Sanctuary Housing is one of the UK’s leading social landlords. The not-for-profit organisation manages approximately 100,000 homes in England and Scotland, has over 11,000 employees and turns over approximately £669 million.However, over the past four decades it has spent its time acquiring and implementing a range of ‘best of breed’ technology solutions to run its individual business units. This disaggregated approach to business and the resulting silos has meant that Sanctuary Housing has not been able to scale sufficiently during periods of growth.
Speaking with Kevin Heslop, Sanctuary Housing’s technical director, at this week’s UK & Ireland SAP User Group conference in Birmingham, he explained how the organisation has gone all-in with one unified SAP platform, in a bid to redesign and consolidate business processes.
What’s interesting is that Heslop and his team put a strong emphasis on the design phase of the project, so as to ensure as much of the platform is as vanilla SAP as possible. This has meant a big shift culturally for the organisation, which has had to adapt to working in different ways. He said:
We have been growing steadily over the past 25 years, that’s what brought about our case to work differently - our programme of work called One Sanctuary. One Sanctuary is a business transformation programme, based around an implementation of SAP to try and streamline and improve and make common the way that we work.
Previously we had a best of breed approach, different systems for each business area and for each business challenge. We had issues with integration, and therefore issues with data, accuracy, reporting. And also that growth and additional complexity, it just brought strains on the way that we worked and the technologies were a constraining factor for future growth.
Heslop and his team began putting the business case for One Sanctuary together in 2012, with the decision to go ahead with SAP in the latter part of the year. Oracle and Microsoft were also assessed, and Sanctuary Housing was not an ‘SAP shop’ prior to the decision being made.
Because of the disparity in technology buying in previous decades, Sanctuary had everything from SAP, to Infor to Northgate - totalling more than 30 core systems.
However, what was clear from the business case was that a single platform was needed. Heslop said:
I think it was quite obvious early on that that’s what was needed. The initial investigation was around our finance systems, around our corporate service systems, but it became obvious that the biggest advantage from doing the piece of work is if we went further than that and started looking at operations and front line customer service.
Keeping our workforce mobile and being able to do the work outside the office, rather than return to base, so the whole business case made more sense to be the bigger piece.
Sanctuary Housing needed a platform that could cope with the diversity of its business needs. For example, it has people who are working the development construction business who are using the system to plan out their projects; it has housing officers sitting in peoples’ living rooms dealing with tenant issues; and it has finance offers sitting in the head office. To name a few.
Heslop and his team believe that SAP fitted with these requirements and has now delivered six releases - which include finance, HR, procurement, fixed asset management, asset lifecycle management and CRM. The final release to go is for maintenance.
Design isn’t indulgentHeslop described Sanctuary One as having an “aggressive” rollout, which given that it has taken just three years for a company-wide overhaul, is pretty accurate. However, Heslop wanted to emphasise the importance that was placed on design prior to the roll-out, which took up on third of the project’s time. Heslop said:
We spent a year in design. At the time that felt quite indulgent, to spend a year doing design when you’ve got a short number of years thereafter to roll out, but I think challenging ourselves to make sure that was right was good. You can cope with lots of challenges that come your way if you’ve got a lot of belief in the design. It underpins the whole benefits case and the realisation plans thereafter.
Quite. And the reason that Sanctuary wanted to spend a lot of time on design was largely because it wanted the business as a whole to understand the reprocessing required to go for a largely vanilla rollout. This type of change is hard, but Heslop estimates that Sanctuary is now working with over 90% standard, out-of-the box SAP software. He said:
The reason it took a year was because the opening question in each design workshop was - why wouldn’t we use standard SAP here? Which is a very different way for our business to think. When we have previously used best of breed systems for each department, we ended up with highly configurable best of breed systems.
We had lots of choices around different operating models for different parts of Sanctuary. But actually we want to standardise. Our business is mainly around, how do we manage our assets? How do we manage our employees? How do we manage our customers? All of our businesses have these things in common, and yet we all worked with different operating models.
So we actually came into design workshops with all businesses represented in the workshop with a question of - we are proposing we use standard SAP here, let’s discuss that. There were some areas where there were differences and we have done some enhancements to make the system sector specific for Sanctuary, but predominantly it’s standard SAP and that meant changing the business process.
And although the technology project itself has been challenging, it’s the people change that haven proven to be particularly difficult. Heslop said:
I think the non-technology part of the programme of work have been more predominant than the technology part. The idea of working all the executives, all of the sponsors, all of the business owners and business process owners that we work with to try and manage the change. The communications plan, trying to be honest with staff around how it’s going to impact them. There has been more work in these areas - more people doing this work than doing the technical work.
Taking this further
When Sanctuary Housing began looking at SAP in 2012/13, Heslop wasn’t convinced about thematurity of the conversations around SAP’s HANA platform. However, three years down the line and him and his team are now seriously eyeing the S/4 HANA platform as the next step
Why? Because Heslop sees this as for further improving the commonality across the Sanctuary Housing business and simplifying processes. He said:
We are starting to understand what it means for us. I think we see it as an opportunity for a further drive of more simplicity, greater simplicity. Looking at what we have done, we can definitely extract more vanilla SAP and adopt more effective ways of working.
However, it’s not a done deal. He added:
There are some unanswered questions as well at the minute. Real estate is such a fundamental part of how our system hangs together, we don’t yet understand what the migration plan for real estate is. We can see the vision for finance, for CRM, for HR, we don’t yet see the vision for real estate. We can’t really make the firmest plans for S/4 HANA until we know what is going to happen with real estate
But even if the S/4 HANA project doesn’t go ahead in the future, Heslop believes that Sanctuary housing has gained a number of benefits from pursuing a single platform for the whole of the business. These fall into three areas - costs, removing barriers to growth and customer service. He said:
There are cost savings over a period of time, our benefits case has an eight year ROI on it. There are more efficient and more effective ways of working in there. We are already getting ahead of ourselves of doing that kind of work.
There’s also the fact that we had to create a new platform to continue growing, it just had to be done anyway. That’s a fact. We saw that the way that we worked was a barrier to continued growth. We had to change.
And from a customer point of view, we were trying to work out what the customer outcomes are. So if in our customer service centre we have got shorter, more effective calls, that record more information, with clearer follow up action - that must pay back and improve customer service. Less failure demand, less repeat calls, better hand offs from one part of the business to another. There is direct customer impact.