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October2016

THETHREEDIMENSIONSOFSAPBUSINESSByDESIGNSETTHESTAGEFORGROWTH

SIMPLICITY,FLEXIBILITY,EXTENSIBILITYINTHECLOUD

InCloudERP:TheGreatEnablerofGrowth,MintJutrasexaminedhowEnterpriseResourcePlanning(ERP)solutionsdeliveredassoftwareasaservice(SaaS)helpcompaniesfuelandsimplifygrowthbyaddressingpeoplechallengesandmitigatingrisk,whilemaintaininggovernanceandcontrol.Cloudsolutionsenableyoutofail(orsucceed)faster,allowingyoutofocusonthenextandbestopportunityforgrowth.WhilesomeofthefactorsthatenablegrowthareinherentinanySaaSsolution,notallcloudERPsolutionsarecreatedequal.Targetingmid-sizeandfastgrowingcompanies,SAPclaimsitsSAPBusinessByDesignisdesignedspecificallytohelpthesecompaniesgrowandmaximizeprofits.Inthisreportweinvestigatethemeritofthoseclaims.

SAPBusinessByDesignwasborninthecloudin2007,longbefore“RunSimple”becamethemantraofSAP.Yettheinitialobjectivewastosimplify,deliveringa100%cloud-basedsolutionforthesmalltomid-sizeenterprise(SME),whilealsofullyleveragingSAP’sexperienceandinfrastructure.Insteadofreworkinganexistingproduct,SAPtooka“startover”approach,andoverthepastnineyearshasdevelopedandrefinedathreedimensionaldesignphilosophy.Thosethreedimensions:simplicity,flexibilityandextensibility.Thisphilosophyisaperfectprescriptionforagrowingcompanythatneedstogetoutofthegatefast,buthasnotyetreached,orperhapsevendetermineditsfinaldestination.HowdoesSAPdothat?

ABOUTSAPBUSINESSByDESIGN

Beforeweanswerthatquestion,itisimportanttounderstandwhatSAPBusinessByDesignis.Becauseithasbeeninandoutofthespotlightforthepastseveralyears,retracingabitofhistoryhelps.

HISTORYSAPBusinessByDesignwasfirstreleasedinSeptember2007,justasSaaSandcloudwereemergingasviableandappealingoptions,especiallyforSMEs.Both“cloud”andcompanysizeandcomplexitycontributedsignificantlytothelaunchofthisnewproduct.SAPhadbeenverysuccessfulinitsbidtopenetratethelargeenterprisemarketaroundtheworld.Butasitssolution

Who is SAP?

SAPisoneoftheveryfewERPsolutionproviderswithinstantnamerecognitionacrosstheglobe.Bysheernumbers,SAPisamarketleader,butisalsowell-knownforitsverycomprehensivesolutionforlargeenterprises.However,80%ofSAPcustomersaresmalltomid-sizecompanies.

Somefactsaboutthecompany:

üOver320,000customersin188countries

ü80,000+employeesandlocationsinmorethan130countries

ü45+yearhistoryasasolutionprovider

üAnnualrevenue(IFRS)of€20.79billionin2015

ü Listedunderthesymbol"SAP"onstockexchanges,includingtheFrankfurtExchangeandNYSE

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage2of12

addressedmoreandmorechallengesandsatisfiedmoreandmorerequirementsoflargemulti-nationalenterprises,thecomplexityofSAPERPhadgrownalongwiththecomplexitiesofglobalbusiness.Theinitialgoalwastosimplifyforthemid-market,whilealsodeliveringa100%cloud-basedsolution,adifferentiatingfactoratthetime.

SAPcouldhavetakenafewdifferentapproaches,includingmovinganexistingproducttothecloud.Buttocomedownmarket,SAPERPwouldhavehadtoshedsomeofthatcomplexityorbeoverkillforanSMEorevenforasubsidiaryordivisionofalargeenterprise.

Ultimately,startingoverallowedSAPtoarchitectthesolutionspecificallyforthecloud,drawingonacquiredandorganicallydevelopedleadingedgeinfrastructure.Andevenmoreimportantly,SAPwasabletodrawonthethousandsofperson-yearsofexperienceaccumulatedbyitsstaffinaddressingtheneedsofthelargeenterprise.Tohelpagrowingcompany,ithelpstofullyunderstandtheneedsitwillfacewhenitreachesitsdesireddestination.

AFRESHAPPROACHTOPRODUCTDESIGNSAPalsotookadifferentapproachtodesigninganddeliveringthefeaturesandfunctionsrequiredbySMEs.WhileSAPhadawealthofexperiencefromwhichtodraw,developmentteamswereessentiallystartingfromscratchintermsofactualcode.Thisinofitselfisquitealuxury,relievingthedevelopmentteamoftheburdenofdesigndecisionsmadewhentechnologywasquitelimitedandthebusinessworldwasverydifferent.Andthoseteamscoulddevote100%oftheirattentiontodevelopingnewproductsratherthanmaintainingorenhancingexistingcode.

