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July 2013 Delivering Real-Time Business Value for Utilities SAP Business Suite Powered by SAP HANA Public

Delivering Real-Time Business Value for Utilities

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This deck is a SoH Executive positioning document in 3 parts for Utilities

Text of Delivering Real-Time Business Value for Utilities

  • July 2013

    Delivering Real-Time Business Value

    for Utilities SAP Business Suite Powered by SAP HANA

    Public

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

    A smart digital utility orchestrates data to provide

    innovative services and business models

    Data orchestration layer

    Smart digital utility Cost, revenue and

    billing tracking

    Customer and user data

    Data storage

    Data collection Data analytics

    Monitoring and tracking

    Asset management

    Market com- munication

    Security

    Dynamic tariff and

    pricing models

    Energy mgmt.

    for infrastructures

    Demand-side I

    ntegration

    Mobile services

    (bill shock)

    Mobility services

    Prosumers and

    virtual power plants

    Capacity mgmt. Grid and

    data services

    Investment

    operations

    and contracting

    Controllable

    local systems

    Enterprise services

    (energy footprint,

    sustainability)

    Trading and port-

    folio services

    Service provider

    Social media

    Energy storage

    services

    Market service layer

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

    Manage the energy revolution in real-time

    Maximize production

    without compromising

    safety or compliance

    Optimize asset performance with streamlined and integrated processes

    Enhance visibility into asset performance to improve maintenance efficiency and proactively

    manage risk and safety

    Optimize your asset

    investments in

    distribution

    Provide deep insight into information across multiple data sources to adopt state-of-the-art

    maintenance strategies that ensure grid reliability

    Support the decision-making of capital planning and central treasury exposure management for

    network expansion

    Deliver greater value in

    supply while consistently

    reducing the cost

    Enable timely and accurate reporting of financial and operational performance

    Enable call centers and online services to deep-dive into high volume data for better customer

    service.

