SAP solutions for government contracting in Aerpspace & Defense

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SAP ERP solutions for government contractors.

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SAP solutions for government contracting in Aerpspace & Defense

  1. 1. Solution in Detail © 2013 SAP AG or an SAP affiliate company. All rights reserved. Aerospace and Defense Government Contracting in Aerospace and Defense Executive Summary Solution Overview Contact Us © 2013 SAP AG or an SAP affiliate company. All rights reserved.
  2. 2. 2 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Deliver Excellence Across the Board U.S. federal government buying agencies such as the Department of Defense have always expected contractors to provide exceptional value. Today, though, they expect contractors to deliver that value at lower, more affordable costs. At the same time, contracting and auditing agencies, such as the Defense Contract Management Agency (DCMA) and the Defense Contract Audit Agency (DCAA), expect contractors to demonstrate that they have met their contractual obligations – and that they have done so in compliance with the labyrinth of regulations that apply to government contracts. Contractors are caught in the middle. They must try to execute these complex programs in the most efficient and cost-effective ways, while also complying with regulatory requirements that can be burdensome and often increase the cost of doing business. Successfully executing such programs efficiently, cost-effectively, and in compliance with regulations requires contractors to adopt business processes that are more automated and integrated than ever. They need solutions that are fast, lean, highly optimized, and highly transparent. Managing any complex, large-scale program poses big challenges. But when the customer is the U.S. federal government, the challenges grow even greater. Complex government contracts introduce the need for additional oversight and regulatory compliance. An organization’s ability to manage these challenges successfully can impact program cash flow significantly and can even create – or limit – future business opportunities. Optimize Compliance Deliver Excellence Leverage SAP Innovations Run Better Executive Summary Solution Overview Contact Us 20% Lower compliance costs among companies that implement software designed to support government requirements Source: SAP Performance Benchmarking
  3. 3. 3 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. The contract is the starting point when optimizing program operations with compliance in mind. Program managers need a full understanding of the contract’s requirements, deliverables, key terms, and conditions. They need to understand which terms must flow down and which elements they must track for regulatory compliance through subsequent work orders and activities. Operationalizing this understanding is key. The contract needs to be integrated into the underlying architecture of the project and execution systems so that information flows through all parts of the system – from execution to accounting – without cumbersome translations and manual interventions. A solution optimized in this way facilitates earned value reporting, rapid and accurate bill generation, and comprehensive change and modification tracking. When the time arrives for incurred cost submissions, such a solution can segregate direct and indirect costs, properly account for unallowables, and generate reports in the proper formats. And it does all this with full traceability. Optimize Operations with Compliance in Mind Federal contractors face enormous and competing pressures. There are operational and competitive pressures to execute programs more efficiently and cost-effectively in order to deliver results on time and within budget. Simultaneously, there are pressures to operate ever more transparently and in compliance with government regulations. Solutions that can help optimize operations with compliance in mind are crucial to managing these competing pressures. Executive Summary Solution Overview Contact Us Optimize Compliance Deliver Excellence Leverage SAP Innovations Run Better
  4. 4. 4 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. SAP software can help contractors drive operational excellence and achieve compliance. Working with our partner, Dassian, SAP offers integrated and flexible solutions with the functionality that contractors require. These solutions enable contractors to streamline operations based on their policies and procedures while automating compliance to meet the Federal Acquisition Regulation (FAR), Defense FAR Supplement (DFARS), and Cost Accounting Standards (CAS).  Improve contractual compliance by integrating directly with project and execution systems  Improve invoice accuracy and reduce disputes by integrating directly with project cost information  Decrease delays in earned value reporting by streamlining the movement of project information within the system  Increase earned value accuracy via access to integrated project cost and schedule information  Improve accuracy and efficiency in incurred cost reporting via automatic incorporation of accounting and project costs and use of regulation-compliant report formats Run Faster, Run Better, Run Smarter Executive Summary Solution Overview Contact Us Optimize Compliance Deliver Excellence Leverage SAP Innovations Run Better
