Delivering Real-Time Business Value for Oil and Gas

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This deck is a SoH Executive positioning document in 3 parts for Oil and Gas

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Delivering Real-Time Business Value for Oil and Gas

  1. 1. Delivering Real-Time Business Value for Oil and Gas SAP Business Suite Powered by SAP HANA July 2013 Public
  2. 2. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 2Public Prudent and cost-effective development of all available energy resources requires coordinated planning, development, and operation of complex, capital-intensive programs. To be effective, energy enterprises must adapt quickly to changing market and regulatory dynamics:  Maximize production without compromising safety  Invest the right resources in the right projects  Deliver greater value while consistently reducing the cost The real-time opportunity
  3. 3. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 3Public The prudent energy supplier Ensure safe, efficient, and responsive operations Maximize production without compromising safety or compliance  Optimize asset performance through streamlined and integrated processes.  Enhance visibility into asset performance to improve maintenance efficiency and proactively manage risk and safety. Invest the right resources in the right projects  Initiate new projects with reliable analytics and integrated processes to support quality work on time and within budget.  Gain insights to support fact-based investment decisions. Deliver greater value while consistently reducing the cost  Streamline all financial functions with minimal error rates and self-service reporting for business users.  Work with efficient and effective planning and budgeting, detailed reporting of costs and profitability, and quick and easy scenario analysis.
  4. 4. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 4Public 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
  5. 5. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 5Public Industry value map for oil and gas The prudent energy supplier IT Management Operational Integrity Risk Analysis and Governance Operational Risk Management Asset Integrity Capital and Spend Effectiveness Strategy Management Planning, Building, and Commissioning Assets Supplier Discovery and Lifecycle Management Analyzing, Sourcing, and Contracting Integrated Digital Oilfield Operations Field Data Capture and Surveillance Integrated Planning and Performance Analysis Field Execution Hydrocarbon Accounting Hydrocarbon Supply Chain Commodity Management Refining and Plant Management Hydrocarbon Supply and Distribution 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 Application Lifecycle Management IT Infrastructure Management IT Portfolio and Project Management IT Service Management IT Strategy and Governance Procurement and Order Collaboration Commercial Sales and Retailing Environmental Stewardship Training and Certification Technology Solutions 3-D Business Visualization Consumer ExperienceAnalytics Enterprise Mobility SAP HANA Platform Application Develop- ment and Integration Data Management
  6. 6. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 6Public IT Management Operational Integrity Risk Analysis and Governance Operational Risk Management Asset Integrity Capital and Spend Effectiveness Strategy Management Planning, Building, and Commissioning Assets Supplier Discovery and Lifecycle Management Analyzing, Sourcing, and Contracting Integrated Digital Oilfield Operations Field Data Capture and Surveillance Integrated Planning and Performance Analysis Field Execution Hydrocarbon Accounting Hydrocarbon Supply Chain Commodity Management Refining and Plant Management Hydrocarbon Supply and Distribution 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 Application Lifecycle Management IT Infrastructure Management IT Portfolio and Project Management IT Service Management IT Strategy and Governance Procurement and Order Collaboration Commercial Sales and Retailing Environmental Stewardship Training and Certification Technology Solutions 3-D Business Visualization Consumer ExperienceAnalytics Enterprise Mobility SAP HANA Platform Application Develop- ment and Integration Data Management 1 2 3 45 6 7 Industry value map for oil and gas The prudent energy supplier Highest real-time business value for oil and gas
  7. 7. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 7Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Asset integrity (1/3) Real-time maintenance plan scheduling  Manual and error-prone process of preselecting maintenance plans  Potential lack of objects necessary for automatic generation of maintenance orders  Schedule all maintenance plans within a specific timeframe  Plan several times a day (instead of once a week) for up-to-date scheduling information in maintenance operations Improve quality of preventive maintenance program Reduce time for maintenance plan scheduling  Maintenance plan scheduling that consumes a great deal of time  High number of maintenance plans that need to be scheduled frequently  Accelerate mass transactions  Preselect plans due to speed the process significantly Easier and more flexible scheduling of maintenance plans that leads to real- time adjustments based on asset usage and therefore to better uptime, fewer failures, and mitigation of production losses. With SAP Business Suite on SAP HANA
  8. 8. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 8Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Asset integrity (2/3) Real-time spare parts planning  Decisions often based on periodic material requirements planning (MRP) runs and outdated information; process done in batch  Faster replanning to allow more frequent MRP runs in shorter cycles  Instant reaction to demand changes and updates to the supplier  Demand information propagated through the supply chain more quickly Reduce out of stocks Decrease inventory and safety stocks  Inability to replan quickly if conditions change due to long run times  Difficult prediction of inventory coverage for critical parts More frequent MRP runs:  Allow reduction in inventory and safety stock levels  Accelerate information flow to suppliers to enable them to react to changed planning conditions more quickly Faster replanning to allow more frequent MRP runs in shorter cycles. With SAP Business Suite on SAP HANA
