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Supply Chain Excellence

SAP Integrated Business Planning


IBP

2015 SAP SE or an SAP affiliate company. All rights reserved. Confidential 2


SAP Integrated Business Planning
Speeding up the Supply Chain requires a new Supply Chain Planning approach

Enhanced User Experience


Introduce state-of-the art user experience with communication capabilities (SAP JAM)
and MS Excel Spreadsheets

Built on SAP HANA


Demand Networks require real-time monitoring and a focus on short-term planning Enhanced User Experience

Supply Chain Control Tower


One Harmonized Data Model
Avoid any latency due to integration efforts and leverage the SAP ERP data model Sales & Operations Planning

Supply Inventory Response Demand


New Planning Algorithm
Leverage predictive analytics (e.g. demand sensing) algorithm in combination with SAP HANA Platform
optimization
SAP Business Network
Cloud First Approach
The solutions will be provided in the SAP Cloud but also be made available on-premise
S&OP Customer Testimonial

Colgate Business Planning (CBP) is our integrated business planning process focused on
accelerating profitable growth. We have engaged with SAP as an co-innovation partner
and collaborator to utilize their S&OP tool to enable our integrated monthly CBP process
to synchronize demand and supply.

The S&OP capabilities on HANA include the real time simulation and analysis of demand
opportunities during planning sessions. The tools contextual social collaboration
capabilities have facilitated more timely communication and updates of demand changes Colgate-Palmolive is a leading global
across the organization. It has also streamlined the preparation and information exchange consumer products company, tightly
leading up to key consensus meetings by providing one tool and repository for
information.
focused on Oral Care, Personal Care,
Home Care and Pet Nutrition. Colgate sells
Jim Davis
its products in over 223 countries and
territories around the world.
Global Director of Demand Planning and Customer Service

2015 SAP SE or an SAP affiliate company. All rights reserved. 4


The IBP Pillars
IBP: Plan in Real-time With a Unified Data Model

Capabilities:
Plan in real-time, using a unified model of your demand,
supply chain and financial data within a single data
model, allowing planning on qty or value
Analyze massive volumes of complex data instantly at
any level of granularity, aggregation, and dimension
Import massive amounts of detailed data directly from
SAP and non-SAP sources

Benefits:
Optimize product/customer profitability and product mix,
considering supply and financial constraints
Adjust inventory levels to reduce cost, while meeting
target customer service levels
Manage capacity utilization to avoid capacity and
material shortages
Alert management User-defined process template

User-driven embedded analytics Value Qty


IBP: Run Simulations and Scenarios Instantly

Capabilities:
Rapidly run simulations of demand, supply and
financial changes using your full data model to
support what-if analysis

Compare planning scenarios and their impact on key


performance indicators in real-time

Drill down into simulated data to perform detailed


analysis without the need for manual disaggregation

Benefits:
Identify optimal set of tactics to drive revenue growth
and increase market share

Uncover opportunities to reduce supply chain cost

Prepare for potential changes in demand and supply


before they happen
Select quantity or value Embedded alerts

Create own master data for simulation


Addresses NPI and invisible demand

Plan on select key figures Plan on select hierarchy level and disaggregate
IBP: Enable Rich, Contextual Social Collaboration

Capabilities:
Track progress of your business process, including
assignment and monitoring of action items and the
stakeholders responsible

Collaborate quickly and easily using embedded role


and context-aware social tools

Plan using user-friendly web and Microsoft Excel


interfaces

Benefits:
Increase speed and agility of planning

Drive greater engagement and improve input from


users across your organization

Improve precision of demand and supply balancing


Collaborate and share analysis

Wealth of collaboration tools Messenger to key stakeholders


SAP Integrated Business Planning (IBP)

Supply Chain Control Tower

Sales and operations planning

Demand Inventory Supply Response

SAP HANA
Consider an airport control towers real time visibility of all airlines events in the region.

The air traffic controllers has all the relevant information presented to them in real time
SAP Supply Chain Control Tower
and are able to analyze, interpret and act on the information presented.
They have a single interface to manage actions, corrective actions and communication
with stakeholders.
Taking these lessons learned into supply chain planning reacting to events in your
supply chain timeously helps to prevent losses and increase profit.
SAP enables global visibility of the supply chain linked to sales, operations and
inventory planning in real time through the SAP Integration Business Planning solution
delivered in the SAP Managed Cloud

2015 SAP SE or an SAP affiliate company. All rights reserved. 13


SAP Supply Chain Control Tower
Understand current supply chain status with flexible dashboards

Supply Chain Control Tower


Enable supply chain professionals to
Sales and operations planning
navigate, analyze and profitably manage
the end-to-end supply chain in real-time Demand Inventory Supply Response

