Delivering Real-Time Business Value for Aerospace and Defense SAP Business Suite Powered by SAP HANA

Transcription

1 Delivering Real-Time Business Value for Aerospace and Defense SAP Business Suite Powered by SAP HANA July 2013 Public

2 The real-time opportunity Globalization, worldwide market volatility, and shrinking defense budgets are forcing aerospace and defense (A&D) companies to adapt quickly and streamline operations while continuing to innovate. Increase market capture and create next-generation solutions Execute complex programs on time and within budget Develop a responsive supply network, reducing cost and risk 2

3 Becoming an innovation-driven enterprise Align business operations with customer needs Manage complex customer programs Monitor and analyze high volumes of financial and operational data for faster and accurate project progress and status Increase process efficiency in project management and operations Reduce cost of finance and compliance reporting for big programs Design, build, and service complex products Support lean initiatives and increase manufacturing efficiency Increase aftermarket profitability with real-time monitoring of service operations and full customer insight Plan, simulate, and run bigger projects in engineering and manufacturing Orchestrate responsive supply networks Sync demand and supply in real time, adapt faster to disruptions, model alternative scenarios Gain deep supplier integration for real-time collaboration Get instant insight into supply chain risk and performance 3

4 SAP Business Suite powered by SAP HANA The next-generation business platform Real-time business Collaborative business Digital connections Mobile In-memory Big Data Social Business transactions Advanced analytics Cloud One platform bringing it all together 4

5 Industry value map for aerospace and defense Enabling the innovation-driven enterprise Managing Complex Customer Programs Designing and Building Complex Products Responsive Supply Network Aftermarket Services Collaborative Sales Force Automation Product Development and Compliance Collaborative Supply Planning MRO Services and Lifecycle Support Government Contracting Embedded Systems Technology Supply Chain Execution Service Parts Program Project Manufacturing for Complex Assembly Supply Chain Analytics Equipment Visibility and Performance Plant Operations and Maintenance People and Talent Core Human Resources and Payroll Talent Time and Attendance Workforce Planning and Analytics Finance Financial Performance Accounting and Financial Close Treasury and Financial Risk Collaborative Finance Operations Enterprise Risk and Compliance Procurement Supplier Discovery and Lifecycle Strategic Sourcing and Contracting Procurement and Order Collaboration Collaborative Invoice to Pay Commodity IT Application Lifecycle IT Infrastructure IT Portfolio and Project IT Service IT Strategy and Governance Technology Solutions 3D Business Visualization Analytics Data SAP HANA Platform Application Development and Integration Enterprise Mobility Consumer Experience 5

6 Industry value map for aerospace and defense Real-time value for key end-to-end processes Highest real-time business value for A&D Managing Complex Customer Programs Collaborative Sales Force Automation Designing and Building Complex Products Product Development and Compliance 3 Responsive Supply Network Collaborative Supply Planning Aftermarket Services MRO Services and Lifecycle Support Government Contracting Embedded Systems Technology Project Manufacturing for Program Complex Assembly Supply Chain Execution Supply Chain Analytics Service Parts Equipment Visibility and Performance Plant Operations and Maintenance People and Talent Core Human Resources and Payroll Talent Time and Attendance Workforce Planning and Analytics Finance 5 6 Financial Performance Accounting and Financial Close Treasury and Financial Risk Collaborative Finance Operations Enterprise Risk and Compliance Procurement Supplier Discovery and Lifecycle Strategic Sourcing and Contracting Procurement and Order Collaboration Collaborative Invoice to Pay Commodity IT Application Lifecycle IT Infrastructure IT Portfolio and Project IT Service IT Strategy and Governance Technology Solutions 3D Business Visualization Analytics Data SAP HANA Platform Application Development and Integration Enterprise Mobility Consumer Experience 6

