SAP Customer Success StoryIndustrial Machinery and ComponentsATLAS COPCOSAP® BusinessObjects™ Planningand Consolidation Adds Dimensionto Analysis“With SAP BusinessObjects Planningand Consolidation, executives per-form multidimensional analysis ofsales, costs, and profitability acrossmarkets, customers, and products, tosee what is really happening in thebusiness.”Sofie Luyten, System Manager, Atlas Copco ABWhy SAP• User-friendly• Familiar Microsoft Excel–based interface• Availability on Microsoft platformBenefits• Achieved complete transparency intoconsolidated gross profit across theenterprise• Gained flexibility for revenue, cost, andprofitability analysis across markets,customers, and products• Accelerated monthly financial close• Reduced currency conversion frombetween 7 and 8 hours to 30 minutes• Provided users with the ability to workmore quickly and efficiently• Improved data qualityExisting EnvironmentHyperion softwareThird-Party Integration• Database: Microsoft SQL Server• Hardware: IBM• Operating system: Microsoft WindowsCompany• Name: Atlas Copco AB• Headquarters: Stockholm, Sweden• Industry: Industrial machinery andcomponents• Products and services: Compressors,construction and mining equipment,power tools, and assembly systems• Revenue: €7.8 billion• Employees: 33,000• Web site: www.atlascopco.com• Implementation partners: Otisco AB(Stockholm, Sweden) and Opal WaveSolutions Ltd. (Marlow, England)Challenges and Opportunities• Consolidate data from 170 global markets• Merge operational and legal reporting intoa single process• Gain ability to analyze business by multipledimensionsObjectivesReplace legacy system with a powerfulconsolidation and analytic toolSAP® Solutions and Services• SAP® BusinessObjects™ Planning andConsolidation application• SAP NetWeaver® Business WarehousecomponentImplementation Highlights• Substantial process change• Strong stakeholder involvement• Extensive trainingQuick facts
SAP BusinessObjects Planning andConsolidation is owned by the groupcontrolling and accounting depart-ments and available on either the SAPNetWeaver® technology platform orthe Microsoft platform. The applicationunifies and streamlines planning, bud-geting, forecasting, financial consolida-tion, and management reporting. Peoplecan model new business possibilitiesto choose a course of action thatmaximizes value creation.That’s just what Atlas Copco is doing.Its finance people around the worldgather data, reconcile the numbers foraccuracy, and analyze business costsand profitability at the unit and division-al level. They upload the information viathe SAP NetWeaver Business Ware-house (SAP NetWeaver BW) compo-nent to headquarters in Stockholm,Sweden. The upload of data in SAPPlanning and Consolidation is donepartly by SAP NetWeaver BW. Manualinput through input schedules is usedfor legal specifications and operationalreporting not supported by the AtlasCopco internal service provider. There,group management consolidates thedata for operational and legal reportingand analyzes the overall business basedon more exact, flexibly defined details.“We now have much more transparencyinto consolidated gross profit acrossthe enterprise,” says Sofie Luyten,system manager at Atlas Copco. “WithSAP BusinessObjects Planning andConsolidation, executives perform multi-dimensional analysis of sales, costs,and profitability across markets, cus-tomers, and products, to see whatis really happening in the business.Reporting is faster. We shortened themonthly close. We reduced currencyconversion times from between 7 and8 hours to 30 minutes. Users workmore quickly in the Microsoft Excelinterface. And data quality is better.”Granular, Multifaceted AnalyticsAtlas Copco had previously been usingHyperion software. The legacy systemwas out-of-date and approaching theend of its support agreement. It alsodidn’t have the flexibility the globalleader needed to analyze performancemeasures to stay nimble in all ofits markets. “We selected SAPBusinessObjects Planning and Consolidation because it is user-friendly, isbased on Microsoft Excel, and enablesmultidimensional analytics,” Luytensays. “This dimensional capability iscrucial. It enables management to getmore out of the figures to make betterdecisions.”She gives an example: “Using SAPBusinessObjects Planning and Consoli-dation, we can now view compressorsales by the end customer and the typeof business to which they were sold,such as OEMs or aftermarket dealers.We can run revenue numbers by brand,by division, and by type of business.We couldn’t see that before; everythingwas lumped together under a singleproduct – compressors.” Profitability Tracking at Each StepSAP BusinessObjects Planning andConsolidation also helps Atlas Copcomeasure consolidated gross profit.The company tracks not only incomestatements and balance sheets butalso each center’s cost and profit con-tribution. “We calculate across theentire cycle, from production to distri-bution to sales,” Luyten says. “Thisenables us to precisely allocate costsand calculate profitability at each stepin the process.”Atlas Copco also increased efficiencyby merging operational and legal report-ing. Before, it was reporting full opera-tional data next to full legal data. Theorganization has legal companies con-sisting of multiple operational entities; itbuilt a structure in SAP BusinessObjectsPlanning and Consolidation that auto-matically merges them together, whichresults in the reporting of legal adjust-ments only (instead of reporting twice –full legal and full operational). Thisallows it to perform automatic inter-company sales eliminations withinone legal entity.Success brings its own challenges. Just ask Atlas Copco AB,with world-leading positions in compressors, construction andmining equipment, power tools, and assembly systems – a massivemarket triumph with a complex reporting process. But the SAP®BusinessObjects™ Planning and Consolidation application wasup to the task, helping the firm consolidate operational and legalreporting from 100 million database records spanning 170 countrymarkets, 416 operational units, and 252 legal entities.