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

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

    Industry value map for utilities

    Customer Experience

    Multichannel Marketing

    Sales and Customer Service for

    Residential Customers

    Sales and Customer Service for

    Commercial and Industrial Customers

    Energy Supply Chain Optimization

    Fuel Supply Chain Management

    Metering Service Parts

    Planning and Logistics

    Energy Portfolio Management

    Operational Efficiency for Plants

    and Grids

    Asset Portfolio and Commissioning

    Asset Visibility and Performance

    Asset Operations and Maintenance

    Operational Risk Management

    Energy Revolution Management

    Smart Meter Data

    Management and Operations

    Demand Side Management

    Energy and Environmental Resource

    Management

    People and

    Talent

    Core Human Resources and

    Payroll Talent Management

    Time and Attendance

    Management

    Workforce Planning and

    Analytics

    Finance Financial Performance

    Management

    Accounting and Financial

    Close

    Treasury and Financial Risk

    Management

    Collaborative Finance

    Operations

    Enterprise Risk and

    Compliance Management

    Procurement Supplier Discovery and

    Lifecycle Management

    Strategic Sourcing and

    Contracting

    Procurement and Order

    Collaboration

    Collaborative Invoice

    to Pay

    IT Management Application Lifecycle

    Management

    IT Infrastructure

    Management

    IT Portfolio and Project

    Management IT Service Management IT Strategy and Governance

    Bill-to-Cash

    Technology

    Solutions

    Analytics Consumer Experience Data Management Enterprise Mobility

    SAP HANA Platform

    Application Development

    and Integration

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

    Industry value map for utilities Real-time value for key end-to-end processes

    Customer Experience

    Multichannel Marketing

    Sales and Customer Service for

    Residential Customers

    Sales and Customer Service for

    Commercial and Industrial Customers

    Energy Supply Chain Optimization

    Fuel Supply Chain Management

    Metering Service Parts

    Planning and Logistics

    Energy Portfolio Management

    Operational Efficiency for Plants

    and Grids

    Asset Portfolio and Commissioning

    Asset Visibility and Performance

    Asset Operations and Maintenance

    Operational Risk Management

    Energy Revolution Management

    Smart Meter Data

    Management and Operations

    Demand Side Management

    Energy and Environmental Resource

    Management

    People and

    Talent

    Core Human Resources and

    Payroll Talent Management

    Time and Attendance

    Management

    Workforce Planning and

    Analytics

    Finance Financial Performance

    Management

    Accounting and Financial

    Close

    Treasury and Financial Risk

    Management

    Collaborative Finance

    Operations

    Enterprise Risk and

    Compliance Management

    Procurement Supplier Discovery and

    Lifecycle Management

    Strategic Sourcing and

    Contracting

    Procurement and Order

    Collaboration

    Collaborative Invoice

    to Pay

    IT Management Application Lifecycle

    Management

    IT Infrastructure

    Management

    IT Portfolio and Project

    Management IT Service Management IT Strategy and Governance

    Bill-to-Cash

    Technology

    Solutions

    Analytics Consumer Experience Data Management Enterprise Mobility

    SAP HANA Platform

    Application Development

    and Integration

    Highest real-time

    business value

    for utilities

    2

    4

    1

    5

    6

    3

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

    Customer Cases

    Japanese

    technology firm

    SAP HANA products and SAP Business Suite on SAP HANA

    Automated reporting Inventory optimization Predictive analytics Inventory visibility

    European

    technology firm

    SAP Business Suite on SAP HANA Real-time inventory Real-time material planning Marketing and sales Fast financial close

    Leading U.S.

    technology firm

    SAP HANA Platform and SAP Business Suite on SAP HANA

    Variable margin analysis Customer service excellence Opportunity order analysis Predictive analytics Supplier network traceability Predictive scoring

    $25 million

    benefit over

    five years

    Annual

    benefit

    85 million

    Five-year net

    value

    $152 million

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

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

    Thank you

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

    Appendix with detailed customer cases

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

    Customer case: utilities provider in Russia Summary validated scenarios

    Feasibility

    Bu

    sin

    ess v

    alu

    e

    Legend

    Lo

    w

    Hig

    h

    Low High

    HR reporting on

    SAP HANA

    (150k)

    Annual revenue: 2 billion

    Financial reporting

    on SAP HANA

    (250k)

    SAP Business

    Suite on

    SAP HANA

    SAP HANA

    products

    SAP HANA

    Platform

    Phase deployment road map

    1 Phase 1

    HR reporting on SAP HANA

    (Increase business user productivity)

    Financial reporting on SAP HANA

    (Increase business user productivity)

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

  • 2013 SAP AG or an SAP affiliate company. All rights reserved. 13 Public

    Customer case: utilities provider in Russia SAP HANA Platform

    400

    0

    50

    100

    150

    200

    250

    300

    350

    400

    450

    2013 Phase 1

    Costs SoH Applications Platform

    Anything built on the platform that is customer specific - new business processes and business models

    SAP NetWeaver BW on SAP HANA, high performance apps (HPAs), apps powered by SAP HANA mapped to IVM E2E solutions

    Currently available functionalities (SP0, 1, 2); 23 scenarios mapped to IVM E2E solutions; and planned functionalities (All of

    the end-to-end solutions on the industry value map are in scope.)

    SAP HANA Platform

    SAP HANA products

    SAP Business Suite on SAP HANA

    SoH = SAP Business Suite on SAP HANA

    Annual benefits, SAP HANA

    Platform

    Annual benefits, applications

    powered by SAP HANA: 400k

    Annual benefits, SAP Business

    Suite on SAP HANA

    Estimated deployment costs

    Total transition cost

    Based on actual SAP

    customer engagements

  • 2013 SAP AG or an SAP affiliate company. All rights reserved. 14 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.

    Financial reporting on SAP HANA Utilities

    Business context and goals

    This large utility provides heat and hot water in Moscow and the Moscow region.

    Business challenges

    Existing environment requires effort to collect accounts receivable (AR). There is a need to optimize the process and make it more transparent and fast.

    Process innovations

    Centralized reporting on SAP NetWeaver Business Warehouse with a drill-down to specific accounts

    Contribution of SAP HANA

    Meets requirements for performance and large volume of data

    Value drivers/KPIs

    Business user productivity

    Innovation scope

    SAP Business Suite on SAP HANA (now and

    future)

    E2E solution

    Utilities financial performance management

    Value potential 2

    Feasibility 3

    Low High

    1 5

    Low High

    1 5

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

    HR reporting on SAP HANA Utilities

    Business context and goals

    This large utility provides heat and hot water in Moscow and the Moscow region.