  9. 9. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 9Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Asset integrity (3/3) Warehouse management  No up-to-date view of the inventory situation  Need for accurate display of actual stock to react to stock shortfalls quickly  Time-consuming reporting on inventory management  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 by 2%–5% Improve Optimize SLA with real-time product allocation working capital With SAP Business Suite on SAP HANA
  10. 10. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 10Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Planning, building, and commissioning assets (1/2) Project management  Project members experience long waiting times when starting the project and task dashboards. This situation reduces user productivity when working on several projects and tasks across projects.  Updates on multiple tasks are inefficient and time-consuming because project team members confirm tasks one by one to reduce waiting times.  Searching for documents across projects takes a very long time for a large portfolio of projects.  The process of finding projects, tasks, and phases by those responsible is slow.  Faster access to my tasks and my projects  Accelerated access to project, task, and checklist items dashboards  Ability of project team members to confirm times, status, and dates and to attach documents for several tasks at once  Increased user productivity  Accelerated search for documents  Accelerated ability to find projects or tasks by responsible project member Increase user productivity Reduce Improve time for task confirmation search for documents and project elements With SAP Business Suite on SAP HANA
  11. 11. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 11Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Planning, building, and commissioning assets (2/2) Project management (PS)  Long wait and locking times along business processes hinder project execution and the flexibility needed to react to deviations.  User acceptance is reduced due to affected usability in handling large amounts of project data.  Reduced waiting and locking times of critical transactions along the end-to- end process result in higher process efficiency and improved employee productivity. Increase user productivity and end-to-end process efficiency Improve transparency and decision support to take appropriate corrective measures in time  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 information system reporting and new project line item reporting deliver faster insights.  Early insight in deviations and risks enable timely corrective measures by highlighting deviations in real time.  Planned: Project execution cockpit enables project managers and employees to analyze the status and progress of one or more projects in execution from an end-to-end perspective at maximum speed with real-time data and to derive and execute actions wherever applicable. With SAP Business Suite on SAP HANA
  12. 12. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 12Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Refining and plant management Global plant performance management  Inability to gather and visualize data from production in real time to improve the status of manufacturing performance 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 contribute 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  Allows enterprise-level overall equipment effectiveness (OEE) to roll up plant-level OEE for enterprise analytics and comparing assets and performance across multiple sites Improved return on assets, costs of goods sold, and product quality Increased Reduced resource utilization and asset uptime unplanned downtime, changeover, and waste by 5%–10% With SAP Business Suite on SAP HANA
  13. 13. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 13Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Accounting and financial close Entity close  Long-running processes  Time-intensive reconciliations  Limited time for analysis  Inefficiencies due to manual processes and low automation  Missing financial excellence results in higher cost of equity on the capital markets  Difficulties in supporting parallel financial reporting standards on a global basis and in simulation of scenarios  More time for analysis, less overtime, or earlier publishing of financial results through faster period-end processes and better reconciliation  Increased efficiency through smarter reconciliation and reporting, reducing operating costs and improving stakeholder satisfaction  Real-time analytics down to the lowest level of detail – delivering quality at source, transparency, and process efficiencies Minimize time to close the entities’ books by 50% Reduce Enhance cost of financial reporting by 40% compliance and accuracy by 50% With SAP Business Suite on SAP HANA
  14. 14. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 14Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Financial performance management Planning, budgeting, and forecasting  Planning performance limited to OLAP; staged cubes for transactional and master data  Data-load performance driven by the amount of data extracted from SAP Business Suite  Reporting, loading, and retraction performance that limit planning iterations  Drilldown within OLAP cube and drill- through to data in SAP Business Suite and OLTP data within standard times  Smooth replication of master and transactional data from SAP Business Suite  Availability of more granular data to support planning  Negation of Big Data challenge to allow for faster extract and activation times for days sales outstanding (DSO)  Iterative planning and real-time simulation supported through improved performance  Improved performance for drill-down (expand) and consolidation (collapse)  Fast drill-through and live view of transactional data in SAP Business Suite Improve service level performance Reduce Minimize cycle times and manual effort operating costs With SAP Business Suite on SAP HANA
