This article appeared in the OCT NOV DEC 2012 issue

of insiderPROFILES (http://insiderPROFILES.wispubs.com)
and appears here with permission from WIS PUBLISHING.

Vodafone

Walks the Talk

Going Mobile with One of the Worlds Biggest SAP ERP Implementations
by David Hannon, Senior Features Editor

n todays booming mobile environment, Vodafone

Group a business that has mobility hardwired into
its DNA considers itself fortunate to be in the right
industry at the right time, with the right products and
strategy. The business has seen incredible growth since its
avant-garde beginnings 27 years ago. By revenue, it is the largest mobile service provider in the world, and it services almost
400 million customers across Europe, the US, Africa, and Asia.
London-based Vodafone grew quickly in its various markets by successfully establishing local operating companies
that catered products and services to the local markets needs.
However, the business lacked common practices, centralized
operations, and data sharing between operating companies.
For Vodafone to continue to grow at such a robust pace, the
company needed to function more like a single entity and less
like a network of individual businesses.
And a major business transformation has done that. In
the next phase of transformation, the company plans to use
mobility to continue its growth strategy.

Given our business, wed like to see about 80% of our

internal transactions happening on a mobile device, says
Niall OSullivan, Global Finance Transformation Director
at Vodafone. We are obsessed with operating with speed,
simplicity, and trust. With this transformation completed, I
believe that mobility can help really drive speed and simplicity
in everything we do.
Vodafone employees have been using mobile apps on their
BlackBerry devices and a mobile intranet for years. We always
focused on mobile, but now we are working on bringing mobility to enterprise applications, says OSullivan. For example,
we want our employees to be able to approve leave requests
or expense reports while traveling in a secure, quick, and
easy-to-use mobile app instead of clicking on the internet
and using office time for those tasks.

Transformation Strengthens the Core

In 2006, a group of Vodafone executives went to the
companys board with a plan for a business transformation

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aimed at creating a centralized shared services

organization and a set of common processes
in finance, human resources, and the supply
chain for all of its operating companies. The
implementation plan called for a core project team to visit each of the individual operating companies and implement these new

Setting the Stage: A

Business-Led Project
From the start of the initiative, Vodafone
management wanted to instill the idea
that the project was a business transformation underpinned by an ERP implementation and not an ERP implementation that
would change local business processes. To
help drive that message home, the board
chose OSullivan, a former CFO of an
operating company, to lead the project
because he came not from IT, but from the
business side.
We wanted to be sure everyone understood from the beginning this was a business transformation, he says. And we
learned you need to remind people of that
at every stage of the project.
A full year before the ERP implementation began, all of the operating companies department heads of finance, supply
chain, and human resources attended a
series of workshops in London to map out
common, global processes in those key
areas. OSullivan says the goals of those
workshops were to agree on core concepts
and gain buy-in from the businesses for
proposed changes.
Once the processes were firmly established, Vodafone took another step to ensure that they would be implemented as
designed, and that the business leaders
maintained control over the processes after
the ERP implementation began. That step
included creating the Vodafone Global
Design Authority, a committee made up
of key senior business leaders across the
organization responsible for owning the
processes. Any time a person or group suggested a change to one of the processes
(which included the IT organization during
the ERP implementation), the Global Design Authority had to approve the change.

processes locally with the help of a

systems integrator and local resources.
The technology platform that would
underpin this transformation would
be an SAP ERP system designed to
facilitate the sharing of information
and drive common processes. This will
now be combined with the power of
Sybase Unwired Platform. OSullivan
hopes this mixture of technology will
make access to Vodafones core enterprise systems for the 63,000 SAP users
as easy as shopping online at Amazon
and eBay or using a mobile app on an
iPhone or Android device.
Being on one global platform
for finance, HR, and the supply
chain would speed up our business
processes and make life simpler and
better for our employees even those
who dont access the SAP system on a
daily basis and might only use it every
few weeks to enter a leave request,
says OSullivan. The key is to engage
more of these occasional SAP users and
get them interacting with the system
on their mobile device.

Starting with Procurement

How does a business begin its journey
undertaking one of the biggest SAP
ERP implementations in the world?
With a year of process design and finetuning completed, Vodafone targeted
procurement as the first business process for transformation using the new
SAP ERP system. Like many decentralized companies spread across a wide
geography, Vodafone wanted to better
leverage its massive spend with its material and service suppliers. By tackling
procurement early on, the transformation project could gain ROI quickly and
win further support internally.
But rather than establish a centralized procurement department,
Vodafone created a procurement company that is based in Luxembourg and
operates on the centralized SAP platform. As OSullivan explains, today,
the Vodafone Procurement Company
signs the contracts with suppliers and

buys goods or services on behalf of the

individual Vodafone businesses. The
unique structure ensures the majority
of the companys spend goes through
the central organization. Suppliers can
better see and plan their volumes with
Vodafone because theyre selling to
one company instead of to many.

