Setting Goals, KPIs & Cost Targets

Objective

After completing this lesson, you will be able to define SMART goals, KPIs, and cost reduction targets for a rationalization program.

Content

Key Takeaways

  • Define success upfront – Without clear goals, application rationalization risks stalling in analysis. Set SMART objectives (Specific, Measurable, Achievable, Relevant, Time-bound) to drive direction.
  • Use KPIs to track progress – Measure success with metrics like:
    • % of applications classified with TIME (transparency in analysis).
    • TCO reduction vs. baseline (cost savings).
    • Redundant applications retired (simplification impact).
    • Risk reduction (e.g., end-of-life technologies eliminated).
  • Leverage SAP LeanIX dashboards – Monitor KPIs in real time to maintain momentum and demonstrate value to stakeholders.
  • Focus on cost impact, not just app count – Prioritize retiring high-cost systems over small apps to maximize financial benefits.
  • Align targets with strategy – Tie cost savings to broader goals (e.g., reinvesting in ERP transformation) to ensure executive buy-in.
  • Create accountability – Clear goals, KPIs, and cost targets help teams celebrate wins, adjust course, and communicate value effectively.