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Delivering Real-Time Business Value for Cargo Transportation and Logistics

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This deck is a SoH Executive positioning document in 3 parts for Cargo Transportation and Logistics

Published in: Technology, Business

Delivering Real-Time Business Value for Cargo Transportation and Logistics

  1. 1. July 2013 Delivering Real-Time Business Value for Cargo Transportation and Logistics SAP Business Suite Powered by SAP HANA Public
  2. 2. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 2Public The real-time opportunity Transportation and logistics service providers live in an incredibly dynamic world of evolving markets, shifting customer demands, and rising competition. Companies need to continuously innovate ways to align business operations with customer needs.  Differentiate through profitable services that excite customers  Run flexible, efficient, and cost effective business processes  Respond rapidly to evolving trends and demands
  3. 3. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 3Public Drive profitable growth through differentiated offerings  Predict trends and evolving customer needs  Gain customer intimacy in marketing, sales, and service  Tailor services to the needs of target segments Manage costs with end-to-end process support  Realize cost savings through better management of resources (assets, people, fuel)  Embed decision support throughout business processes  Transform from reactive into proactive execution mode Respond to market dynamics in real time  Conduct ad hoc, what-if, and root-cause analysis based on reliable and real-time data  Empower employees to make informed decisions  Provide flexible self-service reporting functionalities Becoming an innovation-driven enterprise Align business operations with customer needs
  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 cargo transportation and logistics Cargo – information and the path to growth Technology Solutions Analytics Data Management Consumer Experience SAP HANA Platform Asset Management Transportation Assets Management Infrastructure Assets / Linear Asset Management Operations Warehouse Management Transportation Management and Operations Fuel Management People and Talent Core Human Resources and Payroll Talent Management Workforce Planning and Analytics Finance Financial Performance Management Accounting and Financial Close Collaborative Finance Operations Enterprise Risk and Compliance Management Procurement Supplier Discovery and Lifecycle Management Strategic Sourcing and Contracting Collaborative Invoice to Pay IT Management Application Lifecycle Management IT Infrastructure Management IT Service Management IT Strategy and Governance Enterprise Mobility Application Develop- ment and Integration Time and Attendance Management Treasury and Financial Risk Management Procurement and Order Collaboration IT Portfolio and Project Management Sales and Marketing/Customer Service Marketing Management Key Account and Territory Management Quotes and Contract Management Sales Force Support Customer Service Real Estate Lifecycle Management
  6. 6. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 6Public Industry value map for cargo transportation and logistics Cargo – information and the path to growth Technology Solutions Analytics Data Management Consumer Experience SAP HANA Platform Asset Management Transportation Assets Management Infrastructure Assets / Linear Asset Management Operations Warehouse Management Transportation Management and Operations Fuel Management People and Talent Core Human Resources and Payroll Talent Management Workforce Planning and Analytics Finance Financial Performance Management Accounting and Financial Close Collaborative Finance Operations Enterprise Risk and Compliance Management Procurement Supplier Discovery and Lifecycle Management Strategic Sourcing and Contracting Collaborative Invoice to Pay IT Management Application Lifecycle Management IT Infrastructure Management IT Service Management IT Strategy and Governance Enterprise Mobility Application Develop- ment and Integration Time and Attendance Management Treasury and Financial Risk Management Procurement and Order Collaboration IT Portfolio and Project Management Sales and Marketing/Customer Service Marketing Management Key Account and Territory Management Quotes and Contract Management Sales Force Support Customer Service Real Estate Lifecycle Management 1 2 3 4 5 Highest real-time business value for transportation and logistics
  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. Transportation management and operations Business value for transportation management  Huge order volumes with limited ability to analyze and react to changes and exceptions  High manual effort to manage orders, documents, and so on  Suboptimal asset utilization driving higher costs and lower service  Hard to handle sheer volume of data from assets (for example, containers)  Limited ability to track status and lifecycle of customer orders  Limited visibility into total customer engagement, own performance, and economic impact  Running a global no-latency order platform enabling better-informed decisions, exception monitoring, and alerting to meet customer demands with accurate information  Up-to-date information on availability and real-time tracking of assets, leading to higher reliability  Management, planning, and optimization of huge volumes of asset data  Control over transportation in real time to decrease costs while maximizing available resources  Real-time analysis of customers, orders, value-added services, and overall operational performance Perfect order taking and fulfillment Heighten Understand asset utilization order flow, customer preferences, and financial impact 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. Customer service Business value for multichannel customer service  High volume of customer records and interactions resulting in increased search times when handling customer inquiries  No single platform for monitoring, notification, adjustments, and analysis of all business events in real time  Limited ability to successfully resolve