Increase end-to-end visibility SAP HANA

Provides historical and forward looking


KPIs in a single view
Drive visibility and action with user
configurable dashboards and analytics
Monetized impact of exception conditions
SAP SUPPLY CHAIN CONTROL TOWER
SAMPLE USE CASES

KPI dashboard Global visibility

Alerting to Action Task and Case management


SAP Integrated Business Planning for sales and operations

Deliver a cross departmental sales &


operations plan balancing the impact on Supply Chain Control Tower
inventory, service levels and profitability
Sales and operations planning
Create the optimal business plan to drive
Demand Inventory Supply Response
revenue growth and increase market
share SAP HANA

Effectively balance demand and supply


and attain financial targets
Increase speed and agility of planning
and drive most profitable responses
Improve forecast accuracy and on-time
delivery
SAP Integrated Business Planning for sales and operations

S&OP process management Simulation

Collaboration Dashboard analytics


Supporting different Business Models and Challenges
Net Business Impact

Value Proposition with S&OP powered by HANA Benefits

Plan in real-time, using a unified model of your demand, supply chain and financial Optimize product/customer profitability
data and product mix
Analyze massive volumes of complex data instantly at any level of granularity,
Real-time Planning aggregation, and dimension Single business plan for all
stakeholders
Import massive amounts of detailed data directly from SAP and non-SAP sources
Avoid shortages
Rapidly run what-if simulations of demand, supply and financial changes using
your full S&OP data model (30 to 40% improved response time)
Become prepared to seize opportunities
Compare planning scenarios and their impact on key performance indicators in real-
Instant Simulations or deal with imminent threats
time
& Scenarios
Drill down into simulated data to perform detailed analysis without the need for Lower safety buffers without raising risk
manual disaggregation

Track progress of the S&OP process, including assignment and monitoring of action
items and the stakeholders responsible Improve forecast accuracy through a
faster and collaborative S&OP process
Collaborate quickly and easily using embedded role and context-aware social tools
Social Collaboration
Plan using user-friendly web and Microsoft Excel interfaces Greater accountability & adoption from
stakeholders
Net Business Impact

Value Proposition with S&OP powered by HANA Business Impact


Standardize process with automated workflow and task management

1 Standardize
Process
Enable collaboration with field providing ability for customer program managers to directly
input forecast data
Integration and consolidated data provides single version of the truth
Participation
&
Accountability

Optimize demand planning by leveraging historical data (previous forecast, actuals, etc.) and

2
Optimize
current backlog data Forecast
Demand
View different demand inputs to create a single consensus
Accuracy (%)
Plan
Run financial impact simulations, e.g. revenue impact based on supply plan

3
Balance
Perform constraint based supply planning Inventory
Supply-
Perform material and capacity analysis to balance supply-demand
Costs
Demand

Real-time refresh of data fields including: product family, part number, ASP, customer master,
form factor Time for Data

4
Real-time
Run simulations in real-time to make better business decisions, faster Analysis
Data
Paradigm shift from time spent on data gathering to data analysis to uncover opportunities
vs.
Refresh
for improvement Gathering
Planning More Effectively with SAP IBP for sales and
operations planning

Company Business challenges


SMART Modular Technologies Inc. Planning processes that could not be scaled to keep up with fast company growth
Unified
Picture of sales, profits, and share
Lack of capabilities to support a value-driven and profitability-oriented sales and operations planning process that is linked to targets, all in one system
Headquarters business strategy
Newark, California
Technical implementation
Industry Implemented the SAP Sales and Operations Planning application powered by the SAP HANA platform
Fast
High tech Cycle times with fewer manual and
labor-intensive sales and
Key benefits
Products and Services operations planning processes
Standardized, optimized, and automated the sales and operations planning process, substantially reducing planning cycle times
Design, development, and deployment of current and next-
and workload
generation memory products
Increased efficiency and accuracy of the forecasting process, and enabled the identification of critical component shortages Intuitive
Employees Enabled integrated business planning User interfaces and embedded
1,400 collaboration tools that help boost
user productivity
Web Site
www.smartm.com

Partner
Intrigo Systems
www.intrigosys.com SAP Sales and Operations Planning powered by SAP HANA helps
SMART Modular manage our sales and operations planning in a
collaborative and efficient manner. We see a single version of the plan
from sales to planning to materials to the factory, all of which can be
correlated to financial performance. The result is true integrated business
planning.
Srini Tanikella, Director IT Solutions, SMART Modular Technologies Inc.

