SAP EC&O

Industry Value Network: RIB in Focus

Van Tang, Director, SAP Discrete Industries, EMEA Wolfgang Flatscher, Director, RIB International Business
Contributors:
Carsten Dietze-Selent, Director IBU EC&O, SAP Michael Kastner, IBU EC&O, SAP Michael Quadt, IBU EC&O, SAP Zach van der Walt, SAP South Africa

SAPs Vision for Industry Solutions

To enable every customer to become a best run business VISION Achieve undisputed market and platform leadership in all industries where we compete Executing industry growth strategies by assembling SAP and partner applications into industry-leading solutions:
Translate industry trends and best practices into solutions and business opportunities for customers, partners and SAP Assemble complete industry solutions based on industry, generic, and partner applications Demonstrate thought leadership around E-SOA and deliver on the promise early! Building a healthy industry ecosystem for the SAP platform Develop critical industry-specific applications

MISSION

as foundation for the strategy in EC&O

AGENDA

SAP Engineering, Construction & Operations SAP EC&O Industry Value Network SAP & RIB Path Forward

How we see the EC&O industry

The Construction Enterprise

Core Enterprise Facility Operations
Maintenance CRM Scheduling Dispatch Financial Mgmt. Workforce Mgmt. Procurement CRM IT

Owners

Architects/ Engineers Equipment

Project

Design & Engineering Materials Suppliers Subcontractors/ Vendors Construction

Project Mgmt. Change Mgmt. Procurement Billing Workforce Mgmt. Document Mgmt Schedule Project Mgmt. Resource Mgmt. Workforce Mgmt. Contract Billing Change Management

Commercial Construction Sub-Segments How we Go to Market

Management Companies Controlled Risk Lower Margin Self-Perform Companies Performance Risk Higher Margin productivity and profitability Project Owners General Construction Special Trade Construction Heavy / Infrastructure Construction / Mfg. Hybrid

Real Estate Developers

General Building Contractors

Mechanical/ Electrical/ Plumbing (MEP) Other Special Trade

Industrial (Power/Petrol.)

ETO Companies

Property Managers

Construction Managers

Highway/ Transportation

EPC / Plant Contracting

Facility Owners & Operators

Other General Contractors

Civil (Water/Sewer/ Environmental)

Construction Materials

Financial / Control Project Cost Change Management Subcontract Management Facility Operations

Financial / Control Project Cost Change Management Subcontract Management Facility Operations Project Logistics Materials Management Work Management Production

SAP for EC&O Customers Base Growth 2001 - 2006

No. of EC&O Customers Worldwide
= CAGR 11%

800 700 600 500 400

747
44 50

68 44 100

441

0 2001 2002 2003 2004 2005 2006

Growth consistent and sustained Significant new well-known customers added in 2005 and 2006 Strong growth in the Midsize and Small Market

Source: MKIS as of December 2006

SAP has 747 E&C Customers Worldwide

By Segment
Special Trade Contractors 231 Homebuilding 115 592 Shipbuilding 56 Plant Contracting & Construction 345

By Employee Size
Range of Employees No. Small 208 Enterprise 118 75 Not Assigned Total : 747 Midmarket 346

Key Takeaways
747 SAP for EC&O customers are spread all over the world. 68% in EMEA (mainly Europe), 16% in APA and 16% in the Americas. SAP for EC&O customers are distributed to 46% on Plant Contracting & Construction, 31% on Special Trade Contractors, 15% on Homebuilding, and 8% on Shipbuilding The structure of SAP for Engineering, Construction & Operations customers is dominated by companies with less than 5.000 employees. More than three quarters are belonging to this magnitude
Source: MKIS as of January 2006

By Region

Americas (120) EMEA (505)

APA (122)

Our EC&O industry solution approach

The Business Process Platform to Bridge Two Worlds

DIFFERENTIATION PRODUCTIVITY
Partner Application SAP Application Customer Application SAP Application
ENTERPRISE SERVICES

Enterprise Services Repository

SAP NetWeaver SAP NetWeaver

REUSE PROCESS STEPS AND ENTERPRISE SERVICES IN CUSTOM PROCESSES

SRM

SCM

CRM

PLM

ERP

SAP ERP 6.0 Stable Foundation for the Next 5 yrs

2005 2006 2007 2008 2009 2010 2011

Enhancement Packages

SAP ERP 6.0

SAP NetWeaver

Next release

Enhancement packages deliver continuous innovation without upgrades and can include Technical and functional enhancements New enterprise services Composite applications

Delivery of new developments and continuous without a release upgrade!

