Business process oriented ERP implementation

Oleg Novozhilov Deputy director of SAP-consulting department, project manager IDS Scheer Russia and CIS

ERP forum Sofia, 16 November 2006

Content IDS Scheer at a glance Typical processes paints during implementation Unique approach ARIS Value Engineering ERP-related experience Summary

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IDS Scheer worldwide

Software and consulting for business process management Analysis and improvement of business processes, implementation of business applications, and development of composite solutions Full service provider for process and IT solutions

With the ARIS Platform for Process Excellence, IDS Scheer is the worldwide market leader for business process analysis and optimisation (Gartner Group)
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IDS Scheer worldwide - International Presence

IDS Scheer is represented by partners and subsidiaries in more than 70 countries.
IDS Scheer subsidiaries IDS Scheer partners

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About IDS Scheer Russia and CIS

IDS Scheer Russia team - leading consultants and topmanagers are in consulting from 1992 January 2005 consulting company Business Logic merges with IDS Scheer group IDS Scheer Russia is one of the 5 top consulting companies with core competence in production of goods and services. Source: Expert journal, 2006
Business focus
Strategic management Management consulting Business Processes Management IT consulting and solutions implementation (Ultimus, HP OpenView, Convera) SAP-related services ARIS software family Modern management technologies training in IDS Scheer Russia Academy

Social activity
Publishing of a professional review Business Logic for business processes owners Department of Business processes analysis and optimization in Business Informatics faculty of State Economics High School Organization of conferences, trainings and workshops

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Content IDS Scheer at a glance Typical processes paints during implementation Unique approach ARIS Value Engineering ERP-related experience Summary

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Typical process paints during implementation

PAIN POINT Process Design & Modeling Business owner and IT expert do not speak the same language, do not share the same concepts of processes, do not use the same tools Plethora of tools without linkage of views & objects Project time lost due to internal alignment needs projects running out of budget PAIN POINT Process Configuration Disruption between business logic and technical implementation missing methodology No navigation from model to process configuration Missing transparency & documentation No re-use of process knowledge No standardization & governance possible PAIN POINT Process Integration There are process-integration breaks No common process repository Missing process management and control across applications and enterprise boundaries
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Where is no common language between business and IT

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Content IDS Scheer at a glance Typical processes paints during implementation Unique approach ARIS Value Engineering ERP-related experience Summary

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Business process management during ERP implementation

ARIS Value Engineering for SAP is the new standardized approach by IDS Scheer for the management of SAP solutions In general it is applicable for any ERP implementation (not only SAP) Focused on business process management during ERP implementation
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ARIS Value Engineering for SAP Roadmap

Strategy
Identify business segments & objectives

Design
Execute as-is (requirement) analysis Design to-be processes (SAP neutral)

Implementation
Setup system infrastructure Execute process configuration

Controlling
Monitor business performance Monitor system performance Monitor organizational performance Control service-Level Agreements Verify cost benefit calculation Trigger corrective actions

Record enterprise map

Determine end-to-end scenarios Determine key performance indicators Perform enterprise analysis Define business case

Select SAP components Build Initial prototype (feasibility) Design to-be processes (SAP based) Create Business Blueprint Perform test and validation Perform User training Execute go-live management

Execute process integration

Business Case

Business Blueprint

Live System

Improvement Strategy

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Business process hierarchy

Process Area
Level 1

Supply Management

Main Process
Level 2

Inventory Management

Process
Level 3

Goods Receive

Activity
Level 4

Receive Shipping Notification

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ARIS Value Engineering for SAP Strategy Phase

Strategy

Record enterprise map Determine end-to-end scenarios

Enterprise map
Management processes

1
2 3 4
Procure-to-Pay Procure-to-Pay (material)

End-to-end scenarios

Operation Management

Analytics

Core processes
Procure-to-Pay (serv ices) Procure-to-Pay (serv ices)

Engineering

Production

Sales & Distribution Management

Plan-to-Produce
Supply Management Customer Management

Re-Order point planning

Order-to-cash

Order-to-cash (standard)

Order-to-cash (tele sales)

Order-to-cash (route sales)

