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July 2013 Delivering Real-Time Business Value for Cargo Transportation and Logistics SAP Business Suite Powered by SAP HANA Public

Delivering Real-Time Business Value for Cargo Transportation and Logistics

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Page 1: Delivering Real-Time Business Value for Cargo Transportation and Logistics

July 2013

Delivering Real-Time Business Value

for Cargo Transportation and Logistics SAP Business Suite Powered by SAP HANA

Public

Page 2: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 2 Public

The real-time opportunity

Transportation and logistics service providers live

in an incredibly dynamic world of evolving markets,

shifting customer demands, and rising competition.

Companies need to continuously innovate ways to

align business operations with customer needs.

Differentiate through profitable services that excite customers

Run flexible, efficient, and cost effective business processes

Respond rapidly to evolving trends and demands

Page 3: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 3 Public

Drive profitable growth

through differentiated

offerings

Predict trends and evolving customer needs

Gain customer intimacy in marketing, sales,

and service

Tailor services to the needs of target segments

Manage costs with

end-to-end process

support

Realize cost savings through better

management of resources (assets, people,

fuel)

Embed decision support throughout business

processes

Transform from reactive into proactive

execution mode

Respond to market

dynamics in real time

Conduct ad hoc, what-if, and root-cause

analysis based on reliable and real-time data

Empower employees to make informed

decisions

Provide flexible self-service reporting

functionalities

Becoming an innovation-driven enterprise Align business operations with customer needs

Page 4: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 4 Public

SAP Business Suite powered by SAP HANA The next-generation business platform

Real-time business

In-memory

Business

transactions

Digital

connections

Collaborative

business

Cloud Social

Big Data Mobile

One platform bringing it all together

Advanced

analytics

Page 5: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 5 Public

Industry value map for cargo transportation

and logistics Cargo – information and the path to growth

Technology Solutions

Analytics Data Management Consumer Experience

SAP HANA Platform

Asset Management

Transportation Assets Management

Infrastructure Assets / Linear Asset Management

Operations

Warehouse Management

Transportation Management and Operations

Fuel Management

People and Talent

Core Human Resources and

Payroll Talent Management

Workforce Planning and Analytics

Finance Financial

Performance Management

Accounting and Financial Close

Collaborative Finance Operations

Enterprise Risk and Compliance

Management

Procurement Supplier Discovery

and Lifecycle Management

Strategic Sourcing and Contracting

Collaborative Invoice to Pay

IT Management Application Lifecycle

Management

IT Infrastructure Management

IT Service Management

IT Strategy and Governance

Enterprise Mobility Application Develop-ment and Integration

Time and Attendance

Management

Treasury and Financial Risk Management

Procurement and Order Collaboration

IT Portfolio and Project Management

Sales and Marketing/Customer Service

Marketing Management

Key Account and Territory Management

Quotes and Contract Management

Sales Force Support

Customer Service

Real Estate Lifecycle Management

Page 6: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 6 Public

Industry value map for cargo transportation

and logistics Cargo – information and the path to growth

Technology Solutions

Analytics Data Management Consumer Experience

SAP HANA Platform

Asset Management

Transportation Assets Management

Infrastructure Assets / Linear Asset Management

Operations

Warehouse Management

Transportation Management and Operations

Fuel Management

People and Talent

Core Human Resources and

Payroll Talent Management

Workforce Planning and Analytics

Finance Financial

Performance Management

Accounting and Financial Close

Collaborative Finance Operations

Enterprise Risk and Compliance

Management

Procurement Supplier Discovery

and Lifecycle Management

Strategic Sourcing and Contracting

Collaborative Invoice to Pay

IT Management Application Lifecycle

Management

IT Infrastructure Management

IT Service Management

IT Strategy and Governance

Enterprise Mobility Application Develop-ment and Integration

Time and Attendance

Management

Treasury and Financial Risk Management

Procurement and Order Collaboration

IT Portfolio and Project Management

Sales and Marketing/Customer Service

Marketing Management

Key Account and Territory Management

Quotes and Contract Management

Sales Force Support

Customer Service

Real Estate Lifecycle Management

1

2

3 4 5

Highest real-time business

value for transportation

and logistics

Page 7: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 7 Public

Today

KPI improvements are high-level estimates and will have to be validated for each customer situation.