  15. 15. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 15Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Financial performance management Profitability and cost analysis  Data latencies and process delays affect the ability to react to issues and opportunities  Lack of data depth and user self- service affect internal decision- making  Long-running processes  Time-intensive data queries  Primarily manual data analysis  Substantial amount of effort (time spent) not directly adding value  Suboptimal resource efficiency and effectiveness  Timely execution of critical business processes that supports decision making and increases the ability to act swiftly (insight to action) in dynamic market environments  Critical transactions and calculations that run quickly  Instant response times on queries  Prebuilt analytics that automate the data analysis process  Leaner processes from data capture through data analysis  Increased productivity through process-optimized analytics and mobile support With SAP Business Suite on SAP HANA Improve service level performance Reduce Minimize cycle times and manual effort by 40% operating costs
  16. 16. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 16Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Financial performance management 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 and reports  Time-intensive data analysis  Large number of time-consuming, and non-value-added processes required to provide (access) accurate, up-to-date information  Timely execution of compliance- relevant validation tasks  Increased end-user satisfaction (accurate, detailed, visualized, timely, and actionable information)  Accelerated key, critical-path processes and reports  Instant response time on most data analysis queries  Elimination of workarounds and data latencies  End-user data analysis through self- service means (with SAP BusinessObjects business intelligence solutions) With SAP Business Suite on SAP HANA Improve service-level performance Reduce Minimize cycle times and manual effort operating costs by 10%
  17. 17. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 17Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Commercial sales and retailing LoB Sales  Missed market opportunities due to lack of visibility and inefficient processes  Data explosion, driven by new level of connectivity of consumers through mobile devices and social networks  Data in disparate sources, preventing a true 360-degree view of the customer  Agile marketing to respond faster to changing market dynamics and opportunities  New analytical data-mining capabilities on Big Data (social media and predictive)  Near-real-time monitoring and reporting on marketing performance  One central place for collecting all customer data, leading to a 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% With SAP Business Suite on SAP HANA
  18. 18. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 18Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Commercial sales and retailing LoB Marketing  Difficulty in distinguishing profitable customers in the customer pool  Inability to identify gaps in the sales pipeline, leading to missed targets  Extraction of actionable information from enterprise-wide customer data to maximize the chance of a sale  Minimal insight into buying preferences of customers in social- data context  Easy identification of profitable customers with account intelligence analytics  Faster transaction search functions  Complete transparency into sales pipeline based on real-time information with unlimited drill-down functions  Real-time analysis of Big Data to understand buying patterns better  Real-time access and assembly of all data including social and sales data Increase profitability by 0.5% Increase Improve percentage of sales reps achieving quota by 17% offer win rate With SAP Business Suite on SAP HANA
  19. 19. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 19Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Commercial sales and retailing Contact management with interaction center  To successfully resolve customer issues, companies need to be able to locate the right experts or resources within the organization quickly, whether they reside inside the contact center or elsewhere.  Managers and supervisors lack actionable reporting and visibility into the workload of their teams.  A high volume of customer records and interactions result in increased search times and greater difficulty in locating specific customer records.  With the new agent inbox based on SAP HANA, users can more easily search for relevant experts – in their own team or elsewhere in the organization – to dispatch or 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 (AHT) by 50% Improve Reduce SLA compliance service cost by 20% With SAP Business Suite on SAP HANA
  20. 20. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 20Public Today KPI improvements are high-level estimates and will have to be validated for each customer situation. Procurement and order collaboration Operational procurement  Missing real-time insight into operational procurement reporting  Lack of functions to create operational procurement–related reporting dynamically in a modern user interface  Slow and costly paper-based processes  High transaction costs  Long-running transactions while posting documents with a high number of line items  Frequent errors yield to maverick spend  New configuration options for procurement analysis  Modern and easier-to-consume user- interface  Complete visibility into end-to-end procurement activities  Real-time insight and easier-to- manipulate information  Accelerated long-lasting processing of purchasing documents Increase transparency Lower Increase procurement operations cost by 20% process effectiveness
  21. 21. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 21Public Customer cases Indian paint manufacturer  Support sales decision making and corrective actions  Improve effectiveness of trade promotion spend  Proactively track and manage customer service level European petrochemical firm  Financial Performance Management: Accelerated financial reporting measured by increased employee productivity Leading U.S. chemical manufacturer  One BW on HANA reporting for SCM real- time planning analytics: Ability to modify customer SLA based on profitability to reduce inventory Annual benefit US$ 10.7 million Annual benefit $2.4 million Annual benefit $15 million
  22. 22. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 22Public 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.