2015 SAP SE or an SAP affiliate company. All rights reserved. 21


SAP Integrated Business Planning for demand

Gain full Demand Transparency for short-,


mid- and long-term forecasting by Supply Chain Control Tower
leveraging demand sensing and statistical
Sales and operations planning
forecasting methods
Demand Inventory Supply Response
Develop more accurate mid-term
statistical forecasts SAP HANA

React faster to short term demand


changes with pattern recognition based
algorithms
Drive more accurate deployment of
product based on short term demand
Manage multiple demand signals
Collaborate to ensure the most
accurate forecast
SAP Integrated Business Planning for demand
Demand Sensing Scenario planning for demand

Defining a forecast model Issue Resolution Fiori app


SAP Integrated Business Planning for inventory

Optimize multi stage Inventory Targets to


most efficiently meet or exceed customer
Supply Chain Control Tower
service levels, fully considering
uncertainties like forecast error and supply Sales and operations planning

uncertainty. Demand Inventory Supply Response

Improve customer service levels SAP HANA

Maximize the efficiency of inventory


and working capital
Improve planner productivity,
standardize planning processes
Standardize the inventory target-setting
process at each tier within the supply
chain to feed operational plans
Determine right amount, right place,
and right time for inventory to carry
while meeting plan objectives
SAP Integrated Business Planning for inventory
Inventory positioning in network Inventory & Service optimization

Drivers of inventory What if analysis on inventory


Mastering complex hub & spoke supply chain model with SAP IBP for sales and
operations and SAP EIS
Company Business challenges
McKesson Corporation Spreadsheet-based planning approach prevented achieving aspired business growth targets
Limited to no possibility to gain insight / analyze vast amounts of relevant data on the required levels of granularity
Increased
User acceptance through centralized
Headquarters Growing and enabling business organization quickly to fulfill growth targets analytics and alerting
San Francisco, CA, US
Implementation
Industry Integrated solution for sales & operations planning and inventory optimization/replenishment planning
Pharmaceuticals
SAP HCI pivotal piece of integrating IBP for s&o, EIS, ECC and BW
One Business Unit globally first, subsequent Roll-out
Products Decreased
Pharmaceuticals, Healthcare products, Medical technology Working capital through optimized
Key benefits
invetory targets and levels
Improved confidence in and integrity of the S&OP process
Employees
Optimal inventory positionng and level setting in complex supply chain environment
43,500
Simplification of planning and fully exception-based procedures enabled scaling up the business organization quickly
Revenue Aggregation/disaggregation on the fly through millions of relevant data records for rapid insight for business users
US$ 122.455 billion Generation of optimal constrained and balanced business plan in line with corporate financial targets Greater
Speed, efficiency and effectiveness of
Web Site planning process
McKesson.com

Partner
SAP Consulting

Simplification of sales and operations planning, the introduction of an optimized inventory positioning
and replenishment process, and the rapid enablement of the human organization was key for scaling up
the business according to the business growth targets.
Jim Smith, Director of Solution Management, McKesson Corporation

2015 SAP SE or an SAP affiliate company. All rights reserved. 28


SAP Integrated Business Planning for supply

Create tactical level supply planning


simulations for S&OP based on forecasts, Supply Chain Control Tower
orders, and inventory or safety stock
Sales and operations planning
targets.
Demand Inventory Supply Response

Simulate either constrained or SAP HANA

unconstrained production and distribution


plan, using heuristics or optimization
based algorithms
Multi level sourcing determination for
both distribution and Bills of Material
Development of rough cut capacity plan
in a times series bucketed supply plan
Gain visibility for projected stock or
shortages at relevant levels of
aggregation
SAP Integrated Business Planning for response and supply
Fast, flexible supply planning supporting a variety of
approaches, suitable for many industries, including:
Supply Chain Control Tower
Support of tactical (time-bucketed, rough cut) supply
planning in conjunction with IBP for sales and operation Sales and operations planning

Demand Inventory Supply Response


Create specific orders for production and procurement
in short mid term, in alignment with tactical plan SAP HANA

Constrained optimization and priority rules-driven


algorithms. Unconstrained demand propagation and
heuristics options as well

Make short-term supply adjustments

What-if analysis of actual or hypothetical


changes to demand and / or supply

Pegging and gating-factor analysis

Optionally generate and provide allocations


to ATP, and reschedule sales orders
SAP Integrated Business Planning for supply & response
Entry screen KPIs and alerts overview Back order processing and confirmation simulation

Stock projection Demand supply pegging analysis


SAP Integrated Business Planning for supply & response
Entry screen KPIs and alerts overview

Stock projection Demand supply pegging analysis


SAP Integrated Business Planning for supply & response

Entry screen KPIs and alerts overview

Stock projection Demand supply pegging analysis


Customers
Integrated Business Planning for sales and operations
Customers and Industries
Consumer Chemicals
Products

Mill
Products &
Mining

Manufacturing
Pharma

High Tech

Services
Retail
Thank you

2015 SAP SE or an SAP affiliate company. All rights reserved.