“Our aim was to report everythingcorrectly, on one single occasion,”says Luyten. “SAP BusinessObjectsPlanning and Consolidation allowed usto introduce a set of reporting codesand a single, combined operational andlegal structure to consolidate these‘two worlds.’”Stakeholder InclusionAtlas Copco worked with partnersOtisco AB and Opal Wave SolutionsLtd. on the implementation. These twocompanies recently combined theirsynergistic operations – both specializein the SAP BusinessObjects portfolio,SAP BusinessObjects Planning andConsolidation, and enterprise perfor-mance management – in a businessalliance. Otisco helped Atlas Copcowith its business process application,design, and development expertise;Opal Wave directed its assistance attechnical issues and systemarchitecture.The first step was the design phase.Atlas Copco gathered all the differentstakeholders to document what theywere currently reporting in the oldsystem and what their requirementswere. The stakeholders included busi-ness owners for controlling and legalconsolidation within the company’sthree major business areas. The firmalso brought in representatives fromhuman resources and environmentalreporting; their data is included inSAP BusinessObjects Planning andConsolidation group reporting.“From that exercise, we developed avery ambitious scope,” Luyten says.“We didn’t just replace the legacy sys-tem; we changed a lot of processesand account definitions. Becauseof these changes, we did extensivetesting and data validation of the newreconciliation and logic models. Wealso upgraded to the newest versionof SAP BusinessObjects Planning andConsolidation just before going live.”Training Brings Buy-InEverything was supported by extensivetraining. Atlas Copco trained powerusers and the support organization;the key users and those in the supportorganization then trained the businessowners during a three-day on-siteexercise across 12 locations. SaysLuyten, “It was a very big effort, andthere were a lot of logistical hurdles,but it was well received and createda lot of buy-in from the end users.”Luyten cites the fact that the SAPapplication was available on the Micro-soft platform – its corporate platformof choice – as another implementationsuccess factor. “This is a key strengthof the SAP application,” she says. “Its“Our group management is very satisfied with SAP BusinessObjects Plan-ning and Consolidation. They . . . get quicker and better responses totheir questions. This will lead to better management decisions.”availability on a well-known platformwith which we are very familiar enabledus to configure the solution’s businessroles and scheduling parameters within-house knowledge.”Consolidated Reporting InformsDecisionsSAP BusinessObjects Planning andConsolidation currently feeds informa-tion to an in-house-developed analyticsapplication; Atlas Copco plans to evalu-ate other SAP BusinessObjects func-tionality, so it can standardize analyticson the SAP platform. This will allowfinance and line-of-business managersto further collaborate in a unified land-scape. The aim is transparent financialdata and a single version of the truthfor fast and accurate reporting, dynam-ic decision making, and minimal busi-ness and compliance risk.“Our group management is verysatisfied with SAP BusinessObjectsPlanning and Consolidation,” saysAnders Pehrsson, vice president andgroup controller at Atlas Copco. “Theyhave discovered that they can get quickerand better responses to their questions.This will lead to better managementdecisions.”Anders Pehrsson, Vice President and Group Controller, Atlas Copco AB“With SAP BusinessObjects Planning and Consolidation . . . reporting is faster.We shortened the monthly close. We reduced currency conversion timesfrom between 7 and 8 hours to 30 minutes.”Sofie Luyten, System Manager, Atlas Copco AB