Mostsoftwarevendorsbuildoutbasicmoduleslikeaccounting,purchasingandperhapsinventoryfirstandlaterfleshouttheproductwithfeaturesthathelpbringallthedifferentfunctionstogether.Eventuallytheyaddmorefeaturesandmodulesthathelpcustomersdifferentiatethemselves,butusuallythoseareonthelonger-termhorizon.

Thisistheeasiestwaytogrowyourdevelopmentorganizationandyourproductmodules–findsomeonewhounderstandsaccountingandputthemonthat.Findapurchasingorinventoryspecialistanddevelopthosemodules.Butthatmaynotbethebestwaytosupportabusinessanditisnothowacompanynaturallygrows.Youdon'tbuildyouraccountingfunctionsandthenfigureoutwhatthebusinesswilldotomakemoney.Youfigureoutabusinessmodelandthenbuildyourfunctionalteamsaroundthatandperformanend-to-endbusinessprocess,engagingavarietyofdifferentfunctionalareas.

SAPdesignedanddevelopedSAPBusinessByDesignaroundthewayabusinessdevelopsandgrows,creatingbusinessprocessscenarioslikeorder-to-cash,procure-to-pay,andintra-companystocktransfers(seesidebar,nextpage).Someofthesebusinessscenariosmaysitwithinasinglefunctionalarea

SAP Business ByDesign

Somefactsandcurrentstatisticsabouttheproduct:

ü 3,500+businessesrunSAPBusinessByDesignsupporting80,000+users

üUsedin90+countriesaroundtheworld

ü 175+largeenterprisesrunSAPBusinessByDesignintheirsubsidiaries

ü 250+value-addedpartnersworldwide

ü 200+softwaresolutionpartnerswith1,800+add-onsolutions

ü 19SAP-deliveredcountrylocalizations,supporting9languages


ofthebusiness,butmorelikely,theymightspanmanydifferentfunctions.Thisisalittlehardertodobecauseminimallythedesignersneedtounderstandmorethanonefunctionalsiloofthebusiness.Ideallythatinsightispassedontothedevelopersaswell.Bothneedtounderstandthebusinessitself.

ButSAPalreadyhadpeoplelikethis.Ithadspentmanyyearsdefiningrequirements,doingfunctionaldesigns,developingbestpractices.Itjustneededtoleverageallthispreviouslyacquiredexperienceandreinvent,redesignanddeliveritforthemid-market.TheSAPBusinessByDesignteamneededtomakesuretheproductcouldinstall,deploy,implementandrunsimpler,atalowercost.

TARGETMARKET:SEGMENTINGSMEsThisneedtosimplifyandreducecostwasdrivenbytheaudienceSAPwastargetingfortheproduct.WhileSAPalwayshadSMEsinmind,thespecifictargethasshiftedabitovertheyears,segmentingthisbroaddefinitionofSMEs,eitherbynumberofemployeesorrevenue,withthresholdsbetweensegmentssometimesvaryingbygeography.However,SAPBusinessByDesignalwayssharedtheSMEmarketwithSAPBusinessOneatthelowerendandSAPBusinessAll-in-Oneattheupperend.TypicallySAPBusinessByDesignsatinthemiddle,appealingtothoseinsearchofacloud-basedsolution,andyes,therewassomeoverlap.Thetargethasnowevolvedtotargetmid-sizeandfast-growingcompaniesandsubsidiaries(businessunits,divisions)oflargeenterprises.ThesesubsidiariesareoftenSMEsintheirownright,butthefactthattheymustinteroperatewithinalargerenterprisemakesa100%cloudsolutionevenmoreattractive.

ThisproposedmarkettakesthebestadvantageofSAPandSAPBusinessByDesign’sstrengths.Whiletheearlygoalwastosimplify,inrealitymid-sizecompanyneedsarenotthatdifferentfromlargeenterpriseneeds.AndwhounderstandsthoseneedsbetterthanSAP?Mid-sizeenterprisesjustdon’thavethesameresourcestogetthejobdone,whetherthejobisenteringnew,perhapsemergingmarkets,implementingERP,orboth…hencetheneedforsimplicityandlowercost.

LargeenterprisesubsidiariescreateaparticularlysweetspotforSAPBusinessByDesign,especiallyifcorporateheadquartersalreadyrunsSAPERP.Theintegrationandtheabilitytoconsolidatebacktothecorporatelevelcomebuiltin.SAPhasalreadyestablishedafootholdin175ofthese,withSAPBusinessByDesignrunningatsubsidiaries.