Support processes
Empties processing
Financial Management Human Capital Management Corporate Services Management

Self -collector

Standard deliv ery

DSD-deliv ery

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ARIS Value Engineering for SAP Design Phase

Design

To-be design (how ERP supports processes) with usage of different reference content

SAP Solution Maps

ARIS reference models

SAP Solution Manager BPR Business process repository

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ARIS Value Engineering for SAP Implementation phase

Implementation

Transfer process hierarchy from ARIS to ERP implementation tool (e.g. SAP Solution Manager) and process-oriented system customization Process-oriented testing Process-oriented user training
not O.K. O.K.
Mate ria l Requireme nts Pla nning

Inventory Management
Scenario
Sales & Distribution Manageme nt

Procureme nt

decid ing who informs th e claimant Modu le 1

Goods Rece ived

Orde r Rece ived

Che ck Inve ntory

checking calculations of interest

checking calculation of costs

Goods Rece ipt Proce ssing

decid ed for the registrar

Che ck Order

decid ed not for the registrar

calculations checked but not verified

Main process

SAP function type: Process

Goods Rece ipt Proce ssed

Orde r Che cke d

informing the claimant

registrar

asking claimant to adjust the application within 4 weeks

registrar gives writing office order to comp ose a letter

issueing payment o rder

informing the defen dand about his option s

letter composed
Goods Rece ipt Posting Goods Moveme nt

SAP function type: Process

SAP function type: Process

claimant informed and asked writing office

payment o rder isssued transmitting the letter and order to the courts office giving order to the courts office to serve payment order

defen dand informed

Post Goods Rece ipt

Send Goods Financial Manageme nt

Add Goods to Wa rehouse

transmitted to the courts office

registrar

Sales & Distribution Manageme nt

Goods Wa rehousing

adding the o rder to the file

courts office

transmitting the letter to th e post office

order given

order not given Modu le 2

SAP function type: Process

order added
Wa rehouse checked Goods adde d to Wa rehouse

letter transmitted

comission ing to serve th e payment o rder

sending objection to the post office

defen dand

Goods Receipt Processing (EPC)

Inve ntory Manageme nt

Process
sending letter to claimant
Sta rt Che ck Inve ntory

objection received b y the post office served by the post served by the police sending objection to the courts office letter sent to claimant

Goods Rece ived

post office

Rece ive Shipping Notifica tion

SAP function type: Process step

checking if serving was successful

objection sent

Rece ive Purchase d Goods

adding ob jection to the file

Unpack Goods

courts office

transmitting objection to registrar

incorrect/incompl ete documen t

serving has not been possible

successful

objection added
Che ck Goods

transmitted to registrar

giving order to demand a repeated serving to the post

informing the parties (module1)

registrar

informing claimant&ask him to adjust the direction of the defendand within 3weeks

transmitting the serving document to th e court informing claimant about objection and his option s to react (Module1)

using Module 1!

Process
End Che ck Inve ntory

Goods OK

Goods Differe nt to Notifica tion

order given
Goods not OK

parties informed claimant informed

serving document transmitted

registrar

Differe nce Proce ssing

Perform Return Delivery

examining the serving document

registrar

claimant informed

Differe nce s Correcte d

Return Goods

executing the procedure

serving document examined

checking if claimant wants to eng ag e the ordin ary legal procedure

procedure has finished yes

Create Transfe r Orde r

no

arranging the archiving of the file

registrar

Perform Stock Tra nsfe r

arranged

applying for the divesture to the judge

claimant

payin g the costs for an o rdinary procedure

issueing the enforcement order upon application of the claimant (Module2) declaration about all payments

registrar

issueing a executed copy

Confirm Tra nsfer Orde r

applied archiving the file courts office

costs payed enforcement issued

executed copy issued

Goods Rece ipt Proce ssed

file archived

transfering the procedure to the comp etent court

giving an order to inform the central costs office to send him the file

registrar

checking if application is conform to the time limit

Goods Rece ipt Posting

Goods Moveme nt

checking if file is archived three years

transfered order given not O.K. informing the parties about the transfer (Module1) O.K.