    Business challenges

    Current reporting time for payroll and employee statistics (more than 20,000 employees) is slow, which impacts the productivity of HR function

    Process innovations

    Centralized payroll processing for 20,000 employees based on SAP HANA technology faster, cuts down on errors, and requires fewer calculating resources

    Contribution of SAP HANA

    Meets requirements to performance and large volume of data

    Value drivers/KPIs

    Business user productivity

    Innovation scope

    SAP Business Suite on SAP HANA (now and

    future)

    E2E solution

    Utilities core human resources and payroll

    Value potential 2

    Feasibility 3

    Low High

    1 5

    Low High

    1 5

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

    Reference utilities customer Summary validated scenarios (combined findings)

    Feasibility

    Bu

    sin

    ess v

    alu

    e

    Me

    d

    Hig

    h

    Med High

    HR

    reporting

    on SAP HANA

    Sales and

    operational

    analytics on SAP

    NetWeaver BW on

    SAP HANA

    Predictive

    maintenance

    Financial analytics

    on SAP NetWeaver

    BW on SAP HANA

    Finance

    reporting

    on SAP HANA

    Phase deployment road map

    1 Short term

    EAM: Predictive maintenance: Predictive

    maintenance for assets and facilities reduces

    downtime and parts inventories while increasing

    asset utilization.

    CRM: Sales and operational analytics: Sell what is

    available, merging information from multiple

    LOBs in one real-time dashboard.

    EPM: Financial analytics: Get real-time visibility into

    profitability by segment and individual customer.

    2 Medium term

    FIN: Finance reporting: Existing environment

    requires big efforts to collect AR data. There is a

    need to optimize the process and make it more

    transparent and fast.

    HCM: HR reporting: Current reporting time for payroll

    and employee statistics (more than 20,000

    employees) is slow, which impacts the

    productivity of the HR function.

    SAP HANA Platform: customer specific SAP HANA products: SAP NetWeaver on SAP HANA , HPAs, apps powered by SAP HANA SAP Business Suite on SAP HANA

    SAP HANA

    use case

    Legend

    SAP Business

    Suite on

    SAP HANA

    SAP HANA

    products

    SAP HANA

    Platform

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

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

    SAP Business Suite powered by SAP HANA Business value for each end-to-end process/implementable step

    Line of business End-to-end process/implementable step

    Finance

    Financial performance management

    Planning, budgeting, and forecasting

    Profitability and cost analysis

    Financial and managerial reporting

    Accounting and financial close

    Accounting and entity close

    Collaborative financial operations

    Receivables management

    Payables management

    Shared service framework

    Enterprise risk and compliance

    Access control role analytics

    Human resources

    Core HR and payroll

    Payroll processing

    Effective shared services delivery

    Time and attendance management

    Time and absence calculation

    Workforce planning and analytics

    Transactional analytics

    Procurement Operational procurement

    Manufacturing

    Production Planning

    Material requirement planning

    Efficient manufacturing operations

    Global plant performance management

    Research and development and engineering

    Enterprise portfolio and project management

    Portfolio management (portfolio and project management)

    Project management (portfolio and project management)

    Project management (project system)

    Supply chain Demand driven supply chain Supply chain monitoring Warehouse management

    Sales, service, marketing

    Marketing

    Definition and execution of sales strategy, collaborative order to cash, collaborative sales force automation

    Sales planning and monitoring (CRM), collaborative pipeline management, customer engagement intelligence, audience discovery and targeting

    Sales

    Multichannel marketing management, marketing operations, marketing demand management

    Audience discovery and targeting, customer insight and segmentation, campaign management, marketing analytics and performance management

