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CONFIDENTIAL

Delivering Real-Time Business Value for Usha Powered by SAP Business Suite on HANA Subodh Dubey, Group CIO, Usha International Limited

SAP HANA Council July 30, 2013 • Mumbai, India

Journey So Far

  Became the first Indian customer to go live on BW on HANA

  Started BPC on HANA implementation project

Complete

SAP BW on HANA

March 2012

Business Planning & Consolidation (BPC)

on HANA

April 2013

SAP Business Suite on HANA

> April 2013

  Started the journey on SAP Business Suite on HANA

  Go-live with ECC 6.0 on IBM i-Series – AIX & DB2 platform

  Go-live with BW and SCM

SAP ECC 6.0

April 2008

SAP Business Suite on HANA (SoH) Evaluation - Approach

Complete Enterprise

Readiness Assessment

Business Case Preparation

Migration Planning


SAP Business Suite on HANA (SoH) Evaluation – Enterprise Readiness Assessment

Complete Enterprise



Migration Planning


•  Can SAP do a productive instance migration at our site rather than in lab environment?

•  What kind of performance acceleration can be achieved?

•  BW on HANA is great, but what about ECC on HANA?SCM? CRM? We have all these solutions.

•  Is Business Suite on HANA Enterprise ready yet?

•  How is business continuity ensured? •  What is Far-site Disaster Recovery

readiness?

  SAP completed SoH Architecture and Sizing

  High Availability, Far-Site Disaster Recovery, Log-shipment, Back-up related queries responded to our full satisfaction by product development experts from SAP Labs

  SAP Services completed the assessment of custom codes

Data Center Readiness

May-June 2013

Custom Code Assessment

  SAP Consulting completed the production system pilot migration in 4 weeks

  Upgraded ECC to EhP6.06 and then to EhP6.16

  Unicode conversion and   HANA DB migration of

1.0 TB

Production System Pilot Migration

April-May 2013

SAP Business Suite on HANA (SoH) Evaluation – Enterprise Readiness Assessment

The database footprint in DB2 was close to 1 TB (without Unicode), which came down to 210 GB on HANA, thus achieving a very satisfactory compression factor of 5.

We had to upgrade to EhP6 and also convert the landscape to Unicode, before HANA DB migration.

One large table on sales pricing condition (>240 Million records) didn’t migrate in the first attempt. Need to be careful in migrating large tables. Overall smooth migration completed in 4 weeks.

Business Suite on HANA is fully Enterprise ready, with far-site Disaster recovery functionality in SP6 (from Jun’13). Production System in Active-Passive mode and Virtualization allowed optimization of required HANA appliances.

During the testing of migrated Pilot system, custom code transactions ran without issue, but certain custom coded programs needed modification for optimized performance on HANA.

SAP Business Suite on HANA (SoH) Evaluation – Outcomes and Learnings…………………………..(1/4)


  One Sending Plant and All receiving Plants (50+), All material (80,000)

  Performance gain of 10X

Stock in Transit

  All Plants (50+), All material (80,000) Stock as on a date


Stock as on a date (MB52)

  All Plants (50+), All Material, 2 years


Purchase Order List (ME2M)

Stock Movement (MB5B)

68

694

0 200 400 600 800

SoH

ECC-DB2

168

1011

0 500 1000 1500

SoH

ECC-DB2

570

4500

0 1000 2000 3000 4000 5000

SoH

ECC-DB2

335

9000

0 2000 4000 6000 8000 10000

SoH

ECC-DB2   All Plants (50+), All Material, 1 year


MATERIALS MANAGEMENT

SALES & DISTRIBUTION AND PRODUCTION PLANNING


  All Sales Office, All Divisions, All Sales Areas, All Plants (50+)


Open Sale Orders

  All Plants (50+), 200+ Finished Material, All Distribution Channels and Divisions

  Performance gain of 1.2X, requires custom code management

Sales Price Simulation

  All Plants (50+), 200+ material, 1 vendor


Purchase Price Simulation

2

647

0 200 400 600 800

SoH

ECC-DB2

1456

1672

1300 1400 1500 1600 1700

SoH

ECC-DB2

14

1851

0 500 1000 1500 2000

SoH

ECC-DB2

81

262

0 100 200 300

SoH

ECC-DB2 Multi-level, Multiple Material BoM

  Bill of Material Details for Multi-level, Multiple Material


Business Value of Speed

What capabilities can HANA deliver that were not possible before

1. Period-end closing of Production Orders for accurate inventory valuation

FINANCIALS AND CONTROLLING


  1 Co. Code, 1 Plant, 3 months


Purchase Register

  All Vendor Accounts Open Items


Vendor Due Date Analysis

  Asset History

  Performance gain of 2.5X

Asset History

Actual Overhead Calculation   Actual Overhead calculation, 1 plant, all

production orders

  Performance gain of 3.6X

119

1800

0 500 1000 1500 2000

SoH

ECC-DB2

17 187

0 50 100 150 200

SoH ECC-DB2

478

1200

0 200 400 600 800 1000 1200 1400

SoH

ECC-DB2

2014

7200

0 2000 4000 6000 8000

SoH

ECC-DB2

SAP Business Suite on HANA (SoH) Evaluation - Approach

Complete Enterprise



Migration Planning


•  What are tangible business benefits of SoH?

