dynamic planning & forecasting w big data

Dynamic Planning & ForecastingPartner Summit

Atul PatelVice PresidentSAP AnalyticsSAP APJ

CFO’s continue to emphasize EPM as their top initiative for BI and Analytics

Source: Gartner. John Van Decker. Survey Analysis: CFOs' Top Imperatives From the 2013 Gartner FEI CFO Technology Study. May 2013

Social networking

Disclosure Mgmt Solutions

Mobile technologies

Cloud computing

On-demand apps/SaaS

GRC apps

Reconciliation mgmt apps

BPM

Integrated financial mgmt apps/ERP

BI, analytics, performance mgmt

3

2

3

11

5

3

2

17

23

35

3

3

6

3

5

8

11

11

18

29

5

6

3

7

8

10

18

24

14

Top Initiatives Today: Finance

Ranked 1st Ranked 2nd Ranked 3rd

Statistical analysis

Predicitive modeling

Big data

Customer and product profitability

Data warehouse

Budgeting, planning and forecasting

Financial reporting and consolidation

Performance measurement, scorecard, and dashboard

16%

18%

22%

30%

35%

43%

45%

54%

Investment in Business Analytics

Percentage of respondents

More Companies Choose SAP EPM

Largest EPM installed base (10,000+ customers)

Fastest growth of top 3 vendors (2010 – 2012 30%)

Source: Worldwide Financial Performance and Strategy Management Applications 2013-2017 Forecast and 2012 Vendor Shares, doc #241220, June 2013

© 2011 SAP AG. All rights reserved. 4

What the analysts have to say

SAP rated as a “hot” vendor and awarded highest combined ranking across all categories for 3rd consecutive year – Ventana Value Index for FPM (2013)

“SAP's customer reference scores were very good, near the top of the peer group” – Forrester Wave for FPM (Q3 2013)

“SAP’s mobile capabilities stand out for the breadth of performance management capabilities made available on mobile devices and for the ability to enter data and complete processes via mobile device…… other vendors just had ready-only access to basic dashboards and static reporting” – Nucleus Research Technology Matrix for CPM (H1 2013)

Customer Momentum

Big DealsBig HANA Success

Big Hyperion Wins

BPC/MS, BFC

BPC/NWBFC, TRM

PCM, BPC/NW

TRM

BPC/NW

BPC/NW, PCM

EPM + HANA Success

Customer Success Industries

High Tech

Oil & Gas

Consumer Products

Financial Services

Energy

Use Cases

Sales, production, purchasing planning

SKU level planning

Headcount planning

Capital planning

Sales forecasting

Legal & financial consolidations

OPEX planning


1 toolProviding centralized data, a common user interface, and standardized calculations

20%Reduction in time to create forecasts

CompanyHewlett-Packard Company (HP)

HeadquartersPalo Alto, California

IndustryHigh tech

Products and ServicesComputing equipment, services, software, and solutions

Employees>300,000

RevenueUS$120.4 billion

Web Site www.hp.com

Business challenges Eliminate use of disparate spreadsheets and Essbase cubes for

global expense management (GEM) Automate processes and centralize GEM data as part of a multi-year

project to centralize corporate planning and simulation

Technical implementation Deployed the SAP® Business Planning and Consolidation application

to run on HP AppSystems and the SAP HANA® platform and extended the application enterprise wide

Deployed dimension with over one million members including hierarchies with no performance implications

Ran the system on an HP converged infrastructure, including ProLiant servers

Key benefits Replaced a multitude of spreadsheets and decentralized legacy

databases with one centralized tool Reduction in manual processes, time to consolidate data and ease in

ability to create comparisons Increased flexibility and adoption in reporting ,via the EPM Add-In

with users reporting off one single version of the truth

“SAP understood what we were trying to do and together we made it happen. Before, everyone had a slightly different method to calculate average salary. We agreed on a standard way so everyone is using the same base assumptions. Having everything centralized and standardized speeds plan creation and validation. We wanted to prove that SAP Business Planning and Consolidation could scale to the enterprise, and now we know that on HP infrastructure it can.”