  23. 23. © 2013 SAP AG or an SAP affiliate company. All rights reserved. Thank you
  24. 24. © 2013 SAP AG or an SAP affiliate company. All rights reserved. Appendix Detailed customer cases
  25. 25. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 25Public Feasibility Businessvalue Legend LowHigh Low High Payroll on SAP HANA ($5 million) Annual revenue: US$100 billion SAP HANA platform: Customer -specific SAP HANA, applications: SAP NetWeaver BW on SAP HANA and high-performance applications SAP Business Suite on SAP HANA: Available today or planned SAP HANA: Use case Accelerated financial reporting ($4 million) Well work-over planning ($12 million) SAP ERP on SAP HANA ($4.5 million) Gas transmission integrity ($34 million) Real-time procurement planning ($45 million) Reduction production loss ($49 million) Transportation balancing ($98 million)Real-time drilling failure prediction ($2 million) 1 1 1 2 2 2 3 3 3 Reference $100 billion oil-and-gas company Summary validated scenarios Legend SAP Business Suite on SAP HANA SAP HANA, applications SAP HANA Platform 1 Short term FIN: Accelerated reporting: Slow data-mining process makes reporting a burden of resources, putting company at risk of mistakes in publicly available reporting HCM: Payroll: Centralized payroll processing for 400,000 employees within 5 days based on SAP HANA – faster and with fewer calculating resources) BPC: ERP: Huge volume of data coming from over 200 legal entities – very time-and labor-consuming process 2 Medium term SRM: Real time procurement planning: Reduced lead time for new on-shore or off-shore oil rig plans to procure material to start construction for competitive advantage SCM: Reduction production loss: Gas production and transmission system diagnostics and monitoring to prevent loss and fraud. There is currently no analysis of real time transmission data in real time. SCM: Transportation balancing : Complex time- and labor-consuming process of balancing gas volume transmitted over the system based on sheer number of data points Note: Included in business case Phase – deployment road map SAP HANA use cases mapped to industry value map end-to-end solutions
  26. 26. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 26Public Reference $100 billion oil-and-gas company SAP HANA as a real-time data platform 13 13 13 95 130 98 112 0 50 100 150 200 250 300 2013 Phase 1 Phase 2 Phase 3 Costs SoH Applications Platform $ Annual benefits, SAP HANA Platform: $112 million Annual benefits, applications powered by SAP HANA: $130 million Annual benefits, SAP Business Suite on SAP HANA: $13 million Estimated deployment costs Total transition cost: TBD In millions of USD More information: Value engineering Annual revenue: $100 billion Based on actual SAP customer engagements 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), and applications – mapped to inventory value map (IVM) end-to-end (E2E) solutions Currently available functionality (SP0, 1, and 2) – 23 scenarios mapped to IVM End-to-End Solutions and planned functionality (all the End-to-End Solutions on the IVM are in scope) SoH = SAP Business Suite on SAP HANA SAP HANA Platform SAP HANA products SAP Business Suite on SAP HANA
  27. 27. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 27Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Oil refining and marketing: SAP NetWeaver on SAP HANA for downstream financial reporting Oil and gas Business context and goals  Improved cash and liquidity management Business challenges  Predict cash flows to manage collections, risk, and short-term borrowing in real time Process innovations  Interactive analysis of both inbound and outbound operating and capital cash-flow data in several dimensions  Access to payment history at customer, partner, product, asset, and geographic level Contribution of SAP HANA Increased flexibility for use:  Drastic improvement of the response time of the system  Sharp reduction in the risk of delays in the availability of daily report  Ability to ensure the availability of large volumes of data reduction of operating costs Value drivers and key performance indicators  DSO, DPO, FTE IT efficiency, and FTE business efficiency Innovation scope SAP HANA, products (HPAs and apps) End-to-end (E2E) solution Oil and gas – financial performance management Value potential 3 Feasibility 2 Low High 1 5 Low High 1 5
  28. 28. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 28Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Global energy company – payroll on SAP HANA Oil and gas Business context and goals  Centralized payroll processing for 400,000 employees Business challenges  Current payroll regulation requires this process to be finalized within first 5 days of the month. Doing so for 400,000 employees within 5 days requires huge calculating capacity and lots of work. Process innovations  Centralized payroll processing for 400,000 employees within 5 days based on technology of SAP HANA – faster and requires fewer calculation resources Contribution of SAP HANA  Requirements for performance and large volume of data Value drivers and key performance indicators Productivity increase for HR and finance:  Improved compliance with regulations on payroll processing  Improved employee satisfaction because of erroneous payroll reduction Innovation scope SAP Business Suite on SAP HANA (now and in the future) End-to-end (E2E) solution Oil and gas – core HR and payroll Value potential 3 Feasibility 4 Low High 1 5 Low High 1 5
