12/1/2017

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Modern Analytics for the

Optimized for S/4 HANA Finance

Digital Economy

SAP Analytics Cloud

Finance Transformation

Business Planning
Eric Smit
Global Center of Excellence
Consolidation
Analytics & Insight

The Organisation of the future believe that the stringent regulatory

of CEOs from high-performing
organizations believe that the CFO’s
role will increase in importance over
the next three years.
72%
49%
environment is impeding the CFO’s
ability to focus on other areas while 42
percent see the regulatory environment
as an opportunity to derive competitive
advantage.
43%
Big-picture thinking and
strategic approach are
the most important
attributes for a CFO
believe that technology will
have the greatest effect on the
future role of the CFO

63% 80%

32% say their CFOs don’t

understand or assist them CEOs put a huge value on
with the challenges that they people skills and many see
face with running their their CFOs as lacking in
organizations. them.

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Source: KPMG The view from the Top – survey 178 executives APJ – 50% CEO 15 % Owner rest MD or chairman – 72% were once CFO’s

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The Benefit of the Right Balance

Business
partnership
Effectiveness M&A
Customer &
Product
76%
Debt Profitability Of CFOs believe that at least
restructuring half their time should be spent
What if
on high-value planning and
analytic activities, versus 55%
Analysis
Forecasting who actually achieve this
Compliance
Treasury & Financial Risk
Management
Source: CFO Research, “The
Receivables Next Stage in Creating the
Management Planning
Budgeting Value-Added Finance
Real Estate Lifecycle
Function,” 2014
Invoice to Pay Travel Management
Management
Financial Close Enterprise Risk and
Compliance
Operations
Efficiency Corporate Close
Entity Close
Disclosure
Process Control -1.6% in 2015 Actual
-2.7% In 2016 Projected
Access Control

Finance resource allocation Finance resource allocation

Current aspirational

The Benefit of the Right Balance

Business
partnership
Effectiveness M&A
Customer &
Product
76%
Debt Profitability
Of CFOs believe that at least
restructuring half their time should be spent
What if
on high-value planning and
analytic activities, versus 55%
Analysis
Forecasting who actually achieve this
Compliance
Treasury & Financial Risk
Management
Source: CFO Research, “The
Receivables Next Stage in Creating the
Management Planning
Budgeting Value-Added Finance
Real Estate Lifecycle
Function,” 2014
Invoice to Pay Travel Management
Management
Financial Close Enterprise Risk and
Compliance
Operations
Efficiency Corporate Close
Entity Close
Disclosure
Process Control -1.6% in 2015 Actual
-2.7% In 2016 Projected
Access Control

Finance resource allocation Finance resource allocation

Current aspirational

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Large Disparity Between Average and Best

PRODUCTIVITY = EFFECIENCY * EFFECTIVENESS

74 worst

80% worst
22 worst

10 worst

1.2% worst 52 average

85% average
14.8 average

0.8% average
5.5 average

0.4% best 1 best 7 best 90% best 43 best

Finance costs as Time to create new Working days to Forecast Day sales
percent of revenue Finance Report close Accuracy outstanding
or budget annual books

APQC Benchmark: 0.6% best 2.3 % worst

SAP Value Engineering Global Figures 5

Putting the right measures in place

Efficiency
• Finance Cost as a percent of Revenue
• Days too close books
• Cycle time for creation of forecast
Key performance • Audit costs
Indicators
• Effectiveness Effectiveness
• Efficiency • Operating margin
• % of profitable customers
• Days sales outstanding
Performance • Forecast Accuracy
Analysis
Framework Technology
• System landscape
• Usage of manual processes, spreadsheets
• Degree of integration
• Financial compliance automation/software

Best practice adaption

Performance
• Importance of best practices
drivers
• Current coverage of best practices
• Importance and coverage gap

SAP Value Engineering Global Figures

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The Benefit of the Right Balance

Business
partnership
Effectiveness <12%
Of senior finance executives
Can respond in real time to
information requests
Decision
Operations Support Source: CFO Research, “The
Next Stage in Creating the
Value-Added Finance
Function,” 2014
Financial Financial
reporting and planning
Analysis and control
Past Future
Compliance
Efficiency
Standard Transaction Master Data
(ERP) Services and Policy
system Shared Management

Finance resource allocation Finance resource allocation

Current aspirational

Strategize and Plan

Run models for key initiatives, finalize LRP and Evaluate ongoing projects and Evaluation segments
set near term targets bottom up plans based on profitability for better
operational feasibility and cash allocation of resources
positions and approve bottom up
plan

Strategic Financial Operational Periodic Forecast Update Long-term

Planning Planning Planning Cycle Strategic Plan

Seed targets to annual bottom up Financial forecast revisions based

financial and start bottom up Update LRP with latest
on on-going project forecast financial forecast
planning process fed by project variance analysis
plans

