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The Process Innovation Journey for SAP

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Title: The Process Innovation Journey for SAP


1
The Process Innovation Journey for SAP
Accelerate your path to
Process Innovation
2
Business Process Effectiveness is the Top
Priority for Executives
A Global Technology Survey found that Improving
business process effectiveness ranked as the 1
priority for executives but WHY?
McKinsey Global Technology Survey, December 2011
, How IT is Managing New Demands https//www.mckin
seyquarterly.com/High_Tech/Strategy_Analysis/A_ris
ing_role_for_IT_McKinsey_Global_Survey_results_290
0
3
A customers experience with an enterprise is
based on the quality and consistency of the
companys critical processes
4
Typically process improvement as well as ERP has
been managed in a discrete and segmented fashion
with limited visibility, governance and
collaboration across organizations
Operations
Sales/Marketing
Finance
Human Resources
Manufacturing
Consumers and businesses tend to choose products
and services based on their experiences and
relationship with a company
5
Tools and methods for driving process improvement
have also been implemented with a limited
holistic and cross operational integration view.
.resulting in sub-optimized islands of
excellence that are neither holistic nor customer
centric
6
Today, creating outstanding customer experiences
requires broad Process Innovation that spans the
entire organization
  • Respond and react to individual customers,
    segments or market needs no matter where in the
    organization they interact.
  • Interconnect and synchronize departments with
    enterprise-wide visibility to ensure consistency
    and outstanding client experiences.
  • Create collaboration and governance across
    departments organizations to drive efficiency
    but more importantly effectiveness.
  • Manage for end outcomes enabled by consistent
    value driven execution from the front office to
    the back office.

Process Innovation
7
Process Innovation enables new forms of customer
value to be identified with strategies for Unique
Business Change
Domain Expertise
Organizational Enablement
Process Innovation
Innovative Business Change Stronger Customer
Experience
Structured Experimentation
E2E Process Optimization
Adaptive Integrated Operations
Value-based Pricing
System Revitalization
Harmonized Systems
8
Integrated Business Applications Deliver Strong
Valueand SAP is the best
  • Improve alignment of strategies and operations
  • Improve productivity and insight
  • Support changing industry requirements
  • Reduce risk
  • Improve financial management and corporate
    governance
  • Retain top performers
  • Provide immediate access to enterprise
    information
  • Give employees new ways to access the enterprise
    information required for their daily activities.

SAP customers excel by taking advantage of SAPs
industry-specific knowledge, best practices and
standardized processes all codified into the
worlds leading integrated application platform.
9
ButSAP implementations tend to drive
standardization not Process Innovation
Most SAP implementations are documentation-centric
driving standardized processes that create a
reliance on informal business processes and
differences between organizations and instances.
Every business strives to be unique, requiring
heavy process customization for all but a very
few, commodity processes making it difficult to
invoke change, migrate to future releases and
provide adequate real-time visibility.
all costing you customer centricity,
flexibility, adaptability, time, money and lost
business opportunities
s
10
Because many SAP implementations are basic
configurations avoiding customizations they do
not meet initial expectations
  • Opaque SAP processes make process analysis and
    improvement difficult
  • Rigid SAP processes increase time to value
  • End-to-end processes are difficult to model,
    simulate and manage
  • SAP Enterprise Services are difficult to use and
    incomplete
  • Limited SAP process and real-time visibility
    causes risk to KPIs and SLAs
  • Low utilization of inline operational decision
    management limits productivity

Source Panorama Consulting 2010 ERP Report
A solution to one or more of these challenges is
required in almost every SAP implementation
11
Though SAP is on of the best enterprise wide
solutions to improve business execution there is
no easy way to implement or avoid customizations
Solution Manager
Blueprint
Capability
12
Process Innovation requires balancing two methods
to optimize business processes
  • BPM Tools SOA
  • Adapt quickly
  • Outpace the competition
  • Process visibility across core fringe
    application systems
  • Smaller, incremental projects
  • Packaged Applications
  • Improve 100s of processes at once
  • Sunset inflexible legacy systems
  • Catch up to competitors
  • Huge multi-year projects