  29. 29. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 29Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Global energy company – SAP ERP on SAP HANA Oil and gas Business context and goals  Accelerated financial processes to speed up financial closing and improve performance Business challenges  Intense labor needs to process a huge volume of data coming from over 200 legal entities  Desire to improve accuracy and timeliness significantly Process innovations  Centralized data collection and processing can simplify and speed up financial processes significantly Contribution of SAP HANA  Data volume and requirement to processing speed Value drivers and key performance indicators  Increased productivity of finance function  Selling, general, and administrative expenses reduction Innovation scope SAP Business Suite on SAP HANA (now and in the future) End-to-end (E2E) solution Oil and gas – financial performance management Value potential 3 Feasibility 4 Low High 1 5 Low High 1 5
  30. 30. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 30Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Global energy company – gas transmission system integrity Oil and gas Business context and goals  Real-time analysis of equipment diagnostics data to forecast equipment reliability and plan maintenance based on the state of the equipment Business challenges  Despite multiple real-time measurement of equipment parameters, this data is not analyzed in real time. Maintenance is conducted according to a fixed schedule or based on the results of periodic diagnostics. As a result, opportunities to optimize maintenance costs or increase equipment availability are lost Process innovations  Real-time analytics of huge data volume and predictive analytics to analyze the state of equipment, make conclusions about its state, and plan maintenance accordingly Contribution of SAP HANA  Analysis of huge volume of data in real time Value drivers and key performance indicators Maintenance cost reduction:  Equipment and asset availability increase  Risks of equipment breakdown reduction  Personnel efficiency increase Innovation scope SAP HANA, products (HPAs and apps) End-to-end (E2E) solution Oil and gas – asset integrity Value potential 3 Feasibility 3 Low High 1 5 Low High 1 5
  31. 31. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 31Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Global energy company – instant balancing of gas transported Oil and gas Business context and goals  Accelerating the process of balancing gas volume transmitted through the system to prevent delays in customer billing, reduce multiple discrepancies and a lack of clarity in the invoices, and costs for reconciliation; accelerate customer payments; and increase customer satisfaction Business challenges  Complex time- and labor-consuming process of balancing gas volume transmitted through the system based on the sheer number of data points  Delays in customer billing, multiple discrepancies and a lack of clarity in the invoices, high costs for reconciliation, late customer payments, and low customer satisfaction  Political tension around gas trading  Critical for the core business, COO area, supply chain execution, and finance; some instances require involvement of the government for resolution Process innovations  SAP HANA is uniquely positioned to help customer simplify and accelerate transmitted gas balancing, speed up invoicing, and bring clarity to the process  Solution is based on SAP HANA and involves significant CDP. The solutions, including process mapping, data collection, processing algorithms, and results interpretation should be developed from scratch, which drives the complexity and costs of the project. Risks include delays or failure of the project, but the risks will not affect customer’s core business negatively. Contribution of SAP HANA  Analysis of huge volume of data Value drivers and key performance indicators  Sales volume increase, improved customer satisfaction, improved visibility and transparency, and increased market capitalization  Decreased DSO Innovation scope SAP HANA Platform (customer-specific) End-to-end (E2E) solution Oil and gas – hydrocarbon supply and distribution Value potential 5 Feasibility 3 Low High 1 5 Low High 1 5
  32. 32. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 32Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Global energy company –transportation and production loss Oil and gas Business context and goals  Real-time analysis of gas transmission system diagnostics and monitoring to prevent loss and fraud Business challenges  The data about the transmission system is collected hourly, but there is no way to analyze it in real time currently. As a result, huge opportunities in preventing losses and fraud are lost. Process innovations  Given the performance and capacity to work with real-time data of SAP HANA, the company can now analyze network diagnostics data instantly, assess potential losses, and make relevant decisions on abnormal situations in the system Contribution of SAP HANA  Analysis of a huge volume of data real time Value drivers and key performance indicators Production losses decrease:  Improved risk management  Increased asset utilization  Improved employee effectiveness Innovation scope SAP HANA, products (HPAs and apps) End-to-end (E2E) solution Oil and gas – operational risk management Value potential 4 Feasibility 3 Low High 1 5 Low High 1 5