7 Program management Business value for portfolio management (SAP Portfolio and Project ) Increase transparency for decision making on portfolio or program level Today Fact-based decisions require realtime information on the status of running projects, programs, and proposals Analysis of large portfolios in the portfolio dashboards is timeconsuming, leading to lack of transparency With SAP Business Suite on SAP HANA Faster access to decision-making information in dashboards, such as status, timeline, financials Accelerated dashboard performance for comparison of large running projects and proposals Improve speed of aggregating financial, scope, or resource 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 investments increases efforts for reviews Accelerated roll-up for financial and capacity planning Information Calculation of most important key performance indicators (KPIs) based on values from financial planning, removing manual calculation Enhanced transparency for holistic monitoring of capacity demand and supply at various levels of portfolio hierarchy KPI improvements are high-level estimates and will have to be validated for each customer situation. 7

8 Project manufacturing for complex assembly Business value for project management (project system) Increase user productivity and end-to-end process efficiency when managing large projects Today Long wait and locking times along business processes hinder project execution and impact flexibility to react to deviations Execution of complex engineer-toorder/make-to-order (ETO/MTO) processes is suboptimal, due to unmanageable data volumes across finance and logistics With SAP Business Suite on SAP HANA Improved runtime of core project management transactions, such as resource-related billing, overhead application, or progress analysis Higher end-to-end process efficiency and increased employee productivity, improving work quality Improve transparency and decision support to quickly adapt to critical alerts Real-time analysis of high volumes of data for complex, long-lasting projects or cross-project monitoring is challenging due to high data volumes Due to missing 360-degree real-time transparency across applications, deviations in costs, time, resources, or quality are seen too late in the process Acceleration of project info system and new project line-item reporting, delivering faster insights Early insight into project risks, allowing timely corrective measures, highlighting deviations in real time Planned: Project execution cockpit to enable project managers and staff to analyze status and progress of one or more projects end-to-end with real-time data KPI improvements are high-level estimates and will have to be validated for each customer situation. 8

9 Project manufacturing for complex assembly Business value for material requirements planning (MRP) Reduce days in inventory and safety stock 1% 5% Today Decisions are often made based on outdated information produced by periodic MRP runs With SAP Business Suite on SAP HANA Faster replanning allowing more frequent MRP runs in shorter cycles Faster reaction to demand changes Reduce inventory obsolescence cost (% of revenue) 1% 5% Improve customer service level and efficiency when dealing with engineering changes There is no ability to replan quickly if conditions change due to long run times Prediction of inventory coverage for critical parts is difficult There is no ability to replan if conditions change during the planning horizon due to long runtimes Reduction in inventory and safety stock levels Fast simulation of different what-if scenarios Accelerated calculations such as stock requirements and where-used lists, as well as early alerts on critical materials Better synchronized demand and supply for global cross-plant planning, reducing bullwhip effect Changes propagated faster through the supply chain, allowing such things as more frequent updating for supply network collaboration KPI improvements are high-level estimates and will have to be validated for each customer situation. 9

10 Supply chain analytics Business value for supply chain monitoring Reduce time spent compiling, generating, and waiting for reports 5% 10% Increase visibility into key supply chain performance and risk indicators Today Near real-time information is lacking. Batch jobs are used to extract data from planning system to central reporting, typically on weekly basis There is no ad hoc operational reporting Reporting, queries, and dashboards must be created by each customer individually With SAP Business Suite on SAP HANA Decision support based on near realtime information Information updates possible via delta capabilities Built-in analytical reporting scenarios provided with streamlined data load Planned ability for customers to add their own KPIs and dashboards Optimize analysis capabilities with multiple levels of aggregation and drill-down techniques It is not possible to run sub-daily planning jobs and analyze the results because of long data preparation times in the business warehouse This prevents fast response to ad hoc queries from customers, which may result in lost sales Advanced data retrieving and computing functions of SAP HANA used to optimize the reporting of supply chain planning data KPI improvements are high-level estimates and will have to be validated for each customer situation. 10