  5. 5. 5 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. The amount of information captured, stored, created, and shared during the course of an aerospace and defense program can be staggering. And just as the U.S. federal government relies on the experience and specialized skills of contractors to manage key programs, contractors have come to rely on the experience and innovation found at SAP to manage the business and information challenges that these programs present. SAP innovations in the areas of Big Data, real-time analytics, and in-memory computing can provide government contractors with the resources they need to manage day-to-day program operations more effectively than ever. These innovations enable the real-time manipulation and analysis of huge volumes of information. They provide detailed insights into costs, performance, trends, schedules, and variances. Moreover, these same innovations can help contractors meet the regulatory and compliance requirements that go hand-in-glove with such programs. The information required for invoicing, compliance reporting, and more can be retrieved and formatted for presentation to the appropriate agencies. SAP Innovations SAP innovations for aerospace and defense (A&D) contractors can help optimize operational processes while simultaneously increasing the transparency and accuracy of reporting processes – a critical consideration where regulatory compliance is concerned. SAP solutions leverage powerful analytics and real-time computing technologies to help contractors manage, analyze, and report on vast amounts of program data. Executive Summary Solution Overview Contact Us Optimize Compliance Deliver Excellence Leverage SAP Innovations Run Better
  6. 6. 6 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Manage Government Contracts Better Government Contracts and Billing Establish complex contracts that include accounting classification reference numbers (ACRNs), limits, and fee types; manage terms and flow down; track modifications; and bill all contract types. Earned Value Reporting Generate control account plans, responsibility assignment matrices, and properly formatted contract performance reports; analyze performance trends, variances, and more. Project Accounting and Incurred Cost Reporting Segregate, analyze, and report direct and indirect costs in detail; generate properly formatted incurred cost submissions with greater automation. Contracting and Billing Solution Overview Project Accounting Earned Value Reporting Why SAP? Program Management Executive Summary Solution Overview Contact Us
  7. 7. 7 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Government contract and billing solutions from SAP support the needs of companies doing business with the U.S. government. Government Contracting and Billing Executive Summary Solution Overview Contact Us Contracting and Billing Solution Overview Project Accounting Earned Value Reporting Why SAP? Program Management Design, Build, Support, and Management Contracts and Billing Program Management Financials and Accounting Government Contracts and Billing Project Accounting and Incurred Cost Reporting Earned Value Reporting Procurement Time and Expense Project- Driven Manufacturing Project Creation and Execution Payroll Financial Close Applied Indirect Costs Project Accounting Maintenance Operations Incurred Cost Reporting Billing Details Maintenance of Contract Changes Invoice Creation Management of Contract Flow Down Contract Creation Payroll Reconciliation Earned Value Reporting Earned Value Management Accounts Payable, Accounts Receivable
  8. 8. 8 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Software solutions from SAP and Dassian enable aerospace and defense companies to capture all the details related to government contracts – and to link those details back to the business processes helping to manage the underlying project. This tight integration of contract and project information improves an organization’s ability to comply with flow down and billing requirements. Aerospace and defense contractors can quickly and efficiently generate inception-to-date invoices that automatically reflect the proper limits, as well as the correct withholdings, billing rates, and ACRN balances. Capture government contract details, terms, and conditions, including all information needed to execute billing for all contract types. Manage and track the history of contract modifications. Establish and control contract flow down. Monitor contract performance, including billed and unbilled costs. Government Contracting and Billing Capabilities Contracting and Billing Benefits SAP Innovations Solution Overview Executive Summary Solution Overview Contact Us
