Delivering Real-Time Business Value for Automotive

July 2013
Delivering Real-Time Business Value
for Automotive
SAP Business Suite Powered by SAP HANA
Public

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 2Public
The real-time opportunity
Customer individualization, new mobile trends, new technology
developments, and increasing regulatory requirements
necessitate faster reaction times from automotive companies
and lead to products with more and more variations, higher
technical complexity, and larger data volume. This leads in turn
to greater operational risk that must be managed.
 Follow new customer behaviors and trends
 Manage overcapacities
 Move to emerging markets

Becoming an innovation-driven enterprise
Align business operations with customer needs
Drive profitable
growth with flexible
sales and revenue
models
 Advanced prediction
 Customer-specific promotions
 Increased market share
Bring enticing and
relevant products
to market rapidly
 Increased manufacturing efficiency
 Reduced cost of operations
 Simplified planning of maintenance activities
Respond to market
dynamics in real
time
 Faster reaction to changes
 Optimized inventory levels
 Minimized out-of-stocks

SAP Business Suite powered by SAP HANA
The next-generation business platform
Real-time business
In-memory
Business
transactions
Digital
connections
Collaborative
business
CloudSocial
Big DataMobile
One platform bringing it all together
Advanced
analytics

Back
Industry value map for automotive
The innovation-driven enterprise
Technology
Solutions
Marketing, Sales and
Aftermarket
Dealer Business Management
Vehicle Sales Management
Customer Service, Support,
and Warranty Management
Application Develop-
ment and Integration
SAP HANA Platform
Collaborative Product
Innovation
Continuous Product and
Service Innovation
Integrated Product Development
for Discrete Industries
Embedded Product
Compliance
Manufacturing and Logistics
Operational Procurement and
Inbound Logistics for Direct
Material
Lean Manufacturing
Make to Order
Outbound Logistics
Responsive Supply Networks
Service Parts Management
Transportation Management
Supply Chain Execution
People and
Talent
Core Human Resources
and Payroll
Talent Management
Time and Attendance
Management
Workforce Planning and
Analytics
Finance
Financial Performance
Management
Accounting and
Financial Close
Treasury and Financial
Risk Management
Collaborative Finance
Operations
Enterprise Risk and
Compliance Management
Procurement
Supplier Discovery and
Lifecycle Management
Strategic Sourcing and
Contracting
Procurement and Order
Collaboration
Collaborative Invoice
to Pay
Commodity Management
IT Management
Application Lifecycle
Management
IT Infrastructure
Management
IT Portfolio and Project
Management
IT Service Management
IT Strategy and
Governance
Multichannel Marketing
Management
Enterprise Mobility
Consumer
Experience
Data ManagementAnalytics
3D Business
Visualization

Back
Industry value map for automotive
Real-time value for key end-to-end processes
Technology
Solutions
Marketing, Sales and
Aftermarket
Dealer Business Management
Vehicle Sales Management
Customer Service, Support,
and Warranty Management
Application Develop-
ment and Integration
SAP HANA Platform
Collaborative Product
Innovation
Continuous Product and
Service Innovation
Integrated Product Development
for Discrete Industries
Embedded Product
Compliance
Manufacturing and Logistics
Operational Procurement and
Inbound Logistics for Direct Material
Lean Manufacturing
Make to Order*
Outbound Logistics
Responsive Supply Networks
Service Parts Management
Transportation Management
Supply Chain Execution
People and
Talent
Core Human Resources
and Payroll
Talent Management
Time and Attendance
Management
Workforce Planning and
Analytics
Finance
Financial Performance
Management
Accounting and
Financial Close
Treasury and Financial
Risk Management
Collaborative Finance
Operations
Enterprise Risk and
Compliance Management
Procurement
Supplier Discovery and
Lifecycle Management
Strategic Sourcing and
Contracting
Procurement and Order
Collaboration
Collaborative Invoice
to Pay
Commodity Management
IT Management
Application Lifecycle
Management
IT Infrastructure
Management
IT Portfolio and Project
Management
IT Service Management
IT Strategy and
Governance
Multichannel Marketing
Management
Enterprise Mobility
Consumer
Experience
Data ManagementAnalytics
3D Business
Visualization
Highest value
for automotive
2 2
3
2
2
3 2
3
1
* For component manufacturers