TARGETMARKET:SERVICESYetthetargetmarketforSAPBusinessByDesignisnotdefinedentirelybycompanysize.Needsvarybasedonindustryandproductofferingsofpotentialcustomers.Traditionallycompaniesfallintotwodistinctcategories:thosethat

SAP Business ByDesign Business

Scenarios

ü CashandLiquidityManagement

ü CustomerContractManagement

ü CustomerReturnManagement

ü DemandPlanningü ExpenseReimbursementü FieldServiceandRepairü FinancialClosingü FixedAssetManagementü Intra-CompanyStock

Transferü Make-to-Stockü Marketing-to-

Opportunityü Order-to-Cash

(StandardizedServices)ü Order-to-Cash(Project-

BasedServices)ü Order-to-Cash(Sellfrom

Stock)ü Order-to-Cash(Third-

PartyOrderProcessing)ü Order-to-Cash(Specified

Products)ü PayrollServicesü PhysicalInventory

Managementü Procure-to-Pay(Non-

Stock)ü Procure-to-Pay(Services)ü Procure-to-Pay(Stock)ü ProductCatalog

Managementü ProductDefinitionü ProductDevelopmentü ProductEngineeringü ProjectManagementü QualityAssuranceü Request-to-Resolveü ResourceManagementü StrategicSourcingü SupplierReturn

Managementü TimeandLabor

Managementü Workforce

AdministrationandAuthorization


make,moveand/orsellphysicalgoodsandthosethatbuildtheirbusinessonprovidingservices.TypicallyERPproductsaredesignedtofocusononeortheother,butnotnecessarilyboth.

Whilethisworkedwellfordecades,todaymanybusinessesareablendofthetwocategories.Manufacturersarequitelikelytoalsoprovideservices,whetherforrepair,consulting,projectmanagementoranyothercomplementaryofferings.Distributorsandevenretailersmayofferlightassemblyorsimilarrepairservices.Whilesomeserviceprovidersmaydelivergoods(documentation,contentonvariousmedia,etc.),allmustdealwithindirectgoods(suchasofficesupplies)andequipment(suchaslaptopsanddesktops).

ThefirstSAPBusinessByDesigncustomerscamefrombothofthesetwodifferentworlds,andhappenedtoberepresentativeoftherealitiesoftoday’schangingbusinessclimate.Itsmanufacturingcustomerswerealsodrawnintoprovidingservices(repair,support,consulting,etc.)anditsservicecustomershandledphysicalgoods,whetherjustinsupportoftheirownbusiness(indirectmaterials)orinshippingmaterials(e.g.fieldrepairservices,documentation,softwareonvariousmedia).

BythetimethedustsettledonthefirstSAPBusinessByDesigncustomers,SAPfounditcouldeffectivelysupportbothcategories,aswellasblendedbusinesses.Whilemanydifferentsolutionswereavailabletomanagethemovementofphysicalgoods,theservicesideofmanybusinesseswasunderserved,resultinginmanualprocessesandmultiple,disparateanddisjointedsolutions.Becauseitaddressedtheseneedsaspartofafullyintegratedsolution,thisbecamesomewhatofanicheforSAPasitactivelywentafterthatbusiness.

Thisisparticularlykeyduringgrowthandexpansion.Evenifyouarepurelyoneortheothertoday,itislikelyyouwillnotbetomorrow.Andasyouextendyourfootprintinternationally,differentlocations(whichifindifferentcountrieswillbedifferentlegalentities)andsubsidiariesmightplaydifferentrolesintheorganization.Youmighthaveasalesandmarketingarminsomelocations,adistributionwarehouseinanother,repairserviceshereandmanufacturingthere.Havingasingleproductthatcanhandlethesedifferenttypesofbusinessesiscertainlyanadvantage,eliminatingtheneedforintegration.

WHAT’SINIT?MintJutrasdefinesERPasanintegratedsuiteofmodulesthatformstheoperationalandtransactionalsystemofrecordofyourbusiness.Itincludesallthemasterdataneededtosupportthefullcyclefromordertocash,includingafullaudittrailofalltransactions.Whilethisisourminimaldefinition,mostcompleteandmodernERPsolutions,includingSAPBusinessByDesign,domuchmorethanthistoday.Besidesthetraditionalfiscaltransactions,SAPhas

Definition of ERP MintJutrasdefinesERPasanintegratedsuiteofmodulesthatformstheoperationalandtransactionalsystemofrecordofyourbusiness.Itincludesallthemasterdataneededtosupportthefullcyclefromordertocash,includingafullaudittrailofalltransactions.Whilethisisourminimaldefinition,mostcompleteandmodernERPsolutions,includingSAPBusinessByDesign,domuchmorethanthistoday.


includedsomenot-so-traditionalbusinessscenariossuchasthirdpartyorderprocessingandservice/supportrequest-to-resolve,anditspansallthevariousfunctionalareasofmostbusinesses,includingthoseprovidingservices(seesidebar).