Transportation management and operations Business value for transportation management

Huge order volumes with limited

ability to analyze and react to

changes and exceptions

High manual effort to manage orders,

documents, and so on

Suboptimal asset utilization driving

higher costs and lower service

Hard to handle sheer volume of data

from assets (for example, containers)

Limited ability to track status and

lifecycle of customer orders

Limited visibility into total customer

engagement, own performance, and

economic impact

Running a global no-latency order

platform enabling better-informed

decisions, exception monitoring, and

alerting to meet customer demands

with accurate information

Up-to-date information on availability

and real-time tracking of assets,

leading to higher reliability

Management, planning, and

optimization of huge volumes of

asset data

Control over transportation in real

time to decrease costs while

maximizing available resources

Real-time analysis of customers,

orders, value-added services, and

overall operational performance

Perfect order taking and

fulfillment

Heighten

Understand

asset utilization

order flow, customer

preferences, and

financial impact

With SAP Business Suite on SAP HANA

Page 8: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 8 Public

Today

KPI improvements are high-level estimates and will have to be validated for each customer situation.

Customer service Business value for multichannel customer service

High volume of customer records

and interactions resulting in

increased search times when

handling customer inquiries

No single platform for monitoring,

notification, adjustments, and

analysis of all business events in

real time

Limited ability to successfully resolve

customer issues as companies are

unable to quickly analyze and

resolve root causes of problems

Quickly identify customers and get

a complete 360-degree view of

customer orders and related

documents in real time

Provide self-service reporting

functionality to customers

Proactive customer reporting on

order, billing, and performance

Spotting of potential problems in real

time, allowing mitigating actions to

reduce late or incomplete orders

Operational tracking and advanced

real-time analytics as a basis for

more effective collaboration with

business partners in order to

mitigate risks

Transform from service desk

dependency to

provisioning self-

service

Improve

Gain insight

service quality

through end-to-end

view

into customer

preferences in order

to provide targeted

offers

With SAP Business Suite on SAP HANA

Page 9: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 9 Public

Today

KPI improvements are high-level estimates and will have to be validated for each customer situation.

Financial performance management Business value for financial performance management

Inability to adapt (plan, replan,

monitor, and control) the business

model, operations, and services in

volatile market environments

Need to quickly adapt finance and

business operations

Long performance management

cycles with complex consolidation

landscapes

Reporting, loading, and retraction

performance limits planning

iterations

Inefficiencies due to disruptions

between planning and execution

Drilldown limited to within OLAP

environment, no drill-through to

transactional data

Leveraging of more granular data to

gain full transparency and as a basis

for planning

Ad hoc analytics, iterative planning,

and real-time simulation supported

through real-time platform

No latency in heterogeneous

consolidation landscapes through

quasi-instant response times

(even with large number of complex

calculations)

Improved performance for drilldown

(expand) and consolidation (collapse)

Fast drill-through to lowest level view

of transactional data in SAP Business

Suite

financial

transparency

and forecasting

cycle times and

manual effort

financial costs

With SAP Business Suite on SAP HANA

Improve

Reduce

Minimize

Page 10: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 10 Public

Today

KPI improvements are high-level estimates and will have to be validated for each customer situation.

Accounting and financial close Business value for accounting and financial close

High number of systems and people

requiring many handovers and

reconciliations hinders a transparent

central financial close

Inefficiencies due to manual

processes and low automation

Missing financial excellence that

results in higher cost of equity

at the capital markets

Lack of governance – issues in ensuring a sound end-to-end closing process and effectiveness of internal controls

Difficult to comply to parallel financial reporting standards and simulate scenarios

More time for analysis, less overtime,

and earlier publishing of financial

results through faster period-end

processes and better reconciliations

Single repository for company and

corporate data

Increased efficiency through smarter

reconciliations and reporting,

reducing operating costs and

improving stakeholder satisfaction

Deeper and faster insight down to the

lowest level of detail – delivering

quality at the source, transparency,

and process efficiencies

Improve insights into financial

performance

Minimize closing costs

With SAP Business Suite on SAP HANA

Reduce month-end closing

time

Page 11: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 11 Public

Today

KPI improvements are high-level estimates and will have to be validated for each customer situation.