  33. 33. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 33Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Oil and gas – sustain the competitive advantage of the trading business Oil and gas Business context and goals  Need for better-informed trading decisions Business challenges  Delay in getting data to analyze trading performance Process innovations  Reduced time to get trading actual data Contribution of SAP HANA  Accelerated Big Data analysis in trading process Value drivers and key performance indicators  Reduction in lost revenue due to lack of visibility and what-if analysis to limit exposure and improve trading efficiencies Innovation scope SAP HANA Platform (customer-specific) End-to-end (E2E) solution Oil and gas – SAP HANA Platform Value potential 4 Feasibility 4 Low High 1 5 Low High 1 5
  34. 34. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 34Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Oil and gas customer – real-time prediction of drilling failures Oil and gas Business context and goals  It is estimated that the stuck drill problem alone costs the oil industry in the hundreds of millions of dollars every year. Even when all precautions are taken, a stuck pipe may occur. For example, to free a differentially stuck drill string, the driller must overcome the restraining force of the drilling fluid, which pushes the drill string against a permeable formation. The drill string (drill pipe or collars) will soon become imbedded in the filter cake opposite the permeable zone if corrective action is not taken as soon as the sticking situation is noticed. Business challenges  Predicting a stuck pipe is a very technical exercise: Data is being collected on many channels at the site of the drilling operations and historic data is also available Today, the process is not analytical, with a prediction based on the drilling crew’s experience and skill. Decisions based on data involve measurements of torque, drag, weight on bit, mud flow, equivalent circulating density, weather, and the like. Te size of the rock fragments in the drilling mud, vibration, and other visual and sensory input also play an important role in the decisions. Process innovations  Respond rapidly to changing drilling conditions: Implementation of an analytical control system that alerts the drilling crew to stuck-drill events. Enable truly real-time prediction by sensing and responding to failure with low latency. Improve automation and execution speed and the efficiency of drilling operations and reduce drilling cost. Avoid lost revenue due to down-time of a drill rig during the remediation process. Contribution of SAP HANA  SAP HANA will enable customers to detect and predict upcoming events and potential failures in real time and at unprecedented speed to enable corrective action. Data from multiple sources including the drill string, earth model, historical data, and so on are aggregated into SAP HANA and predictive analytic models. Pattern re- cognition, simulation, and event processing can be defined flexibly to works on real-time and historical well data. Value drivers and key performance indicators  Drilling efficiency improvement Innovation scope SAP HANA Platform (customer-specific) End-to-end (E2E) solution Oil and gas – field execution Value potential 5 Feasibility 3 Low High 1 5 Low High 1 5
  35. 35. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 35Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Oil and gas customer – well work-over plan optimization Oil and gas Business context and goals  Upstream companies face constant challenges (equipment failure, well under-performance, and other well-servicing requirements) to maintain the hydrocarbon production from wells according to plan. When liquid loading occurs in wells in a producing field, the operator needs to find an optimum schedule for performing a work-over service (like swabbing) that optimizes the revenue loss and work-over cost against the potential production gains subsequent to the work-over operation. Business challenges  Limited ability to apply the knowledge from historical work-overs and arrive at optimal work-over plan. Limited ability to react fast and communicate with service providers for changes to work- over schedule. Process innovations  Analyze historical data on previous work-overs using statistical techniques and use this knowledge to predict behavior of planned work-overs. Arrive at the optimal work-over plan for servicing multiple wells in the field and communicate with service providers. Contribution of SAP HANA  Analyze historical data on previous work-overs using statistical techniques and use this knowledge to predict behavior of planned work-overs. Arrive at the optimal work-over plan for servicing multiple wells in the field and communicate with service providers. Value drivers and key performance indicators  Reduce work-over operations cost as a percentage of revenue Innovation scope SAP HANA Platform (customer-specific) End-to-end (E2E) solution Oil and gas – field execution Value potential 5 Feasibility 3 Low High 1 5 Low High 1 5