customer issues as companies are unable to quickly analyze and resolve root causes of problems  Quickly identify customers and get a complete 360-degree view of customer orders and related documents in real time  Provide self-service reporting functionality to customers  Proactive customer reporting on order, billing, and performance  Spotting of potential problems in real time, allowing mitigating actions to reduce late or incomplete orders  Operational tracking and advanced real-time analytics as a basis for more effective collaboration with business partners in order to mitigate risks Transform from service desk dependency to provisioning self- service Improve Gain insight service quality through end-to-end view into customer preferences in order to provide targeted offers 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. Financial performance management Business value for financial performance management  Inability to adapt (plan, replan, monitor, and control) the business model, operations, and services in volatile market environments  Need to quickly adapt finance and business operations  Long performance management cycles with complex consolidation landscapes  Reporting, loading, and retraction performance limits planning iterations  Inefficiencies due to disruptions between planning and execution  Drilldown limited to within OLAP environment, no drill-through to transactional data  Leveraging of more granular data to gain full transparency and as a basis for planning  Ad hoc analytics, iterative planning, and real-time simulation supported through real-time platform  No latency in heterogeneous consolidation landscapes through quasi-instant response times (even with large number of complex calculations)  Improved performance for drilldown (expand) and consolidation (collapse)  Fast drill-through to lowest level view of transactional data in SAP Business Suite financial transparency and forecasting cycle times and manual effort financial costs With SAP Business Suite on SAP HANA Improve Reduce Minimize
  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. Accounting and financial close Business value for accounting and financial close  High number of systems and people requiring many handovers and reconciliations hinders a transparent central financial close  Inefficiencies due to manual processes and low automation  Missing financial excellence that results in higher cost of equity at the capital markets  Lack of governance – issues in ensuring a sound end-to-end closing process and effectiveness of internal controls  Difficult to comply to parallel financial reporting standards and simulate scenarios  More time for analysis, less overtime, and earlier publishing of financial results through faster period-end processes and better reconciliations  Single repository for company and corporate data  Increased efficiency through smarter reconciliations and reporting, reducing operating costs and improving stakeholder satisfaction  Deeper and faster insight down to the lowest level of detail – delivering quality at the source, transparency, and process efficiencies Improve insights into financial performance Minimize closing costs With SAP Business Suite on SAP HANA Reduce month-end closing time
  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. Collaborative financial operations Business value for receivables management  Challenges to assign revenues and allocate costs to service products/cost drivers correctly due to volume and complexity; inability to process data on detailed/line-item level  Limitations in analysis capabilities and dimensions because of reliance on finance aggregates  Large data volumes that lead to batch processing and reporting latency  Difficulty in identifying exceptions in thousands of pages of reports  Empowered business users with rapid access to trusted, detailed data and new insight to optimize decision making  Ad hoc data queries and drill-downs to isolate variances  More accurate document-level calculation of, for example, DSO that allows you to identify root causes of changes to DSO  Real-time reporting on all accounts receivable data including credit, collections, and disputes  Anywhere, anytime access to key receivables status Optimize profit/loss distribution across network Improve Increase billing and revenue management cash collections and accelerate dispute resolution With SAP Business Suite on SAP HANA
  12. 12. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 12Public 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.
  13. 13. © 2013 SAP AG or an SAP affiliate company. All rights reserved. Thank you Contact information: Franz Uhr Solution Manager Dietmar-Hopp Allee 16, 69190 Walldorf Tel. +49 6227764438
  14. 14. © 2013 SAP AG or an SAP affiliate company. All rights reserved. Appendix with detailed customer cases
  15. 15. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 15Public Container transportation/transportation and logistics Summary validated scenarios Feasibility BusinessvalueLowHigh Low High Order settlement reporting (US$2.6 million) Incremental revenue from higher utilization of assets (US$1.7 million) Reduce costs of budgeting and forecasting (US$2.4 million) Reduce costs of allocations (US$0.3 million) Reduce time spend to create reports (US$0.8 million) Reduce preparation time spend to close the books (US$1.0 million) Legend SAP Business Suite on SAP HANA SAP HANA applications SAP HANA Platform Phase - deployment road map Annual revenue: US$10 billion 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 Scenario (business value) 1 Short term Reduce costs of budgeting and forecasting: Higher planning and forecasting efficiency Incremental revenue from higher utilization of assets: Increased profitability Reduce preparation time spend to close the books: Accelerated financial closing Increased margin per deal by analyzing service income statements per deal: Increased profitability Reduce time spend to create reports: Reduced manual reporting effort Reduce costs of allocations: Reduced manual effort 2 Medium term Order settlement reporting 3 In evaluation Other functions – To be discussed in future discovery workshops Increased margin per deal by analyzing service income statements per deal (€1.7 million) SAP HANA use cases mapped to industry value map end-to-end solutions
