How to Ensure Your Next EHS & Sustainability Software Platform Will Achieve Your Business Objectives Implementation Best Practice Begins with Effective Planning Mark Pratorius Client Services Manager EHS & Sustainability Solutions March 2, 2011 Copyright © 2010 IHS Inc. All Rights Reserved. 10 Common Beliefs The total cost of ownership is less for “buy” than it is for “build” 2 2. A large customer base drives innovation and stability in commercial software 3. Complete solutions are about people, process, technology, and data 4. Solutions require a long term view 5 5. Centralizing data will increase data integrity 6. Value must be recognized early in the implementation process 7. Value must continue to be shown throughout project and well into system use 8 8. Commercial software should not be customized unless absolutely necessary 9. Level of influence is greatest at the beginning of the project, cost to change is greatest toward the end – early project planning is essential 10. Dedicating resources to the implementation project is critical to success 10 1. Copyright © 2010 IHS Inc. All Rights Reserved. EHS & Sustainability Covers Many Topics Enterprise Sustainability Management Metrics & Dashboards Compliance Status & Evaluation Integration & Interoperability Site & Enterprise Level Reporting Configurable & Automated Workflows Operational Excellence Environmental Health & Safety Risk Management Product Stewardship GHG & Energy Corporate Responsibility Air Emissions Behavioral Safety Incident Tracking (M)SDS Authoring Emissions Inventories Sustainability Reporting Fugitive Emissions Industrial Hygiene Automated Notifications Labels & Packaging Compliance & Verification Project Tracking Refrigerant Inventory Occupational Medicine Emergency Operations Product Compliance Water Usage & Discharge (M)SDS Hazardous Waste Chemical Approval Chemical Inventory Process Safety Regulatory Permits & Citation Linkage Training Cap & Trade Abatement & Offset Projects Assessments & Audits Materials & Supply Chain Process Hazard Analysis Certifications & Declarations Corrective Actions Product Evaluation & Classification Internal & External Reporting Energy Usage & Reduction Strategic Planning Key Performance Indicators Footprinting & Reductions Environmentally Preferred Purchasing Shared Value Creation Foundational Content People Assets & Equipment Sites & Locations Chemical & Material Data Geospatial Information Regulatory Citations Copyright © 2010 IHS Inc. All Rights Reserved. Regulatory Rules & Templates Policies & Procedures Today’s EHS Business Challenge • Across every business sector, organizations face a rapidly growing i regulatory l b burden, d plus l iincreased dd demand d ffor corporate responsibility reporting. • Regulatory R l t complexity l it and d risks i k are d driving i i companies i tto support compliance management programs with enterpriseg technology. gy level information management • Without a platform approach to managing your EHS data, you risk making repeat investments in technology that fall short of meeting the demands of your business. 4 Copyright © 2010 IHS Inc. All Rights Reserved. What’s Your Pain? • Growing regulatory/sustainability reporting burden • Cost of operating multiple disparate EHS management systems • Inefficient manual compliance processes • Lack of system interoperability • Risks, costs associated with complex financial-based regulatory schemes • Increased demand for corporate responsibility reporting • Increased I d regulatory l t complexity l it • Resource reduction • Increased transparency of reporting • Managing assets across large organizations 5 Copyright © 2010 IHS Inc. All Rights Reserved. Where Are You in The Journey? C Collaboration ll b ti Optimize Process Review Performance Share Knowledge & Prioritize Actions Engage the Work Force Standard Process & Consolidate Systems S Performance 6 Copyright © 2010 IHS Inc. All Rights Reserved. Experts estimate that more than 65% of enterprise software implementations fail. Why? “The first stumbling block for many failed implementations is a severe misalignment g between software functionality y and business needs.” Eric Kimberling, g Welcome to the Jungle: g Lessons from ERP Software Implementation Failures Copyright © 2010 IHS Inc. All Rights Reserved. Expertise is Needed to Create The Plan Software Knowledge EHS Business Expertise Project P j t Management Practices IT Knowledge 8 Copyright © 2010 IHS Inc. All Rights Reserved. Emerging Best Practice: Value Assessments Successful software deployment begins with a preimplementation value assessment. This process entails working with a trusted advisor to develop a comprehensive plan that: • Outlines your business goals, desired outcomes, processes and resources and aligns them with standards and regulations that govern your operations operations. • Evaluates all of the resources that will be required to implement a solution. • Helps you achieve your business goals by managing change within your operations. 