    Service

    Multichannel customer service

    Contact management with interaction center

    Service

    Asset operations and maintenance

    Asset planning and scheduling

    Asset management Asset operations and maintenance

    Asset planning and scheduling

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

    Today

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

    Asset operations and maintenance Asset planning and scheduling

    Maintenance scheduling consumes a great deal of time

    High amount of master data influences performance of data

    maintenance

    Manual and error-prone process of preselection of maintenance plans

    Potential to miss necessary objects for maintenance calls

    High number of maintenance plans that need to be scheduled frequently

    leads to a weekly scheduling scheme

    Accelerated mass transactions

    Instant analysis on top of transactions

    Preselection of due plans, speeding up the process significantly

    Real-time analytics on all data, including machine sensor information

    Scheduling of all maintenance plans within a specific timeframe

    Planning several times a day (instead of once a week) results in

    up-to-date scheduling information in

    maintenance operations

    Faster response times leads to more accurate maintenance scheduling

    Increase asset utilization

    and reduce

    unplanned asset

    downtime

    Maximize

    Gain

    asset uptime

    up-to-date

    scheduling

    information on

    maintenance

    operations

    With SAP Business Suite on

    SAP HANA

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

    Today

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

    Asset portfolio and commissioning (1/2) Business value for portfolio management (SAP Portfolio and Project

    Management)

    Fact-based go/no-go decisions require real-time information on the status of

    the running projects and the project

    proposals. Analysis for large portfolios

    in the portfolio dashboards is time

    consuming, leading to lack of

    transparency.

    Faster access to decision-making information such as status, timeline,

    and financials in dashboards

    Accelerated comparison of running projects and proposals in the

    dashboards

    Increase transparency for

    decision-making

    Improve speed of

    aggregating

    financial

    information

    Aggregation of financials, such as actual or planned cost commitments

    along the investment hierarchy, takes

    a long time for large portfolios.

    Outdated information on the

    investment increases review efforts.

    Manual editing of standard financial KPIs such as net present value and

    internal rate of return adds additional

    tools and manual effort for portfolio

    managers

    Speeding up of aggregation of financials along the investment area

    hierarchy

    Calculation of most important KPIs based on values from financial

    planning, removing manual calculation

    With SAP Portfolio and Project

    Management on SAP HANA

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

    Today

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

    Asset portfolio and commissioning (2/2) Business value for project management (SAP Portfolio and Project

    Management)

    Project members experience long waiting times when starting the

    project and task dashboards. This

    reduces user productivity when

    working on several projects and on

    tasks across projects.

    Updates on multiple tasks are inefficient and time consuming as

    project team members confirm tasks

    one-by-one to reduce waiting times

    Searching for documents across projects takes a very long time for

    large project portfolios

    The process of finding projects, tasks, and phases by responsible

    project member is slow

    Faster access to tasks and projects

    Accelerated access to project, task, and checklist items dashboards

    Ability of project team members to confirm times, status, and dates and

    to attach documents for several tasks

    at once

    Increased user productivity

    Accelerated search for documents

    Ability to quickly find projects or tasks by responsible project member

    Increase user productivity

    Reduce

    Improve

    time for task

    confirmation

    Search for

    documents and

    project elements

    With SAP Portfolio and Project

    Management on SAP HANA

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

    Today

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

    Procurement and order collaboration Business value for operational procurement

    Missing real-time insight into operational procurement reporting

    Inability to dynamically create operational procurement-related

    reporting in a modern user interface

    Slow and costly paper-based processes

    High transaction costs

    Long running transactions while posting documents with high volume

    of line items

    Frequent errors, yielding to maverick spend

    New configuration options for procurement analysis

    Modern and easy-to-consume user interface

    Complete visibility into end-to-end procurement activities

    Real-time insight and easy-to- manipulate information

    Accelerated long-lasting processing of purchasing documents

    Increase transparency

    Lower

    Increase

    procurement

    operations cost

    process

    effectiveness

    With SAP Business Suite on

    SAP HANA

  • 2013 SAP AG or an SAP affiliate company. All rights reserved. 22 Public

    Today

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

    Asset visibility and performance Business value for material requirements planning (MRP)

    Decisions often based on periodic MRP runs and outdated information;

    process done in batches

    Inability to replan quickly if conditions change due to long run times.

    Prediction of inventory coverage for

    critical parts is difficult.