Introducing ... Enhancement Packages

- More Innovation, More Quickly, More Accessible to Customers

2006

2007

2008

2009

2010

Areas of innovation

Legal Changes Enterprise Services Functional Enhancements

Composite Applications

Mandatory Core-modifying

Optional Non core-modifying

Service Enablement of Industry Scenarios

Example: Project Planning & Scheduling
Develop Design Estimate Tender Execute Operate

Planning & Scheduling Desegregation of Process into Process Steps Process Step SAP Services
Create Project Structures Create Estimate Schedule Project Resource Planning Quantity Take-Off

Composition of the Process with Enterprise Services

Create/Update Project Objects Create/Update Cost Plan Schedule Network/Project(*) Update Network Attach Material Components

Service Bundle for Projects (EhP 3)

Enterprise Services Repository Definition of processes, enterprise services, data types, and mappings Service metadata Central modeling and design environment Definition of Services: Jointly with Partners and (in future) Customers

Enterprise Services: Connecting Islands and Drive CoInnovation

Enterprise Services are the pre-condition for Simplification and efficient cooperation with partners

To build a partner ECO-system

To simplify development from code to model-driven

Enterprise Services Repository

To deliver Enhancement Packages

To leverage new technologies

Our Objective: Service Enablement of EC&O Core Scenarios

SAPs Leadership in the EC&O Industry

Industry Segments Operative Builders Example SAP Customers SIC Codes 1531 1521, 1522, 2451

Residential Construction General Construction, nonresidential Road, Highway, Elevated Highway Infrastructure & Heavy Construction Special Trade Contractors Shipbuilding, Boat Building and Repairing

1541, 1542

1622 1623, 1629

1700-1799

3731, 3731

SAPs Leadership in the EC&O Industry

Industry Segments Operative Builders Example SAP Customers SIC Codes 1531 1521, 1522, 2451

Residential Construction General Construction, nonresidential Road, Highway, Elevated Highway Infrastructure & Heavy Construction Special Trade Contractors Shipbuilding, Boat Building and Repairing

1541, 1542

1622 1623, 1629

1700-1799

3731, 3731

AGENDA

SAP Engineering, Construction & Operations SAP EC&O Industry Value Network SAP & RIB Path Forward

SAP Ecosystem New Dimensions of Collaboration

Industry Knowledge
Business Process

Customer-driven business process insights

Communities for Innovation

Business partners, individuals

Products and Services

Platform with application functionality

SAPs Industry Solution Map for EC&O

Enterprise Services Enabled Key Scenarios for EC&O

Focus on scenarios Project Planning & Scheduling, Project Execution Procurement of Services and Materials 2008: Design & Engineering Current Partner Status Primavera approved for EBS Partnership (in solution qualification) RIB: Nominated Intergraph, NRX: Nominated

Do we miss Scenarios and Software Vendors with the potential for broad adoption?

Partner Offerings Relative to SAPs Industry White Spaces

SAP In-house
Industry specific Reporting (Prio I) Quotation Estimation

Partner
Vendors (ISVs, SIs)
<ISV1> Project Cost Estimation & Planning <ISV2>

Critical

Procurement process Driven by CAD data (Material Take OFF) Progress & Earned Value

Project Change Management

Forecasting Complex Service Procurement & Subcontractor Management Integrated Resource Management (Material, Labor, Equi) Industry specific Reporting (Prio II) Industry specific forms

Enabling

Retention Processing

Paid when Paid

Part off process

Reuse of Services: Integration with Primavera & RIB (planned)

Primavera
Design to Quantify Estimate to Contract Tender for Purchase
Exchange of project information (e.g. schedule, tasks)

Subcontractor

Customer

Process View

Develop

Design

Estimate

Tender

Execute

Operate

Primavera

Project View ERP View

Masterdata

ERP Process Analytics ERP Application Components

Enterprise Services Repository

Enterprise Services

AGENDA

SAP Engineering, Construction & Operations SAP EC&O Industry Value Network SAP & RIB Path Forward

RIB Overview

RIB Profile Experience is the Basis for Future Innovations

Experience is the basis for future innovations 2008 2006 2005 2004 2003 2002 1998 1986 1972 1961 RIB visual First customer in Middle East - Orascom Founding of R&D Center in China First customer in China - Vanke First customer in United Kingdom Network Rail First customer in the USA - Fluor Corporation Fully integrated pre- and post contract software First integrated civil engineering solution First structural engineering software with FEM method Founded by Prof. Dr. Ing. Volker Hahn, Stuttgart

RIB Success Story

RIB Success Story Over 45 years of experience More than 100,000 RIB-installations worldwide Over $ 35 million revenue (2006) > 350 highly skilled staff worldwide Head office Stuttgart, Germany. Offices in UK, Eastern Europe, Asia, USA 35 % of the German tender volume (about $ 180 bn) 100 % of the top 10 internationally operating German building Groups work successfully with RIB software 80% of construction projects (> $ 1 m) in Germany are managed with RIB Software