BPM
Natural Tendency
Natural Tendency
Process Optimization Approach B
Process Optimization Approach A
Differentiating Business Processes
Non-Differentiating Business Processes
Successful organizations will have a balanced
I/T Strategy of SOA/BPM and ERP Consolidation
13
Examples of IBMs Own BPM SAP Projects and
Benefits in 2011
  • Mid-Market Deal Registration Delivered 18.5M
    2012 PTI by reducing deal registration cycle time
    with rules-based work-flow automation.
  • Supply Chain Alerts Over 2M annual savings for
    timely notifications when supply chain
    disruptions occur.
  • Pricing estimator for Cross-brand solutions
    Reduced pricing proposal implementation from 14
    days to 1 day and deployment to new countries in
    days versus weeks.
  • GTS Cloud Sales Enablement Integrated
    work-flow, rules and monitoring to reduce partner
    register to welcome kit cycle-time from days to
    hours.
  • GMU Geo Location Code Assignment - Geo location
    code is key enabler of GMU expansion. Eliminated
    manual process and enabled GMU reps to update
    rules directly and reduced cycle time to update
    and run rules from several weeks with many
    handoffs to just a week for more than 50
    countries.
  • Infrastructure Optimization Reduced cycle time
    by 75 to complete the analysis required to
    migrate from Physical servers to Virtual servers.

Business Value Achieved
14
Process Innovation for SAP can be enabled with
IBM Software and Expertise
Integration
Analytics
Domain Expertise
Master Data Management
Enterprise Content Management
Organizational Enablement
15
IBM BPM V8 integrates seamlessly with SAP to
improve your implementation and execution success
Orchestrate SAP Services
Monitor SAP Business Events
Upload processes to Solution Manager
Download processes from Solution Manager
Retrieve Enterprise Service Definitions
16
IBM BPM can easily exchange Models with SAP
Solution Manager
IBM Process Designer
SAP Solution Manager
Business Process Hierarchy
Lev 0
Process Application
Project
Lev 1
Business Scenario
Lev 2
Process
Business Process
Lev 3
Activity, (Sub-)process, Service
Process Step
Implementation Content eg. Transactions, Docs
SAP Implementation Content
IBM BPM maps its process elements directly to SAP
Solution Manager constructs and performs
bidirectional exchanges
s
17
IBM offers a comprehensive solution to SAP
implementation and process challenges
Challenge IBM BPM Solutions
Opaque SAP processes make process analysis and improvement difficult Iterative, playback-based modeling facilitates transparent process definition
Rigid SAP processes increase time to value Directly execute SAP process models for flexible processes and rapid process change cycles
End-to-end processes are difficult to model, simulate and manage Easily orchestrate heterogeneous processes for simple end-to-end control
SAP Enterprise Services are difficult to use and incomplete Easily consume and deploy SAP Enterprise Services at the business level
Limited SAP process and real-time visibility causes risk to KPIs and SLAs Actively monitor and manage SAP and heterogeneous processes in real time
Low utilization of inline operational decision management limits productivity Improve process throughput, consistency and responsiveness with active inline decision management
18
BPM Enhances the Value of Your SAP Investment
19
Applying IBM BPM to SAP
  • Use an iterative, experiential-based approach to
    accelerate traditional SAP blueprinting