Today
Manage financial performance
Business value for financial and managerial reporting
 Risk of noncompliance due to
unfulfilled (overruns in) audits
 A lot of data; decision-relevant
information not readily available
 Data analysis not supported or
automated
 Long-running batch jobs/reports
 Time-intensive data analysis
 Large number of time-consuming,
and non-value-added processes
required to provide access to
accurate, up-to-date information
 Timely execution of compliance-
relevant validation tasks
 Increased end-user satisfaction
(accurate, detailed, visualized, timely,
and actionable information)
 Acceleration of key critical-path
processes and reports
 Instant response time on most data
analysis queries
 Workarounds and data latencies
eliminated
 End-user data analysis through self-
service means (via SAP
BusinessObjects business
intelligence solutions)
Improve
service level
performance
10%
Reduce
Minimize
month-end
closing time
33%
operating costs
25%
Key performance indicator (KPI) improvements to be validated by SAP Value Engineering
With SAP Business Suite
on SAP HANA

Today
Continuous product and service innovation
Business value for project management (SAP Portfolio and Project Management)
 Project members experience long
waiting times when starting the
project and task dashboards. This
reduces user productivity when
working on several projects and tasks
across projects
 Updates on multiple tasks are
inefficient and time-consuming as
project team members confirm tasks
one by one to reduce waiting times
 Searching for documents across
projects takes a very long time for
large portfolio of projects.
 The process of finding projects,
tasks and phases by responsible
project member is slow
 Faster access to my tasks, my
projects
 Accelerated access to project, task,
and checklist items dashboards
 Project team members enabled to
confirm times, status, and dates and
attach documents for several tasks at
once
 Increased user productivity
 Accelerated search for documents
 Faster ability to find projects or tasks
by responsible project member
Increase
user productivity
20%
Reduce
Improve
time for task
confirmation
35%
Search for documents
and project elements
35%
KPI improvements are high-level estimates and will have to be validated for each customer situation.
With SAP Portfolio and Project
Management on SAP HANA

Today
Continuous product and service innovation
Business value for project management (project system)
 Long wait and locking times along
business processes hinder project
execution and impact flexibility to
react on deviations
 User acceptance is reduced due to
affected usability in handling large
project data
 Reduced waiting and locking times of
critical transactions along the end-to-
end process, resulting into higher
process efficiency and improved
employee productivity
Increase
user productivity
and end-to-end
process efficiency
10%
Improve
transparency and
decision support to
take appropriate
corrective measures
in time
10%
 Real-time analysis of high volumes
of data for complex, long-lasting
projects or cross-project monitoring
is challenging due to high data
volumes
 Due to missing 360-degree real-time
transparency across applications
deviations in costs, time, resources,
or quality are seen too late in the
process
 Acceleration of project info system
reporting and new project line-item
reporting delivering faster insights
 Early insight in deviations and risks
enabling timely corrective measures
by highlighting deviations in real time
 Planned: Project execution cockpit
enabling project managers as well as
project employees to analyze status
and progress of one or multiple
projects in execution from an end-to-
end perspective at maximum speed
with real-time data, and to derive and
execute actions wherever applicable
on SAP HANA

Today
Operational procurement/inbound logistics (for direct material)
Business value for warehouse management
 No up-to-date view of the inventory
situation
 Need for accurate display of actual
stock to react quickly to stock
shortfall
 Time-consuming inventory
management reporting
 Real-time access to complex
inventory management data
 Real-time stock insight and inventory
monitoring
 High-performance inventory
management with large volumes of
documents
 Higher process efficiency in adjacent
procurement processes
Reduce
inventory levels
10%
Minimize
Optimize
out-of-stocks
5%
working capital
5%
KPI improvements to be validated by SAP Value Engineering
on SAP HANA