Collaborative financial operations Business value for receivables management

Challenges to assign revenues and

allocate costs to service

products/cost drivers correctly due to

volume and complexity; inability to

process data on detailed/line-item

level

Limitations in analysis capabilities

and dimensions because of reliance

on finance aggregates

Large data volumes that lead to

batch processing and reporting

latency

Difficulty in identifying exceptions in

thousands of pages of reports

Empowered business users with

rapid access to trusted, detailed data

and new insight to optimize decision

making

Ad hoc data queries and drill-downs

to isolate variances

More accurate document-level

calculation of, for example, DSO that

allows you to identify root causes of

changes to DSO

Real-time reporting on all accounts

receivable data including credit,

collections, and disputes

Anywhere, anytime access to key

receivables status

Optimize profit/loss distribution

across network

Improve

Increase

billing and revenue

management

cash collections and

accelerate dispute

resolution

With SAP Business Suite on SAP HANA

Page 12: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 12 Public

Next step Business scenario recommendation and value discovery workshop

SAP offers a proven methodology and approach to

discover the customer-specific business

improvement areas and quantify value potential.

We suggest such a workshop with your

line-of-business and IT experts.

As starting point, we recommend a performance

and usage analysis of your current system.

Page 13: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved.

Thank you

Contact information:

Franz Uhr

Solution Manager

Dietmar-Hopp Allee 16, 69190 Walldorf

Tel. +49 6227764438

Page 14: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved.

Appendix with detailed customer cases

Page 15: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 15 Public

Container transportation/transportation and logistics Summary validated scenarios

Feasibility

Bu

sin

ess v

alu

e

Lo

w

Hig

h

Low High

Order settlement reporting

(US$2.6 million)

Incremental revenue from higher

utilization of assets (US$1.7 million)

Reduce costs of budgeting and

forecasting (US$2.4 million)

Reduce costs of allocations

(US$0.3 million)

Reduce time spend to create reports (US$0.8 million)

Reduce preparation time spend to close

the books (US$1.0 million)

Legend

SAP Business

Suite on

SAP HANA

SAP HANA

applications

SAP HANA

Platform

Phase - deployment road map

Annual revenue: US$10 billion

SAP HANA Platform: customer-specific SAP HANA products: SAP NetWeaver BW on SAP HANA, high-performance applications (HPAs), apps powered by SAP HANA SAP Business Suite on SAP HANA

Scenario

(business value)

1 Short term

Reduce costs of budgeting and forecasting:

Higher planning and forecasting efficiency

Incremental revenue from higher utilization of

assets: Increased profitability

Reduce preparation time spend to close the

books: Accelerated financial closing

Increased margin per deal by analyzing service

income statements per deal: Increased

profitability

Reduce time spend to create reports: Reduced

manual reporting effort

Reduce costs of allocations: Reduced manual

effort

2 Medium term

Order settlement reporting

3 In evaluation

Other functions – To be discussed in future

discovery workshops

Increased margin per deal by analyzing service income

statements per deal (€1.7 million)

SAP HANA use cases mapped to industry value map end-to-end solutions

Page 16: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 16 Public

Container transportation/transportation and logistics SAP HANA Platform

Results over five years – SAP Business

Suite on SAP HANA only

Surplus US$7.2 million

ROI 260%*

Pay back period <12 months*

-3.800 -400

8.400

11.000

-4.000

-2.000

0

2.000

4.000

6.000

8.000

10.000

12.000

2013 Phase 1 Phase 2

Costs SoH Applications Platform

US$’000

* to be validated

Based on actual SAP

customer engagements

SAP HANA Platform: Anything built on the platform that is customer-specific – new business processes and business models

SAP HANA products: SAP NetWeaver BW powered by SAP HANA; high-performance apps (HPAs); applications – mapped to

inventory value map (IVM) end-to-end (E2E) solutions

Currently available functionality (SP0, 1, 2) – 23 scenarios mapped to IVM E2E solutions, and planned functionality (all of the

E2E solutions on the IVM are in scope)

SAP HANA Platform

SAP HANA products

SAP Business Suite on SAP HANA

Annual benefits, SAP HANA

Platform

Annual benefits, applications

powered by SAP HANA: US$11

million

Annual benefits, SAP Business

Suite on SAP HANA

Estimated deployment costs

Total transition cost: US$3.8 million

SoH = SAP Business Suite on SAP HANA

Page 17: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 17 Public

Note: Use cases in the global use case repository are captured directly from customers and internal SAP innovation

sessions and may not be completely validated.