SAPhasalsoleveragedtheknowledgeandexpertiseithasdevelopedandacquiredthroughitsinvestmentsintheunderlyingtechnology.SAP’sstrengthsincludein-memorydatabasesandintegrationcapabilitiesdevelopedinternally,reportingandanalyticsstrengthenedthroughtheBusinessObjectsacquisitionandmobility,bolsteredthroughtheacquisitionofSybase.Allcombined,thishelpsSAPprovideaddedvisibilityaboveandbeyondthetypical“accessanytime,anywhere”aspectofcloud,whetheritisthroughembeddedanalyticsoreasyandpurposefuldirectaccessthroughmobiledevices.

Buttherealvalueofcombiningallthistechnologyinvestmentisinthecreationofaplatformfordevelopmentthatsupportsflexibilityandextensibility.ThefollowingsectionexploresmoredeeplyhowSAPBusinessByDesigndeliversthistosupportgrowth,butfirstitisimportanttorecognizewhygrowingcompaniesneedboth.

Afastgrowingcompanyneedsto“rightsize”itssolutionateverystageofgrowth.Inthebeginning,andthroughoutthesedifferentstages,itneedstogetupandrunningquicklywithminimaldisruption.Thatmeansitneedstosatisfycurrentneedswithoutover-reaching.Thereisnoneedtobuildinaddedcomplexityinanticipationofpotentialrequirements.Andyet,implementingasolutionthatyoumayoutgrowveryquicklyisjustasrisky.Asolutionthatallowsyoutostartwithwhatyouneednowandaddmoreasyouneedit,whenyouneedit,whereyouneedit,isawisechoice.

HOWDOESSAPBUSINESSByDESIGNENABLEGROWTH?

Bynowitshouldbeclearthat,inordertoenablegrowth,asolutionmustbebroad(intermsoffunctionality),flexibleandextensible.WehavealsoseenhowcloudERPcanbeanimportantenablerofgrowth.SAPattackstheserequirementswithamodernandmodulararchitecturethatwasborninthecloud.ItdeliversanextgenerationuserexperiencethatcontinuestoevolveandabusinessconfiguratorthathasbecomethegoldstandardwithinSAP,helpingorganizationsadaptastheygrowandchange.Andfinally,itembedsreportingandanalyticsrightintheapplicationitselfsothatcontinualoversightandanalysisdoesnotbecomeanafterthought.

ARCHITECTURESAPBusinessByDesignismodularbydesign.Thisshouldnotbeconfusedwithsimplybeingcomprisedofasetofmodules.Bydefinition,anyERPsolutionisanintegratedsuiteofmodules.Itishowmodulesarecoupledtogether,orin

Functional Areas Covered by SAP

Business ByDesign

ü ProjectManagementüManufacturingü SupplierRelationshipManagement

ü SupplyChainManagement

ü CustomerRelationshipManagement

ü FinancialsüManagementReporting

üHumanResourceManagement

Afastgrowingcompanyneedsto“rightsize”itssolutionateverystageofgrowth….Asolutionthatallowsyoutostartwithwhatyouneednowandaddmoreasyouneedit,whenyouneedit,whereyouneedit,isawisechoice.


thecaseofSAPBusinessByDesign,howtheyaredecoupled,thatmakesasolutionflexibleorrigid.Mostmid-sizetolargeenterprisestodaynolongergrowtobelarge,monolithicenterprises.Theygrowmodularly,spawningnewdivisionsorsubsidiariestoexpandtoaddressnewproducts,productlinesorterritories.Butthesedifferentbusinessunitsmustinteroperatesmoothlyandseamlessly,makingobsoletethoselegacyERPsolutionsthatweresimilarlydesignedasrigidandmonolithic.

OneoftheguidingprinciplesofthedesignofSAPBusinessByDesignisdecoupling.Thisdecouplingisdeliveredinavarietyofways.Businesslogicisdecoupledfromtheuserinterface,allowingforeaseoftranslationandalsothereuseoflogicandservicesacrossanynumberofdifferenttypesofinterfaces.Thesametransactionscanbetriggeredwhetheryouareusingtheproductthroughabrowseronadesktop,amobileapplicationornouserinterfaceatall.Throughprocessautomation,sometimesthebestuserinterfaceisnointerface.

Inaddition,thesoftwaremodulesthemselvesareessentiallydecoupled.Insteadofhard-codedlogic,communicationbetweendifferentmodulesismessage-based.Thismakesitfareasiertoaddorswapmodulesandbusinessscenariosasneededoreventoconsumeinnovation.Witharigidmonolithicsolution,theentireenterpriseneedstomarchforwardtogether,oftentimesmakingsomedepartmentswaitformuchneededenhancementsbecauseotherpartsofthebusinessaren’treadyforchange.