Today
Lean manufacturing
Business value for supply chain monitoring
 Lack of near real-time information
 Batch jobs to extract data from
planning system to central reporting
typically on weekly basis
 No ad hoc operational reporting
 Reporting, queries, and dashboards
required to be created by each
customer individually
 Not possible to run sub-daily planning
jobs and analyze results due to long
data preparation times in SAP
NetWeaver Business Warehouse
(SAP NetWeaver BW)
 Inability to respond quickly to ad hoc
queries from customer, which may
result in lost sales
 Decision support based on near real-
time information
 Information updated via delta
capabilities
 Built-in analytical reporting scenarios
provided with streamlined data load.
 Planned ability for customers to add
their own KPIs and dashboards
 Advanced data retrieving and
computing functionality of SAP HANA
used to optimize the reporting of
supply chain planning data
Reduce
time spent compiling,
generating, and
waiting for reports
5%
Increase
Optimize
visibility into key supply
chain data in an easy,
consumable way
8%
analysis capabilities
with multiple levels of
aggregation and drill-
down techniques
15%
on SAP HANA

Today
Make to order*
Business value for material requirements planning (MRP)
 Decisions are often based on
periodic MRP runs and outdated
information; process done in batch
 It is not possible to replan quickly if
conditions change due to long run
times. Prediction of inventory
coverage for critical parts is difficult
 It is not possible to replan if
conditions change during the
planning horizon due to long runtimes
 Faster replanning allowing more
frequent MRP runs in shorter cycles
 Instant reaction to demand changes
and updates to the supplier
 Demand information propagated
faster through the supply chain
More frequent MRP runs
 Allowing reduction in inventory and
safety stock levels
 Speeding information flow toward
suppliers, enabling them to react
faster to changed planning conditions
 Better synchronized material demand
and supply planning with reduced
bullwhip effect
Reduce
out-of-stocks by
5%
Decrease
Limit
inventory and
safety stocks by
5%
bullwhip effect
* For component manufacturers
on SAP HANA

Today
Make to order
Business value for global plant performance management
 Inability to gather and visualize data
from production in real time to
improve the status of manufacturing
performance both within and across
multiple sites
 Inability to understand where
machine maintenance issues and
bottlenecks exist in production
 Need to capture the root causes for
downtime, efficiency loss, and poor
quality
 Unplanned downtime, suboptimal
performance and poor product quality
all contributing to decreased asset
utilization, poor product yields,
increased costs, and reduced
customer responsiveness
 Combines quantitative performance
measures with qualitative context and
reasons for performance issues
 Combines plant performance with
business context
 Facilitates corrective action at the
plant level and across plants
 Enables broader supply chain,
sustainability, financial and enterprise
performance improvements
 Enterprise-level overall equipment
effectiveness (OEE) that rolls up
plant-level OEE for enterprise
analytics and comparing assets and
performance across multiple sites
Improve
return on assets,
costs of goods sold,
and product quality
5%
Increase
Reduce
resource utilization
and asset uptime
8%
unplanned downtime,
changeover, and
waste
20%
on SAP HANA

Today
Outbound logistics
Business value for warehouse management (outbound logistics)
 No up-to-date view of the inventory
situation
 Need for accurate display of actual
stock to react quickly to stock
shortfall
 Time-consuming inventory
management reporting
 Real-time access to complex
inventory management data
 Real-time stock insight and inventory
monitoring
 High-performance inventory
management with large volumes of
documents
 Higher process efficiency in adjacent
procurement processes
Reduce
inventory levels
10%
Minimize
Opitmize
out-of-stocks
5%
working capital
5%
KPI improvements to be validated by SAP Value Engineering
on SAP HANA

Today
Supply chain execution
Business value for demand-driven supply chain
 More and more difficult to access and
effectively use timely demand
information from the supply network
 Decisions often based on incomplete,
inaccurate, and outdated information
 Hardware and system landscapes
that are challenging to administrate
 Increased business/expert user
productivity with faster planning
processes and improved user
experience and by driving rapid
consensus across the supply chain
network
 Near real-time reporting with
increased speed of information
analysis leading to better supply
chain visibility and decision
making
 Improved production and cost
efficiency by simplified system setup
and administration and by providing a
more robust planning foundation
Reduce
planning cycle
times
36%
Increase
Reduce
supply chain
performance
18%
total cost of
ownership (TCO)
24%
on SAP HANA