  9. 9. 9 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. With government contracting and billing software from SAP and Dassian, contractors can efficiently manage all types of contracts (cost type, time and material, firm fixed price, progress payments, performance-based, milestone, and more). They can use distinct fee structures, such as fixed, award, and incentive fees. They can also establish limits on costs and fees by cost element, and manage with- holdings and ACRN balances. Contractors can link contract line items (CLINS) to specific project efforts. They can register key contract information, such as Defense Priorities and Allocation System (DPAS) ratings and FAR clauses. All this information flows down into the project’s purchase orders, production orders, work breakdown structure (WBS) elements, service orders, and deliveries, which helps ensure contract and regulatory compliance. Contractors can also accurately maintain and track changes throughout a contract’s lifecycle for items such as awarded values, incremental funding, and more. Finally, SAP software can help automate and orchestrate billing processes with workflow and approval processes – helping the organization generate timely, accurate invoices with the level of detail and information that government customers require. Execute Government Contracts with Greater Efficiency and Compliance Executive Summary Solution Overview Contact Us Capabilities Contracting and Billing Benefits SAP Innovations Solution Overview
  10. 10. 10 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. With integrated software from SAP and Dassian, contractors can perform ACRN accounting and generate accurate invoices without error-prone and costly manual calculations, thereby reducing customer disputes and delayed payments. This can improve days sales outstanding (DSO) and maximize cash flow. The software handles corrections without affecting the billing cycle, enabling contractors to place partial or entire costs on billing hold and send out invoices without waiting. It enables rapid cost reconciliation for DCAA audits with detailed and traceable billing backup reports. Contract administrators can stay on top of contract performance via dashboards that present contract metrics at a glance. They can track modifications to contract and funding values to stay up-to-date and operate with full awareness of current contract funding. Automated e-mail messages can alert managers when approaching specified contract spending levels. Unlock greater efficiency with a billing solution that can generate accurate and compliant invoices, reduce receivables aging, and improve cash flow. Automate processes and calculations to reduce labor associated with preparing invoices. Track contract metrics to understand performance at a glance. Achieve Efficiency in Compliance and Optimize Visibility into Contract Performance Executive Summary Solution Overview Contact Us Capabilities Contracting and Billing Benefits SAP Innovations Solution Overview
  11. 11. 11 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. SAP Business Suite software and Dassian government contract accounting solutions take advantage of the SAP HANA platform. The in- memory computing technology in SAP HANA can significantly reduce the cycle time for billing, decrease unbilled receivables, and facilitate the rapid recovery of incurred costs. This improves Innovations for Government Contracts and Billing program cash flow and can significantly decrease working capital requirements across the company. And, since SAP Business Suite powered by SAP HANA can be deployed in a nondisruptive manner, aerospace and defense contractors can achieve these benefits without having to learn new processes or retrain staff. SAP Business Suite software powered by the SAP HANA platform delivers valuable innovations for government contractors. In-memory computing helps minimize the time spent performing contract management and billing processes and enables the management and processing of large volumes of data with greater efficiency. Executive Summary Solution Overview Contact Us Capabilities Contracting and Billing Benefits SAP Innovations Solution Overview
  12. 12. 12 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Software from SAP and Dassian supports comprehensive earned value reporting, enabling aerospace and defense contractors to analyze program performance at every level of the WBS. Detailed reports include interactive analytics, such as S-curve charts, cost and schedule performance indices, and more. The contractor can discover program performance issues as well as variance root causes. Built-in cost performance reporting (CPR) formats enable compliance with U.S. government reporting requirements, so contractors can share program performance in the formats expected. Finally, contractors can submit program performance information electronically to government customers using the integrated program management report (IPMR) format. SAP software complies with the latest United Nations Center for Trade Facilitation and E-Business (UN/CEFACT) XML data schema, described within the IPMR Data Item Description (IPMR DID). Analyze, report on, and share a pro- gram’s earned value information with program and company leadership, as well as with customers and auditors. Detailed reporting and informative analytics provide key insights into program performance and inform government customers of program progress – in precisely the formats they expect. Earned Value Reporting Capabilities Earned Value Reporting Benefits SAP Innovations Solution Overview Executive Summary Solution Overview Contact Us