Think Global, Act Local

RIB Markets and Sites

Research and Development Consulting, services, sales

SAP & RIB Industry Solution

Joined Solution Overview SAP - RIB

Design / Engineering Material Supplier HR Service Provider Subcontractor Customer

Leverage design information for project execution

Real time availability check and delivery information

External payroll processing

Access to tasks and schedule, Time recording online

Exchange of real time project information (e.g. change requests)

Project Life-cycle
Process View Project View ERP View Develop Design Estimate Tender Execute Operate

SAP CRM

SAP FM, BI

SAP ERP SD, MM, PS, FI, CO, HR

Enterprise Services Repository

From Design to Bill of Quantities / Estimate

Client
Tender

Construction Company
RIB SAP

Vendor

CAD Model from Client

Import CAD Model (RIB Visual)

Object Modelling/Cost Planning

Scenario A

Import CAD Model (RIB Visual)

Drawings From Client

Import CAD Model (RIB Visual)

Standard Libraries

Scenario B

Bill & Estimate Preparation

Bill from Client

Import the Bill Estimate Preparation

Scenario C

Estimate

Estimating Process
Client Construction Company
RIB
Quantity Take Off Bill of Quantities
Price Cost Estimate Direct Cost

SAP

Supplier Subcontractor

RFQ Procurement Quotes

Supplier

Material (Commodities) Equipment / Plant Labour Subcontractor Estimate Indirect Cost Allocation / Allowances Optimization of Bid Evaluation of Bids Award Contract Final Bid Contract Budget Historic Price Data Create Sales Order Create PS Project CRM Contract Management Equipment / Plant Cost HR

Import RFQ Estimate Send Electronic Bid

Subcontractor Major Items Only

Subcontract Procurement
Client Construction Company
RIB
Award Contract

Subcontractor

SAP

Packaging Tender Documents

Supplier Database

Import RFQ (e-bid)

Estimate Contract Management

Import Quotes Evaluation Benchmarking

Send Electronic Bid

Transfer Quotes to Estimates

Update Budget

Updated Baseline

Award (Sub) Contract

Create Purchase Order

Contract Award

Execution

Controlling

Material Procurement
Client Construction Company
RIB
Contract Award Request for Procurement Send RFQ (Request for Quotation) Evaluation of Quotes Evaluation of Quotes Create/Send RFQ (Request for Quotation) RFQ Send Quotation to Contractor

Supplier

SAP

Create Contract / Order Update Cost

Create Purchase Order

Purchase Order

Enter GRN (Goods Receipt Note) Reconcile GRN vs Invoice Transfer Payment

Delivery

Invoice

Payment

Workflow Site Procurement

Cost Engineering, Applications for Payment

Client
RIB
Awarded Contract WBS/Activities Map Estimate to Activities Value Reconciliation Time-phased Estimate Payment Certificate Progress Measurement Application Prepare Invoice Stage of Completion Budgeted Cost of Work Scheduled (BCWS) Budgeted Cost of Work Performed (BCWP) Actual Cost of Work Performed (ACWP) Sequencing

Construction Company
Primavera SAP

Subcontractor

Controlling / Forecast

Awarded Contract

Variations

Change Management
Valuation of Changes Value Reconciliation

Change Management Client Change Management Subcontractor Send Invoice

Execution of Work Variations Application Prepare Invoice

Payment Transfer

Payment Certificate

Accounting Payment Transfer Receive Payment

Invoice Receive Payment

Great Brands, Great Relationships

Joint Customers SAP/RIB

AGENDA

SAP Engineering, Construction & Operations SAP EC&O Industry Value Network SAP & RIB Path Forward

Value Prototyping Powered by Center of Excellence

Bring your challenge to a lab and accelerate innovation!

Value Prototyping

Reduce risks and accelerate realization of value opportunities.

powered by Center of Excellence

The high performance collaboration platform for customers, partners and SAP to drive innovation from vision to reality. Service Level: Services:
Coaches Architects Experts Systems Support Facility Helpdesk Methods Target price for fuzzy scope in 1 hour Ready to start lab in 5 days Access to all lastest technologies and solutions Tangible results every 2 weeks

With the rapid prototyping and rapid implementation approach, the project was 3 times faster and 5 times cheaper than with the classical approach. Lars Radoor, Lego Supply Chain Executive

Contact: Secure your lab through the respecitive field representative, business unit or directly with the registration office martin.hirtle@sap.com + 49 170 22 00 156

Center of Excellence
Walldorf - Palo Alto Newtown Square Bangalore Minsk -Sofia Atlanta - Montreal - Gorinchem/NL

