erp roadmapping one way to do it

ERP Roadmapping, One Way to Do It

Sue ShawLead, ERP Solutions, Cenovus Energy Inc

2010-08-17

Agenda

• Cenovus Energy

• Roadmap Process

• Roadmap Process Results

Cenovus Energy Inc

• Formed on November 30, 2009 from the split of Encana Corporation into two highly focused and independent publicly traded energy companies:

• one an integrated oil company (Cenovus) • the other a pure play natural gas company (Encana)

• Pronounced se-NO-vus• Cen for Century• Novus from the Latin root word meaning New

• Headquartered in Calgary, Alberta, Canada

• More than 3000 staff

• www.cenovus.com

http://www.cenovus.com/

Financial & Operating HighlightsFinancial:

2009 - 11 months Encana carve-out, one month actual (net to Cenovus on a before royalties basis)

– Revenues: $11.5 B CAD

– Cash flow: $2.8 B CAD

– Op earnings: $1.5 B CAD

Production: Oil & NGLs: 100,000 bbls/d

Natural gas: 905 MMcf/d

Proved reserves: Oil & NGLs: 1,143 million barrels

Natural gas: 1.5 Tcf

Land position: Net acres: 7.8 million

Shareholder base: Common shares: 751 million

Trading symbol: TSX & NYSE: CVE

SAGD – Steam Assisted Gravity Drainage• Cenovus is a leader in SAGD, and uses this recovery method at both its Foster Creek and Christina Lake projects.

• Relatively new process that many companies are using for commercial scale development in western Canada.

• It is a simple process in concept but complex in application: a well injects steam into the producing zone, creating a high-temperature steam chamber in the formation.

• The heat melts the thick bitumen which allows gravity to assist it to flow freely to the horizontal production well below.

• About 80 percent of the oil reserves in northeast Alberta are deep under the ground and can only be accessed using enhanced oil recovery methods, such as SAGD.

• Interest in seeing 2 minute video?

Roadmap Process – Background and Context

In late 2009 it was recognized that an ERP Roadmap was required.

In early January 2010 it became apparent that a roadmap wasn’t just optional but a document was required to understand what the future state of ERP and options developed to navigate from the current state to the future one.

Any pre-requisites to make that navigation possible would be identified and documented.

Roadmap Deliverables

• Five year outlook (roadmap) gathered based on business and vendor input.

• Options explored to help navigate from the current state to the future state.

• Prerequisites outlined to drive the transition.

• Roadmap created with possible timelines and dependencies and presented to ERP stakeholders.

Roadmap Team / Stakeholders

ERP Roadmap Stakeholders:• HR- VP, HR Development and Operations• Finance - VP and Comptroller• SCM - Manager, Supply Chain• Capital Projects – Senior Lead• Asset Management - VP, Business Services• IT - CIO

ERP Roadmap Core Team:• HR IT Manager• Finance JDE Business Manager, Fin HR IT Manager• SCM Lead, Capital Projects BA, SCM BA• 2 Maintenance Leads, EAM IT Mgr• ERP Solutions Lead, IT PM• IT Tech Architect, Enterprise Architect

Roadmap Process

Visioning

Developing the future state model will be using input from the business, services and consulting areas. This is a core deliverable that must be performed prior to analyzing the options and prerequisites.

Each group (Finance, HR, SCM, Capital Projects and Asset Management) will hold envisioning sessions to explore the “business need”. The meeting in more is an open forum where ideas can be freely expressed and time is taken to do some ‘blue sky’ thinking.

Options AnalysisEach Business area reviewed options available and discussed pros, cons and risks

for the different options. Also timing considerations were discussed. The preferred option, by business area was documented, with the goal of coming to consensus on the best path forward.

Options Considered:1. Integrated System - This refers to trying to keep functionality within one ERP

system.2. Best of Breed - This refers to having multiple ‘best in class’ systems.3. ERP with Specialty and/or Best of Breed Applications

Timing:There will likely be some Best of Breed or Specialty applications, assuming that a

business case has been made to use an alternative to the Integrated System (newest release). This leads to some timing questions.

1. Implement Best of Breed before an ERP Upgrade 2. This is to be interpreted that a Best of Breed (BoB) project is entirely complete

before an ERP Upgrade project begins.3. Implement Best of Breed with an ERP Upgrade 4. Implement Best of Breed after an ERP Upgrade

Prerequisites

Before we reached this stage we thought that would be technical in nature. Things like infrastructure upgrades.

It turned out quite differently as most of the prerequisites turned out to be more business focused.

The identified prerequisites found will be discussed with the Findings below.

