ISACA
Systems Implementation Assurance –
Lessons Learned
February 2009
Agenda – Lessons Learned
1. Project Phase 1- Planning / Mobilization
2. Project Phase 2 – Design / Blueprint
3. Project Phase 3 – Realization / Build & Test
4. Project Phase 4 - Pre Go-live / Deliver Phase
5. Project Phase 5 - Post Go-live / Maintenance Phase
6. Example Project Discussion Document
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 1- Planning/Mobilization
Careful planning, particularly in the early stages of a project, is
necessary to coordinate activities and manage project risks effectively.
The depth and formality of project plans should be commensurate with
the characteristics and risks of a given project.
Outline Project Plan
Define Roles and Responsibilities
Define Project Communication and Reporting Requirements
Define Deliverables and Expectations – Involvement of all Key Players
Outline Risk Acceptance - Manage Internal and External Risks
Define Project oversight activities – Definition of Standards
Define Tollgates and Requirements
Define Budget and estimated Project Costs
Define Project Change Procedures
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 1 Planning/ Mobilization – Lessons Learned
Putting a proper project governance structure in place with
sufficient "checks and balances".
Proper Executive and Senior Management buy-in and
involvement in project and milestones reached
Projects are often comprised of international teams and must
consider both cultural issues and compliance with local laws
and regulations
Broader industry and business issues must be taken into
consideration
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 1 Planning/Mobilization – Lessons Learned cont.
Underlying Data Model Consideration (e.g. US GAAP versus
IFRS)
Downstream impact on support functions such as internal
audit and security administration
Additional Considerations to be aware of during the planning
stage:
41% of projects fail to meet management’s objectives
Only 28% of project fulfill management's expectations
Only 16% of IT projects hit all their targets
50% of projects end up late or over budget
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Planning/Mobilization – Lessons Learned cont.
Reasons for project failure in the planning stage:
Bad estimates
Scope changes
Change in environment
Insufficient resources
Change in strategy
Imprecise goals/ Insufficient budget
Poor communication
Insufficient support
Wrong project management
Insufficient motivation
Stakeholders not adequately defined
Poor quality of deliverables
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Project Phase 2 - Design/Blueprint
The design phase involves converting the informational, functional, and network
requirements identified during the initiation and planning phases into unified design
specifications that developers use to script programs during the development
phase
Application Control Standards
Designing appropriate security, audit, and automated controls
Standards should be in place to ensure end users, network
administrators, auditors, and security personnel are appropriately
involved during initial project phases.
Application control standards enhance the security, integrity, and
reliability of automated systems by ensuring input, processed, and
output information is authorized, accurate, complete, and secure.
Automated input controls help ensure employees accurately input
information, systems properly record input, and systems either reject,
or accept and record, input errors for later review and correction (e.g.
Check Digits, Completeness Checks, Duplication Checks, Validity
Checks, Reasonableness Checks, etc.)
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Project Phase 2 - Design/Blueprint cont.
Processing Controls - Automated processing controls help ensure systems
accurately process and record information and either reject, or process and
record, errors for later review and correction.
• Batch Controls
• Error Reporting
• Transaction Logs
• Run-to Run Totals
• Sequence Checks
Output Controls - Automated output controls help ensure systems securely
maintain and properly distribute processed information
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 2 Design/Blueprint – Lessons Learned
Avoid excessive customization - companies desire to
"re-invent the wheel"
Many key controls are application driven (e.g. controls which
depend on system generated reports, configuration settings
such as for the three-way match in the procurement cycle)
Effective process to prioritize all the business "wish-lists”
Decision Making from “Middle Management” – Timely
Decisions
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Project Phase 3 - Realization/Build & Test
Development
Development standards should be in place to address the responsibilities of
application and system programmers. Application programmers are responsible for
developing and maintaining end-user application.
Library Controls - Libraries are collections of stored documentation, programs,
and data. Program libraries include reusable program routines or modules stored
in source or object code formats.
Automated Password Controls – Management should establish logical
access controls for all libraries or objects within libraries
Automated Library Applications – When feasible, management should
implement automated library programs, which are available from
equipment manufacturers and software vendors
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Project Phase 3 - Realization/Build & Test – cont.