  13. 13. 13 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Even with programs involving vast amounts of data, SAP software can provide contractors with the in-depth insights they need to comply with program performance reporting require- ments. The software integrates analytical tools with program management and reporting tools to enable true earned value (EV) reporting. At any level of the WBS, contractors can access key EV information. This includes the budgeted cost of work scheduled (BCWS), budgeted cost of work performed (BCWP), and actual cost of work performed (ACWP), as well as budget, estimate, and variance at completion (in both dollars and hours). Embedded and interactive charts can facilitate insight, graphically presenting EV information with S-curves, bull’s-eye performance graphs, variance and trend analysis charts, and more. Analyses presented in this way help contractors spot issues and trends at a glance. If a more detailed view of data is required, the underlying transactional information is just a few clicks away. Once the EV analysis is complete, contractors can report on program performance using a range of government-compliant CPR formats, including IPMR, which can be shared via approved UN/CEFACT XML schemas. Analyze Program Performance with Confidence and Report with Compliance Executive Summary Solution Overview Contact Us Capabilities Earned Value Reporting Benefits SAP Innovations Solution Overview
  14. 14. 14 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. SAP software can help contractors do more with less. Without the need to engage multiple systems, contractors can commence the analysis-to-report process without waiting for time-consuming interfaces. They can gain insight into a program’s earned value information at any level and access underlying transactional information without having to jump from system to system. They can identify problems with source information quickly and cycle corrections into the analysis without manual intervention. Because the critical EV data, analytical tools, and charting and reporting tools are all part of the same integrated SAP solution, contractors eliminate the need to reconcile the program system of record with a separate EV system. They gain improved transparency and trace- ability, along with the ability to generate timely and accurate reports that are automatically formatted to comply with the requirements of individual agencies and sponsors. Minimize analysis-to-reporting cycle time and gain greater insight into earned value performance by using analytical and reporting tools that are deeply integrated with the program system of record itself. Meet analysis, charting, and reporting requirements more efficiently using a single solution rather than multiple systems. Increase Efficiency and Gain Deep Insight into Earned Value Performance Executive Summary Solution Overview Contact Us Capabilities Earned Value Reporting Benefits SAP Innovations Solution Overview
  15. 15. 15 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. The SAP HANA platform extends innovations in in-memory computing to all aspects of aerospace and defense program management and reporting. It enables the management and manipulation of huge volumes of data in real time. It provides the data management foundation for SAP Business Suite powered by SAP HANA, as well as for integrated software products provided by SAP partners such as Innovations for Compliant Earned Value Reporting Dassian. It facilitates the use of interactive and embedded analytics that present program analysts with at-a-glance insights about the state of the program under management. And, they can do this without having to pour over endless rows and columns of program data or jump from system to system to find disparate fragments of information they can piece together to form a more complete picture. SAP innovations in areas such as in- memory computing, Big Data, and embedded, real-time analytics introduce exceptional levels of performance, analytical insight, and automated compliance reporting to aerospace and defense contractors performing earned value reporting. Executive Summary Solution Overview Contact Us Capabilities Earned Value Reporting Benefits SAP Innovations Solution Overview