Today
Customer service, support, and warranty management
Business value for contact management with interaction center
 To successfully resolve customer
issues, companies must be able to
quickly locate the right experts or
resources within the organization,
whether those experts reside inside
the contact center or elsewhere
 Managers and supervisors lack
actionable reporting and visibility into
the workload of their teams
 High volume of customer records and
interactions results in increased
search times and greater difficulty
locating specific customer records
 With the new agent inbox based on
SAP HANA, users can more easily
search for relevant experts – whether
in their own team or elsewhere in the
organization – to dispatch/escalate
issues to the best-suited employee
roles
 A new interactive work distribution
dashboard provides supervisors with
actionable insights into the workload
of their teams and employees
 Searches in the interaction center are
significantly faster, including account
searches, interaction history, and the
customer fact sheet
Decrease
average handling
time by
36%
Improve
Reduce
service-level
agreement (SLA)
compliance
5%
service cost
10%
on SAP HANA

Today
Multichannel marketing management
Business value for marketing
 Missed market opportunities due to
lack of visibility and inefficient
processes
 Data explosion, driven by new level
of connectivity of consumers via
mobile devices and social networks
 Data in disparate data sources, which
prevents true 360-degree view of the
customer
 Agile marketing to respond faster to
changing market dynamics and
opportunities
 New analytical, data mining
functionality for Big Data (social
media, predictive)
 Near real-time monitoring and
reporting on marketing performance
 One central place for collecting all
customer data, leading to 360-degree
view of customers in real time
 Precision marketing to personalize
every interaction with the customer
Improve
profitability by
0.5%
Optimize
Increase
return on
marketing
investments by
15%
customer
satisfaction by
40%
on SAP HANA

Next step
Business scenario recommendation and value discovery workshop
 SAP offers a proven methodology and approach to
discover the customer-specific business
improvement areas and quantify value potential.
 We suggest such a workshop with your
line-of-business and IT experts.
 As starting point, we recommend a performance
and usage analysis of your current system.

© 2013 SAP AG or an SAP affiliate company. All rights reserved.
Thank you

© 2013 SAP AG or an SAP affiliate company. All rights reserved.
Appendix
with detailed customer cases

21© 2013 SAP AG or an SAP affiliate company. All rights reserved.
Real customer cases
(based on SAP Value Engineering)

Reference automotive
Summary of validated scenarios (combined findings)
Feasibility
Businessvalue
Legend
LowHigh
Low High
Real-time material
coverage and
dynamic planning
SAP Business
Suite on SAP
HANA
SAP HANA
products
SAP HANA
Platform
Real-time project
management
reporting
Detailed claim level
analysis for
warranty cost and
incidence
Equipment
reliability analysis
and prevention
failure
SAP HANA Platform: customer-specific
SAP HANA products: SAP NetWeaver BW on SAP HANA,
high-performance applications (HPAs), apps powered by
SAP HANA
SAP Business Suite on SAP HANA
Real-time quality
assurance
Parts management
Real-time
processing quality
management
notifications
Costing and
financials
Phase – deployment road map
1 Short term
CRM: Detailed claim level analysis (ability to carry to
warranty analysis at detailed claim level for
better analysis of failure)
Production:
Real-time quality assurance (free test capacity
by reduced test times; TCO reduction via
reduced long time test; time-to-market
improvement; reduction of lead times)
Financials and costing:
Profitability analysis, faster financial close,
optimized cost management / controlling
2 Medium term
SCM: Real-time material coverage and dynamic
planning (real-time inventory analysis and
ability to simulate alternate production plan and
optimize production mix)
SCM: Parts management (reduction of material costs
due to demand bundling; reduction of planning
costs; increase revenue due to price
optimization; reduction of warranty claims)
PLM: Real-time project management reporting
(optimized project reporting and decision
making)
SAP HANA
use case
SAP HANA use cases mapped to
industry value map end-to-end solutions

SAP Business Suite
on SAP HANA
7,3
21,3 21,38,3
8,3
20,6
1,7
5
25
0
10
20
30
40
50
60
70
80
2013 Phase 1 Phase 2 Phase 3
Costs SoH Applications Platform
$
Based on actual SAP
customer engagements
Annual benefits, SAP HANA
Platform: US$25 million
Annual benefits, applications powered
by SAP HANA: US$21 million
Annual benefits, SAP Business Suite
on SAP HANA: US$21 million
Estimated deployment costs
Total transition cost: to be determined
SAP HANA Platform: Anything built on the platform that is customer-specific – new business processes and business models
SAP HANA products: SAP NetWeaver BW powered by SAP HANA; high-performance apps (HPAs); applications – mapped to
inventory value map (IVM) end-to-end (E2E) solutions
Currently available functionality (SP0, 1, 2) – 23 scenarios mapped to IVM E2E solutions, and planned functionality(all of the
E2E solutions on the IVM are in scope)
SAP HANA Platform
SAP HANA products
SoH = SAP Business Suite on SAP HANA
In millions of US$
More information: Indranil Som; Ben Gruber; John Kohlmeyer
Annual revenue: US$50 billion
Reference automotive OEM
SAP HANA Platform

