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Simple and Easy-Steamline your AP Processes ... p2

Do You Feel the Need for Speed? ... p2

An Inconvenient Truth: Migrating to S/4 HANA ... p3

Mark Your CalendarUpcoming events.... Don’t miss out! ... p4

September 2016

One of our clients is embarking on their S/4 HANA journey. How did they arrive at this important decision? We want to share that with you in a two part series.

In this article, part 1, how did they assess and justify their decision? The second article will focus on how our client planned the project; some tasks - pretty much the same for ECC, other tasks - very different.

BackstoryOur client leads the global building supplies industry. For years, they were content with single digit growth, but under new leadership, they tripled in size through acquisition.

With these acquisitions, they cobbled together a portfolio that spans 40 years of technology changes: green screens, A/S 400, multiple software vendors and spreadsheets - plenty of spreadsheets. SAP ECC 6 is the foundation of their ERP applications.

In an internal assessment, the company found that one-third of their IT and related costs was from bridging and reconciling multiple hardware and software platforms.

In addition to the costs, the financials still required excessive effort and overtime to gain confidence in the results.

There were three options to fix the problem: 1. Convert all business units to the current ERP platform, SAP ECC; 2. Implement SAP Central Finance to consolidate the various platforms; or 3. Standardize on S/4 HANA.

Decision

The company strategically decided to consider only the latest technology to support their global operations. Executives would only discuss Central Finance or S/4 HANA alternatives.

Central Finance was the early favorite. It showed a faster time to results for covering a major pain area: a single database for financial and management reporting.

But it masked the underlying problems with master data, inefficient processes and batch and timing differences. These issues were the real drivers of the high cost of ownership.

The third option, standardize on S/4 HANA, was deemed the best short- and long-term solution. It aligned with the business and IT commitment to be on the best platform for achieving their strategic initiative: growth.

Assess

In the assessment, one key factor,

tribal knowledge in the acquired businesses, contributed to reconciliation, timing, and consistency issues. Fiori was ideal for standardizing and harmonizing across the new shared functions.

The master data issue was born from the growth by acquisition.

Justify

S/4 HANA’s simple data model and in-memory processing would reduce the time to close the books. Harmonized master data would drive less reconciliation, higher reliance on the financials in one ledger and fewer timing differences for financial and management reporting. Justifying the adoption of S/4 HANA as the digital core requires the same diligence as any strategic initiative. It must align with your business and IT strategy. S/4 HANA’s real-time capabilities reduce or eliminate many current batch processing and reconciliation problems.

Next month, we will present how our client addressed the S/4 project planning. If you would like a snapshot of the specifics changes, contact Warren Norris, warren@titanconsulting.net, 972.679.5183; or contact your Titan Consulting Director. You can see additional information on our Advisory Services page at www.titanconsulting.net.

- Warren Norris

Disruptive Technologies Require Clear Planning and Leadership

PLANNING FOR YOUR S/4 HANA IMPLEMENTATION

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Yes, Accounts Payable (AP) is boring! But it is one area of the business that makes your business partners, critical suppliers, and employees successful and happy. If you want to run a good business, pay your partners on-time!

What prevents most businesses from paying on-time and how do you fix it?

Fouled up accounts, duplicate invoices and un-recorded vendor invoices are the main reasons why payments get delayed or consume resources.

Let’s look at a few statistics! It costs about 400% more for a bottom performing company to process an invoice than a top performer. As a percentage of revenue, the AP function for top performers is 0.04% of revenue. For bottom performing companies, costs are 0.16% of revenue according to APQC. What do leading companies do to streamline their AP processes? They: 1. Centralize; 2. Standardize; and 3. Automate.

We helped a global specialty chemicals customer improve AP processes by implementing OpenText – a 2016 SAP Pinnacle Award winner for the 9th year in a row. OpenText offers many solutions for SAP and digital transformation.

Our solution uses OpenText’s VIM, Invoice Capture Center (ICC), and Enterprise Scan functionality integrated to SAP ECC 6. •EnterpriseScanisforscanninghardcopyinvoices. • ICCisfortheinitialsetofbusinessrulestoallowforproper routing of the invoice. •VIMintegratesintotheSAPtransactionssuchasFB60–Post Vendor Invoice or MIRO – Enter Incoming Invoice usually matched to a Purchase Order.