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The New Planning

Traditional Planning Driver Based Planning Predictive Based Planning

ABC Company
COGS per COGS per
Profit & Loss Subscriber ARPU Subscriber subscriber
subscriber ARPU
Revenues 5,000

Cost of Sales 3,000

Gross Margin 2,000

Operating 400

Payroll 300

SG&A 250 Rev Cos

t
enu
Revenu Cost e

Depreciation 50 e

Operating Profit 1,000 Ebit

da

Ebitda
Interest Expense 50

Net Income 950 Deterministic Probability distributions

Deterministic Driver Model Driver Model of drivers
No Driver Model

Single Target Measure Value Selected Scenarios for target measures and Target measure distribution
drivers

Realistic Worst Realistic Best Worst Realistic Best

Perceived Potential
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UNDER ARMOUR INC Best Run Finance

Company
§ Headquarters: Baltimore, Maryland
§ Industry: Retail
§ Products and services: Athletic apparel,
footwear, and accessories
§ Revenue: US$1.06 billion (2010)
§ Employees: 2,700
§ Web site: www.underarmour.com
§ Implementation partner: SAP® Services
organization
Challenges and Opportunities
§ Improve financial planning and analysis
§ Gain a better perspective on business
performance across the enterprise
§ Enable more-informed decision making
§ Improve operational efficiency
Objectives
§ Reduce time needed for monthly and
quarterly closes
§ Enable financial leaders to play a more
strategic role within the company
§ Equip business leaders with better insight
§ Develop metrics that support future business
improvement
§ Improve capacity planning
Implementation Highlights Organizations have…
§ Completed project in less than 3 months
§ Teamed with experts from SAP Services
“
Why SAP “SAP BusinessObjects Planning
§ Usability of software
§ Flexibility and scalability of applications
and Consolidation lends itself
§ Ability to integrate with SAP and non-SAP very well to our existing
solutions infrastructure. It’s flexible, our
§ Compelling product road map
people find it easy to use, and it
Benefits provides the best overall fit with
§ Decreased time needed to prepare where we see our business
monthly close from 8 weeks to 2 weeks going in the future.”
§ Gained better perspective and insight into
drivers impacting financial results
§ Improved understanding of performance David Roberts, Corporate
via dashboards and analytics
§ Developed key performance indicators
Manager of Financial Planning
designed to improve operational efficiency and Analysis, Under Armour Inc.
>> Inventory levels, Customer
satisfaction, Right product on the right
shelf at the right time
”

UNDER ARMOUR INC Best Run Finance

SAP Advanced Analyze Organizations have…
Planning & • Store Traffic vs.
Optimization •
•
Service levels vs.
Which Distribution Center
“
Solution “Now we can take a collection of
accounts, build hierarchies to support
Excel
them, and then establish metrics
Performance around what the results have been
Management historically versus where we’d like to
(SAP BPC)
see them in the future.”
Web

Actual David Roberts, Corporate Manager of

Sentiment
External Financial Planning and Analysis,
Under Armour Inc.

commodity pricing
Oil, Cotton

Products Price
Supplier
”
Factory § Past performance
Fill rate
Scorecard § Future estimate
Suppliers
95% Capacity

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UNDER ARMOUR INC Best Run Finance

Organizations have…

“
“SAP BusinessObjects Planning
and Consolidation lends itself
Global Return
% by Segment very well to our existing
infrastructure. It’s flexible, our
people find it easy to use, and it
provides the best overall fit with
where we see our business
going in the future.”

David Roberts, Corporate

Manager of Financial Planning
and Analysis, Under Armour Inc.
Customer
”
Return % by
Segment

Return based
on Revenue

Close and Disclose

Financial Entity Corporate Reporting

Accounting Close Close Disclosure

General Entity Close

Ledger Account Management Consolidation
Disclosure
Reconciliation Management
Sub Ledger Reporting
Intercompany
Reconciliation and Analysis

Starter Kits
Master Data Governance For Finance
Process Control

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Consolidation In Detail Plan

Actual
SGD
USD Management
GAAP
Legal
• balance sheet
Allocation • profit-and-loss
HQ • cash-flow statements
• Notes to Account

GAAP
GAAP
IFRS SGD SGD
USD
Group 1 Group 2

70 %
100 % 40% 80%

SGD USD SGD

20%
Entity A Entity B Entity C
Intercompany

© 2017 SAP SE or an SAP affiliate company. All rights reserved. ǀ Internal 15

Consolidation In Detail Plan

Actual
SGD
USD Management
GAAP
Legal
• balance sheet
Allocation • profit-and-loss
HQ • cash-flow statements
Audit Trail• Notes to Account

GAAP Contribution
GAAP
IFRS SGD SGD
Eliminations
USD
Group 1 Manual Group 2
Ownership
70 %
Intercompany
100 % 40% 80%