Modeling for Documentation
Increasing Integration
Real-Time Monitoring
Mine SAP business events to discover actual
processes and act in real time to business
challenges
Guided Workflow
Interactively guide end users through process
steps to improve productivity, visibility and
consistency
Process Integration and Orchestration
Optimize process steps to improve cycle time,
manageability and visibility of key processes
Automate complex decision making to reduce
bottlenecks and improve business outcomes
Inline Decision Automation
Dramatically reduce the cycle time of high volume
processes by reducing/removing human interaction
Process Automation
20
IBM BPM Drives Stronger Business Results From
Your SAP Implementation
  • Live playback during all phases of process
    design and rollout
  • Reduce blueprinting time and costs
  • Deliver agile SAP business processes that are
    easy to change
  • Create market-differentiating SAP processes
  • Position your SAP implementation for continuous
    process improvement
  • Integrate SAP business activity monitoring

Business users can directly drive SAP
blueprinting, process orchestration and process
improvement
s
21
Next Steps
  • Discuss with us how to provide you and your team
    with a demonstration or a detailed briefing
  • Discuss how we could assist with your SAP project
  • Let us lead your team with an in-house workshop

s
22
Examples
23
SAP Process Documentation Is Usually Outdated by
Months or Years
2012
2008
SAP process blueprints created Probably Outdated
SAP design completed Probably Outdated
SAP configuration changes completed Additional SAP configuration changes Documentation Possibly Outdated
SAP customization completed Additional SAP customization Documentation Possibly Outdated
Ad hoc changes to processes by end users Blueprint Not Updated
Without insight into the real SAP processes
being used in production, it is very difficult to
initiate and build an effective process
innovation program or to migrate to a newer SAP
release.
24
Event-Based Business Monitoring Can Be Used to
Uncover the Real SAP Processes
Which could be analyzed by a data analyst or
process specialist to discovery real process
structures
  • SAP can create and publish the business events
    needed to discover the actual business processes
    in production

25
But SAPs Business Monitoring Approach is Overly
Complex
And lots of custom coding is required to
implement
26
Business Monitor can be used to drive real-time
insight that leads to continuous Process
Innovation
  • Identify trends, forecast events, feed
    correlate alerts to make key decisions for
    critical business situations and events in
    real-time
  • Completely non-intrusive to SAP simply turn on
    the SAP Business Events needed
  • Easily customize dashboards to ensure targeted,
    relevant information
  • Easily create shadow process views of SAP
    Business Events by associating milestones with
    changes in business state
  • Rebalance work loads on the fly
  • Leverage mobile

27
Most SAP implementations follow a traditional
approach while using general purpose
documentation tools
  • Most SAP customers use Office or Visio for
    blueprinting.
  • Some leverage Aris which is a documentation-centr
    ic modeling tool.
  • These tools encourage a documentation-centric
    approach to process management.
  • The typical SAP implementation approach is
    structured to drive configuration and not Process
    Innovation.
  • Approximately 40 of SAP customers use Solution
    Manager to maintain their process flows, which is
    used to document, but not control, the business
    process and can not provide execution of the
    process.

Goal Setting and Scope Management
Process Analysis
SAP Process Library
SAP Process Blueprinting (Powerpoint, Visio,
Excel, Aris)
SAP Solution Manager
Configure
Customize
28
A typical SAP process today
  • A high level process blueprint is defined in
    Powerpoint, Visio, SAP Solution Manager or a
    modeling tool, including transactions

VD03 - Display customer master
VA01 - Create sales order
VOK0 - Maintain Pricing
CK51N - Create Order BOM Cost Estimate
IW21 - Create notification
The implementation then relies on users to read,
properly understand and comply with documentation
by entering the proper sequence of transaction
codes in SAP.
29
With this approach, how can you?....
  • Quickly know the status of key processes?
  • Ensure that the process you designed is the
    process that is being executed?
  • Get real-time visibility into where workload or
    other bottlenecks are causing business issues?
  • Effectively reroute work to less experienced
    workers to reduce bottlenecks?
  • Know which process changes are most likely to
    help improve business performance?
  • Quickly rollout SAP process changes?
  • Quickly integrate new process workers into your
    business?