Key Findings

Proliferation of Systems: There are too many tools and in some cases not the right ones.

Multiple sources of truth exist for master data and no there are common process to ensure the reliability and maintenance of it.

The need to review and transform business processes to ensure they meet the needs of an oil-centric organization and evaluate and rationalize the applications that support them.

Ownership and definition of master data and associated business processes needs to be defined.

Standards and governance of IT architectural principles must be in place and adhered to.

The changes to effect the required change need to be driven by the business, not IT.

Future State

ERP is not necessarily a single branded/vendor solution.

There may be multiple “core” components to an ERP that provide required enterprise resource planning functionality for the business.

One of those core components will be JDE EnterpriseOne.

Other components may consist of approved ‘Best of Breed’ equivalents, based on merits, to be used in lieu of an existing JDE module(s).

Enterprise ResourcePlanning

JDE

BOB

BOB

Enterprise ResourcePlanning

JDE

Best Of Breed

Specialty App

Future State (cont’d)

Changes to the ERP are governed so that new releases can be leveraged.

Governance is in place for new applications to ensure that those requirements are not already met by existing applications or the ERP that is in place.

An effective information strategy is in place to ensure that data maintenance, master data management and reporting provide timely and accurate results to the business.

Next Steps

• Governance /Strategy

• Scope & Definition

• Technical

• Reimplementation

ERP Roadmap Timeline

Q1 2010

Q2 Q3 Q4Q1

2011Q1

2012

Non-ERP Application Re-evaluation / Rationalization

JDE Module & Function Re-evaluation

Data Reconfiguration

ERP Technical Refresh

ERP Definition & System Requirements

Business Process Review

ERP Application Rationalization

New Application Evaluation

Integration Strategy

ERP Steering Committee Formation

Code Standards Strategy

Architectural Principles Governance Strategy

Cenovus Operational Model

IT/Business Alignment

Go

vern

ance

/ S

trat

egy

Re-

Impl

eme

ntat

ion

Sco

pe D

efin

ition

Tec

hnic

al

Q2 Q3 Q4 Q2 Q3 Q4

ERP Re-Implementation

Next Steps

Governance / Strategy (2010: Q1-Q2)• Establish Steering Committee• Confirm Cenovus Operational Model• Define Governance Model• Begin IT Strategy initiative


Q1 2010

Q2 Q3 Q4Q1

2011Q1

2012

New Application Evaluation

ERP Steering Committee Formation

Code Standards Strategy

Architectural Principles Governance Strategy

Cenovus Operational Model

IT/Business Alignment

Gov

erna

nce

/ S

trat

egy

Q2 Q3 Q4 Q2 Q3 Q4

Next Steps (cont’d)

Scope Definition (2010: Q2-Q4)• Identify areas for review• Conduct Business Application Roadmap exercises for strategic

areas of the business.

– Business Process Reviews

– Application Review and Rationalization

– Information Architecture / Data Reconfiguration Review

– JDE Module & Function Re-evalution


JDE Module & Function Re-evaluation

Data Reconfiguration

ERP Definition & System Requirements

Business Process Review

ERP Application Rationalization

Re-

Impl

emen

tatio

nS

cope

Def

initi

onT

echn

ical


Q1 2010

Q2 Q3 Q4Q1

2011Q1

2012Q2 Q3 Q4 Q2 Q3 Q4


Technology (2010:Q2 – 2011:Q1)• Create Integration Strategy

– Ensures that all ERP components can communicate in this new more distributed environment. Effective communication between systems is key to the long term strategy.

• ERP Technical Refresh

– Prepare for changes required for ERP to be served with web applications in a services oriented architecture


ERP Technical Refresh

Integration Strategy

Tec

hnic

alERP Roadmap Timeline

Q1 2010

Q2 Q3 Q4Q1

2011Q1

2012Q2 Q3 Q4 Q2 Q3 Q4


ERP Reimplementation (2010:Q4–2012:Q2)

• ERP Reimplementation Scope Defined by Q4 2010.• Project teams / planning in place for a January 2011

project start-up.

Tec

hnic

al

ERP Re-Implementation


Q1 2010

Q2 Q3 Q4Q1

2011Q1

2012Q2 Q3 Q4 Q2 Q3 Q4

Steering Committee Formation

A specific mandate would need to be defined but at high level, this group would provide direction and leadership for the establishment of:

• Rules, Standards and Principles• Governance• Rules of Engagement (Framework)• Decision stage-gates for further project phases

Senior Leaders from all Business Areas that use ERP Systems are on the steering committee.

Questions?

erp roadmapping one way to do it

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