Whilethereisalotofvaluetobegainedfromthistypeofdecoupling,thereisoneareawhereembeddingfunctionalityaddsmorethanitdetractsinvalue.Ifreportingandanalyticsarecompletelyseparate,theyoftenbecomeanafterthought,somethingtheimplementationteamneverquitegetsaroundtodelivering.Andeveniftheydo,ifdeliveredasanentirelyseparatefunction,theyareoftenoutofsightandoutofmind.

Separatingreportingandanalyticsisoftenrequiredinordertopreserveorimproveperformance,hencetheemergenceofsolutionsforonlineanalyticalprocessing(OLAP)separatefromonlinetransactionprocessing(OLTP).However,fromthebeginning,SAPBusinessByDesignwasbuiltusinganin-memorydatabasethatremovesthoseperformanceissuesandallowedSAPtoembedanalyticalcapabilitieswithinthesolution.Inadditiontobringingthisanalysisfrontandcenter,italsoprovidesrealtimeaccessfromawidevarietyofdatasources,includingdatafromsistercompaniesorheadquarters,eliminatingdelaysandspeedingdecisions.Thespeedandcapacityofin-memoryalsoremovestheneedtolimittheamountorgranularityofdataneededtohelpdeterminewhereandhowtoinvestnext.Insteadofusingaggregatedsummarydatathatmightbemisleading,SAPBusinessByDesignuserscandiveintoalevelofdetailthatwouldbeunmanageableandunimaginableusinglegacyarchitectures.

Mostmid-sizetolargeenterprisestodaynolongergrowtobelarge,monolithicenterprises.Theygrowmodularly,spawningnewdivisionsorsubsidiariestoexpandtoaddressnewproducts,productlinesorterritories.Butthesedifferentbusinessunitsmustinteroperatesmoothlyandseamlessly,makingobsoletethoselegacyERPsolutionsthatweresimilarlydesignedasrigidandmonolithic.


NEWGENERATIONUSEREXPERIENCEInCloudERP:TheGreatEnablerofGrowthwetalkedaboutthepeoplechallengesassociatedwithgrowth.NewgenerationsofERP,deliveredthroughthecloudcanhelpalleviatesomeofthesechallenges.ButMintJutrasresearchfindsthat“easeofuse”meansmorethanjustaprettyface.Easeofuseisfirstandforemostaboutefficiency,whichnotonlyrequiresauserinterfacethatisintuitive,butalsoprocessesthatalignwiththewaybusinessreallyworks-businessscenariosthatmaximizeefficiencyandminimizetimetocompletetasks.

OfcoursetherealproofthatSAPBusinessByDesigndeliversonthesepromisescomeswithademonstration,butSAP’sdesignmethodologyisconducivetosupportingboth.Whendesigningabusinessscenario,SAPdesignersgoonsite,observingthewaypeopleworkandinteract.Theirdesignsarebasedontheseobservationsandthenvalidated,typicallyinmultiplecountries(China,India,GermanyandtheUnitedStates)beforebeingincorporatedintotheproduct.

Theresultofthismethodologyhasbeenanemphasisonthehumanengineeringoftheprocess.Eachindividualworksfromapersonalizedhomepage,whichcombinesfunctionsfromwithinSAPBusinessByDesignwithotherfunctions(e.g.email,calendars,maps,etc.)andapowerfulenterprisesearchcapability(thinkofitasaGoogle-likesearchthroughoutyourenterprisedata).Businessprocessesaremademoreefficientastasksarepushedtousers.Throughout,thereisathemeofsimplicityandpersonalization.

BUSINESSCONFIGURATIONPersonalizationwithinSAPBusinessByDesignisachievedthrougha“BusinessConfigurator”thattakesadvantageofthepre-definedbusinessscenariosdiscussedearlierandarules-basedcatalog.Togetherthesealloweachcustomertotailorthesolutiontospecificneedsbyinteractinginbusinesslanguage,notcodeandwithoutinvasivecustomization.Thesebusinessscenariosmaptheworkflowofabusinessprocessthroughthevariousfunctionsofthesolution.Selectingapre-definedscenarioautomaticallyselectsallthefunctionsnecessaryduringinitialimplementation.Customerscanthenselectivelyfine-tunethesettingsimmediatelyorasbusinessconditionschange.

Thistypeofconfigurationtoolisparticularlyimportantascompaniesexpandintonewlocations,eitherthroughorganicgrowthoracquisition.CloudERP:TheGreatEnablerofGrowthadvisedgrowingcompaniestoestablishstandardstoensureahighlevelofgovernanceandcontrolwhilegrowing.Itspecificallynoted:

“WhatbetterwaytoenforcethesestandardsthanbyrollingthemoutthroughastandardimplementationtemplateofaSaaSsolutionthatis

Data Source InthisreportMintJutrasreferencesdatacollectedfromits2016(andprior)EnterpriseSolutionStudies,whichareusedtoinvestigatethegoals,challengesandstatusandalsotobenchmarkperformanceofimplementationsofsoftwareusedtorunbusinesses.