SAP function type: Process

SAP function type: Process

no

yes

sending file to claimant

cost office registrar arranging the serving procedure

parties informed destructing all costituent parts o f the file except for the enforcement order sent to claiman t check if procedure should be transferred to other court upon req uest of claiman t serving procedure arranged executing the file

Receive Shipping Notification

Process step
ME308 (Send Contracts with Conditions) VL75 (Shipping Notification Output)
Shipping Notifica tion Output

destructed

sig nalizing on the file if executed doc has been issued

no requ est o f claimant

request of claimant

file was executed

registrar sig nalized

informing defen dand about the request (Module 1)

sending back the file to courts office

claimant

Activity
IDS Scheer Russia and CIS

Send Contra cts with Conditions

Inve ntory Manager

destroying the whole file after 30years

defen dand informed

file received in courts office

file destroyed after 30 years

asking if defen dand agrees (Module2)

Rece ive Shipping Notifica tion

defen dand agrees to transfer to another court

defen dand agrees not

SAP R/3

SAP function type: Process step SAP component: SAP R/3

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ARIS Value Engineering for SAP Controlling phase

Controlling

Process-oriented support (issue management linked to the processes) Monitor business performance ARIS Process Performance Management
Measure 1

Order processing
Orderannahme: Order kann bei 01-36111 - 01-36114, 01-36211, 01-36214 eingehen. Auftrag des Kunden liegt vor 01-36211 GER Domestic Institutions - Notieren der Order durch Sales auf einem Orderzettel (papiergesttzt!) - keine Vergabe einer lfd. Nummer (nicht MAH-konform) - Orderzettel dient als Grundlage zur weiteren Bearbeitung; Daten auf dem Orderzettel sind nicht immer vollstndig vorhanden (Ursache fr Fehler in der Weiterbearbeitung) - Sales und Handel fllen Orderzettel teilweise nur unzureichend aus. - keine Systemuntersttzung! Vollstndig manuelles Arbeiten. 01-36111 Orderverwaltung: - keine bersicht da keine Systemuntersttzung ber vorhandene Orders und jeweiligen Status, - Orderzettel liegen lose auf den Hndlertischen - keine bersicht Nichtbearbeitung Doppelbearbeitung oder ber den Status der Orders, d.h. Gefahr der Orderzettel (Aktien) Orderzettel vervollstndigen Sales Trading 01-36214 International Institutions z.B. Ausfhrungswnsche Grosse Orders knnen zur weiteren Bearbeitung direkt von Sales an Sales/Trading gegeben werden. Festpreisgeschft oder AQR liegt vor 01-36211 GER Domestic Institutions 01-36214 International Institutions 01-36111 Sales Trading Aktien handeln (Kassa) Auslandsbrsen Eigenhandel Zusage aus Trading liegt vor Orderzettel (Aktien) Normale Execution liegt vor 01-36211 GER Domestic Institutions 01-36214 International Institutions 01-36111 Sales Trading

ARIS PPM

Anfrage an Trading stellen

Order an Executor weiterleiten

Order liegt Executor vor

Hier gibt es keine eindeutige Regelung. Die Order kann mndlich weitergeleitet werden oder per Orderzettel.

01-36211 GER Domestic Institutions 01-36214 International Institutions 01-36111 Sales Trading GL-TRADE Order erfassen MA Execution Aktien Telefon Order an Broker weiterleiten MA Execution Aktien Orderausfhrung: Besttigung aus GL-Trade liegt vor kann gleichtgig abgerufen werden; telefonische Ausfhrungsbesttigung erfolgt taggleich Telefon Kunden ber Ausfhrung informieren Bei europischen Mrkten liegen ca. 50% der Besttigungen gleichtgig (nach 17:00) und ca. 50% am nchsten Morgen vor. Besttigung vom Broker liegt vor i.d.R. am nchsten Morgen; telefonische Ausfhrungsbesttigung erfolgt taggleich - Manuelle Weiterleitung des Orderzettels zum Execution Desk, Gefahr des Informationsverlustes bei der manuellen bertragung - Zeitaufwendige, manuelle Ergnzung des Orderzettels erforderlich (z.B. Kurs); es wird letztendlich doppelt erfat: 1mal auf Zettel, 1mal im System