Globetrotting: Technology
Rollouts
With the new procurement company
up and running on the SAP system,
Vodafone took on its next major transformation step: create a centralized
shared services organization and bring
it onto the SAP ERP system. Vodafone
selected Budapest, Hungary as the location and built an entire shared services
organization from scratch including
purchasing a new office building and
hiring staff while simultaneously
implementing SAP ERP.
This was the first time we brought in
shared services, so getting Hungary up
and running was a huge deal for us, especially because we were still designing
the SAP ERP system while implementing it, OSullivan says. The company
has since established two more shared
services organizations in India and all
are running smoothly on SAP ERP.
After the pilot implementation in
Hungary, Vodafone chose to introduce
the operating company in Germany to
the new processes and brought it onto
the SAP platform. As Vodafones largest
market, the project team felt this company would present the biggest transformation challenge. Germany could
not go wrong, says OSullivan. We had
to make sure the system worked properly, so we did a tremendous amount
of testing and made all the necessary
modifications before we went live.
From there, the project team brought
a long list of operating companies online, prioritizing the implementations
based on each operating companys
size, complexity, and appetite for
change. The early rollouts are difficult
and you need all the support you can

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At a Glance
get, OSullivan says. Early successes
are vital to keep the momentum and
support of the executive team.
Each operating company brought its
own unique challenges and demands,
and no two rollouts were exactly the
same. Many of the companies had
grown very quickly, and chose numerous different legacy systems based on
local requirements or competitive
reasons. Challenges usually involved
striking a balance between time, quality, and cost move too quickly and
quality will suffer, which increases
costs in the long run; focus too much
on quality, though, and the project
will slow to a crawl while costs spiral.

Making People a Priority

In addition to which legacy systems
were currently in place, OSullivan
says there were two major personnel

factors that determined how successful a rollout would be: the skills of
the local project team and the willingness of the local organization to
accept change.
Vodafones primary systems integration partner, Accenture, filled in
skills gaps when needed and assisted
with change management in the
local markets. Gradually, the project
team including Vodafone internal
staffers and the Accenture experts
learned to assess early on how to best
allocate resources in a specific project.
For example, if members of an operating company werent present for
the project kickoff meeting, or they
were there but disinterested, the project team knew that company would
require more attention.
If they didnt show up to the kickoff meeting, it was a pretty clear sign

Objective: Standardize

business processes, leverage

best practices across a diversified
business portfolio, and eventually
deliver 80% of transactions
through mobile devices

Solution: Created a global

shared services organization, all

underpinned by a single instance
of SAP ERP, and rolled out
mobile apps internally, supported
by Sybase Unwired Platform

Benefits: Better visibility and

collaboration across business
units, more users accessing the
enterprise system, improved
spend leverage and procurement
savings, and faster financial
reporting

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We are obsessed with operating

with speed, simplicity, and
trust. With this transformation
completed, I believe that mobility
can help really drive speed and
simplicity in everything we do.
N
 iall OSullivan, Global Finance
Transformation Director, Vodafone

Company Snapshot

Vodafone Group
Headquarters: London, England
Industry: Mobile phone service provider
Employees: 86,400
Revenue: $
 72.6 billion (46.6 billion)
(Nasdaq: VOD)
Company details:
More than 404 million customers in 30
countries across five continents
Services include voice, messaging, data,
and fixed broadband
Made the first ever mobile call on
January 1, 1985
Owns 45% share in Verizon Wireless in
the US
Embarked on a finance, supply chain,
and HR transformation in 2006
Current business strategy focuses
on four key areas: data services,
emerging markets, enterprise and total
communications, and new services
SAP solutions:
SAP ERP
SAP ERP HCM
SAP SCM

there would be some pushback,

OSullivan says. Or if their comments
at the meeting were negative or
they had very few questions, it demonstrated they were not that engaged
in the project.
At the same time, the project team
had to be sensitive to local trends
occurring during the rollouts. For
example, if an operating company
resided in a country experiencing a
downturned economy, the personnel
there may have mixed feelings toward
the rollout. Introducing a dramatic
business and technology change could
be embraced by some as a way to
improve their situation, but eyed by
others as an additional distraction
during a very stressful time.
We learned the success of these
projects depended on the people
involved even more than we realized,
OSullivan says. That includes the
strength of the core team, the expertise from the systems integrator, and
a strong local team at the operating
companies. Its imperative that the
various teams have the right skills
and work seamlessly together in the
local projects.

The Latest Benefits and Initial

Mobile Apps
Vodafone is now finishing the rollout
with its remaining operating companies and beginning to loop back to the
earliest implementations to deploy
IT functionality updates and make
improvements based on what it has
learned in the process. For example,
OSullivan says the team learned a lot
about usability based on employee
testing and feedback over the course
of the project, and is enhancing the
interfaces for the early rollouts to be
more user-friendly.
The business has also started to
roll out some initial enterprise apps
for mobile devices. The first mobile
app was a travel and expense reporting app. Employees can take a photo
of their receipts and get paid without
using any paper, and they can request

or approve leave requests on their

phones all at one time, OSullivan says.
So far, Vodafone has signed up for
four applications, with more to come.
We think these mobile apps will be
a major advantage in driving compliance, reducing the level of frustration
in the usage, and reducing the level
of resistance to the actual processes
themselves, he says. We want to implement as many apps as quickly as we
can and get as many users as possible
to have the vast majority of their interaction with the system on their phone.
But the potential goes much deeper
than that, according to OSullivan. Because mobility provides easy access for
employees who dont typically engage
with the SAP systems, more employees
are using the system, he says. And the
more users we have on the system, the
greater the return on investment.
Vodafones business transformation
project is producing real results both
in terms of cost savings and business
efficiency. At a strategic level, the benefits of getting the various operating
companies to think more uniformly
has produced less tangible, but equally
important benefits. This was the first
time we introduced the shared services concept in this company, and the
change in thinking that idea brings is
significant, says OSullivan. From an IT
perspective, the support and administration of one single centralized system
is much more efficient than supporting
many local systems.
When OSullivan looks back on
the scope of Vodafones transformation, hes proud of what the team has
accomplished. We affected tremendous change across the organization.
We established and implemented common supply chain, HR, and finance
processes that now work in every
market across the business. And the
underlying technology that pins it all
together is the common ERP system.
Vodafone can now show its customers how the business itself is working
internally with speed, simplicity, and
trust.

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