Managing SAP Data and Processes to Maximize Operational Efficiency in the Energy Industry. Industry Solution: Oil and Gas/Energy

Transcription

1 Managing SAP Data and Processes to Maximize Operational Efficiency in the Energy Industry Industry Solution: Oil and Gas/Energy

2 Copyright 2015 Dolphin Enterprise Solutions Corporation (dba Dolphin) All rights are reserved, including those of duplication, reproduction, use or disclosure of the contents of this documentation, or any part of it. No part of it may be reproduced in any form, passed on to third parties or particularly by electronic means, processed, reproduced, distributed or used for publication without the written permission of Dolphin. We reserve the right to update or modify the contents. Trademarks 2015 Dolphin Enterprise Solutions Corporation (dba Dolphin). SAP, SAP NetWeaver, ArchiveLink, ABAP and all SAP logos are trademarks or registered trademarks of SAP AG in Germany and in several other countries. All other product and service names mentioned are the trademarks of their respective companies Dolphin, Page 2/8

3 INTRODUCTION Harnessing the power of Big Data is an overwhelming challenge for even the most disciplined enterprise. However, the task grows more complicated in highly-regulated industries such as Oil & Gas/Energy Services, where incredibly large volumes of data are simultaneously being created, shared and processed from multiple locations across the globe. In these decentralized environments, system performance is paramount, and it s critical that all data be available and accessible when needed, or processes can break down. With a global workforce highly dispersed between oil fields, oil rigs, refineries, transport tankers at sea and other remote locations around the world, energy companies demand real-time access to a centralized view of critically important business processes despite functioning in this highly decentralized environment. The complexity of this sophisticated, yet disseminated environment accentuates any process gaps in often overlooked core functions such as procure-to-pay and order-to-cash. Mistakes as a result of these gaps can be crippling. In its 2013 Oil & Gas Industry Perspective, global management consulting firm Booz & Company addresses what it calls new clarity on the ever-fluid pricing dynamic of oil and gas. Without the expectation of rising prices to offset inefficiencies in the industry value chain as they have previously done producers, refiners, distributors and others are looking at their internal operations to unlock opportunities to increase their effectiveness. Oil and gas companies can look within to build more efficient business models to create real value and earn superior returns. Historically, when costs rose, companies were able to raise prices. Without this cushion, companies need a cost-disciplined approach to doing business. Companies need a strategic approach to reduce operating costs and create efficiencies that give them a competitive advantage. Booz and Company contends the industry as a whole has allowed inefficiencies to fester up and down the value chain, from exploration, drilling and project delivery, through production and marketing, to refining and distribution. Vertically integrated companies that have dominated the sector often lack the focus and organizational controls to drive efficiency through their far-flung operations. What s more, despite sophisticated systems, they lack the visibility they need to process information to make truly informed decisions. There are many opportunities to achieve operational excellence. Finding ways to reduce costs and at the same time improve operational performance is key. Negotiating ad hoc cash discounts with vendors; processing more without additional headcount; maximizing cash flows; and streamlining IT infrastructure are but a few areas to derive savings. Companies that adopt these types of practices are automatically more resilient; they can manage price downturns more easily and reap a larger benefit from price increases Dolphin, Page 3/8

4 DOLPHIN s ENERGY INDUSTRY SOLUTIONS Dolphin understands the demanding economic environment and ever-changing regulatory requirements that oil and gas companies around the world are continuously facing. We address their most pressing challenges and help them to look at their businesses holistically and proactively unlock hidden opportunities for cost savings. Our focus is on bottom line results, removing costs from the system and improving business and financial performance. Dolphin s business process management solutions are deployed upstream, midstream and downstream by leading energy companies to help them reduce revenue leakage lost to delays, inefficiencies and process outsourcing, ensuring capital preservation from start to finish. As with any industry, cash is king, and the end goal is to have a more efficient cash flow. This frees up financial assets to take advantage of early pay discounts or apply cash faster, adding further to the bottom line. A good example is an integrated oil & gas company that was having difficulty managing its procure-to-pay process. Dolphin analyzed their processes and identified a significant redundancy - 10 different steps in the exception handling process, creating confusion and a lack of visibility across the entire procure-to-pay process. Effectively managing cash is a key challenge and Dolphin s solutions provide optimal flexibility and can be tailored to each customer s specific environment to help improve performance and achieve bottom line efficiencies. Improving business performance not only elevates business processes but fine-tunes the IT infrastructure as well. Dolphin takes the approach that data management needs a strategy and archiving and managing data is a process, not a project. In order to have optimum performance from your systems and access to your data when and where you need it, you need to have defined data management plan. PROCESS EFFICIENCY= Better decisions based on real-time intelligence To make sound business decisions, Energy companies require accurate information delivered in realtime. Process efficiency and having the right information at the right time are crucial for improved cash flow. Many companies have decentralized business processes, which impairs visibility across their enterprise. The ensuing latency results in the inability to make decisions based on accurate and updated information. Dolphin has been helping organizations gain control with end-to-end solutions that support standardization in financial areas such as procure-to-pay and order-to-cash. This pays big dividends in being able to have needed information in real-time and improve overall business performance. In addition, partner relationships are advanced and a faster return on investment derived Dolphin, Page 4/8