  36. 36. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 36Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Oil and gas production – real-time planning to procurement Oil and Gas Business context and goals  Reduce lead time from new on-shore or off-shore oil rig plan to procure material to start construction or maintenance Business challenges  Long lead time from planning and maintaining an asset to material procurement and supplier engagement could bring a competitive disadvantage Process innovations  Evaluate new asset or strong maintenance operations during the planning phase based on time to procure material and possible costs Contribution of SAP HANA  Real-time data analysis and streamlined process Value drivers and key performance indicators  Increase effectiveness in project realization and reduce time to market for new oil and gas discoveries  Increase asset utilization  Increase strategic supplier relationships Innovation scope SAP HANA, products (HPAs and apps) End-to-end (E2E) solution Oil and gas – planning, building, and commissioning assets Value potential 3 Feasibility 3 Low High 1 5 Low High 1 5
  37. 37. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 37Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Service spend analytics for upstream oil and gas Oil and gas Business context and goals  This company currently uses a workflow tool for entering service vendor invoices and processing them. The system is inefficient, since nearly 10% of the invoices fail the check and manual checks are required, resulting in errors and inefficiencies, redundant effort, and increased spend volumes. Business challenges  Large volumes of data are collected during this process and are not being used for any analysis or improvement. The scale of the problem is huge, since nearly $7 billion of spend is tracked using the system, and a 10% manual intervention translates to opportunities for cost saving and improved efficiency.  Productivity loss because the entire audits is manual and time-consuming. Contribution of SAP HANA  SAP HANA can help analyze service contracts in real time and conduct root cause analysis of noncompliance. SAP HANA could also help optimize workflow by assigning the tasks to contractors more efficiently. Value drivers and key performance indicators  Reduced billing in accuracies and premium service contract payments  Advanced drill-down functions to identify the root cause of the problem  Better reporting and auditing Innovation scope SAP HANA Platform (customer-specific) End-to-end (E2E) solution Oil and gas – strategic sourcing and contracting Value potential 4 Feasibility 3 Low High 1 5 Low High 1 5
  38. 38. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 38Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Oil and gas – inventory availability Oil and gas Business context and goals  All of the company’s departments and managers need to obtain up-to-date information and analyze available supplies and materials on a day-to-day basis. Some 700 employees analyze inventory and make decisions daily. Business challenges  With up to 75,000 articles in circulation and requiring distribution, analysis is a major challenge. Decisions had to be made based on inaccurate inventory data, which affected operations and inventory levels. Process innovations  Sped up inventory availability reporting allowed real-time material inventory analysis. Contribution of SAP HANA  Analysis of huge volumes of inventory data Value drivers and key performance indicators  Inventory turnover Innovation scope SAP Business Suite on SAP HANA (now and in the future) End-to-end (E2E) solution Oil and gas – strategic sourcing and contracting Value potential 4 Feasibility 4 Low High 1 5 Low High 1 5
  39. 39. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 39Public Note: Use cases in the global use case repository are captured directly from customers and internal innovation sessions and may not be completely validated. Oil and gas producer – accelerated financial reporting Oil and gas Business context and goals  Company has allocated massive resources to create financial reports company-wide Business challenges  Slow data-mining process makes reporting a burden of resources, putting the company at risk of mistakes in publicly available reporting. Process innovations  Accelerate data mining, analysis, and financial reporting for a better financial decisions Contribution of SAP HANA  SAP NetWeaver BW on SAP HANA for fast data access Value drivers and key performance indicators  Employee productivity Innovation scope SAP HANA, products (HPAs and apps) End-to-end (E2E) solution Oil and gas – Financial Performance Management Value potential 2 Feasibility 5 Low High 1 5 Low High 1 5

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