Many SAP customers attempt to address these
issues with customization.
30
Workflow in the traditional SAP implementation is
paper based
VD03 - Display customer master
VA01 - Create sales order
VOK0 - Maintain Pricing
CK51N - Create Order BOM Cost Estimate
IW21 - Create notification
  • Process designers create SAP documentation
    (paper, Word, HTML, etc.)
  • Users are trained in how to use the SAP process
    documents
  • Some users comply with the process as designed,
    others create their own
  • Training time for new users is often lengthy
  • Difficult to move users from task to task, even
    in the same department
  • Little to no visibility of backlogs, bottlenecks,
    poor throughput and other process issues

31
With IBM BPM 8.0 the picture is your SAP process
  • Import SAP or IBM best practice libraries
  • Playback any process regardless of the level of
    detail and completion
  • Include real screens, mockups or images
  • Clarify roles, process steps, flow, KPIs and
    reporting
  • Process execution is logged
  • Process performance parameters are visible - KPIs
    are calculated displayed in real time
  • See, feel and touch the process as its executing

32
IBM BPM Can Deliver Guided Workflow for SAP
  • Define process in BPM V8
  • Define activities or steps to execute process
    clarify roles, steps, experts, and KPIs.
  • Invoke correct SAP screen transaction sequence
    for each process step, while gaining real time
    insight into business performance issues and
    opportunities
  • Process performance parameters are visible - KPIs
    are calculated displayed in real time
  • If multiple instances exist process can execute
    at best practice while handling unique
    differences for each instance

33
Use BPM to Collaborate and move decisions to
closer to the source
Interact with other Participants via Stream of
comments and attachments for process instance
34
IBM BPM automation or guided workflow improves
SAP Value
  • Documented processes become orchestrated
    processes
  • Improve SAP process
  • Visibility
  • Manageability
  • Reliability
  • Consistency
  • Audit-ability
  • Performance
  • Detect bottlenecks
  • Reroute process instances with capacity overload
  • Escalate problem processes
  • Initiate and track exception processes
  • Begin continuous process improvement

35
The Value of IBM BPM for SAP
  • Business performance
  • Agility
  • Flexibility
  • Visibility
  • Variability
  • Manageability
  • Audit-ability
  • Consistency

36
Use IBM BPM Throughout Your SAP Life Cycle
A New SAP Implementation
SAP Process Innovation
End-to-End Process Integration
Functional Extensions
SAP Version Migration
s
Most SAP Implementations Benefit from IBM BPM at
every life cycle stage
37
Large US Toy Company Improves SAP Supply Chain
Processes to Reduce Costs
  • BPM Solution
  • Gathers the bill-of-lading information from
    freight forwarders and corresponding invoice data
    from SAP at the right time
  • Automatically prepares and routes all
    documentation required
  • Automates the reconciliation process required for
    all US Customs requirements, updating SAP at each
    milestone

IBM BPM reduced dependency on phone calls,
e-mails and paper faxes, while standardizing
communication between employees and vendors with
increased process visibility
38
Small Sample of IBM BPM SAP Customers

39
Next Steps
  • Discuss with us how to provide you and your team
    with a demonstration or a detailed briefing
  • Discuss how we could assist with your SAP project
  • Let us lead your team with an in-house workshop

s
40
BPM can help you maximize your investment in SAP
customizations
  • Top reasons for SAP customization
  • Streamline or customize the SAP user interface
  • Streamline or customize the SAP process flow
  • Add complementary functionality
  • Integrate with non-SAP systems
  • SAP provides tooling to accomplish each, but not
    in the same tool
  • IBM BPM V8 provides all four capabilities in a
    single tool, driven by the process definition
    innovation
  • Reducing SAP customization reduces cost and
    deployment time, while minimizing risks to future
    SAP updates

Total Cost
Typical Customizations using SAP
SAP
Business Fit
Flexibility
Typical Customizaitons using IBM BPM SOA
Technologies
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