  16. 16. 16 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Accurate and transparent accounting is the basis for efficiency and CAS compliance in government contracting. The ability to capture detailed cost and revenue information consis- tently, appropriately, and accurately enables efficient execution of critical downstream processes such as billing, earned value reporting, and incurred cost reporting. It can also provide a contractor with the tools required to survive the scrutiny of an audit. Project accounting solutions from SAP can integrate with program execution systems to capture, burden, and analyze the accounting information generated by these system. Flexible revenue recognition methods enable contractors to record project revenues according to their own requirements. Incurred cost reporting features enable contractors to analyze and validate direct and indirect cost rates and generate the required reports for incurred cost submissions. Compliance and efficiency in govern- ment contracting depend on an ability to account accurately for all activities undertaken in connection with a program. Companies that can account for incurred project costs consistently and accurately can operate more efficiently – and achieve and maintain compliance. Project Accounting and Incurred Cost Reporting Capabilities Project Accounting Benefits SAP Innovations Solution Overview Executive Summary Solution Overview Contact Us
  17. 17. 17 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. SAP software provides features that support both comprehensive project accounting as well as detailed and accurate incurred cost reporting. The software accurately and automatically accounts for activities performed across the organization, such as time and expense reporting, payroll, purchasing, manufacturing, maintenance, and others. It enables the segregation of costs (such as direct and indirect costs, allowable and unallowable costs). It also allows contractors to define and apply complex indirect rates to burden project costs accurately – and to update those rates retroactively as final rates are approved. Project accounting tools integrate with broader financial accounting tools to facilitate the reconciliation of project costs with the general ledger. The software generates incurred cost submissions with a high degree of automation. It also supports multiple disclosure statements (and multiple versions of each statement). Contractors can create and export incurred cost submission schedules A through H into Microsoft Excel; adjust and annotate trans- action information with notes and clarifications; and run audit and reconciliation reports to verify accuracy. Improve Compliance and Accuracy in Project Accounting and Incurred Cost Reporting Executive Summary Solution Overview Contact Us Capabilities Project Accounting Benefits SAP Innovations Solution Overview
  18. 18. 18 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Project accounting software from SAP collects time, expense, purchasing, and other cost information from the program execution system. Automation minimizes manual intervention and improves accuracy. Integration with downstream processes such as billing and earned value reporting facilitates consistency and compliance. The software improves insight into total costs by automatically applying indirect rates. As actual rates are confirmed, rate adjustments can be calculated and applied retroactively. Comprehensive reporting and traceability foster transparency to facilitate audits. Project accounting software from SAP automatically ties into and reconciles program-wide general ledger accounts and other sources to help ensure accuracy. It automatically generates incurred cost schedules (ICS), which helps increase operational efficiency. Because ICS data resides in the secure SAP software environment, it can be locked down and protected from accidental changes. Automation and integration with the overall program execution system facilitate project accounting. Information from projects and accounting can be incorporated automatically into incurred cost submissions, reducing the time and effort required to maintain regulatory compliance. Access to Accurate Accounting Information Facilitates Compliance Executive Summary Solution Overview Contact Us Capabilities Project Accounting Benefits SAP Innovations Solution Overview
  19. 19. 19 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. SAP HANA extends innovations in in-memory computing to all aspects of aerospace and defense program management and financial reporting. It enables the management and manipulation of huge volumes of data in real time. It provides the data management foundation for SAP Business Suite powered Innovations for Project Accounting by SAP HANA, as well as for integrated software products provided by SAP partners such as Dassian. It facilitates faster processing of large amounts of project accounting information, enabling faster project allocations, burdening, retroactive rate adjustments, project revenue calculations, and more. For government contractors in aero- space and defense, SAP innovations in areas such as in-memory computing introduce exceptional levels of perform- ance and analytical insight. The SAP HANA platform facilitates automated compliance reporting and improves performance in project accounting and incurred cost reporting. Executive Summary Solution Overview Contact Us Capabilities Project Accounting Benefits SAP Innovations Solution Overview
