Orange County Convention Center Orlando, Florida | May 15-18, 2011

SAP Lighthouse / Value Partnership at Canadian Pacific

Rick Feicht
Director, Enterprise Architecture Corporate & SAP Canadian Pacific

[ Agenda
Executive Summary About Canadian Pacific IT Retrospective Driving the Digital Railway Reaching Critical Mass SAP and the Lighthouse Analysis Leveraging the Value Partnership The Road Ahead Summary Questions

Real Experience. Real Advantage.

[ Executive Summary
Canadian Pacific is undergoing a significant business transformation. Our journey to become the safest, most fluid railway in North America is paralleled by our growing relationship with SAP.

This presentation describes Canadian Pacifics experience with the SAP Lighthouse / Value Partnership to date and how we believe it will transform our business.

Real Experience. Real Advantage.

[ Canadian Pacific: Who We Are

North Americas first coast-to-coast transcontinental railway
- In operation for over 125 years - Over 16,000 employees - 14,000 mile Rail network in Canada + U.S.

Provide rail and intermodal freight transportation services

Domestic CDN 25% Domestic US 9%

Global
37%

- Serve multiple sectors: commodities, agriculture, electronics, fuel, vehicles - Global reach through ports of Vancouver, Montreal and New York - Active Customers: 4000 - Annual Revenues: $4.9 billion

Transborder 29%

Technologically-advanced Class 1 Railway

- More than 700 trains running daily - Meet more than 10,000 individual customer service commitments every day

Real Experience. Real Advantage.

[ Canadian Pacific: Who We Are

Our Vision: To be the safest, most fluid railway in North America
Support Groups
Operations Finance Human Resources Information Technology Marketing & Sales Law & Risk Management Strategy & Yield Performance Improvement

IT > Enterprise Architecture

- Responsible for all IT architectural functions - Provide CP with an IT strategic vision - Guide IT solution development and deployment

Real Experience. Real Advantage.

[ IT Retrospective
1997: First Use of SAP 2006: Re-platform
Move from Unix to Windows Upgrade to ECC 6.0 Introduction of Netweaver components (Portal, XI, BW) Introduction of SAP First program Modules in play - FI, CO, AM, PM, MM, SD, PS, HR, RE, IM, PP

2009: Foundation work to support SAP First / SAP FAST

Upgrade EHP4 and SOA framework Additional Netweaver components Creation of a 5 year functional roadmap Establish maintenance and multiyear foundational investment plan Bottom up approach to enabling capability Convergence to 2 asset classes (SAP and Shipment Suite)

Real Experience. Real Advantage.

[ Driving the Digital Railway

Make the railway safer, more efficient and more reliable Ahead of the curve with predictive technology Getting the right information, to the right people, at the right time

Real Experience. Real Advantage.

[ Reaching Critical Mass: Time for Change

Desire to be industry leaders
- Access to the best technology - Efficiency potential is high

Fully leverage our investment with SAP Shift Approach: Bottom-Up to Top-Down Inflection point of change: Crossover

Transform the Business

The Business recognized the need for change IT staged to support change SAP recognized the signs and the opportunity
Real Experience. Real Advantage.
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[ SAP and the Lighthouse Analysis

Lighthouse Analysis
- Reviewed existing business processes with stakeholders Identified opportunities to improve, streamline, transform - Recommendations Developed roadmap for functional areas (HR, L2C, Finance, Ops) Validate existing foundational roadmap - Co-developed and refined a Functional Five Year Roadmap Roadmap design for each functional business area High-Level detail

Real Experience. Real Advantage.

[ Five Year Roadmap

Foundation Innovation
Finance
Q4 Q1

Visibility

CoCo-Innovation

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Lead to Cash

Risk Mgmt

Train Delivery & Execution

Hire to Retire

EAM

Real Experience. Real Advantage.

[ Leveraging the Value Partnership

2011 Value Partnership: preparing for success Crossover

Business

IT

SAP

Business
Business Focus: L2C, Finance, Operations
Launch initiatives to define/design business strategies Understand business processes and pilot change User Group facilitation Financial systems optimization Operational functions alignment
Power of the integrated system

Business Strategic transformation planning

Top-Down model Business SMEs work with Executives Business capabilities > IT capabilities

Real Experience. Real Advantage.

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[ Leveraging the Value Partnership

Information Technology
Governance and methodologies

Business

IT

SAP

- Creating a more consistent approach to solution delivery Enterprise-wide scale of measurement - EAF: Enterprise Architecture Framework Partnership providing framework and training - TOGAF SAP solution delivery aligned with industry requirements

Development Framework
- Better, Faster, solution delivery model: Optimized assembly line approach to solution delivery Speed of delivery and consistency Realization of Business Value

Real Experience. Real Advantage.

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[ Leveraging the Value Partnership

Business

IT

SAP

SAP
Best practices as defined by SAP Who better?
Bring practical application of business systems Establishment and Alignment of PMO processes Application Lifecycle Methodology supported by Certification and Training Access to Ramp-Up Access to Industry Leaders & Core teams in Waldorf Facilitation of industry user groups SUGRAIL A-team of Business Transformation Specialists On site Principle Architects

Real Experience. Real Advantage.

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[ Value Partnership Functions / Structures

overall leadership and executive guidance for the whole Value Partnership / transformation run the transformation program efficient, with flawless delivery and execution, minimal risk or disruption develop the vision & plans for the technical, business process and data architecture that enables CPs transformation Value Partnership Leadership

Enterprise Architecture

the WHAT, based on business requirements and overall transformation needs

run programs flawless and efficient Program Management execution responsibility

embed bestpractice IT organization principles and provide services to implementation projects

Delivery Execution

Value Realization

Technical Architecture

Information Architecture transform CPs data structure into corporate data that allows insight and execution

Business Architecture

New Programs / Projects

Organization al Change Management

Value Engineering

design responsibility

Finance

ensure change happens in a managed way throught the organisation during

Data CoInnovation Introduce technical and business process innovations

Center of Expertise

MaxAttention

the HOW, based on specific business unit and cross-function requirements (detailed design)

L2C Existing Programs / Projects Reporting (Services) Testing (Services)

Visualization

Services provided from CoE to programs, projects and business units

Real Experience. Real Advantage.