The2016studycollectedresponsesfrom~525participantsfromcompaniesofallsizesfromverysmalltoverylarge,representingawiderangeofindustries.


definedandmanagedcentrally?Acloudsolutionaidsbothoperationalandfinancialleadersinimplementingstandardcross-organizationalbusinessprocessesmoreeffectively.Lookforasolutionwithindustrybestpracticesbuiltin,tailorthemforyourcorporationandusethesebestpracticesasablueprintforgrowth.”

ThecombinationoftheSAPBusinessByDesignbusinessconfigurator,pre-definedbusinessscenariosandalibraryofbusinessrulesenablethistypeofstandardization.Customersneedonlytosupplycompany-specificdata,includingassignmentsoftasks,tosupporta“pushapproach”withinanorganizationalstructure.Bypushingtaskstoanindividual,processescontinueuninterrupted,makingthemostefficientuseofthatperson’stime.Nothingfallsthroughthecracks.

ORGANIZATIONSTRUCTURESAPBusinessByDesignallowsgrowingcompaniestomaintainasingleorganizationstructurethatdefinesrelationshipsbetweenalllegalentitiesbothfromafinancialconsolidationstandpointaswellasanorganizational(reporting)pointofview.Asenterprisesmatureandgrowbothofthesetendtoshiftandchange.

Legacysolutionsoftenrequirethesedifferentstructurestobemaintainedseparatelybybusinessunit,embeddingtheenterprisestructurewithinthegeneralledgeraccount,makingmaintenanceclumsyandanytypeofchangedifficult.Onceestablished,changingthestructureofthechartofaccountsisnexttoimpossible.Inlegacysystemspersonnelreportingstructureswerelikelytobedefinedinacompletelyseparatesolution,iftheywererecordedatall.Thesetwoareoftennotalignedidenticallyandthiscausesproblemsinmanagingperformancewhilemaintaininggovernanceandcontrol.

Takeyoursalesorganizationforexample.Salesisoftenmanagedasaglobalorganization,yetsalariesarepaidandrevenueisaccruedbycountryanddifferentcountriesmeanseparatelegalentities.Salesrepresentativesarepartofbothalegalentityandaglobalsalesorganizationthatspansmultipleentities.Pipelineandquotasmaybedeterminedinanentirelydifferentway,byinternal,externalorglobalsalesand/orperhapsbyproductlines.Wherecanyougetafullpictureofperformancefromanyorallperspectives?

SAPBusinessByDesignprovidestheflexibilitytostructureallofthisonce,inawaythatmakesmostsense,notinthewaydictatedbyyourERP.

WhileMintJutrasfindsthattodaymostcompaniesestablishcorporatestandardsforERP,oftenthisisatwotierstandard.Ourresearchfindsalmosthalf(44%)ofmulti-locationcompaniesuseadifferentERPatsubsidiariesorotheroperatinglocationsthantheERPusedatcorporateheadquarters(HQ).BecauseofSAP’sdominanceinthelargeenterprise,corporateisquitelikelytohaveSAPERPatHQ.ForthoserunningSAPBusinessByDesignatsubsidiaries,

SAPBusinessByDesignallowsgrowingcompaniestomaintainasingleorganizationstructurethatdefinesrelationshipsbetweenalllegalentitiesbothfromafinancialconsolidationstandpointaswellasanorganizational(reporting)pointofview.Asenterprisesmatureandgrowbothofthesetendtoshiftandchange.


theprocessoffinancialconsolidationtoSAPERP(runningatcorporateHQ)isverysimple.Thismakesa360oviewofyourentireenterpriseavailablefrommanydifferentangles.

EMBEDDEDANALYTICSOftencompanieslooktoreportingcapabilitieswithintheirERPsolutionsforthis360oviewandtraditionalreportinghaslongbeenanecessarytoolformanagingoperationalperformance.Yetinmanaginggrowth,youneedtolookbeyondcurrentoperationsandanalyzethepotentialofgrowthopportunities.Forthisyouneedanalytics.MostERPimplementationstodaydon’tadequatelydelivereitherbecauseERPhaslonghadthereputationforbeingeasiertogetdataintothandecisionsoutof.

StandardreportingisneverexactlywhatdecisionmakerswantandneedandtheyoftentireofwaitingfortheITstafftomakemodificationsordelivernewreports.Andwhenmakingmorestrategicdecisionsaboutgrowth,theyneedtoaskalotofquestionsandtheprocessisveryiterative.Yetitisveryhardtoknowwheretostartandwhatquestionstoask.