5 For instance, in many organizations, inefficiencies run so deep that they often miss deadlines for early pay discounts or worse, are fined for making late payments. We worked with one company that was experiencing both of the above. The result was that the solution we implemented reduced its invoice to payment time from nine days to just three. This improved the cash discount take rate and eliminated late payment fees, creating thousands of dollars of actual cash savings each month. Frequently mergers or acquisitions are at the root of, or at least add to, inefficiencies across a corporation. Typically, the directive is to merge the processes and manage the increased volume but without adding resources. A system such as Dolphin s Process Tracking System suite that can scale, handle additional workload, and is tightly integrated with SAP solutions can help alleviate some of the problems that come with merging business processes. One of our customers, an oil company, is growing by acquisition and since implementing our solution, has absorbed handling a 50 percent increase in invoice processing without additional headcount. Dolphin s Processing Tracking System for Accounts Payable (PTS-AP), Accounts Receivable (PTS-AR) and Order Management (PTS-OM) have received SAP solution certification and reside within the SAP application. Adding a solution that has been developed using SAP technology to optimize SAP processes provides ease of use, and doesn t require a build out in infrastructure, upgrade delays, or synchronization issues. It treats the SAP application as the system of record and leverages it. Poorly designed business process flows can also delay access to working capital through the ineffective handling of disputes and deduction discrepancies, increased days sales outstanding and limited visibility. Dolphin intimately understands your industry as well as the SAP environment, and we specialize in driving business performance improvement. We provide complete, end-to-end solutions for SAP Energy industry customers for procure-to-pay and order-to-cash. Unlike some of our competitors, our solutions are built using the SAP workflow engine rather than a separate workflow and have the flexibility to adapt to your specialized processes and dispersed environments. The results are a total solution to optimize business processes from start to finish benefit from: Integrated, end-to-end global SAP-certified solutions Real-time, seamless global access to documents Process visibility Improved return on working capital Fast payback Just imagine a fully loaded oil tanker ready to offload its valuable shipment being denied entry into a port because of a rather inexpensive, but unpaid invoice. The ramifications are many, both for those depending on the delivery and the reputation of the provider. No business can afford this type of delay; however, in this industry it is commonplace Dolphin, Page 5/8

6 Although Dolphin focuses on SAP applications, our Oil & Gas/Energy Services customers are not required to convert all systems to SAP ERP to benefit from Dolphin s procure-to-pay and order-to-cash solutions. Because customer information is often dispersed among multiple systems in multiple locations, our solutions are architected to optimize business processes with information coming from external sources and uploaded into an SAP database. Smart Archiving Strategies = Faster Performance + Cost Savings Energy companies are increasingly burdened by Big Data, which can grow uncontrollably and hinder IT system efficiency. Companies process and analyze huge volumes of data, which stress IT infrastructure and slow processing systems. Further, the dual challenges of maintaining terabytes and petabytes of data and managing it throughout its lifecycle adds significant cost and complexity. All can negatively affect core cash flows of the business. Molton, a global management consultancy specializing in the oil and gas industry, refers to how oil and gas executives could use Big Data as a powerful source of competitive advantage as the Data Crunch. Their perspective is that data must be effectively managed if it is to prove its worth. We agree. To derive real value, whether from business intelligence or operational data, a structured data management strategy fuels business performance and lowers costs. Put another way, data is a highly valuable asset, and a well thought out strategy for managing data significantly improves business performance and doing so, adds to the bottom line. Dolphin provides data management strategies and archiving solutions that allow companies to optimize system performance, yet maintain transparent access to their information. The solutions for data archiving include all SAP systems ERP, BW, CRM, SRM, and others and incorporate a nearline analytics infrastructure. As part of the overall strategy, data access, content management, migrations and legacy decommissioning, storage options and even data encryption are also addressed. For example, to alleviate one customers system performance degradation caused by too much data in the database, Dolphin introduced the Nearline Analytic Infrastructure (NAI) for SAP ERP. The NAI solution from PBS Software 1 can be used for both SAP Enterprise Resource Planning (ERP) and SAP BW. With NAI, data is moved from the live database once it is business complete to nearline storage. The data is easily accessible and retrieval is almost as fast as if it were live. 1 Dolphin is the largest reseller in North America of PBS software and an implementation and development partner PBS Software AG. PBS software has been developed specifically for the SAP environment Dolphin, Page 6/8