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Enterprise Architecture
overall leadership and executive guidance for the whole Value Partnership / transformation run the transformation program efficient, with flawless delivery and execution, minimal risk or disruption

develop the vision & plans for the technical, business process and data architecture that enables CPs transformation

Value Partnership Leadership

Enterprise Architecture

the WHAT, based on business requirements and overall transformation needs

run programs flawless and efficient Program Management execution responsibility

embed bestpractice IT organization principles and provide services to implementation projects

Delivery Execution

Value Realization

Technical Architecture

Information Architecture transform CPs data structure into corporate data that allows insight and execution

Business Architecture

New Programs / Projects

Organization al Change Management

Value Engineering

design responsibility

Finance

ensure change happens in a managed way throught the organisation during

Data CoInnovation Introduce technical and business process innovations

Center of Expertise

MaxAttention

the HOW, based on specific business unit and cross-function requirements (detailed design)

L2C Existing Programs / Projects Reporting (Services) Testing (Services)

Visualization

Services provided from CoE to programs, projects and business units

Real Experience. Real Advantage.

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[ Delivery Execution
overall leadership and executive guidance for the whole Value Partnership / transformation run the transformation program efficient, with flawless delivery and execution, minimal risk or disruption develop the vision & plans for the technical, business process and data architecture that enables CPs transformation Value Partnership Leadership

Enterprise Architecture

the WHAT, based on business requirements and overall transformation needs

run programs flawless and efficient Program Management execution responsibility

embed bestpractice IT organization principles and provide services to implementation projects

Delivery Execution

Value Realization

Technical Architecture

Information Architecture transform CPs data structure into corporate data that allows insight and execution

Business Architecture

New Programs / Projects

Organization al Change Management

Value Engineering

design responsibility

Finance

ensure change happens in a managed way throught the organisation during

Data CoInnovation Introduce technical and business process innovations

Center of Expertise

MaxAttention

the HOW, based on specific business unit and cross-function requirements (detailed design)

L2C Existing Programs / Projects Reporting (Services) Testing (Services)

Visualization

Services provided from CoE to programs, projects and business units

Real Experience. Real Advantage.

15

[ Value Realization
overall leadership and executive guidance for the whole Value Partnership / transformation run the transformation program efficient, with flawless delivery and execution, minimal risk or disruption develop the vision & plans for the technical, business process and data architecture that enables CPs transformation Value Partnership Leadership

Enterprise Architecture

the WHAT, based on business requirements and overall transformation needs

run programs flawless and efficient Program Management execution responsibility

embed bestpractice IT organization principles and provide services to implementation projects

Delivery Execution

Value Realization

Technical Architecture

Information Architecture transform CPs data structure into corporate data that allows insight and execution

Business Architecture

New Programs / Projects

Organization al Change Management

Value Engineering

design responsibility

Finance

ensure change happens in a managed way throught the organisation during

Data CoInnovation Introduce technical and business process innovations

Center of Expertise

MaxAttention

the HOW, based on specific business unit and cross-function requirements (detailed design)

L2C Existing Programs / Projects Reporting (Services) Testing (Services)

Visualization

Services provided from CoE to programs, projects and business units

Real Experience. Real Advantage.

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[ Program Coordination
overall leadership and executive guidance for the whole Value Partnership / transformation run the transformation program efficient, with flawless delivery and execution, minimal risk or disruption develop the vision & plans for the technical, business process and data architecture that enables CPs transformation Value Partnership Leadership

Enterprise Architecture

the WHAT, based on business requirements and overall transformation needs

run programs flawless and efficient Program Management execution responsibility

embed bestpractice IT organization principles and provide services to implementation projects

Delivery Execution

Value Realization

Technical Architecture

Information Architecture transform CPs data structure into corporate data that allows insight and execution

Business Architecture

New Programs / Projects

Organization al Change Management

Value Engineering

design responsibility

Finance

ensure change happens in a managed way throught the organisation during

Data CoInnovation Introduce technical and business process innovations

Center of Expertise

MaxAttention

the HOW, based on specific business unit and cross-function requirements (detailed design)

L2C Existing Programs / Projects Reporting (Services) Testing (Services)

Visualization

Services provided from CoE to programs, projects and business units

Real Experience. Real Advantage.

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[ The Road Ahead

What these changes mean for our business: The Railway
Where does this take us?
- What do we hope to gain? Leader in Rail Business Systems. Improved Financial results Meet the objectives of the Digital Railway Enhance the execution of our vision.

What does success look like?

IT Simplification and Standardization SAP and Shipment Suite Leader in Rail Industry Best Practices Greater Integration: Simpler consolidated framework Reduced complexity: Solution Delivery Velocity

Real Experience. Real Advantage.

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[ Summary
Success of the Value Partnership is driven by the mutual commitment and goals of three parties
1. Business 2. Information Technology 3. SAP

Formalizing governance will change the way we deliver solutions

Leadership must follow a top-down model

Senior executives act in unison regarding supporting strategies

Real Experience. Real Advantage.

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[ Questions?

Real Experience. Real Advantage.

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Thank you for participating.

Please remember to complete and return your evaluation form following this session. For ongoing education in this area of focus, visit www.asug.com. SESSION CODE: 2410

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Real Experience. Real Advantage.