  16. 16. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 16Public Container transportation/transportation and logistics SAP HANA Platform Results over five years – SAP Business Suite on SAP HANA only Surplus US$7.2 million ROI 260%* Pay back period <12 months* -3.800 -400 8.400 11.000 -4.000 -2.000 0 2.000 4.000 6.000 8.000 10.000 12.000 2013 Phase 1 Phase 2 Costs SoH Applications Platform US$’000 * to be validated 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); 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 SAP Business Suite on SAP HANA Annual benefits, SAP HANA Platform Annual benefits, applications powered by SAP HANA: US$11 million Annual benefits, SAP Business Suite on SAP HANA Estimated deployment costs Total transition cost: US$3.8 million SoH = SAP Business Suite on SAP HANA
  17. 17. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 17Public 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. Container transportation − close books more efficiently Cargo transportation and logistics Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Cargo transportation and logistics – financial performance management Value potential 3 Feasibility 4 Low High 1 5 Low High 1 5 Business context and goals  Accelerated financial closing Business challenges  Customer spends a lot of time preparing for the closing of 19,000 cost centers, 1,200 account codes, 3 business units, 11 lines of business, and 7 regions. The 300 users of SAP Business Planning and Consolidation extract data and make adjustments to data manually. Process innovations  Higher productivity of employees, less rework, and reduced cycle times Contribution of SAP HANA  With SAP HANA, data loading from SAP ERP can happen more frequently and adjustment values are reflected for financial reconciliation and verification in shorter time frames Value drivers/KPIs  Productivity
  18. 18. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 18Public 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. Container transportation − improve asset utilization Cargo transportation and logistics Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Cargo transportation and logistics – financial performance management Value potential 4 Feasibility 2 Low High 1 5 Low High 1 5 Business context and goals  Increased profitability Business challenges  Finance users are largely reactive to business demands. Utilization of assets such as ports, vessels, containers, and trucks can be improved. Process innovations  By enabling faster insight into the business financial performance, finance users become strategic business partners of the organization Contribution of SAP HANA  SAP HANA will drastically reduce reporting times. That will allow users of SAP Business Planning and Consolidation to run 2x to 3x more simulations then before. This will generate better insight and higher forecast accuracy, and thus decision making about how to utilize assets such as ports, vessels, containers, and trucks in a better way. Value drivers/KPIs  Asset utilization
  19. 19. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 19Public 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. Container transportation − improve budgeting and forecasting productivity Cargo transportation and logistics Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Cargo transportation and logistics – financial performance management Value potential 5 Feasibility 4 Low High 1 5 Low High 1 5 Business context and goals  Improved planning and forecasting efficiency Business challenges  Customer currently conducts three to four outlooks a year for board meetings, and seven to eight forecasts for senior management. Part of the planning and forecasting cycle based on 19,000 cost centers involves manual effort. Process innovations  Enhance productivity of 300 users of SAP Business Planning and Consolidation Contribution of SAP HANA  SAP HANA will speed up the cycles Value drivers/KPIs  Productivity
  20. 20. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 20Public 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. Container transportation − increase margin per deal Cargo transportation and logistics Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Cargo transportation and logistics – financial performance management Value potential 4 Feasibility 3 Low High 1 5 Low High 1 5 Business context and goals  Increased profitability Business challenges  90% of customer’s business is liner business, entailing trade routes with many services offered. Customer is only able to produce P&L statements by trade lanes, and is not able to identify which services within trade lanes are profitable. Process innovations  Finance users can flag if service line items in deals are not profitable Contribution of SAP HANA  Enables more granular insight into the business financial performance Value drivers/KPIs  Margin
  21. 21. © 2013 SAP AG or an SAP affiliate company. All rights reserved. 21Public 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. European railway − order settlement reporting Cargo transportation and logistics Innovation scope SAP HANA products (HPAs, apps) End-to-end (E2E) solution Cargo transportation and logistics - accounting and financial close Value potential 3 Feasibility 4 Low High 1 5 Low High 1 5 Business context and goals  Order settlement reporting allows the company to allocate internal costs of services, and to monitor and control them Business challenges  Response times of data retrieval (for example, cost center reporting) do not meet end-user requirements Process innovations  Fast response times of data requests provide the decision makers with real-time data insights with drill-down capabilities on any granularity Contribution of SAP HANA  Single platform for order settlement data, synchronized with source systems in real time; provision of line item reporting for settlement orders; user centric and flexible ad hoc analysis Value drivers/KPIs  Reduced TCO; process cost reduction through transparent cost analysis

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