Orderzettel (Aktien) - Kurs - EB-account - Valuta - Whrung

Orderzettel vervollstndigen

Orderzettel vervollstndigt

01-36211 GER Domestic Institutions 01-36214 International Institutions

taggleich; insbesondere bei Nettokunden Kunde ber erforderlich Ausfhrung informiert

Weiterbearbeitung:

Orderzettel (Aktien)

Orderzettel vervollstndigen

01-36114 Agency Dealing/ Execution 01-36214 International Institutions

01-36211 GER Domestic Institutions alternativ (s.o.)

- Manuelle Weiterleitung des Orderzettels an das MidOffice, auch hierbei bertragungsfehler und zeitliche Verzgerungen - Weiterbearbeitung im MidOffice erst am nchsten Tag - Brokerfax als externe Geschftsbesttigung wird abgewartet (liegt erst am nchsten Tag vor) - aufgrund der unzureichenden internen Informationslage muss auf externe Daten zurckgegriffen werden; operationelles Risiko! - Daten auf dem Orderzettel weichen von denen auf dem Brokerfax hufiger ab - Daten auf dem Orderzettel sindfter fehlerhaft

Orderzettel vervollstndigt

Orderzettel (Aktien) Telefon

Prfen, ob Kunde Whrungssicherungsgeschft abschliessen will

01-36211 GER Domestic Institutions 01-36214 International Institutions

01-36111 Sales Trading

Measure 2

Kunde will Whrungssicherungsgeschft abschliessen 01-36211 GER Domestic Institutions 01-36214 International Institutions

Kunde will kein Whrungssicherungsgeschft abschliessen

Telefon

Treasury informieren

01-36111 Sales Trading

Kurs und CPD werden auf dem Orderzettel vermerkt Geschftsbesttigung durch Treasury liegt vor

am nchsten Tag 01-36211 GER Domestic Institutions Geschftsbesttigung (Treasury) liegt i.d.R. erst 2-3 Tage in Panmure vor. (eher internes Problem) Geschftsbesttigung abzeichnen 01-36214 International Institutions 4-Augen-Prinzip

01-36111 Sales Trading

Geschftsbesttigung abgezeichnet

Geschftsbesttigung (Treasury)

Unterschriebene Geschftsbesttigung an Treasury weiterleiten

01-36211 GER Domestic Institutions 01-36214 International Institutions

01-36111 Sales Trading

Geschftsbesttigung (Treasury)

Geschftsbesttigung ablegen

01-36211 GER Domestic Institutions 01-36214 International Institutions

01-36111 Sales Trading

Geschftsbesttigung liegt Treasury vor

Geschftsbesttigung abgelegt

Weiterbearbeitung durch Treasury

Taggleiche Weiterleitung an MidOffice! Orderzettel (Aktien) Orderzettel weiterleiten

01-36211 GER Domestic Institutions 01-36214 International Institutions

01-36111 Sales Trading Weiterbearbeitung (nchster Tag): - Langwieriger manueller Abgleich der Daten auf dem Orderzettel und Daten auf dem Brokerfax durch MidOffice ntig. - Versenden einer Faxbesttigung an den Kunden (manuell, daher Fehlerquellen und Verzgerungen)

Orderzettel liegt Desk Support vor

Eingang der externen Brokerbesttigung im Handel ist nicht MAH-konform!

FAX

Faxbesttigung an Kunden senden

MA Desk Support Dsseldorf 01-36211 GER Domestic Institutions

Brokerbesttigung liegt vor liegen i.d.R. am nchsten Tag vor! Gehen per Fax oder ber GL ein.

(Vorabbesttigung) Erfolgt i.d.R. erst nach Eingang der Faxbesttigung Brokerbesttigung an Kunden gesandt

Aktien abwickeln (Kassa) - Ausland

Broker-Faxe werden per Fax Weiche auch direkt an WPS weitergeleitet.