9 Copyright © 2010 IHS Inc. All Rights Reserved. How to Move Forward 7. Articulate Business Case 1. Define Outcome 6.Create 6 Create Deployment & Support Plan 2. Bound Scope 3. Identify Key Inputs, Outputs, & Resources 5. Measure Value 4. Assess Process & Enterprise 10 Copyright © 2010 IHS Inc. All Rights Reserved. Assessment Methods • Subject Matter Experts (SMEs) are asked to describe their workflows, needs, and requirements for critical functional areas to uncover points of potential improvement. SME Interviews • These discussions are captured and analyzed after the assessment. 11 Copyright © 2010 IHS Inc. All Rights Reserved. Typical Assessment Questions • Who are the key stakeholders involved in this business function? • What systems store primary data needed for this business function? • What type t pe of data are needed for this business b siness ffunction? nction? • How frequently are the data needed? • Who uses data from the business function? • What are the most significant business drivers for this business function? • What type of performance metrics are currently used within your organization? • What regulations must you comply with for this business function? • List the most significant output you need from the system? • What equations, methods, or techniques are used to analyze the data for this business function? • Have other systems been implemented in the past to improve this business function? • Did it go well? Why or why not? • What lessons learned are available? • What are the three most important requirements to address? 12 Copyright © 2010 IHS Inc. All Rights Reserved. Work Flow Documentation 13 Copyright © 2010 IHS Inc. All Rights Reserved. Define Requirements To Enable Clear Success Criteria Throughout g Project j 14 Copyright © 2010 IHS Inc. All Rights Reserved. Process Maturity and Enterprise Capabilities Using Industry experience and data, evaluate the maturity and capabilities of your organization…. Process Maturity* Enterprise Capabilities* P1 P2 P3 P4 P1 P2 P3 P4 Design Leadership Performers Culture Owner Expertise Infrastructure Governance Metrics *Based on “The Process Audit” by Michael Hammer, HBR April 2007 15 Copyright © 2010 IHS Inc. All Rights Reserved. Defining The Value Type Description Value Cost Reduction Reduced loss • Focused behavior minimizes loss C t Reduction Cost R d ti Retirement of disparate systems • IT People needed to maintain systems are reduced • Maintenance M i t & supportt fees f to t vendor d are reduced d d • Training required is reduced Cost Avoidance Technology enabled workflow Cost Avoidance Corporate solution Cost & Risk Reduction Reduced violations Risk Reduction Compliance confidence Risk Reduction Libraries of best practices •Best practices shared amongst businesses Risk Reduction Timely data enables decisions •Decisions that impact business can be made more quickly •Technology rather than headcount is leveraged to meet requirements. Reduced business time spent contacting vendors or •Reduced selecting solutions •Reduced IT time spent evaluating technology •Reduced fines •Improved p p public image g •Reduced insurance • Auditable system that allows documentation of compliance •Reduced liabilities, less risk reserves 16 Copyright © 2010 IHS Inc. All Rights Reserved. Desired Business Outcome: Cost Savings • Cost Savings Metrics • Eliminated Eli i t d over $2 million illi in i redundant d d t reporting ti systems • EHS reports generated in 2 hours instead of 2 days • Mobile waste collection entry time reduced from 45 minutes to a few minutes daily per operations employee • Saved 3 months by eliminating need to update homegrown tool Copyright © 2010 IHS Inc. All Rights Reserved. Desired Business