11 Collaborative supply planning Business value for demand-driven supply chain Reduce planning cycle times Increase supply chain performance Today Accessing and effectively using timely demand information from the supply network are becoming more and more difficult Decisions are often based on incomplete, inaccurate, and outdated information With SAP Business Suite on SAP HANA Increased business and expert user productivity with faster planning processes and improved user experience, as well as by driving rapid consensus across the supply chain network Near real-time reporting with faster information analysis, leading to better supply chain visibility and decision making Reduce total cost of ownership Hardware and system landscapes are challenging to administrate Improved production and cost efficiency due to simplified system setup and administration, as well as provision of a more robust planning foundation KPI improvements are high-level estimates and will have to be validated for each customer situation. 11

12 Financial performance management Business value for planning, budgeting, and forecasting Improve financial transparency Today Planning performance is limited to online analytical processing (OLAP), staged cubes for transactional and master data With SAP Business Suite on SAP HANA Seamless replication of master and transactional data from SAP Business Suite Availability of more granular data to support planning Reduce cycle times, monthend closing times, and manual effort Minimize cost of financial reporting Data load performance is driven by the amount of data extracted from SAP Business Suite applications Reporting, loading, and retraction performance limits planning iterations Drill-down within OLAP cubes and navigation to SAP Business Suite and online transaction processing (OLTP) data occur within standard times Big Data challenge negated, allowing faster extract and DataStore object (DSO) activation times Iterative planning and real-time simulation supported through improved performance Improved performance for drill-down (expand) and consolidation (collapse) Fast drill-through and live view of transactional data in SAP Business Suite KPI improvements are high-level estimates and will have to be validated for each customer situation. 12

13 Financial performance management Business value for profitability and cost analysis Improve cost and profitability transparency Reduce cycle times and manual effort Today Data latencies and processes delays impact the ability to react to issues and opportunities Lack of data depth and user selfservice affects internal decision making Processes take a long time to run Data queries are time-intensive Data analysis is mostly manual With SAP Business Suite on SAP HANA Timely execution of critical business processes that supports decision making and increases the ability to swiftly act (insight-to-action) in dynamic market environments Critical transactions and calculations able to run quickly Instant response times on queries Prebuilt analytics to automate the data analysis process Minimize cost of financial reporting Substantial amount of effort (time spent) does not directly add value Resource efficiency and effectiveness is suboptimal Leaner processes from data capture through data analysis Increased productivity through process-optimized analytics and mobile support KPI improvements are high-level estimates and will have to be validated for each customer situation. 13

14 Financial performance management Business value for financial and managerial reporting Improve service-level performance Reduce cycle times, monthend closing times, and manual effort Today Risk of noncompliance occurs due to unfulfilled audits Much decision-relevant data is not readily available Data analysis is not supported or automated Batch jobs and reports take a long time to run Data analysis is time-intensive With SAP Business Suite on SAP HANA Timely execution of compliancerelevant 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 Minimize cost of financial reporting A large number of time-consuming, and non-value-added processes are required to provide (access) accurate, up-to-date information Workarounds and data latencies eliminated End-user data analysis through selfservice means (via SAP BusinessObjects business intelligence solutions) KPI improvements are high-level estimates and will have to be validated for each customer situation. 14

15 Accounting and financial close Business value for entity close Reduce month-end closing time Today Process take a long time to run Reconciliations are time-intensive There is limited time for analysis With SAP Business Suite on SAP HANA More time for analysis, less overtime, and earlier publishing of financial results through faster period-end processes and better reconciliations Reduce cost of finance Inefficiencies occur due to manual processes and low automation Missing financial excellence results in higher cost of equity at the capital markets Increased efficiency through smarter reconciliations and reporting, reducing operating costs and improving stakeholder satisfaction Enhance compliance and accuracy It is difficult to support parallel financial reporting standards on a global basis and in simulation of scenarios Real-time analytics down to the lowest level of detail delivering quality at source, transparency, and process efficiencies KPI improvements are high-level estimates and will have to be validated for each customer situation. 15