Version Controls
Software Documentation
System Descriptions – System descriptions provide narrative
explanations of operating environments and the interrelated input,
processing, and output functions of integrated application systems
System Documentation – System documentation includes system
flowcharts and models that identify the source and type of input
information, processing and control actions (automated and manual), and
the nature and location of output information.
System File Layouts – System file layouts describe collections of related
records generated by individual processing applications
Naming Convention - critical part of program documentation
End-User Instructions – Organizations should establish end-user instructions
that describe how to use an application.
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Project Phase 3 - Realization/Build & Test
Build & Test
The testing phase requires organizations to complete various tests to ensure the
accuracy of programmed code, the inclusion of expected functionality, and the
interoperability of applications and other network components. Thorough testing is
critical to ensuring systems meet organizational and end-user requirements.
Acceptance Testing – to assess the overall functionality and interoperability of
an application
End-to-End Testing - to assess the interoperability of an application and other
system components such as databases, hardware, software, or communication
devices
Functional Testing - to assess the operability of a program against predefined
requirements
Integration Testing - to assess the interfaces of integrated software
components
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Project Phase 3 - Realization/Build & Test – cont.
Parallel Testing - to compare the output of a new application against a
similar, often the original, application
Regression Testing - to assess functionality after programmers make
code changes to previously tested applications
Stress Testing - to assess the maximum limits of an application
String Testing - to assess the functionality of related code modules
System Testing - to assess the functionality of an entire system
Unit Testing - to assess the functionality of small modules of code
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 3 Realization/Build & Test – Lessons Learned
Project streams reporting 99% completion of tasks which, if
subject to deeper analysis, does not hold water
Incomplete testing which can have a devastating post go-live
impact when "too lightly" tested configurations fail and disrupt
the business
Data conversion is a task which many times are under-
estimated
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Project Phase 4 - Pre Go-live/Deliver Phase
The implementation phase involves installing approved applications into
production environments.
Primary tasks include…
announcing the implementation schedule,
training end users, and
installing the product.
Additionally, organizations should…
input and verify data,
configure and test system and security parameters
Management should circulate implementation schedules to all affected
parties and should notify users of any implementation responsibilities.
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 4 Pre Go-live/Deliver Phase – Lessons Learned
Training is a key area where projects tend to cut corners:
Insufficient training can be disastrous for the morale of
users, acceptance of the new application and company
productivity which can seriously hamper the pre-go-live
promises of more efficient post go-live environment.
Strong personalities, ego's, compensation structures and a
mentality of "nothing will stop us from going live on x-date" can
mean that pre-determined exit factors for the deliver phase
such as successfully completed testing and completed cut-over
activities can be compromised
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Project Phase 5 - Post Go-live/ Maintenance Phase
Management should…
conduct post-implementation reviews at the end of a project to validate the
completion of project objectives and assess project management activities.
interview all personnel actively involved in the operational use of a product and
document and address any identified problems.
analyze the effectiveness of project management activities by comparing,
among other things, planned and actual costs, benefits, and development times.
document the results and present them to senior management.
The maintenance phase involves…
making changes to hardware, software, and documentation to support its
operational effectiveness.
making changes to improve a system’s performance, correct problems, enhance
security, or address user requirements.
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 5 Post Go-live/Maintenance Phase – Lessons
Learned
PwC was able to categorize post go-live issues in the
following 35 buckets, sorted by number of incidents, highest
number first:
Locked user/UID validity date required resetting
Abend related issues
Report generation
Authentication
Batch processing/upload issues
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 5 Post Go-live/Maintenance Phase – Lessons
Learned cont.
Interface processing issues
Transaction Processing issues - mostly FI, FI-AP, SD
PO/EBP GR IR Processing issues
Access - General
SAP Mail/Inbox/Workflow Issues
Process Chain Issues
Authorization Issue
Shopping Cart PTP
Master Data issue
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 5 Post Go-live/Maintenance Phase – Lessons
Learned cont.