Container transportation − close books more efficiently Cargo transportation and logistics

Innovation scope

SAP HANA products (HPAs, apps)

End-to-end (E2E) solution

Cargo transportation and logistics –

financial performance management

Value potential 3

Feasibility 4

Low High

1 5

Low High

1 5

Business context and goals

Accelerated financial closing

Business challenges

Customer spends a lot of time preparing for the closing of 19,000 cost centers, 1,200 account

codes, 3 business units, 11 lines of business, and 7 regions. The 300 users of SAP Business

Planning and Consolidation extract data and make adjustments to data manually.

Process innovations

Higher productivity of employees, less rework, and reduced cycle times

Contribution of SAP HANA

With SAP HANA, data loading from SAP ERP can happen more frequently and adjustment

values are reflected for financial reconciliation and verification in shorter time frames

Value drivers/KPIs

Productivity

Page 18: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 18 Public

Note: Use cases in the global use case repository are captured directly from customers and internal SAP innovation

sessions and may not be completely validated.

Container transportation − improve asset utilization Cargo transportation and logistics

Innovation scope

SAP HANA products (HPAs, apps)

End-to-end (E2E) solution

Cargo transportation and logistics –

financial performance management

Value potential 4

Feasibility 2

Low High

1 5

Low High

1 5

Business context and goals

Increased profitability

Business challenges

Finance users are largely reactive to business demands. Utilization of assets such as ports,

vessels, containers, and trucks can be improved.

Process innovations

By enabling faster insight into the business financial performance, finance users become

strategic business partners of the organization

Contribution of SAP HANA

SAP HANA will drastically reduce reporting times. That will allow users of SAP Business

Planning and Consolidation to run 2x to 3x more simulations then before. This will generate

better insight and higher forecast accuracy, and thus decision making about how to utilize assets

such as ports, vessels, containers, and trucks in a better way.

Value drivers/KPIs

Asset utilization

Page 19: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 19 Public

Note: Use cases in the global use case repository are captured directly from customers and internal SAP innovation

sessions and may not be completely validated.

Container transportation − improve budgeting and

forecasting productivity Cargo transportation and logistics

Innovation scope

SAP HANA products (HPAs, apps)

End-to-end (E2E) solution

Cargo transportation and logistics –

financial performance management

Value potential 5

Feasibility 4

Low High

1 5

Low High

1 5

Business context and goals

Improved planning and forecasting efficiency

Business challenges

Customer currently conducts three to four outlooks a year for board meetings, and seven to eight

forecasts for senior management. Part of the planning and forecasting cycle based on 19,000

cost centers involves manual effort.

Process innovations

Enhance productivity of 300 users of SAP Business Planning and Consolidation

Contribution of SAP HANA

SAP HANA will speed up the cycles

Value drivers/KPIs

Productivity

Page 20: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 20 Public

Note: Use cases in the global use case repository are captured directly from customers and internal SAP innovation

sessions and may not be completely validated.

Container transportation − increase margin per deal Cargo transportation and logistics

Innovation scope

SAP HANA products (HPAs, apps)

End-to-end (E2E) solution

Cargo transportation and logistics –

financial performance management

Value potential 4

Feasibility 3

Low High

1 5

Low High

1 5

Business context and goals

Increased profitability

Business challenges

90% of customer’s business is liner business, entailing trade routes with many services offered.

Customer is only able to produce P&L statements by trade lanes, and is not able to identify which

services within trade lanes are profitable.

Process innovations

Finance users can flag if service line items in deals are not profitable

Contribution of SAP HANA

Enables more granular insight into the business financial performance

Value drivers/KPIs

Margin

Page 21: Delivering Real-Time Business Value for Cargo Transportation and Logistics

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 21 Public

Note: Use cases in the global use case repository are captured directly from customers and internal SAP innovation

sessions and may not be completely validated.

European railway − order settlement reporting Cargo transportation and logistics

Innovation scope

SAP HANA products (HPAs, apps)

End-to-end (E2E) solution

Cargo transportation and logistics - accounting

and financial close

Value potential 3

Feasibility 4

Low High

1 5

Low High

1 5

Business context and goals

Order settlement reporting allows the company to allocate internal costs of services, and to

monitor and control them

Business challenges

Response times of data retrieval (for example, cost center reporting) do not meet end-user

requirements

Process innovations

Fast response times of data requests provide the decision makers with real-time data insights

with drill-down capabilities on any granularity

Contribution of SAP HANA

Single platform for order settlement data, synchronized with source systems in real time;

provision of line item reporting for settlement orders; user centric and flexible ad hoc analysis

Value drivers/KPIs

Reduced TCO; process cost reduction through transparent cost analysis