Note: Use cases in the global use case repository are captured directly from customers and internal SAP innovation
sessions and may not be completely validated.
Spare parts visibility and planning
Automotive
Business context and goals
 Ability to scan and analyze 8 million SKUs to improve and optimize spare part availability at the
lowest cost to ensure customer satisfaction and increase spare parts sale
Business challenges
 Huge volume of spare parts SKUs to manage; low customer satisfaction due to unavailability of
spare parts at the time of need by the customer
Process innovations
 Ability to scan and analyze 8 million SKUs across the whole supply chain and visualize all
related factors (current inventory, location, statistical forecast, reservations, and more)
Contribution of SAP HANA
 Ability to forecast, plan, and optimize replenishment of spare parts taking into account multiple
parameters (such as current inventory, predictive demand from existing car fleet in the market,
customer appointments)
Value drivers/KPIs
 Customer satisfaction index, spare parts sales, spare parts inventory
Innovation scope
SAP HANA products (HPAs, Apps)
End-to-end (E2E) solution
Automotive – service parts management
Value potential 5
Feasibility 3
Low High
1 5
Low High
1 5

Fast financial closing
Automotive
Innovation scope
SAP HANA products (HPAs, Apps)
Automotive – financial performance
management
Value potential 3
Feasibility 4
Low High
1 5
Low High
1 5
 Reduce data to be loaded on SAP NetWeaver BW using in-memory database
 Avoid system overwork during critical period
 Improve data quality
 Simplify system management during critical closing period
 Reduce effort auditors spend on reviewing data
 Improve analysis and reporting productivity (using SAP HANA also during nonclosing period)
 Reduce IT and finance overtime working cost during weekend
 Improve IT efficiency writing report with SAP BusinessObjects Web Intelligence software
Business challenges
 Reduce time to close financial books
 React quickly at business needs to post and check books during critical month-end closing period
 Improve efficiency and effectiveness of financial process
Process innovations
 Check posting correction in near real time, eliminating wait time to upload to SAP NetWeaver BW
 Help ensure real-time visibility and reporting of all GL posting in ERP system
 Improve speed and quality of report generation
 Reduce data to be loaded in SAP NetWeaver BW
 Reduce resident data on SAP NetWeaver BW (FI,AP,AR,CP-PA no longer loaded)
 Avoid SAP NetWeaver BW project cost (archiving and optimization)
Value drivers/KPIs
 Finance FTE productivity
 SAP NetWeaver BW hardware cost
 SAP NetWeaver BW project cost for
optimization and archiving

Motor engine test bench: Real-time quality assurance
Automotive
 The engine test bench processes are substantial for all automotive and engine OEMs because
they affect one of the core products/components
Business challenges
 Besides the efforts and expenses for test runs, the growing data volumes must be handled and
stored. These data is expected to build the foundation for pattern deduction and provide an
information source for new high-value services (prediction and so forth)
Process innovations
 Analysis of engine test data from machine data, production process data, and quality
management data; connection to vehicles for telemetric data, creation of special pattern,
knowledge basis for service partners
 Analysis and prediction of data sets out of engine, enterprise resource planning (ERP), quality
management (QM), predictive analytics; reduction of test times by over 10x
Value drivers/KPIs
 Free test capacity by reduced test times; TCO reduction via reduced long-time test; time-to-
market improvement; reduction of lead times
Innovation scope
(now and future)
Automotive – make to order
Value potential 5
Feasibility 2
Low High
1 5
Low High
1 5