James Mooney, Financial Planning and Simulation Program Manager, Hewlett-Packard Company (HP)

HP: Maximizing Performance with SAP® Business Planning and Consolidation powered by SAP HANA®


Improving Performance at the City of Boston

About City of Boston Location: Boston, Massachusetts Industry: Local Government Products and Services: Multiple City

Departments Revenue: n/a Employees: Approximately 8,000 Web Site: www.cityofboston.gov SAP Solutions and Services: SAP Strategy

Management , Strategy Management iPad, CitizenInsight

Scope: Will be rolled out to all departments

Challenges and Opportunities Improve tracking and internal reporting of

performance Reporting of performance results to the

city’s citizens

Objectives Improve strategic planning and alignment of

performance objectives and actions with goals

Support city managers vision for performance management

Report performance results to citizens

Implementation Highlights Strategy Management branded as BAR –

Strategic Tracking and Reporting System Strategy Management iPad application is

used for mobile monitoring and management of performance

CitizenInsight will be made available (coming June 2012) to citizen’s of Boston area to view performance results

Why SAP? Struggled with implementation and

performance of competitor’s scorecarding solution

Evaluated multiple solutions but felt SAP was easier to use, had better aesthetics and covered all key requirements including initiative management, operational reviews, scorecards and mobile capabilities

Leverage SAP available City Management content to accelerate implementation

Needed solution that offered strong mobile capabilities

Benefits Better understanding of and agreement

on performance from the big picture down to the detailed plans

Lowered overall TCO of their strategy management solution

Improved accuracy, availability, and aesthetics of published performance results

“A successful City is one that delivers for its people. Through

accountability and strategic focus, the BAR program ensures

Boston is delivering on that promise”

- Mayor Thomas M Menino http://www.cityofboston.gov/bar/scorecard/reader.html

http://www.cityofboston.gov/bar/scorecard/reader.html

http://www.cityofboston.gov/bar/scorecard/reader.html

Faster SimulationIn Changing Market Conditions

400x faster reporting

4x faster data loads

3x faster ready for reporting

MOBILE TRANSFORMS FINANCE

10


Plan Anytime, Anywhere


Close Anytime, Anywhere


Citizen Insight


Store Insight

CFO.com Research 2013

“The top improvement area for finance executives is improving

capabilities for predictive analytics and simulations.”


The Flaw of Averages

Plans based on average conditions are wrong on average


The New Planning


Integrate EPM and Predictive Analytics


Embed HANA Predictive Capabilities


Driver-based Planning IntroductionDrivers behinds Financial Planning

Factors may impact the report

Labor Cost Units Sold Sale Price Oil PriceSteel Price

Financial Planning Report


Driver-based Planning IntroductionPlanning Process

Build Driver Model

Identify key business drivers Multi-dimensional Modeling Maintain Master Data Define Data Flow

Driver Planning & Analysis

Data Entry Build Report What-if Analysis Forecast Impact

Rule/Calculation Definition

Associate driver with target Define Formula Chain Define Data Scope

Driver1

Time Product

Driver2Revenue

EntityAccount

Revenue = Sales Units × PriceMaintenance Expense = Sales Amount × lookup( maintenance ratio ) Sales Labor Cost = Sales Unit × SalaryTax = ( Revenue – Expense ) × lookup(Tax Rate)


Driver-based Planning in BPC HANAQuery request flow on BPC HANA

EPM Excel Add-in

BPC Backend

HANA MDX Engine

Calculation Model

HANA Calculation Engine

MDX

Query Request

BPC Report


Driver-based Planning in BPC HANASingle Model Approach – Calculation Definition

Member Formula Formula Chain: Nested Formula Driver Reference

– Unqualified Dimension: Tuple with dummy member

Rate Lookup– Member Property

– IIF

Nested Formula

Tuple Reference

Rate Lookup


Driver-based Planning IntroductionBusiness Value

Link plan with drivers Rapid Planning & Forecasting Real-time Risk Analysis

Focus on LoB activity Reduce planning cycle time Reduce guesswork and do

accurate forecasting

Analyze impact from economic condition or event

React faster or make rapid decision based on analysis

Perform what-if Analysis


Driver-based Planning in BPC HANACalculation Accelerated by HANA

Native HANA Calculation Parallelized Calculation Set-Oriented Calculation

No data transferred between HANA and application server

Native HANA MDX engine Native HANA OLAP

aggregation

Compile calculation to HANA calculation scenario

Independent formula can be calculated in parallel

Can be optimized and parallelized by HANA

Less context switch between kernel and application

C = A+B F = D/E

G = F * C H = F * J

G = F * CHANA

Cube MDX/Calc.Engine

Data

BPC NW Server

MDX Command


Driver based Planning Scenarios – How oil rates drive operating profit ?

