SCM Upgrade & Instance Consolidation

SCM Upgrade & Instance Consolidation Dennis Marcinek & Christine Johnson, PepsiCo

Disclaimer: The views and opinions expressed in this document and presentation are those of the author and do not necessarily reflect those of the company.

Learning Points

PepsiCo Overview

Our SCM Upgrade & Instance Consolidation Project

Key Lessons Learned

Question & Answer

Todays Agenda

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Learning Points

Process of taking an SAP upgrade project from ideation to approval

Strategies and execution used to mitigate project cost and risk

Practical lessons learned by PepsiCo during go-live cutover and stabilization

Who We Are

Global Beverages Global Snacks Global Nutrition

Brands

22 billion-dollar

brands

Performance

More than $65 billion

revenue

Scale

>200 countries & territories

People

~300,000 employees

PepsiCo is a global food and beverage powerhouse.

Our broad range of more than 3,000 delicious products offers consumers

convenient, nutritious and affordable options in nearly every country around the world.

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Our SAP North American Journey

RELEASE 3

Mfg & Logistics

Financials

Equipment Service Management

RELEASE 1

Indirect Procurement

RELEASE 4

Integrated Supply Chain Planning

RELEASE 6

Trade - Funds,

Promotions & Claims

Financial Planning

Order to Cash & ESM Upgrade

RELEASE 7

Order to Cash

RELEASE 9

Payroll &

Human Capital Management

2006 2007 2008 2009 2010 -12

R3 R1 R2 R5 R4 R6

RELEASE 2

Order to Cash

Demand Planning

RELEASE 5

Financial Planning

R9 R7

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Our project scope: North America ISCP Landscape

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Our project at a glance

Opportunity Upgrading SCM 4.1 to 7.02 platform creates an SCM landscape simplification opportunity

Enables significant annual labor and infrastructure savings

Additional annual savings through elimination of SAP *CDP maintenance contract

Scope Upgrade SCM/APO environment from version 4.1 to 7.0 Enhancement Pack 2

Consolidate SCM/SNC Customer Collaboration functionality onto upgraded SCM 7.02 environment

Retire obsolete SCM/SNC landscape

Timeline 32 week project duration; go-live target: P2 2013

Operational necessity as SCM 4.1 currently in extended maintenance until April 2013

Cost Considerations PepsiCo and contractor labor

Project landscape and consolidated instance sizing requirements

SAP AGS support

Benefits Inherent performance improvement with upgraded liveCache architecture mitigates SLA risk

Ability to leverage newer SCM 7.02 capabilities

Tailwind for strategy to further simplify ISCP landscape and expand SAP footprint

Risks Delaying upgrade postpones consolidation savings and prevents benefits realization

Expensive SAP time & material support beyond extended maintenance (4/2013); no Service Packs or patches

Disruption to overall SAP Upgrade Roadmap schedule

*Customer Development Project

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Developing a strong business case is key to obtaining upgrade project funding

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Business Case benefits breakdown

Reduce *Support Costs

Reduce Infrastructure Costs

Eliminate Annual CDP Costs

*BASIS, Security, DBA, UNIX/Storage

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We developed an internal proposal to compete in Request for Proposal process

PepsiCo

Supplier B

Supplier A

PepsiCo

Process steps: 1. Develop Request for Proposal

(RFP) and invite suppliers to participate

2. Evaluate written proposals and select suppliers for oral presentations

3. Select preferred suppliers for deeper dive

4. Make decision

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In-sourcing the project using internal PepsiCo resources had many advantages

Deep knowledge of complex ISCP solutions

SAP/SCM expertise

Strong relationships with business partners

Partnerships with integration teams

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Our strategy to mitigate project cost and risk

Technical upgrade only Excluded bundling of business funded enhancements

Document simplification opportunities for follow-up

No activation of Enhancement Pack functionality EHP2 applied with all Business Functions/Switches deactivated

Split-node landscape approach Share break/fix environments vs. project landscape build-out

Utilize Upgrade Accelerator Tool to expedite custom code remediation and landscape consolidation

Mixture of Project & Baseline funded resources Ease transition to Sustainment organization

Partner with SAP AGS Dedicated upgrade expertise support

OSS escalation

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Split-node approach reduced project landscape cost

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An innovative approach was required to deliver our project within available Center funding budget

Challenge Approach

Partnered with Enterprise Planning & Delivery to

conduct tool evaluation

Reduce Project Cost

Utilize Upgrade

Accelerator

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We utilized multiple smartShift tools on our project

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smartShift provided bang for the buck value

Additional project savings realized by using smartShift to remediate complex Customer Development Project vs. SAP

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It takes a village to pull off a successful upgrade

Project staffing involves multiple teams

Functional Expertise

SAP Development

SAP BW

SAP Security

BASIS

Portal

ECC Integration

(CIF)

Middleware

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Project Phases Highlights/Recommendations

Blueprint

Software upgrade

Unit test upgrade code remediation

Mocks

At least 2 mock upgrades and a cutover rehearsal

SAP AGS involvement : dedicate days to experts to support

Realization

System Test : Prioritize code remediation

Allows lead time on OSS messages

Regression Test: Quality of solution remains in-tact

2 rounds and involve super users in testing

Performance Test : before upgrade/after upgrade benchmarks are critical to understand SLA impacts

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Project Execution Phases Highlights/Recommendations

User Acceptance

Involve key end users

Mock and Cutover Rehearsals

SAP AGS dedicated service plan support

TQM Lead for OSS escalation

Involve super users in check-outs

They know the data and will spot things typical IT support wouldnt

Go-Live

2-3 Week Hyper-Care

Plan with 24/7 support for all areas

Involve super users and business end users in check-outs

War Room Set-Up

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Key Learning / Best Practices

1. Project environment needs to mirror production as closely as possible in terms of infrastructure, integration, and data volume

2. Upgrade Accelerator tools are no magic pill. Additional development work and functional review is required

3. Practice makes perfect. Incorporate as many cutover rehearsals as possible into project plan

4. Collaborate with business partners to develop a comprehensive contingency plan

5. Involve business Super Users in testing cycles

6. Dont declare victory until full planning cycle is executed; daily & weekly

7. Inherent performance improvements are a reality!

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Contact Information

[email protected]

[email protected]

www.Pepsico.com

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Questions

Is there anything we can help clarify?

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