  20. 20. 20 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Managing Complex Customer Programs Value Map SAP solutions can help manage complex A&D programs. Executive Summary Solution Overview Contact Us Contracting and Billing Solution Overview Project Accounting Earned Value Reporting Why SAP? Program Management Management of Complex Customer Programs Collaborative Sales Force Automation Government Contracting Program Management Technology Solutions 3D Business Visualization Enterprise Mobility Analytics Data Management Application Development and Integration Consumer Experience SAP HANA Platform IT Management Application Lifecycle Management IT Strategy and Governance IT Infrastructure Management IT Portfolio and Project Management IT Service Management Procurement Supplier Discovery and Lifecycle Management Commodity Management Strategic Sourcing and Contracting Procurement and Order Collaboration Collaborative Invoice to Pay Finance Financial Performance Management Enterprise Risk and Compliance Management Accounting and Financial Close Treasury and Financial Risk Mitigation Collaborative Finance Operations People and Talent Core Human Resources and Payroll Talent Management Time and Attendance Management Workforce Planning and Analytics Aftermarket Services Maintenance, Repair, and Overhaul (MRO) Services and Lifecycle Support Service Parts Management Equipment Visibility and Performance Responsive Supply Network Collaborative Supply Planning Supply Chain Execution Supply Chain Analytics Design and Build of Complex Products Product Development and Compliance Embedded Systems Technology Project Manufacturing for Complex Assembly Plant Operations and Maintenance
  21. 21. 21 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Why SAP? Government contracting solutions from SAP and its partners can help aerospace and defense companies improve operations, increase transparency, and comply with accounting and reporting requirements when doing business with the U.S. federal government. Efficiency Break down information silos and share contract, project, accounting, and operational data across functions. Integration Work without delays and interruptions as information flows between contracts, projects, accounting, and execution systems. Compliance Operate transparently using a solution built to maintain a single version of the truth and designed with government compliance in mind. Executive Summary Solution Overview Contact Us Contracting and Billing Solution Overview Project Accounting Earned Value Reporting Why SAP? Program Management
  22. 22. 22 / 23 © 2013 SAP AG or an SAP affiliate company. All rights reserved. Benchmark Your Performance Position your organization for dominance in this new economy with the business performance benchmarking program from SAP – available free to SAP customers and select prospects. The SAP benchmarking program has helped more than 3,000 organizations assess their strengths, uncover areas for improvement, and identify best practices and IT strategies that generate clear, tangible value – not someday, but today. Go Live in Weeks Here’s the fastest way to run your business better: our rapid-deployment solutions. In one package, you get everything you need to be up and running quickly – including preconfigured software and implementation services – in just weeks. With a defined scope and predictable costs, there are no surprises. Join Your Community of Practices Every day, SAP Community Network (SCN) changes the way that thousands of SAP users work. It lets members help one another solve problems, learn, and invent new ways to get things done – faster. Find out how to connect with people, content, and resources. Find Out More About How Your Organization Can Become Best-Run Visit valuemanagement.sap.com >> Visit sap.com/solutions/rds >> Visit scn.sap.com >> Executive Summary Solution Overview Contact Us
  23. 23. Solution in Detail © 2013 SAP AG or an SAP affiliate company. All rights reserved. Aerospace and Defense Visit us online to learn more: www54.sap.com/industries/aerospace-defense.html http://scn.sap.com/community/aerospace-and-defense www.youtube.com/playlist?list=PL3ZRUb1AKkpSoGaVEIqk lzKWk8QvsR2c9 www.youtube.com/user/dassianinc www.linkedin.com/groups?gid=2053109&trk=myg_ugrp_ovr https://twitter.com/DassianInc http://dassian.com/index.php Executive Summary Solution Overview Contact Us CMP 26933 (13/09) © 2013 SAP AG or an SAP affiliate company. All rights reserved.
  24. 24. © 2013 SAP AG or an SAP affiliate company. All rights reserved. No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG. The information contained herein may be changed without prior notice. Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors. National product specifications may vary. These materials are provided by SAP AG and its affiliated companies (“SAP Group”) for informational purposes only, without representation or warranty of any kind, and SAP Group shall not be liable for errors or omissions with respect to the materials. The only warranties for SAP Group products and services are those that are set forth in the express warranty statements accompanying such products and services, if any. Nothing herein should be construed as constituting an additional warranty. SAP and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG in Germany and other countries. Please see http://www.sap.com/corporate-en/legal/copyright/index.epx#trademark for additional trademark information and notices.

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