New Benchmarking Tools Planned for R/3

FRAMINGHAM (04/06/2000) - Lockheed Martin Corp. can automatically capture information on how the business processes supported by its SAP R/3 system are set up. But analyzing their effectiveness isn't nearly as easy.

Benchmarking how quickly the Bethesda, Maryland, company's operating units can process purchase orders and perform other business tasks is a costly undertaking that requires lots of manual labor, said Dick Beckman, an enterprise resource planning program manager at Lockheed Martin.

Consequently, those measurements are typically done only "in a very selective way," Beckman said. That makes it hard for business managers to figure out how well the R/3 system is being used, he added.

But SAP AG and other software vendors plan to address the problem. On the way are new tools that are supposed to automate the process of measuring how SAP's applications are used from a business standpoint and let users compare themselves with other firms.

For example, German vendor IDSScheer AG is beta-testing software that can pull business-process measurements out of R/3 and stack them up against internal goals. The tool is due this spring and will be used by SAP as part of a year-old service aimed at helping R/3 users measure the return on their investments.

IntelliCorp Inc. in Mountain View, California, is also developing a business-process analysis tool that's due for controlled release this summer.

IntelliCorp and IDSScheer both said they plan to use the Web to publish business-process results from multiple companies for benchmarking purposes.

Lockheed Martin, which already uses business-process modeling tools made by IntelliCorp, hasn't committed to buying the upcoming analysis software. But Beckman said the technology could make it more practical to measure how effectively the firm is using R/3.

The aerospace and defense manufacturer could then compare results across its 17 business units and try to improve any that don't measure up, Beckman said.

External benchmarking against other users might also be helpful, but IntelliCorp "needs to get companies to take part," he said. "Then we're going to know how close the vision is to hitting reality."

Tony Lacy-Thompson, vice president of marketing at IntelliCorp, said business-process benchmarks would be posted on the Web anonymously and would include only the actual results, such as the time it takes a company to enter an order. How business processes are set up wouldn't be disclosed.

Even so, getting R/3 users to share that information with rivals won't be easy, said Pierre Mitchell, an analyst at AMR Research Inc. in Boston. "There's no way people are going to let go of that data," he said.

Robert Rubin, who left his job as CIO at R/3 user Elf Atochem North America Inc. in Philadelphia earlier this month, said giving other chemical manufacturers a look at the internal workings of Elf Atochem wouldn't have been high on his priority list.

"I don't see the value of telling the competition what we can do so they'll know what to shoot for," Rubin said. "The major thing for us was to see what a customer expected and then try to beat that."

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