16 Customer case Reference US$100 billion aerospace and defense companies SAP HANA software, SAP HANA platform, and SAP Business Suite on SAP HANA Payroll Employee competencies Inventory and missing parts data analysis Reduction of inventory levels and customer delivery penalties Annual benefit >US$200 million 16

17 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. 17

18 Thank you 2013 SAP AG or an SAP affiliate company. All rights reserved.

19 Appendix with detailed customer cases 2013 SAP AG or an SAP affiliate company. All rights reserved.

20 Business value Low High Reference US$100 billion A&D companies Summary of validated scenarios (combined findings) SAP HANA use cases mapped to industry value map end-to-end solutions Annual revenue: US$100 billion Phase deployment road map 1 1 Payroll Employee competencies report 1 Inventory and missing parts data analysis 2 Reduce inventory levels and customer delivery penalties HR: 1 Short term Payroll (reduce payroll query wait time, reduce time for it to create a new payroll report, reduce time spent to consolidate payroll reports) Employee competencies report (reduce competencies query wait time) SCM: Reduce inventory levels and customer delivery penalties (reduce days in inventory; reduce customer delivery penalties; reduce inventory write-offs; reduce the cost of developing BI reports; reduce data cleanse costs; reduce IT spend on data integration) 2 Medium term Legend SCM: Inventory and missing parts data analysis (reduce inventory and missing parts query wait time) SAP HANA Platform SAP HANA products Low SAP Business Suite on SAP HANA Feasibility High Scenario (business value) 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 20

21 Aerospace manufacturer: Employee competencies report Aerospace and defense Business context and goals Customer must constantly analyze the required employee competencies for aircraft engineering, production, assembly, and maintenance and assign the appropriate employees to the outstanding work Based on actual and historical data, the customer also requires simulation capabilities to get insights into future competencies and hiring needs Business challenges When a query is run to find a particular competency on the overall customer scope, it takes more than 30 minutes to get a result Data for reporting is not current 2,000 users are currently executing those analysis, with 15,000 expected in future It is difficult to execute simulation runs on future competencies and hiring needs Process innovations Competencies reports can be executed on real-time data and fast simulation runs with ad hoc input parameter settings to deliver high-quality results for future competencies needs Contribution of SAP HANA Reports will be compiled directly in SAP HANA database in the SAP NetWeaver Business Warehouse (SAP NetWeaver BW) application Provide competencies dashboard to top management Increase internal customer satisfaction Better analyze customer competencies capacity thanks to drill-down features Increase number of managers getting competencies information from 3,000 to 12,000 Value drivers/kpis Reduce competencies query wait time by 50% (KPI: Average competencies query wait time, in seconds) 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. Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Aerospace and defense workforce planning and analytics Value potential 3 Low Feasibility 1 High 1 5 Low High

22 Aerospace manufacturer: Inventory and missing parts analysis Aerospace and defense Business context and goals Within the aircraft engineering processes, the inventory and missing parts must be monitored continuously Business challenges Due to the cumbersome data loading process, updated information on inventory and missing parts are only available on a monthly basis Process innovations Inventory and missing parts monitoring and analysis can be executed on data sets that are updated daily Contribution of SAP HANA SAP NetWeaver BW powered by SAP HANA will improve layered architecture capabilities Compile reports directly in the SAP HANA database Help ensure accuracy of data Help ensure a continuous data loading process for all supply chain management (SCM) data Improve inventory and missing parts data loading frequency from monthly to daily Value drivers/kpis Reduce inventory and missing parts query wait time (KPI: Average inventory and missing parts query wait time, in seconds) Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Aerospace and defense project manufacturing for complex assembly Value potential 4 Low Feasibility 1 High 1 5 Low High 1 5 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. 22