SGD USD Aft Proper SGD

20%
Proportional
Entity A Entity B Input
Entity C
Intercompany

© 2017 SAP SE or an SAP affiliate company. All rights reserved. ǀ Internal 16

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BPC Finance / IT owned modelling

BPC BPC BPC BPC

BPC
Standard Embedded Embedded Embedded
Embedded
Model Model Model Model
Model

BW Info BW Info BW Virtual Composite

BW Multi
Multi
Cube Cube Provider Provider
Provider

Database Hana Hana BWHANA

Virtual
Virtual Info Real
Virtual
Time
Provider
VIEW Info
Infoprovider
Provider

Input
Actual
Hana Eliminations
Plan
Hana

ACDOCA
ACDOCA ACDOCC
ACDOCP

Universal
UniversalJournal
Journal

SAP Business Planning and Consolidation version for

NewBW
Old BW/BW4
objectsobjects
NetWeaver optimized for S/4HANA Finance 18

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BPC Pre Build Models Optimized for S/4HANA

Note 1: BPC NW as part of S/4HANA FINANCE instance Business Objects Planning and
Consolidation 10.1
Note 2: Pre Build BPC NW embedded model S/4HANA Finance
data and masterdata
BPC
Includes technology components: Embedded
Ÿ Embedded Model definition Model
Ÿ Infocubes, Multiproviders, Aggregates, Queries
Ÿ Planning Functions (copy, delete, distribute, currency translation)
Ÿ Sequences

Includes templates components: BW Virtual/Info Provider

Ÿ

S/4HANA FINANCE
Cost Center Planning
Ÿ Internal Order Planning
Ÿ Project Planning (WBS)
Ÿ Profit Center Planning (linked CC)
S/4Hana Finance
Ÿ Cost of Sales Planning (Functional Area)
Universal Journal
Ÿ P&L Planning (GL level)
Ÿ Market Segment Planning (COPA Account Base model)
Ÿ Liquidity Planning (Cash Management)

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AUSGRID
Company
§ Headquarters: Sydney, Australia
§ Industry: Utilities
§ Revenue: $A3.34 billion (US$3.13 billion)
§ Employees: 6,000
§ Web site: www.ausgrid.com.au
§ Implementation partner: SAP® Services
organization
Challenges and Opportunities
§ Support increasing scale and complexity of
capital expenditure (CAPEX) forecasting
§ Respond to regulatory requirements with
accurate analysis and reporting
§ Improve transparency and standardization of
forecasting
§ Provide better investment and scenario
analysis functionality
Why SAP
§ Functionality that met requirements for
modeling, planning, and analysis
§ Tight integration of budgeting, forecasting,
and actuals
§ Alignment with strategic decision to leverage
integration between SAP® software and SAP
NetWeaver® technology platform
§ Flexible solution that allows more involvement
of business owners as investment planners
12/1/2017
Best Run Finance
Organizations have…
Low Total Cost of Ownership
• Implementation on time and under budget
• Native integration of SAP software “
• Existing SAP infrastructure leveraged to ““SAP BusinessObjects Planning and
support application Consolidation enables us to better
• CAPEX forecast reports in a format
plan our project portfolio on an
compatible with corporate financial
ongoing basis – offsetting increases
systems
in scope and cost for one project by
Financial and Strategic Benefits making reductions in others.”
• Clearer links between strategic objectives
and investment plans Matt Cooper, Manager, Investment
• Improved transparency and credibility of Strategy, Ausgrid
CAPEX forecasts for industry regulator
•
and stakeholders
Repeatable planning solution with .
”
improved scalability, stability, and
functionality
• Reduced costs for independent auditing
• Improved ability to dynamically manage
CAPEX forecast and track changes
• Ability to link subprojects and run cash
flow profiles at the portfolio and individual
element level
• Ability to use robust financial modelling
techniques such as ”S curves”
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AUSGRID Best Run Finance

Organizations have…
Strategic Strategic Targets
“
““SAP BusinessObjects Planning and
Consolidation enables us to better
Sales Supply Revenue
Tactical Chain plan our project portfolio on an
Sales Demand Revenue ongoing basis – offsetting increases
in scope and cost for one project by
HR Pricing Financial
making reductions in others.”
Headcount & Statement

Interface
Personal Costs
Cost Profit & Loss Matt Cooper, Manager, Investment
Cost Center, Project Strategy, Ausgrid
Supply Internal Order
Balance Sheet
.
”
Activity Cost
Cash Flow Statement
Capital
Expenditure Product Cost