Companiesaresittingonamountainofdata,makingitdifficulttoprocessthroughitveryquicklyinordertodiscernwhichkeyperformanceindicators(KPIs)willbemostindicativeoffutureperformance.Afterall,theycan’tlookateverydetail.Sodecisionmakerssettleforaggregatesummarydatainsteadoftherealdetailtheyneed.Andtheyputtherequestforanalyticsonthebackburnerwhiletheyfighttheoperationalfires.Thisisparticularlytrueofmid-sizecompaniesstrugglingwiththesamekindofdecisionsaslargeenterprises,butwithoutthedeeppocketsandlargestaffstoaddressthemspecifically.

ThisiswhySAPBusinessByDesignembedsanalyticsdirectlyintothebusinessscenarios.WhileotherERPvendorspartnerwithbusinessintelligence(BI)andanalyticssolutionprovidersorstruggletodevelopthesetypesoftoolsthemselves,theacquisitionofBusinessObjectsbackin2007putSAPinaverystrongpositiontodelivernotonlytheBIcapabilitiesthathavebeenthetoolsofthetradefortheITstaff,butalsothetypeoftoolsbusinessusershavelongneeded.

Theanalyticsarebrowser-basedandavailableonmobiledevices,completewithalertsthatcanbesentinrealtime.SAPmakesextensiveuseofdashboards,whichbusinessuserscancreateorpersonalizeforthemselves.ButSAPdidn’tturnitsbackonbusinessusers’almostuniversalloveforspreadsheets.OfflineanalysisusingMicrosoftExcelisstillpossible.

Companiesaresittingonamountainofdata,makingitdifficulttoprocessthroughitveryquicklyinordertodiscernKPIswillbemostindicativeoffutureperformance.Afterall,theycan’tlookateverydetail…Orcanthey?


FEATURE/FUNCTION:GROWTHMAYREQUIREMOVINGBEYONDERPFUNCTIONALITY

ThegrowthanddevelopmentofSAPBusinessByDesignhasfollowedapaththatmodelsthegrowthandexpansionofabusiness.AndsometimesthismeansneedingsomethingwellbeyondthetraditionalscopeofERPquiteearlyon.Itisnotjustverylargeenterprisesthatfacethischallenge.Asyouexpandintonewcountriesandtransformyourbusinessintoa“blended”business,yourneedswillvaryateach(new)location.Herearesomeexamplesofhowyourbusinessmayexpandandgrow…andhowSAPBusinessByDesigncanadapt.

EXPANDSALESINTONEW(EMERGING)MARKETSLet’ssayyouarelookingtoexpandyourmarketintonewterritoriesbyopeninganewsalesoffice.You’llneedtosupportthebusinessscenariofrommarketingtoopportunity.Youwillneedtoconvertquotestoordersandthenperhapsmanagetheorder-to-cashcycleorsendthoseorderstocorporateortoothersistersubsidiariesinordertodeliver.

Ifyouaredeliveringservicesyoumaybedeliveringservicesfromagloballydistributedteam.Ifyouaresellinggoods,youmaybecreatingdemandforadistributionfacilityorevenamanufacturingsite.Youareinvolvedinthefrontandbackend,butalsoneedvisibilityintothemiddleoftheorder-to-cashcycleinordertostayclosetoyourcustomer.Thecombinationofbusinessscenariosyoumayneedisvirtuallyendlessdependingonthetypeofproductorprojectyoudeliverandtheglobaldistributionofresources.ApartiallistofSAPBusinessByDesignbusinessscenariosthatmayberequiredisshowninthesidebar.

RESEARCHPerhapsyouhaveasubsidiarydedicatedtoresearch.Humanresourcemanagementandprojectmanagementwillbeattheheartofyouroperations.Timeandlabormanagementandworkforceadministrationandauthorizationbusinessscenarioswilllikelybedeployed.

FIELDSERVICEOPERATIONSIfyousell,supportandrepairaphysicalproduct,youmayorganizerepairthroughdepotrepairandreturn,oryoumighthaverepairfacilitiesdistributedaroundtheworldforon-siterepair.Youwillneedfieldserviceandrepair,customerreturnmanagement,order-to-cash(forstandardizedorproject-basedservices),timeandexpensemanagement,eitherprocure-to-payorinter-companystocktransfersaswellastimeandlabormanagement–allbusinessscenariosbuiltintoSAPBusinessByDesign.

Business Scenarios– New Sales Office

ThefollowingBusinessScenariosdeliveredbySAPBusinessByDesignmayberequired:

üMarketingtoOpportunity

ü CustomerContractManagement

üDemandPlanningüOrdertoCashü ProcuretoPayü ProductCatalogManagement

ü StrategicSourcingü ProjectManagementüOthers….


MANUFACTURINGManufacturingrequiresallthestandardsupplychainoperationsfromdemandplanningandstrategicsourcing,procure-to-pay,physicalinventorymanagementandmake-to-stockscenarios.Plusyoucan’tforgettheorder-to-cashcycle,resource,timeandlabormanagement.