23 Aerospace manufacturer: Inventory and missing parts analysis Aerospace and defense Business context and goals During the aircraft engineering process, inventory and missing parts need to be constantly monitored and analyzed Business challenges Due to complex and cumbersome loading and report generation process, data is only loaded once a month in the SAP NetWeaver BW environment. Therefore, all report results are not based on current inventory information Process innovations Missing parts data are loaded into SAP NetWeaver BW on a daily basis for better decision support and fast analysis Contribution of SAP HANA Improve layered architecture capabilities for SAP NetWeaver BW Enable compiling reports directly in the SAP HANA database Enable SCM reporting to be based on near real-time data Help ensure accuracy of data Help ensure a continuous data loading process for all SCM data Value drivers/kpis Reduce inventory and missing parts query wait time (KPI: Average inventory and missing parts query wait time, in seconds) Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Aerospace and defense service parts management Value potential 4 Low Feasibility 2 High 1 5 Low High 1 5 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. 23

24 Aerospace manufacturer: Payroll Aerospace and defense Business context and goals Customer manages 4 billion payroll records. Those records are regularly loaded into an SAP NetWeaver BW system, and reports need to be generated Business challenges Loading the payroll data from SAP ERP to SAP NetWeaver BW takes at 1.5 days each week, and during load time, the BW system slows down performance for other reporting requests Aggregated HR information is hard to get have to launch several partial reports and consolidate them in Microsoft Excel Getting a report for the business HR team takes a long time HR team cannot easily identify the several wage types represented in the pay slips of the country Process innovations HR team can report on daily updated payroll data with fast response time and the ability to drill down to any granular level (no data aggregation anymore). Ad hoc slicing and dicing of the data improves the identification of wage types per country. Contribution of SAP HANA Accelerate the loading of data using the customer-specific extractors Increase response time for the reports they can be executed on granular payroll data (no aggregation needed Accelerate the loading of data using standard and customer-specific SAP NetWeaver BW extractors Improve performance of HR system in SAP NetWeaver BW during the data loading (because of reduced time of loading) Increase internal customers satisfaction with better analysis of payroll data thanks to drill-down features Produce the HR dashboard on the first day of each month (and not second or third) Avoid BI system performance issues during working time (as it is the case today for monthly data loading) Value drivers/kpis Reduce payroll query wait time by 50% (KPI: Average payroll query wait time, in seconds) Reduce time for IT to create a new payroll report by 60% (KPI: Time required to create a new report) Reduce time spent to consolidate payroll reports by 40% (KPI: Average time spent to consolidate partial reports in one consolidated report) Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Aerospace and defense core human resources and payroll Value potential 3 Low Feasibility 1 High 1 5 Low High 1 5 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. 24

25 Aerospace manufacturer: Reduce inventory levels and customer delivery penalties Aerospace and defense Business context and goals A leading aerospace and defense manufacturer s teams need real-time analytics on inventory levels and customer delivery performance. Significant customer penalties can be incurred if delivery is late. Business challenges The existing legacy database takes several hours to produce weekly/monthly reports. New reports can take several weeks to develop. Process innovations Real-time analysis of supply chain and customer delivery performance is required to support working capital and operating cost reduction Contribution of SAP HANA SAP HANA can enable further innovation in analyzing/modeling business scenarios. Value drivers/kpis Reduce days in inventory; reduce customer delivery penalties; reduce inventory write-offs; reduce the cost of developing BI reports; reduce data cleanse costs; reduce IT spend on data integration Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Aerospace and defense supply chain analytics Value potential 5 Low High 1 5 Feasibility 4 Low High 1 5 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. 25

26 Aerospace manufacturer: MRP Aerospace and defense Business context and goals When this aerospace manufacturer produces a plane, its bill of materials (BOM) is highly serialized and its MRP run takes about 50 hours to run for one plane. The company also needs to synchronize the production with suppliers and subcontractors. Business challenges This long runtime doesn't allow the company to have a real-time and synchronized supply chain with vendors and subcontractors when engineering changes are applied to the BOM Process innovations Run an MRP on SAP HANA and transfer the result to the ERP system Contribution of SAP HANA Speed up the process Enable running more frequently Value drivers/kpis Reduce out-of-stocks Reduce errors during production Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Aerospace and defense project manufacturing for complex assembly Value potential 4 Low High 1 5 Feasibility 4 Low High 1 5 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. 26