Benchmarks and Value Management for a value chain transformation

SAP Procurement & Logistics Day 2012

30 augustus

Benchmarks and Value Management

for a value chain transformation

© 2012 SAP AG. All rights reserved. 3

The Business Case for Value Management

percentage of

benefit realization

achieved through

high best practice

adoption

2009 Value Management (VM) Survey Results

300+ Global Companies Surveyed

2.4x

HIGHER

return on investment

for companies with

high best practice

adoption

4x

MORE

companies with high

best practice

adoption attain value

“on” or “ahead” of

time

2.4x

MORE

companies with high

best practice

adoption deliver

projects “on” or

“below” budget

57%

L

M

H

39%

65%

119%

L

M

H

72%

173%

27%

L

M

H

11%

43%

48%

L

M

H

29%

71%

1.6x

HIGHER

SAP/AMR Value Management Survey Results 2009


SECURE

SUCCESS

SAP Value Engineering: SAP investment to help the

customers to deliver on time, on budget and on value!

Assess and prioritize opportunities with benchmarking

Build the decision case and set success KPIs

Define the target architecture & roadmap

Value Partnership Services

Establish Value Management Office

Build value based architecture and roadmap

Define and agree optimized business processes

Optimize TCO

Assess delivered benefits

Optimize value for the business


SAP Value Proposition

How to uncover the full potential of a business transformation?

What do we

improve?

How do we

make the

change?

What is the

business

value?

Performance Benchmarking

Value Discovery Workshop

Business Case / Roadmap

1

2

3


SAP Benchmarking +25 business process and +10.000 surveys

Corporate Services

Human Resources

Operations Support

Finance and Analytics

Planning Operations Distribution Sales & Marketing R&D Service

Financial & Compliance Business Intelligence/ Analytics

Human Capital Management Talent Management

SRM/ Procurement

Manufacturing

Total Cost of Ownership (TCO) Mobility

Supply Chain Management

Transportation Mgmt

Warehouse Mgmt

NPDI

Enterprise Asset Management EH&S Compliance

Customer Contact Centers

Sales Effectiveness

Trade Promotion Management

Customer Service & Support

Order to Cash

Enterprise Health Check

Marketing

High Perf. Analytics

Db Geographic Coverage

Main Industries

Automotive

Oil & Gas

CP & High Tech

Industrial & Mill Products

NA

EMEA

APJ

Other


SAP benchmarking for supply chain helps customers

identify and achieve best-in-class performance

On-Time Delivery Performance

Forecast Accuracy

Days in Inventory

A detailed KPI and Best Practice analysis

Order Fulfillment Lead Time


Personalized report is available for you: KPIs, improvement areas, best practices and suggested SAP solutions

Value/

Performance

What defines

“Value”?

What are the

most critical

performance

indicators?

High-Impact

Strategies

What are

proven

improvement

strategies?

What are

actionable sub

strategies?

Enabling Best

Practices

What best

practices

should be put

in place to

support a

given

strategy?

Enabling

Solutions

How do SAP

solutions

enable high-

impact

strategies and

ultimately

value?


Align Supply to

Demand

Strategy Report Example Inventory Reduction

Inventory Days

of Supply

Value/KPI

High-Impact

Strategies

Reduce Variability

in Execution

Implement a

Collaborative

Demand Planning

Process

• Customer data captured directly

from external feed e.g. EDI

• Dynamic and frequently updated

forecasts

• Forecasting at SKUs / inventory

location granularity level

Actionable Sub Strategies Enabling Best Practices

Enabling Solutions

Integrate Supplier

Network

66 88 - 25%

Forecast Granularity /

Inventory Days of Supply*

Low High

• Gain visibility into customer

demand and actual sales

• Build forecast collaboration

capabilities with sales & finance

• Incorporate new product

introductions, promotions and

sales force judgment into

forecast

• Manage inventory and

replenishments for key

customers

Note: *Consumer Products, North America and EMEA


SAP proposes an Innovation Discovery Workshop

Propose one or two days “innovative

workshop” with your stakeholders facilitated

by SAP

The aim of the workshop is to help client

identify opportunities for innovation

and growth

Participants from customer side are

stakeholders from business & IT

This approach is based on design

thinking, graphically facilitated by SAP

Value Engineering team

Big Deal 2.0

Oct 2011 Industry

Trends

Innovation

Real

Time

Mobility

On-Demand

Game

ChangersTechnology

Speed

Flexibility

Vision !

Value !

Business Case and / or Value Roadmap


What is Leading Performance?

Impact of Best Practice Adoption on Procurement KPIs

Source: SAP Benchmarking database “This information is provided by SAP on an "as-is" basis without warranty of any kind, and subject to the "General Disclaimer" and other terms of use stated at http://www.sap.com/company/legal/copyright/. Any results or comparisons shown are for general information purposes only and any particular data or analysis should not be interpreted as demonstrating a cause and effect relationship. Comparable performance on one given key performance indicator does not guaranty comparable performance on another key performance indicator.”

Organizations Today Improvement Potential Examples

Less than 50% operate a single,

integrated procurement system …

… but those who do achieve

on average over 40% higher

annual savings

Purchase requisition to order -98%

reduced PO pricing errors -20%

Employee productivity +20%

Reduced expenses -19%

Headcount -31%

Time to create purchase orders - 80%

Purchasing dept productivity +30%

More than 50% have no system

controls in place to mandate

contract compliance …

… but those who do have on

average 40% lower maverick

spending

Less than 40% have full visibility

into global supplier spend data …


average 35% higher annual

savings

Less than 45% allow their

suppliers to maintain their own

data and invoices for approval …


average 20% lower

procurement process costs

http://www.sap.com/company/legal/copyright/

http://www.thomasville.com/


Call to Action: Benchmark@ SAP Value Management: https://valuemanagement.sap.com/#

End-to-end benchmarking support: from Enrollment to Insight

Performance Benchmarking

Value Discovery Workshop

Business Case / Roadmap

1st Step:

https://valuemanagement.sap.com/

Thank you!

Benchmarks and Value Management for a value chain transformation

Technology

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