HR Transaction Processing Issue
Non - PROD access issue - to DEV,QA etc
ABAP Error
Miscellaneous
BW/BI/Related Reports Issues
Cannot access ESS
Missing Data/Unable to display issues
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 5 Post Go-live/Maintenance Phase – Lessons
Learned cont.
Backup Issues
Project Systems/WBS Issue
Data Entry / Update / Delete Request
Runtime Error
User error/Training Issue
Extracting/Downloading Data from SAP
SAP GUI Access Issues
Financial Period End Consolidation
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Phase 5 Post Go-live/Maintenance Phase – Lessons
Learned cont.
File error/File copy requests
Network Issue
Foreign language/Unicode
MSS Data Display Issues
Transport request / issues
Operating System Issue
Systems Implementation Assurance – Lessons Learned
PricewaterhouseCoopers
Draft
Independent Project Assurance
February 2009
SDLC Selection Framework • IT Process Maturity
Understanding Your Objectives
Draft
The company is making a significant investment to implement a single pricing, billing,
invoicing, accounts receivable and cash management and collection system, utilizing
SAP as the core technology. With Business Blueprint of Phase II of Project SAP
complete, Executive Management would like to gain the appropriate assurance that
the project achieves it’s stated objectives:
Realize the tangible and intangible business benefits outlined in the business case with the
priority to increase customer satisfaction with billing and an enhanced ability to efficiently and
effectively launch new products and services in the future.
Deliver the project on time, within budget, with agreed critical functionality for the business as
quickly as possible.
Leverage standard SAP business process design and core infrastructure to reduce risk and cost.
Provide a standard platform to allow for ease of integration and reporting.
Deliver a compliant system that addresses key stakeholder requirements, including financial and
regulatory reporting requirements.
SDLC Selection Framework • IT Process Maturity
Issues on Your Mind
Draft
Issue Possible Area of Assurance
Data Quality • Review controls around data cleansing and conversion for billing
and customer master data.
• Billing data quality and accuracy
• Share independent perspective on data conversion activities and
• Customer master conversion/migration
provide recommendations throughout the process.
• Customer rate accuracy
• Assess key interfaces identified and controls supporting
• Interfacing of information to legacy systems completeness, accuracy, validity, and restricted access risks.
Customer First Focus • Review controls and system configurations associated with invoice
generation and shipment rating and provide recommendations
• Invoice Presentation Quality and Accuracy
related to validity, completeness, accuracy, efficiency, and
• Shipment Rating Timeframe evidence of duplication.
• Share independent perspective on good practices associated with
revenue cycle and billing/invoicing.
Financial Reporting • Share other client experiences regarding security, internal control
and risk management associated with SAP upgrade to ECC 6.0.
• Inaccurate Bad Debt Provision Calculation
• Provide independent perspective on technical strategy for cash
• Excessive Unapplied Cash Balance
application.
• Current system Upgrade
• Assess process to define key financial and management reporting
requirements and assess the effectiveness of the reporting
designed to meet these requirements.
SDLC Selection Framework • IT Process Maturity
Draft
Project Assurance – A Suggested Approach
• Ongoing review of the project, control and business
outcomes focusing on the stated Project SAP business
objectives, risks, and priorities.
Project
Governance
• Provide Executive Management with ongoing project Project
assurance reporting. Management
Functional
Readiness
• We would work along side the project identifying potential Business
Case Technical
issues as early as possible and hence allowing Executive Project Readiness
Management adequate time to consider, and if necessary Outcomes
address such issues. This is critical if the independent
project assurance role is to add value to the project and Organizational
help assist in its successful outcome. To this end we Readiness
believe the independent assurance function should:
– Attend and provide input to key project team meetings Business Implementation
Benefits
– Provide a rolling progress report on issues identified Outcomes Methodology
through our work Realization Data
Plan Quality
– Brief key program stakeholders on the status of our work
and issues arising on a regular basis
Controls
Outcomes
Interfaces
Project
Structure
ITGCs
Business
Processes
SDLC Selection Framework • IT Process Maturity
Our Value Proposition to the company
Draft
• Flexible, tailored approach to focus on management’s priorities for assurance regarding the achievement of Project SAP
objectives.