Outcome: Risk Reduction Risk Reduction Metrics • Complied with 526 permits across 245 governing bodies – • 1224 rules • 8999 citations • Tracked 4300+ tasks • Achieved goal of assuring > 85% completed on schedule, • Tracked near misses • Preserved license to operate in 200 facilities at 35 manufacturing sites Copyright © 2010 IHS Inc. All Rights Reserved. Planning for a Software Implementation • Do you have sufficient resources to deploy and manage your system? y • Will your system have the flexibility to address your immediate needs today, and account for your organization’s growth – and i increased d regulatory l t d demands? d ? • Most companies focus primarily on software features, functionalityy and user interface. That’s onlyy the beginning g g of the challenge. • You need to know how to properly deploy a software solution so your organization i ti will ill optimize ti i th the b benefits fit off iinformation f ti management. 19 Copyright © 2010 IHS Inc. All Rights Reserved. Use Proven Methodology Initiate Design Construct Test Deploy Improve •Develop Requirements •Define Solution •Create Business Case •Secure Resources •Develop Project Controls •Install Software •Solution Training •Design •Configuration Design •Integration Design •Prototype / Pilot •Data Gathering •Configuration •Integration •Data Loading •Environment Staging •Test Plans •Unit Testing •User Acceptance Testing •Resolution Planning & Execution •Training •Readiness Audit •Go Live •Support •Lessons Learned •Project Close •Change Control Board •Refresher Training •New User Training Systems •Systems Analysis •User / Focus Groups 20 Copyright © 2010 IHS Inc. All Rights Reserved. Plan for Correct Resources Program Manager • • • • Infrastructure Manager Readiness Manager Build Deployment Process Configuration Software customizations Interfaces Reports • Deployment processes and tools • Deployment consulting • Deployment team training Support Process Release Mgmt. • • • • Release management Change control process Management of change Vendor product roadmap (decision to migrate to new version of s/w) • Support processes • Support consulting System Administration • User setup and security • 3rd party access Training • • • • End user training Support training Training logistics Train-the-trainer Communication Software Vendor Execution Manager Quality Manager Deployment Schedule Operations • Schedule development • Schedule management • Coordination with other projects and interdependencies Business Unit Coord. Business Unit Coord Coord. Business Unit Coord. Business Unit Coord. Business Unit Coord. Business Unit Coord. • Operations web site • Metrics and reporting • Safety/Op Ex Project Controller Finance • Cost management and reporting • Cost recovery models BVR Testing • Test plan, processes, and tools • Testing execution • User U acceptance t testing t ti • Performance and reliability testing • Business value realization plan • Sustainability plan • Stage gate preparation Feedback Coordinator • Program feedback process (end user, deployment, support) • Lessons learned • Surveys, focus groups • Go/No-Go process and decision Support 21 Copyright © 2010 IHS Inc. All Rights Reserved. Coordination • • • • Resource plan Vendor mgmt Evergreen governance Legal Choose the Right Deployment Approach 22 Copyright © 2010 IHS Inc. All Rights Reserved. Build a Project Plan 23 Copyright © 2010 IHS Inc. All Rights Reserved. Calculate your Anticipated Cash Flow, ROI, and/or Pay Back Period 24 Copyright © 2010 IHS Inc. All Rights Reserved. Summary • Savvy organizations understand that proper implementation of an EMIS platform can help your organization improve its environmental, health and safety (EHS), material management, and product stewardship business program. • Advanced software systems also have a track record of helping companies reduce operational risks and costs, increase c ease e efficiency c e cy a and d de develop e op forward-thinking o adt g st strategies ateg es to prevent, rather than mitigate business EHS challenges. • Proper p p planning g for this important p endeavor is critical to long g term system sustainment and optimized processes that will drive your program success. 25 Copyright © 2010 IHS Inc. All Rights Reserved. Mark Pratorius Client Services Manager EHS & Sustainability Solutions (713) 231-7650 Mark.Pratorius@ihs.com 26