1,000+ prototypes over 6 years

for customers from more than 25 countries and all industries

High Performance Collaboration

Capability Labs Hub Layout Engagement teams bring the challenges to a lab Experienced coaches build the teams and guide them to success The registration gurantees direct access to all capabilities Capability Labs

Solutions
SCM Lab SRM Lab CRM Lab SEM Lab PLM Lab HCM Lab Adaptive Manufacturing Lab MDM & Data Cleansing Lab Service Parts Mgt Lab

Methods
Proof-of-Concept Lab Innovation Lab Pilot Lab Discovery Lab

Project Labs

Customer Lab

Customer Lab

Customer Lab

Customer Lab

Technologies
Integration Lab High Performance Lab BI Accelerator Lab Composite Lab Adaptive Computing Lab
SAP Lab

Types
Capability Labs
Coaching SAP Lab Partner Lab Partner Lab

R&D Lab Beta Lab Ramp-up Lab Best Practice Lab

Registration

Solutions Technologies

Methodes Systems Support

Focus Areas
eSOA Lab Duet Lab RFID Lab EP & Knowledge Mgt Lab Analytics Lab

SAP Lab Industries SAP Lab Helpdesk

Partner Lab

Campaigns & Programs

Retool Lab (Bye-bye I2) Retool Lab (Bye-bye Siebel)

Partner Lab Facilities

Industries
Automotive Logistics Service Providers ...

Customer Lab

Customer Lab

Partner Lab

Partner Lab

Industries
Retail Public Sector Banking Aerospace & Defense ...

Satellite & Remote Project Labs

Value Prototyping Approaches & Methods

Proof of Concept Lab ( Proof & Qualify ) Proof & Qualify of a given solution outline/design max 2-3 weeks with 2-5 FTE
Innovation Lab
Discover & Envision Research & Design Capture & Promote Proof & Qualify

From Vision to Concept !

Classic Implementation
Architecture and technology proven against key business challenges/opportunity Touchable lab environment with strategic reference template on latest technology Reduced technology risk, know-how risk, acceptance risk, budget risk Easier scoping and effort estimation

ThinkTank to Value max 6 weeks - 2-5 FTE

Pilot Lab
Pre-configure & Validate Fine-tune & Confirm Animate & Simulate Scope & Assess Load & Launch

Learn & Transfer

From Concept to Reality !

Learn & Transfer

Short-cut Implementation / Roll-out or Fast Deployment

Processes proven against real-live data and operation Touchable pilot environment with a reference process template No technology risk, no know-how risk, acceptance risk, budget risk Clear scope and effort to contract out-sourcing, off-shoring, hosting partners

LiveDrive to Value max 8-10 weeks 2-5 FTE

Innovation Center
Innovation Center 10 MiniProjects of 50-150 man days and 3-4 iteration cycles of 2 weeks on average

Send your thought leaders with the vision & challenge to a Innovation Lab !
(3 workshops of 1,5 days)

Gain Insight, Confidence and Speed in Innovation

Qualified Ideas

From Vision to Concept ! Have your power users validate the solution in a Pilot Lab !
(3-4 workshops of 1,5 days)

From Concept to Reality ! Give you IS competence team early access to the latest solutions & technologies as needed and desired !
(workshop or full-time) Pilot Lab

Innovation Lab

Inn. Lab

Pilot Lab

Inn. Lab

Pilot Lab

Pilot Lab

Sample Topics: eSOA The Perfect Plant High Speed Analytics Order-to-Cash Strategic Procurement, etc.

Quality gate

Deployment

Benefits of Prototyping

cash

Seeing is Believing
Fast, Predictable Payback

Shorter Payback Time

Accelerate Time-to-Benefit Reduce Initial Investments

time

Customers are more and more excited about the opportunity to use an ideal lab environment and appreciate this highly value adding services To improve the decision making To get the buy-in from stakeholders and power users To reduce risk and total cost of implementation To accelerate implementation and deployment To develop scenario specific know-how efficiently with Limited initial investment and resource needs Touchable results, control and exit points every 2 weeks No need to freeze scope and gather detailed requirements up front Time of customer key people limited to concentrate step stone workshops Keeping the focus on the business challenge rather than on technology

SAP Center of Excellence Track Record

With the rapid prototyping and rapid implementation approach, the project was 3 times faster and 5 times cheaper than a classical approach. Lars Radoor, Lego Supply Chain Executive

1,000+ prototypes over 6 years Customers from more than 25 countries and all industries
"With the rapid prototyping approach we were able to globally break into the logistics area... It reduced the engagement time and risk significantly... " Gunther Fonteyne, Account Executive