    Inability to replan if conditions change during the planning horizon due to

    long run-times

    Faster replanning allowing more frequent MRP runs in shorter cycles

    Instant reaction to demand changes and updates to the supplier

    Demand information propagated faster through the supply chain

    A new interactive work distribution dashboard provides supervisors with

    actionable insights into the workload

    of their teams and employees

    Better synchronized material demand and supply planning with reduced

    bullwhip effect

    Reduce out of stocks by

    36%

    Decrease

    Limit

    inventory and

    safety stocks by

    29%

    bullwhip effect

    With SAP Business Suite on

    SAP HANA

  • 2013 SAP AG or an SAP affiliate company. All rights reserved. 23 Public

    Today

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

    Sales and customer service for residential customers Business value for contact management with interaction center

    To successfully resolve customer issues, companies need to be able to

    quickly locate the right experts or

    resources within the organization,

    whether those experts work inside

    the contact center or elsewhere

    Managers and supervisors lack actionable reporting and visibility into

    the workload of their teams

    High volume of customer records and interactions results in increased

    search times and greater difficulty

    locating specific customer records

    With the new SAP HANA-based agent inbox, users can more easily search for relevant experts whether in their own team or elsewhere in the organization in order to dispatch/escalate issues to the most suitable employee roles

    A new interactive work distribution dashboard provides supervisors with

    actionable insights into the workload

    of their teams and employees

    Searches in the interaction center, including account searches,

    interaction history, and the customer

    fact sheet, are significantly faster

    Decrease average handling

    time

    Improve

    Reduce

    service-level

    agreement

    compliance

    service cost

    With SAP Business Suite on

    SAP HANA

  • 2013 SAP AG or an SAP affiliate company. All rights reserved. 24 Public

    Today

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

    Financial performance management (1/3) Business value for planning, budgeting, and forecasting

    Planning performance limited to OLAP, staged cubes for transactional

    and master data

    Data load performance is driven by the amount of data extracted from

    SAP Business Suite

    Reporting, loading, and retraction performance limits planning iterations

    Drilldown within OLAP cube, and drill-through to SAP Business Suite

    and OLTP data within standard times

    Seamless replication of master and transactional data from SAP

    Business Suite

    Availability of more granular data to support planning

    Big Data challenge is negated, and allows for faster extract and DSO

    activation times

    Iterative planning and real-time simulation are supported through

    improved performance

    Improved performance for drilldown (expand) and consolidation (collapse)

    Fast drill-through and live view of transactional data in SAP Business

    Suite

    Improve service level

    performance

    Reduce

    Minimize

    cycle times and

    manual effort

    operating costs

    With SAP Business Suite on

    SAP HANA

  • 2013 SAP AG or an SAP affiliate company. All rights reserved. 25 Public

    Today

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

    Financial performance management (2/3) Business value for profitability and cost analysis

    Data latencies and processes delays impact the ability to react to issues

    and opportunities

    Lack of data depth and user self-service affect internal decision

    making

    Long-running processes

    Time-intensive data queries

    Mostly manual data analysis

    Substantial amount of time and effort on processes that do not directly add

    value

    Suboptimal resource efficiency and effectiveness

    Timely execution of critical business processes supports decision making

    and increases the ability to act swiftly

    (insight-to-action) in dynamic market

    environments

    Critical transactions and calculations run quickly

    Response times on queries are instant

    Prebuilt analytics automate the data analysis process

    Leaner processes from data capture through data analysis

    Increased productivity through process-optimized analytics and

    mobile support

    Improve service level

    performance

    Reduce

    Minimize

    cycle times and

    manual effort

    operating costs

    With SAP Business Suite on

    SAP HANA

  • 2013 SAP AG or an SAP affiliate company. All rights reserved. 26 Public

    Today

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

    Financial performance management (3/3) Business value for financial and managerial reporting

    Risk of noncompliance due to unfulfilled (overruns in) audits

    A lot of data; decision-relevant information not readily available

    Data analysis not supported or automated

    Long-running batch jobs/reports

    Time-intensive data analysis

    Large number of time-consuming, and non-value-added processes

    required to access and provide

    accurate, up-to-date information

    Timely execution of compliance-relevant validation tasks

    Increased end-user satisfaction (accurate, detailed, visualized, timely,

    and actionable information)

    Acceleration of key critical-path processes and reports

    Instant response time on most data analysis queries

    Elimination of workarounds and data latencies

    End-user data analysis through self-service means

    Improve service level

    performance

    Reduce

    Minimize

    month-end

    closing time

    operating costs

    With SAP Business Suite on

    SAP HANA