Brokerbesttigung

Orderzettel (Aktien)

Brokerbesttigung zuordnen

MA Desk Support Dsseldorf

Brokerbesttigung zugeordnet Orderzettel (Aktien) 1. Brokerbesttigung ergnzen MA Desk Support Dsseldorf Fr Weiterbearbeitung in WPS: Kundennummer Kundenname EB-account (ggfs. Zuordnung zu Fonds) (ggfs. FW-Sicherungsgeschft) Weiterbearbeitung (2 redundante Schritte): - Manuelles Ergnzen des Brokerfaxes um relevante Daten fr die Weiterbearbeitung in der WPS Bank (z.B. Kundennummer, Kundenname, EB-account, ) - Weiterleitung des Brokerfaxes per Fahrradkurier (!) an die WPS Bank - Erfassung des Geschftes im System OMNI (nicht MAH konform, da nicht taggleich) - Ergnzung des Geschftes (z.B. Settlementinstruktionen) in AKTIAS (Doppelarbeit!)

Measure 3

2.

Brokerbesttigung

Brokerbesttigung ergnzt

Measure 4

OMNI erfolgt erst nach Eingang der Brokerbesttigung

Geschft erfassen

MA Desk Support Dsseldorf

Brokerbesttigung

Brokerbesttigung an WPS weiterleiten

MA Desk Support Dsseldorf per Fahrrdakurier

Geschft erfasst

- Art des Geschfts - Menge - Gattung - Limit - brutto/netto - Kunde/account - Whrung (bei FW-Sicherungsgeschft wird die "Trading Cross Rate" auf Basis des Orderzettels erfasst)

Brokerbesttigung an WPS weitergeleitet

Aktien abwickeln (Kassa) - Ausland

Trade Control: Marktgerechte Bedingungen berwachen Aktien

AKTIAS

Settlementinstruktionen MA Desk Support zu Kundengeschft Dsseldorf zuordnen

Settlementinstruktionen zu Kundengeschft zugeordnet

AKTIAS

Geschfte zu Kunden zuordnen

MA Desk Support Dsseldorf z.B. bei Investmentgesellschaften Zuteilung eines Geschfts auf mehrere Fonds

Geschfte zu Kunden zugeordnet

Reclamation processing

ARIS PPM Process Warehouse

AKTIAS

Daten an Schnittstelle zu BSP-TRADE weiterleiten Daten liegen in Schnittstelle zu BSP-Trade vor

Vom Ordereingang bis zur Vorlage in der WPS vergehen teilweise ca. 48 Std. Ca. 80% liegen nach einem Tag vor. Settlement mu in der Regel mit T+3 erfolgen.

Aktien abwickeln (Kassa) - Ausland

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Using ARIS report tool

Business blueprint

Test cases

Authorization concept

Manuals

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Share process-related knowledge though the Web

Run ERP transactions

Manuals

Web portal
Customization description

Training courses

Knowledge is available

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Content IDS Scheer at a glance Typical processes paints during implementation Unique approach ARIS Value Engineering ERP-related experience Summary

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ERP-related clients of IDS Scheer Russia and CIS

Tumenenergo

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Projects description

Process-oriented mySAP ERP implementation

Business process design for SAP implementation, processes coverage by SAP analysis

Business processes oriented SAP-implementation (SAP MM, SD), processes design and SAP processes modeling

SAP redocumentation, creation of user documentation and customization documentation

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Projects description

Preparation for SAP solution implementation, processes design and modeling

SAP solution processes modeling

Tumenenergo
SAP system documentation, processes modeling, review documentation

Pilot SAP process design and modeling, analyses of processes coverage by SAP

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Content IDS Scheer at a glance Typical processes paints during implementation Unique approach ARIS Value Engineering ERP-related experience Summary

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Benefits of process-oriented implementation Builds a bridge between business and IT Process culture introduced and enforced Ensures integration between requirements, blueprint and implemented system thru processes Ensures process integration between different process areas Accelerated process-oriented customizing and testing More effective user training and increased process competence High quality and easy to maintain documentation of ERP solution

Think in processes not in systems

IDS Scheer Russia and CIS

Business view

IT view

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Q&A section

Oleg.Novozhilov@ids-scheer.com