Asset
Operational Production
Accounting
Liquidity

gATP
Liquidity
Cap Ex Management

SAP Business Planning and Consolidation Deployment • Public Cloud

SAP Analytics Cloud

• Planning
• Business Intelligence
• Predictive
• Digital Boardroom

SAP S/4HANA Live

Web MS Office Web MS Office

Web MS Office
BPC 10.1 NW Source 1 BPC 11
Source 1 BPC 10
10.1
NWNW
Source 1 Source 2
Central Finance

S4 Prebuild
Source 2 Standard Embedded Standard Embedded
Content
Standard Embedded Source 2 Source 3
Source 3
Source 3 Source 4
Embedded BW 7.5 BW/4HANA
BW 7.5
HANA

Database
HANA Universal Journal Source 5

HANA

Deployment Option 1 Deployment Option 2 Deployment Option 3

• Single instance S/4HANA strategy
• No Hana • Yes Hana
• ERP is large data source BPC
• No BW4 Hana • Yes BW4 Hana
• No single instance S/4HANA strategy • No short term single instance S/4HANA strategy
• Large data volume not S/4 based

• On Premise
• Private Cloud
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SAP Analytics Cloud

S/4 SaaS PaaS DBaaS

Public Cloud SAP Analytics Cloud

SAP Cloud Platform

SDK
• Lower Cost of Entry Analytics Hub Mobile
• Reduced time to Benefit

HANA
• Pay as you go Digital Boardroom
HANA
• Vendor responsible upgrade
• Higher adoption rates BI Planning Predictive
Exploration Stories Planning Allocation Machine Discovery Harmonization

On premise/ Business Intelligence

Private Cloud SAP S/4HANA Harmonization

S/4HANA S/4HANA Planning and Consolidation

Predictive
Finance Logistics
Consolidation

Planning

Embedded
Analytics
HANA

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BLEND AND QUERY DATA ANYTIME, ANYWHERE SAPPHIRE 2017 Announcements

Create end-to-end scenarios by blending on premise and cloud data Already Available

Partners

Acquire Data imported to cloud Live Bring cloud to data

SAP Cloud Platform1 SAP HANA SAP BW SAP BW4/HANA

Cloud Data Sources SAP Data Sources Other Data Sources
SAP BPC NW & MS
S/4 HANA Cloud S/4 HANA2 Universe2
Google Drive & Sheets IBM MS SQL Server

SAP Cloud Platform1 SAP BW SAP ECC MySQL Netezza OData

SAP Business ByDesign Universe SAP HANA Oracle Progress OpenEdge
Hybris Cloud for Customer S/4 HANA CSV Excel
Access via SDI for SAP Cloud Platform & HANA3
Fieldglasss Google BigQuery
Apache Hive AWS HANA Vora
Workforce Analytics OData
SuccessFactors Concur SAP Sybase ASE, IQ, ESP MS SQL Server

S/4 HANA Cloud Salesforce Acquire Spark SQL Oracle Teradata OData
Import data into SAP
MaxDB IBM DB2 MySQL Netezza
Analytics Cloud
Acquire Partner delivered Facebook Google+ Twitter

APOS CDATA DataDirect Cloud

Universe QuickBooks eloqua Live Live Partner delivered
Web Intelligence
NetSuite CRM & ERP Google Analytics Data not moved into
APOS
MSFT SharePoint Hubspot SAP Analytics Cloud
Universe
MongoDB Marketo
SAP BW
Oracle Mktg Cloud MSFT Dynamics CRM
Microsoft Analysis Services
… SugarCRM
…
1. Requires SAP Cloud Platform DBaaS license
2. Planned for release in Q3 2017
Refer to product roadmap for latest availability 3. SAP CP connects to data using Smart Data Integration and Smart Data Access Adapters
4. Requires the Vora 1.3 release which is planned for Q4 2017?
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SAP Runs SAP - Leading the way with SAP S/4 HANA

Business Suite on Simple Finance SAP S/4 HANA

Data model and simplification
SAP HANA User experience and guided
configuration

2013 2014 2015

speed real-time processes no aggregates & one source of truth flexibility & insight

• 420 hours less • 22% elimination of • 1 day: time to • Operational Reporting on

processing time at closing efforts implement org ERP Simplified Data
quarter end close changes (down from 1
Decision Model improves
• 99% reduction week) performance and moves
• 70% reduction: time to processing time to Support
reporting back to ERP
process reconciliation perform chargeback • ~ 50% efficiency gain
issues @ SAP SE (elimination with Fiori • Unified data model –
of batch processes) Transactional Fiori breaking silos One single
Financial Financial
apps with optimized set of granular data
reporting planning
duration, Reconciliation effort
and Analysis and control
# of clicks, # of eliminated
Past Future
screens and # of entry
fields

Standard Transaction Master Data

Non-disruptive
(ERP) implementation
Services and&Policy
adaptation
system Shared Management

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Thank You!
Eric Smit
Center of Excellence
Analytics & Insight
Eric.smit@sap.com
+781 825 7514

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