Equipment reliability analysis and prevention failure
Automotive
 Based on equipment performance characteristics provided by telematics, alerts are sent to
operators/owners and local dealers when equipment diagnostics detect failure, potential failure,
or other critical issues
Business challenges
 The amount of data generated and available for analysis is enormous, and tools required for
effectively analyzing and using the data have not previously existed
Process innovations
 Gain insight and knowledge out of Big Data
 Store telematics data in SAP HANA and perform ad hoc analysis of data to identify performance
characteristics in real time to predict machine failures and trigger alerts
Value drivers/KPIs
 Reduce warranty cost; optimize vehicle part durability; reduce recall liability costs
Innovation scope
(now and future)
Automotive – embedded product compliance
Value potential 2
Feasibility 3
Low High
1 5
Low High
1 5

Real-time processing of quality management notifications
Automotive
 Quality management notifications are created and processed in QM systems or other
applications based on which specific problem is described; actions and root cause analysis are
initiated
Business challenges
 Enormous amounts of data from various production sites, facilities, and lines must be collected
and consolidated; optimal analysis and graphical display of results must be available in real
time
Process innovations
 Linkage of all relevant data sources to one common data pool; retrieval of real-time data from
QM systems; fast generation of reporting and analysis
 Prompt analysis of the vast information from the QM notifications in a consolidated manner
could be the basis for faster decisions within the production process to assure high quality
requirements
Value drivers/KPIs
 Reduction of re-work; increase of transparency in QM and assurance of high QM standards;
reduce scrap
Innovation scope
(now and future)
Automotive – embedded product compliance
Value potential 2
Feasibility 3
Low High
1 5
Low High
1 5

Detailed claim-level analysis for warranty cost and incidence
Automotive
 Detailed claim level analysis can help reduce warranty claims
Business challenges
 There are performance issues in calculation of IPTV (incidents per thousand vehicles); root
cause analysis by claim type and by individual claim is not possible due to high volume of data
Process innovations
 Warranty claim analysis by individual, vehicle, and claim type will be possible
 Ability to drill down and analyze data at claims level, which can then be linked to root causes of
failure, can lead to better analysis of failures and thus identification of corrective measures to
be taken
Value drivers/KPIs
 Warranty claims/expenses
Innovation scope
(now and future)
Value potential 2
Feasibility 3
Low High
1 5
Low High
1 5

Real-time material coverage and dynamic planning
Automotive
 An inventory dashboard is available to buyers to check gaps in inventory availability at the start
of a day to plan for stock-out situations, but it does not support planning based on available
inventory
Business challenges
 There is no capability to carry out dynamic planning based on available inventory and
production plans, as system does not support processing of such huge amount of data (takes
more than 6 hours)
Process innovations
 Ability to simulate alternate production plan quickly at the beginning of a day/shift will enable
optimization of production capacity and material available
 Simulate alternate production plans on the fly; drill down to Nth level of bill of materials, on the
fly, and get more accurate insight into inventory; ability to optimize production mix based on
product profitability and market demands
Value drivers/KPIs
 Production/revenue, inventory level (raw materials, components)
Innovation scope
(now and future)
Automotive – supply chain execution
Value potential 5
Feasibility 2
Low High
1 5
Low High
1 5

Original parts management
Automotive
 Company needs the ability to reduce investment in original parts and have the right parts at the
right time and place
Business challenges
 Matching of original parts requirements and current inventory is not visible on a global and
regional level; simulation of plan data cannot be executed due to large data volumes; complex
analysis requests takes several hours
Process innovations
 Worldwide original parts requirements vs. inventory matching with early alerting; global planning
and simulation of original parts per company brand; predictive maintenance through automatic
defect detection
 Insight into current original parts requirements vs. inventory matching in real time; central data
platform for prediction and simulations
Value drivers/KPIs
 Reduction of material costs due to demand bundling; reduction of planning costs; increase
revenue due to price optimization; reduction of warranty claims
Innovation scope
(now and future)
Value potential 4
Feasibility 4
Low High
1 5
Low High
1 5

Delivering Real-Time Business Value for Automotive

Recommended

Recommended

More Related Content

What's hot

What's hot (19)

Viewers also liked

Viewers also liked (9)

Similar to Delivering Real-Time Business Value for Automotive

Similar to Delivering Real-Time Business Value for Automotive (20)

More from SAP Technology

More from SAP Technology (20)

Recently uploaded

Recently uploaded (20)

Delivering Real-Time Business Value for Automotive