7 Nearline storage solutions from Dolphin also enable rapid indexing of SAP data archives and faster response times to database queries. For some customers, Dolphin has helped manage data during acquisitions, reorganizations and company shutdowns. In these scenarios, decommissioning older systems can reap significant cost savings by eliminating storage space and maintenance costs, and it offers a host of efficiencies by having all information accessible from one system. For companies moving BW and other applications to the HANA platform, nearline and archiving is essential to curbing costs and maintaining performance. One of the energy companies that we ve been working with to stabilize growth told us that with the addition of nearline for their BW system on HANA, yearly growth was reduced from 34% to 12%. DATA SECURITY, GOVERNANCE/COMPLIANCE/AUDIT International, federal, state and other regulatory bodies are enforcing stricter laws that dictate how companies handle sensitive information. A breach is not something a company wants to risk as it can damage a corporate reputation for years, affecting its competitive advantage. One common method used to secure data is encryption. More than ten states now have such data encryption laws in place and stringent regulations are being imposed in Canada and Europe. Organizations not in compliance with data management laws face large monetary fines. As a result, CIOs and CFOs are keeping a close eye on this area. Although many companies use data encryption to protect current data, the laws also apply to archived data. This poses two challenges for companies running SAP systems: 1) Encrypting data that has been archived 2) Monitoring to determine whether encrypted data loses its encryption when archived Whether used for ecommerce, governance or for sensitive intellectual property, the importance of data encryption cannot be overstated. As the large data explosion continues, the trend of enacting tougher laws governing data encryption will only continue to expand. For this reason, organizations must take a closer look at not just their encryption strategy but also their overall archiving strategy to ensure that both can function in a complementary manner to get the most from their SAP investment, optimize system performance and to ensure organizational risk mitigation. Dolphin has developed solutions to handle both of these scenarios. Given a short timeline to comply with a relatively new state law that all sensitive data be encrypted, a Dolphin customer realized it faced fines before they even started archiving. Realizing it couldn t encrypt terabytes of the data they had archived over the years and meet the short timeline, the customer enlisted Dolphin s help to automate the process and finish the task in time Dolphin, Page 7/8

8 Tackling risk and compliance requires a data management platform that offers a combination of traditional SAP archiving and other SAP-certified software to meet governance, risk, and compliance (GRC) obligations. The optimal solution uses standard archiving processes with minimal system performance degradation. For data retrieval, the platform can update SAP Tcodes for end users and auditors to read the archive data, making both online and archived data available. Responding to audits in a highly regulated industry such as Energy presents additional risk challenges. With various tiers of government involved in all stages of production, not to mention US agencies such as EPA, OSHA and multiple tax authorities around the globe, audits are time-consuming and often costly. Cost-efficiently storing and then finding specific information within a stated timeframe without offering up too much is the goal. Dolphin s solutions allow you to search by criteria and pull data together from multiple systems for financial and other audits. Business users can easily build standard (globally used) data extracts, layouts and views for each audit type -internal, state & local, other - and are enabled to develop rapid responses to any IDR (Independent Data Request), thus avoiding fines, penalties and undue work interruption. ABOUT DOLPHIN Dolphin leads the way in business performance improvement for companies running SAP solutions and is the one partner that manages both data and processes. From data and information lifecycle management to end-to-end solutions for procure-to-pay and order-to-cash processes based on SAP software, Dolphin delivers a competitive advantage that drives cost savings, optimizes cash flows and fosters a lower total cost of ownership. Leveraging SAP technology, Dolphin s data lifecycle and business process management solutions and add-on applications with SAP-certified integration have built-in flexibility and are designed to be tailored to each customer s specific business processes and IT environments. The company was founded in 1995 and has offices in San Jose, CA, Philadelphia, PA and Toronto, Canada. Dolphin s smart, adaptable and proven solutions are implemented by hundreds of companies across North America and around the world. Among Dolphin customers are more than one-third of Fortune 100 companies running SAP systems. To learn more, us at [email protected] or visit Dolphin, Page 8/8