When you were 2 years old, what did you dream about? Mike Haggar dreamed about racing cars and today, he is living that dream.

From as far back as he can remember Mike Haggar wanted to race cars. When he turned 12, his dad said that if he helped pay for it, they could get a kart. Mike didn’t waste any time finding ways to earn the money. He started mowing lawns and raking leaves for his neighbors to raise money for his first motorized racing machine. He started racing karts at 14, and was a top 50 in the US by the age of 19.

Now, at age 24, he continues that dream and has his NASCAR license, just like Dale Jr., Kyle, Kurt and Jimmie.

On weekends at Elko Speedway in Minnesota, Mike and his dad race in the Big 8 Series reaching amazing speeds of over 110 mph on the tiny 3/8 mile, high banked track.

Who wouldn’t want to drive Mike’s car. It tops out around 180 mph and has a Chevy 358 modified engine that puts out a screaming 500

horses. The Big 8’s are a custom racing frame composed of sheet metal, plastic and fiberglass to keep the weight down. The engine and suspension have major enhancements.

In his 4th year of racing NASCAR, Mike is a top 5 driver at Elko. With the new car, they are continually tweaking the car to get more out of it. He is still looking for his first checkered flag this season, but has finished as high as 2nd and 3rd place in many races.

When Mike isn’t racing, he is an IT Project Manager handling the daily challenges of technology and business processes. Mike say’s “racing helps me stay sane and balanced, while IT helps to pay for the auto bills!”

Titan Consulting is a proud sponsor of Haggar Motorsports and wishes Mike and his dad success in this year’s final races at Elko and LaCrosse, WI.

Check out Mike’s pictures, behind the wheel of his Chevy 358 going 140 mph on the straight with his hair on fire!

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Simple and Easy - Streamline your AP Processes

DO YOU FEEL THE NEED FOR SPEED?MIKE HAGGAR WITH HIS HAIR ON FIRE

An Inconvenient Truth: Migrating to S/4 HANA

VENDOR INVOICE MANAGEMENT (VIM) WITH SAP AND OPEN TEXT

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When planning your migration to S/4 HANA, don’t forget to plan for your custom objects!

SAP provides a couple of paths to S/4 HANA to take advantage of the in-memory technology. The two options are:

1. Apply Service Packs to get to the correct starting point (if you are already not there), upgrade to HANA database, the S/4 code base, and code changes for process and technical changes; 2. Re-implement on S/4 HANA.

The inconvenient truth; depending on the amount of custom development, migrating custom objects (Z or Y fields, tables, programs, and transactions) can be the long pole in the tent. A lot of planning and effort will go into moving your objects to S/4.

In both options above, you need to plan for eliminating, re-developing and/or re-engineering these objects. With the re-architected and simplified data structure, the chances are high that you will have an impact on your custom objects.

What steps must you take to estimate the effort and manage your risk?

For purposes of this article, we focus on option 1. We will assume that if you opted to re-implement, there are major reasons for this decision. Usually, the overall effort and cost of ownership of custom objects is a factor.

In the option 1 approach, SAP provides you with some helpful tools to estimate the technical steps i.e. SAP Software Update Manager (SUM) and Custom Code Analyzer (CCA). SUM is launched to assess the overall readiness of your SAP delivered environment for the upgrade: synchronize by application, Basis, and support packs.

CCA is used to identify the custom objects and assess the level of effort affected by the database and code changes. The output is a list of all custom objects in ECC.

There are practical steps to consider for your custom objects. They are: •Aretheobjectsinusetoday?(weusea 13-month window to account for annual processes) •Dotheysupportyourdesiredbusiness processes? (your justification) • Ifyestotheabove2,dotheyneed re-engineering or re-developing of the code?

Hopefully, you have whittled the list of custom objects down to a more manageable number. Our experience shows that there is a 50/50 split between re-engineering and re-developing the code. This is as much an art as it is a science and varies by customer.