– Efforts embedded in and integrated with overall Project SAP approach with a focus on value-add
– “One touch” integration of effort with external audit requirements to minimize disruption to project and avoid
surprises
– Evaluate and leverage work performed by others (e.g., Parent Company Internal Audit, SAP, etc.)
• “Hub and Spoke” deployment of world class functional and technical capabilities from PwC to the project:
– SAP Risk Management, Security, and Control
– Transportation & Logistics
– Business Process
– Data Assurance
– Program/Project Management
– Internal Control and Financial Reporting
• Distinguished history of providing independent project assurance services to the company and the parent company.
– Experience navigating the Demand and Supply IT Model
– Invested in relationships throughout the service center and the company.
– Teams deployed alongside of the company in Houston, Scottsdale, and Plantation.
SDLC Selection Framework • IT Process Maturity
Integrating our Audit into Project SAP
Draft
Control Design/Gap Realization Testing Framework
Blueprint Go-live & support
Analysis
Our experience of large
TIMETABLE
Agreement of expected key implementations has
controls within the draft found that the proving of
documentation during the Business Process/ IT General Controls the system is complex and
Blueprint and Realization difficult to manage
phases of the project allows Management Reporting effectively. A key factor
maximum opportunity to are the controls around
correct any issues within the Testing Framework the remediation of issues
design. reported during the testing
Data Conversion/ Cleansing phase.
Management Reporting Security and Access Control
Many key business process Data Conversion
controls rely upon system and Cleansing
generated data. The
requirement to manipulate this
Data integrity is a key risk
data as part of its use adds
within any environment;
additional risk. Effective design
and implementation of system
Security and Access Control this risk is increased
during periods of
reports maximises process
As greater use of system based controls changes such as a
efficiency and reduces the audit
are built into the control environment, the system replacement.
risk.
reliance upon the proper allocation of
access increases. Getting this right from
day one both for business and support
users reduces the risk that gaps are
found post live that affect our strategy.
SDLC Selection Framework • IT Process Maturity
Example Workplan
Draft
Business Process Management Reporting Testing Framework Data Security/Access Controls
/IT General Controls Conversion/Cleansing
Assess process to define Ensure requirements for unit Review proposed SAP
Review proposed key financial and testing, integration testing, Review scope, access related controls
business process control management reporting system testing, UAT, approach, and for sensitive access (SA)
documentation requirements and interface and performance requirements for data and Segregation of
containing the following assess the effectiveness testing are adequately cleansing and Duties (SOD) rule set;
types of controls: of the reporting designed considered with a focus on conversion. role maintenance; and
configurable, reports, to meet these testing of key controls. user provisioning.
manual procedures, requirements. Assess whether an adequate Assess quality controls
automated, and testing monitoring system is within the conversion, Assess SAP user roles
interfaces. Baseline key custom in place. setup and cleansing against SA and SOD rule
reports used to support processes to ensure sets.
Evaluate key controls the operation of manual Assess coordination of data integrity.
over financial reporting controls for financial testing between business Walkthrough user
(selected by the reporting (completeness, and IT. Review controls over provisioning and role
company) for accuracy). the data cleansing and maintenance process.
completeness, accuracy, Review configuration conversion process.
validity, restricted management and change Assess existence of
access, efficiency, control strategy and plan. Review sample of data processes to manage
resilience, and evidence cleansing and access during
of duplication. Review sample of testing conversion results. implementation and
scenarios and results during early stages of live
Review of SAP screens focusing on consistency in Review strategy for operation.
to confirm settings of approach and compliance master data
configurable controls. with policy in relation to key maintenance.
controls.
Walkthrough of business
process controls to
confirm
existence/operation of
the automated and
manual controls.
Assess SAP ITGCs
SDLC Selection Framework • IT Process Maturity
Draft
Questions
Contact Information
– Peter Harries, Partner 213 – 356 – 6760
– Charles Lewis, Partner 602 – 364 – 8290
– Pablo Hernandez, Senior Manager 602 – 364 – 8064
– JJ Marais, Senior Manager 602 – 364 – 8232
SDLC Selection Framework • IT Process Maturity