•  What is the Total Cost of Ownership?

  SAP Solution Engineering and Value Engineering team followed up the BSR exercise, with value driver workshops, where the business benefits were quantified

  SAP also quantified the productivity improvement areas, due to acceleration of certain daily and month end transaction benefits.

  Using quantified business benefits and with details of Software, Implementation and Infrastructure total cost of ownership (TCO), we internally completed the business case for investment approval

Value Driver Workshop Business Case Preparation

  SAP completed Business Scenario Recommendation (BSR) study identifying solution area wise, business scenarios, that have highest relevance for Usha across

  Financials   Supply Chain   Procurement   Manufacturing   Sales and   HR

Business Scenario Recommendation

SAP Business Suite on HANA (SoH) Evaluation – Business Case Preparation

May-June 2013 April-May 2013

Business Scenario Recommendation – Value Map Focus areas for Business Suite on HANA - Finance

Business Scenario Recommendation – Value Map Focus areas for Business Suite on HANA - Finance

Domain Areas SoH Use Cases Drivers KPI / Metrics

Financial Performance Management

Days Sales Outstanding (DSO) Receivable Management

•  Optimized collection from defaulters (time) •  Real-time credit management

•  DSO

Profitability Management Net Margin Analysis

•  Impact of cost driver into margin of FG •  Improved pricing •  Simulation and what if analysis for better sales forecast

•  Net Margin

Cash Flow & Liquidity Forecast •  Reduction of coverage gap because of better forecast visibility •  Optimized borrowing and investment decisions thanks to real-time cash

visibility and simulation capabilities

•  Working Capital

Financial Close Depreciation posting Product costing WIP calculation Valuation GR/IR reconciliation

•  Faster transaction processing •  Real-time visibility of doing closing process and bottlenecks •  Optimized GR/IR and inter-company reconciliation

•  Operational costs •  Time to close books

Collaborative Finance Operations

Bank reconciliation •  Real-time visibility of bank book •  Optimized bank reconciliation

•  Operational costs

Business Scenario Recommendation Value Drivers Quantification – Finance (figures held back due to confidentiality)

SoH Use Cases KPI Baseline 1 Benchmark Performance 2 Estimated

Improvement 3 (%)

DSO & Receivables Management

•  Days Sales Outstanding (in days)

•  Reduce Overdue Accounts Receivable (in %)

•  Reduce Uncollectible Accounts Receivable Write Offs (in %)

1.4

34

60 30 45

18 3 11.2

0.22

1.6 0.04 1.08

Notes : 1 – Baselines provided by Usha International 2 – Illustrative, based on SAP CPG benchmarking database (100+ companies) 3 – Preliminary SAP estimation

Business Case Summary

SAP Business Suite on HANA (SoH) Evaluation – Migration Planning

Complete Enterprise



Migration Planning


•  How SoH migration is different from typical OS/DB migration project?

•  How long will it take to migrate? •  Will it work with multiple SAP and non-

SAP add-ons and interfaces, that we have?

•  We have quite a few customized programs. How will they be migrated?

•  What up-skilling will be required for our BASIS, ABAP and functional consultants?

SoH migration is slightly different from typical OS/DB migration project, due to homogeneous and heterogeneous steps required for migration. SAP convinced us that with their Rapid Deployment Solution, the migration for 4 systems (Dev, QA, Production and DRS) will be completed in 12 weeks.

We realized that most add-ons like Collabera EXIM, Org Publisher etc. and interfaces to Enterprise Portal, BW, OpenText Archiving etc. and non-SAP apps, work with SoH at an application level and not at a database level. All we need to worry about is testing them in ECC 6.0 EhP 6 environment.

During the acceptance testing of the migrated Pilot system, all the custom code transactions ran without issue, but certain custom coded programs will need to be modified for optimized performance on HANA.

With BW-HANA project experience, our BASIS consultants were skilled on HANA database administration and management, but we realized that our ABAP team will also need to up-skill to internally take care of customized programs that exist today.

SAP Business Suite on HANA (SoH) Outcome & Learning – Migration Planning

Q2 to Q4 2014

SAP Business Suite on HANA (SoH) Our HANA Journey

Complete

Functional Upgrade on ECC6.0 EhP6 on HANA

Dec 2013 – Mar 2014

CRM on HANA Implementation

Supply Chain Management (APO) on

HANA Migration

ECC on HANA Migration

Aug – Nov 2013

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