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SAP implementation keeps Aquarion Water flowing

Aquarion Water cut its SAP implementation time from five years to two using a big bang approach.

Aquarion Water needed to replace its ineffective software platform from the mid-1990s. Instead of following its...

initial five-year plan, the company completed the project in two years with what it called a "big bang."

Bridgeport, Conn.-based Aquarion's big bang implementation took what was going to be a linear installation of SAP software to improve its supply chain -- Financials and ERP back office first, then customer and billing, and finally asset and work management -- over a five-year period and crammed it into two years of concurrent projects.

"Comparing the scope as defined in the five-year plan and the scope that was delivered this year, it's roughly apples to apples," said Steve Halloran, a program director for Aquarion. "It wasn't just getting all the software installed at the same time, it was flipping risk on its head."

Aquarion had been getting by with an old "green screen" system that had been installed quickly, without many resources dedicated to the project. The result was a predictably less-than-optimal solution and many frustrated end users.

The main driver for change was, quite simply, the obsolescence of that system.

Not surprisingly, Aquarion didn't really have to deal with one aspect of system replacement that many companies face -- users who are reluctant to change.

"There were not a lot of barriers to replacing the system," Halloran explained. "Sometimes in organizations, people put in a lot of money and effort and like the system that's in place, so there's a little bit more arm-pulling to get them to standardize across one new platform. That wasn't the case here."

One key to the successful big bang approach was getting the right resources involved from the beginning. Aquarion selected TUI Consulting, which was soon acquired by Jersey City, New Jersey's Axon Global.

The company specializes in SAP and had recently completed two big bang installations at other utilities. If Axon had not been involved in the project, Aquarion might not even have considered the big bang option, according to Halloran.

"The vendor we chose specialized in a big-bang approach," he said. "If they weren't at the table, it might've been more prudent, if the next option had more linear experience, to take a more linear approach."

In fact, if Axon hadn't had experience with big bang installations, Aquarion could still be in the middle of its implementation -- or it could have been sunk.

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Aquarion is one of the oldest continuously operating water utilities in the U.S., having recently celebrated its 150th anniversary. It currently serves customers in Connecticut, Rhode Island, Massachusetts and New York, and counts approximately $130 million in revenue.

But in recent years it was acquired by the West Yorkshire, U.K.-based Kelda Group plc holding company and its Yorkshire Water subsidiary. Then, in early 2006, Aquarion changed hands again, and was bought by Sydney, Australia-based Macquarie Bank.

"We had the project almost railroaded two or three times by M&A [merger and acquisition] activity as it was. And if you try to extend that over three years, requirements become obsolete, business factors and environment can change," Halloran said. "So, what looked like a big leap of faith was actually the safest route by far, considering the options."

Challenges and success factors

That is not to say that the implementation was easy. Instead of having projects run one at a time over a long period, the company ran three projects at the same time. This required a company-wide willingness to change.

"The ability to change [is very important], to get everyone aligned and absorb all these process and technical changes at once," Halloran said. "We spent a lot of money, thought and creativity on figuring out that problem."

One thing that helped was setting expectations about who would get pulled onto the project early on. While it may require heavy resource allocation, the big-bang approach has the benefit of only having to backfill positions of those business people pulled onto the project for a shorter time.

To deal with the inevitable times when business priorities tend to take precedence over the project, it was critical that expectations were set formally with the human resources department, Halloran said.

Another key factor Aquarion dealt with in the early days was setting up a post-project framework and structure. To that end, the company has had success with what it calls its business council.

In its weekly meetings, the council's business people work with representatives from IT to go through system issues and prioritize them, identify potential new opportunities, and figure out training plans. This has helped maintain the collaboration between IT and the business side that occurred during the project into the post-implementation phase.

And, of course, the whole project is a non-starter if the right expertise isn't sought out from the beginning, Halloran said. While Axon had extensive big bang experience, it was its work implementing SAP with utility companies that put it over the top.

"The experience of those you work with is more important than the big bang or linear," he said. "Both can work."

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