THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october...

12
October 2016 THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN SET THE STAGE FOR GROWTH SIMPLICITY, FLEXIBILITY, EXTENSIBILITY IN THE CLOUD In Cloud ERP: The Great Enabler of Growth, Mint Jutras examined how Enterprise Resource Planning (ERP) solutions delivered as software as a service (SaaS) help companies fuel and simplify growth by addressing people challenges and mitigating risk, while maintaining governance and control. Cloud solutions enable you to fail (or succeed) faster, allowing you to focus on the next and best opportunity for growth. While some of the factors that enable growth are inherent in any SaaS solution, not all cloud ERP solutions are created equal. Targeting mid-size and fast growing companies, SAP claims its SAP Business ByDesign is designed specifically to help these companies grow and maximize profits. In this report we investigate the merit of those claims. SAP Business ByDesign was born in the cloud in 2007, long before “Run Simple” became the mantra of SAP. Yet the initial objective was to simplify, delivering a 100% cloud-based solution for the small to mid-size enterprise (SME), while also fully leveraging SAP’s experience and infrastructure. Instead of reworking an existing product, SAP took a “start over” approach, and over the past nine years has developed and refined a three dimensional design philosophy. Those three dimensions: simplicity, flexibility and extensibility. This philosophy is a perfect prescription for a growing company that needs to get out of the gate fast, but has not yet reached, or perhaps even determined its final destination. How does SAP do that? ABOUT SAP BUSINESS ByDESIGN Before we answer that question, it is important to understand what SAP Business ByDesign is. Because it has been in and out of the spotlight for the past several years, retracing a bit of history helps. HISTORY SAP Business ByDesign was first released in September 2007, just as SaaS and cloud were emerging as viable and appealing options, especially for SMEs. Both “cloud” and company size and complexity contributed significantly to the launch of this new product. SAP had been very successful in its bid to penetrate the large enterprise market around the world. But as its solution Who is SAP? SAP is one of the very few ERP solution providers with instant name recognition across the globe. By sheer numbers, SAP is a market leader, but is also well-known for its very comprehensive solution for large enterprises. However, 80% of SAP customers are small to mid-size companies. Some facts about the company: ü Over 320,000 customers in 188 countries ü 80,000+ employees and locations in more than 130 countries ü 45+ year history as a solution provider ü Annual revenue (IFRS) of € 20.79 billion in 2015 ü Listed under the symbol "SAP" on stock exchanges, including the Frankfurt Exchange and NYSE

Transcript of THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october...

Page 1: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

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

Page 2: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

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

Page 3: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage3of12

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

Page 4: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage4of12

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.

Page 5: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage5of12

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.

Page 6: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage6of12

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.

Page 7: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage7of12

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.

Page 8: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage8of12

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.

Page 9: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage9of12

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?

Page 10: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage10of12

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….

Page 11: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage11of12

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.

Page 12: THE THREE DIMENSIONS OF SAP BUSINESS ByDESIGN … Bydesign/documents/WhitePaper_The... · october 2016 the three dimensions of sap business bydesign set the stage for growth simplicity,

TheThreeDimensionsofSAPBusinessByDesignSettheStageforGrowthPage12of12

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.