The steps for analyzing the objects include: •RuntheSAPCustomCodeAnalyzer •ComparetheobjectswithSAP’sS/4 HANA Simplification Database to understand where SAP has made changes that affect your code. •ReviewtheCustomCodeMigration Worklist (a part of SAP NetWeaver 7.5) to understand the changes associated with the simplification in HANA. •Plan,prioritizeandestimatetheeffortfor your list of objects.

This approach shines a light on your objects that you have to change to make the move to HANA. This list combined with the appropriate justification and approvals provides the necessary governance and support for your migration of custom objects into S/4 HANA.

Custom objects are an essential component of your business and is not going away with digital transformation, an inconvenient truth - but relevant. Our Advisory Services and On-shore, remote development options provide our customers with the clarity and confidence to pave your roadmap to S/4 HANA.

You surely don’t want to do any more than is necessary to make the migration to S/4. To discuss your migration plans, contact me, Mark Vasinda, mvasinda@titanconsulting.net, 972.977.3100; or your Titan Consulting Director.

An Inconvenient Truth: Migrating to S/4 HANA

MOVING CUSTOM OBJECTS TO S/4 HANA

972.377.35004 |

2016 C A L E N D A R O F E V E N T S

ASUG All Texas Chapter MeetingNovember 11, 2016 Kay Bailey Hutchinson Convention Center Dallas, Texas

SAP TechEd September 19-23, 2016Booth #212 Venetian/Palazzo Congress Center Las Vegas, Nevada

ASUG Houston Chapter MeetingOctober 6, 2016 Chevron Phillips Chemical Co. The Woodlands, Texas

SAPinsight ConferenceNovember 9-11, 2016 Kay Bailey Hutchinson Convention Center Dallas, Texas

Processing invoices through the SAP Invoice Manager with OpenText is straightforward. An invoice is digitized and the meta-data is evaluated according to the business rules.

In our situation, we have basic rules that look at amount, invoice date, PO number, and other information to match the invoice to vendor and PO. When the rules are passed, the data is converted to FB60 or MIRO and posted.

If the invoice match fails, then it is routed for review and troubleshooting.

Our customer’s key metric: 50% no-touch invoices per period.

The business case and justification for centralizing, standardizing and automating is obvious and compelling. Below is a snapshot of our customer’s business case. Assume that it costs $25 to process a vendor invoice. If invoices are processed as no-touch, the processing cost is expected to be cut in half.

Also, for top performers, it takes approximately 3 days to resolve an invoice error. For bottom performers, it takes a full week or more to resolve invoice errors.

They process approximately 15,000 vendor invoices per month. 80% of these invoices require matching to a PO, approximately 12,000 invoices. Prior to our solution, all of these invoices were processed manually: from receipt to error resolution.

Approximately 15% or 1,800 invoices are no-touch invoices in only the first month of production.

Our solution is smart, it can learn from its mistakes. The OCR and business rules can be adjusted to continually increase the number of no-touch invoices.

To increase the number of no-touch invoices, we analyze invoices with the “80/20 rule”. Improvements for vendors with a large volume of invoices, or highest dollar amounts have the largest savings and greatest benefits.

Based on our other projects with similar business processes and solutions, we have achieved as high as 80% no-touch invoices. Not every customer reaches this level.

The short and long-term benefits that our customer is seeing today: •Significantpercentageofinvoicesenteredwithoutmanual handling. •Reducesinvoiceapprovaltimesthroughworkflowtothefield and time spent on errors and exceptions. •Reducesinvoicingentryerrorsandduplicates. • ImprovesAPAnalyticsandTracking. •Reducesinvoiceprocessingtimebyatleast2days. •EnablesAPdepartmenttoscaleupanddownwithworkload. Accounts Payable may seem boring, but centralizing, standardizing, and automating can improve your processes and build your relationships with your partners.

Do you want to know how to reduce your AP processing costs or build your business case? Contact Kent Lamb at 972.377.3525 or kent@titanconsulting.net. You can also contact your Titan Sales Director as well. See additional information on our Advisory Services page at t www.titanconsulting.net.

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Simple and Easy - Streamline your AP Processes