ABC CompanyStatement of Profit & Loss

Revenues ……………$5,000Cost of Goods sold ……………3,000

Gross Margin …………2,000

Maintenance ………………………400Payroll ……………………………300

SG&A ……………………………250Transportation ……………………50

Operating Profit ……1,000

Interest Expense ……………50Net Income ……………$950

Price

Headcount

Oil Rates

Region

Customers

Product

Planning using SAP Predictive Analysis (using offline BPC data extracts)


Planning using SAP Predictive Analysis (using offline BPC data extracts)

SAP HANA

HANA Tables supporting BPC model

BWBPCBPC

Model

BI Reporting

EPM Reporting

ERP1. In the first set of exercises, you will

create a flat file extract of BPC data

2. Import it into the SAP Predictive Analysis application

3. Execute predictive algorithms to generate a forecast

4. Export the results to a flat file

5. Import the results into BPC using BPC Data Manager

SAP Predictive Analysis

Transaction

1

2

3

4

5

Planning using BPC and SAP HANA native functions executed within HANA


Planning using BPC and SAP HANA native functions executed within HANA

SAP HANAHANA Tables supporting BPC model

BWBPCBPC

Model

BI Reporting

EPM Reporting

ERP1. Data Manager package executes

ABAP function –or- write back BAdI triggers ABAP function automatically during any BPC model data save

2. ABAP function triggers predictive algorithm stored procedure in HANA

3. Forecast data generated by HANA procedure is stored in HANA BW schema table supporting a BW DSO

4. Forecast data in DSO joined with BPC model data using the system generated BPC multi provider

Predictive functions from

HANA AFL

Transaction

1

2

3

4

HANA Table supporting DSO model

DSO containing generated forecast

BPC Multi Provider


Strategic Financial Planning RDS- Go live in as little as 7 weeks -

Plan business drivers Full impact on

Profit & Loss Balance Sheet Cashflow

Monitor KPIs Financial Bank covenants Credit ratings


Rapid Deployment and Further Innovation

Prebuilt Dashboards Reports Data extraction Data models

Planned HANA for high

performance acceleration


Optimize Transfer Pricing to Save Potential M$

> 75% of the global trade takes place between related parties


Optimize Transfer Pricing to Save Potential M$


Transfer Pricing. Just Do It.


Recent releases

• SAP EPM Unwired mobile app

• SAP Business Planning and Consolidation, starter kit for SAP Financial Results Insight mobile app

• SAP Strategic Financial Planning rapid-deployment solution (for use with the SAP Business Planning and Consolidation application)

• SAP Business Planning and Consolidation 10.0, version for SAP NetWeaver SP11

• SAP Profitability and Cost Management application 10.0 SP07


SAP’s differentiation

InnovativeEasyComplete

Get everything you need for performance management – integrated and from one vendor

Improve operability and reduce cost of ownership with direct integration into the SAP NetWeaver technology platform, the SAP ERP application, and analytics solutions from SAP

Choose an industry-recognized, leading portfolio for reduced risk

Deploy on premise or in the cloud to meet the requirements of your organization

Leverage industry and line-of-business content to get up and running faster

Use simplified mobile, Web and Microsoft Office (Excel) interfaces to satisfy all user types instead of only a few

Analyze and act anytime and anywhere with mobile-ready apps for consuming information and inputting data on the fly

Make faster and better decisions by eliminating wait times through the power of the SAP HANA Platform

Improve planning and forecast accuracy on any data size with a platform that is predictive and Big Data-ready

1. Invest in EPM 10 and beyond

2. HANA today, and more tomorrow

3. Leverage predictive analytics

Atul PatelVice President, SAP AnalyticsSAP APJ

THANK YOU