - Based on managing the investments and capitalizing the costs
• Research and development (R&D) and Innovation Portfolios - Focus on optimizing the capital spend and resources in innovation cycle
• IT Portfolios -  Align IT related activities and resources with business strategy
• Commercial Project Portfolios -  Focus on execution of customer projects

EPPM consists of :

• Portfolio Management which is about doing the right projects, provide the central repository of all project proposals, programs and projects.  Each Project/Proposal has a clearly defined phase/gates which helps in structured decision making. It allows prioritization/ranking of projects using common process framework, underpinned by consistent metadata and metrics. Approved projects proceed to the project execution post prioritization. It also provides enterprise wide reporting of all projects based on various dimensions such a financial, operational or organizational. Allows risk and issue management and provides overall project health reporting.
• Project Management is about doing the projects right.  It allows tight integration with financial and logistic processes. It provides ability to detailed planning, structuring , execution and monitoring.  Project management and accounting rolls up into the portfolio management to provide a consolidated financial view of all projects. Budgets allocation is made from Portfolio to Projects and can be reported and controlled against overruns.

Option B: Continue as-is (multiple applications) but with integrated reporting solution

Continue using the existing multiple applications for managing portfolio of projects.  Since not all existing applications are integrated with SAP, an integrated reporting solution should be implemented to bring all the projects together from various sources to provide the overall reporting, tracking and decision making of all projects.

This approach may require updating CAPEX01 procedure to be aligned  with the GBU specific project management philosophy such as phases/gates, metrics and deliverables.

Evaluation

Below table outlines the comparison of the proposed options for effective portfolio and project management.

	Option A - S/4Hana EPPM	Option B - Multiple Applications with integrated reporting
Pro	Provides standardization and alignment of Portfolio with Group's vision and goals through common Prioritization methods and scoring model Provides simulation and what-if analysis for making informed decisions Allows monitoring of the performance of the portfolio through detailed visibility into projects across the entire enterprise Provides integrated process and governance through stage gate reviews Provides aggregated view of Portfolio, programs and projects Allows Integrated Risk and Issue management for individual projects Provides native integration with Finance, Procurement, HR and EAM for project realization Allows multiple languages to cater to country specific needs	No or minimal change management required as continue as-is No additional training costs needed Provides Integrated reporting by sourcing data from multiple applications
Con	Requires upfront License, implementation and deployment costs Requires Change management and business buy-in from all GBUs	Does not provide standardization and alignment of portfolio across all GBUs Does not provide integration with Finance, Procurement, HR and EAM for project realization Does not provide single source of truth Requires cost of ownership and maintenance for multiple applications Does not provide integrated audit trail

See also

Change log

Workflow history