Thereaderwillnoticethatwehavenotreferencedthetraditional“modules”ofERPsuchasordermanagement,inventorycontrol,accountspayable,accountsreceivable,etc.Bychoosingthebusinessscenariosthatarethebestfittomodelyourbusiness,theSAPBusinessByDesignbusinessconfiguratorwillactivatethemodulesneededtosupportyourbusinessprocesses.Andofcourse,asa100%cloud-basedsolution,thosemodulesareallrighttheretobeused,ornot,asneeded.

GOODGROWTHISPROFITABLEGROWTH

Throughout,whetherlookingatsubsidiariesorthecorporatewhole,youwillneedtomanagecashandliquidity,payrollservices,qualityassuranceandthefinancialclose.Forthisyouneedvisibility,deliveredbySAPBusinessByDesign’sembeddedanalytics.Andyouwillneedaconsolidatedviewacrossthesepotentiallydifferentbusinesseswithinthebusiness.Youcan’trunasalesandmarketingteamlikeaserviceandrepairfacility.Andyoucan’trunafieldserviceoperationidenticallytoamanufacturingoperation.Yetallthesehaveacommonthreadofmasterdata(customer,products,parts,employees)andneedtobeconsolidatedatHQ.

Ofcourseyouwanttosatisfytheindividualneedsofthedifferenttypesofbusinesseswithinabusiness,butyoualsodon’twanttobetryingtocobbletogetheraunifiedviewfromdisparatesystems.ThisistheadvantageofSAPBusinessByDesign’sapproachofasingle,multi-purposesolution–providingitreallycanmeettheindividualneedsofthedifferentfunctions.Duringyourevaluationprocess,lookcarefullyatthosebusinessscenariosdeliveredwiththestandardsolution.Thesewillprovidethebaseofoperationofeachfacetofyourbusinessandthoseoperationsmayvaryandchangewithgrowth.

SUMMARYANDKEYTAKE-AWAYS

CloudERPisindeedagreatenablerofgrowthformid-sizecompanies,particularlythoselookingtotakeboldstepsinarapidlychangingbusinessclimate.ItisclearthatSAPhastakentheneedsofthesemid-sizecompaniesseriously,particularlythosethatarefastgrowing.Keepinginlinewithitscurrentmantraof“RunSimple,”SAPBusinessByDesigncanindeedhelpsimplifythegrowthprocessthroughitsthree-dimensionaldesignphilosophyincorporatingsimplicity,flexibilityandextensibility.

Bychoosingthebusinessscenariosthatarethebestfittomodelyourbusiness,theSAPBusinessByDesignbusinessconfiguratorwillactivatethemodulesneededtosupportyourbusinessprocesses.


Keyfactorsandthereforekeytakeawaysinclude:

• A“startover”approachthatkeepsthedesignanddevelopmentcleanandclear,butisabletodrawextensivelyfromSAP’svastexperienceandtechnologyinnovation

• AbusinessconfiguratorthathasbecomethegoldstandardwithinSAPforadaptingandpersonalizingthesolutionwithoutinvasivecodechangesorlock-in

• Theabilitytomaintainasingleorganizationstructurethatdefinestherelationshipsbetweenbusinessunits,locationsorsubsidiariesandalsoflexiblydefinesreportingstructuresthatmaycrosslegalentityboundaries

• Pre-definedbusinessscenariosthatallowentirecompaniesornewsubsidiariestogetoutofthegatefast,butwiththeflexibilitytoadapttochange

• Functionalitythatcreatesanend-to-endsolutionforavarietyofdifferentbusinessmodelsformanufacturedgoodsandservices,orablendedbusinessofboth

• Anextgenerationuserexperiencethatmakesextensiveuseofdashboardsandembeddedanalytics,whetheronadesktop,laptoporanymobiledevice

Formid-sizecompanieslookingtotakefulladvantageofunprecedentedgrowthopportunities,anyoldERPisnotenough.Ifyouareinsearchofacloud-basedERPsolutionthatcanhelpyougrowandgrowquickly,SAPBusinessByDesigndefinitelydeservesconsideration.

Abouttheauthor:CindyJutrasisawidelyrecognizedexpertinanalyzingtheimpactofenterpriseapplicationsonbusinessperformance.Utilizingover40yearsofcorporateexperienceandspecificexpertiseinmanufacturing,supplychain,customerserviceandbusinessperformancemanagement,Cindyhasspentthepast10+yearsbenchmarkingtheperformanceofsoftwaresolutionsinthecontextofthebusinessbenefitsoftechnology.In2011CindyfoundedMintJutrasLLC(www.mintjutras.com),specializinginanalyzingandcommunicatingthebusinessvalueenterpriseapplicationsbringtotheenterprise.