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SAP Co-CEO Henning Kagermann’s keynote in Sapphire 2008 in Orlando featured a demo of SAP’s newest BPM Offering, Project Galaxy and the Business Rules Management capability that SAP acquired from YASU Technologies in Oct 2007. In this post I will explain a bit more on what the demo problem was and what process and rules were demoed.

 

Background Information

 

A Company, say X has determined that it’s Transportation and Shipping Costs are way too high. The company uses 5 carriers let’s say A, B, C, D, E  to take care of its shipment and transportation. From the previous year’s records the company has determined the following.

 

Carrier

Lesson Learnt

Rank

Carrier A

Expensive, but very reliable. 99% on Target

1

Carrier B

Reasonable Cost @ average performance

4

Carrier C

Bang for Buck. Best Cost to performance Ratio.

2

Carrier D

Like C, but slightly lower

3

Carrier E

Bad. Expense and Unreliable.

5

 

 

 

 

 

 

 

 

 

 

Problem Situation

The problem is how to put this knowledge into operation. The answer is obvious. Improve the process that is used to select carriers for shipments and make sure that the lessons learnt are turned into action. You do this   so that the transportation & shipping costs can br brought down.

 

So, based on the above knowledge, the company has decided on the following operational policy for the current year. [These are for illustration purpose only. Real Rules will be more complex]

 

  • For high priority shipments, A and C are the first choice. If both are unavailable, then choose carrier with lowest cost based on a Quotation.
  • For Medium Priority shipments, choose D or C. If both are unavailable, then choose carrier with lowest cost based on a Quotation.
  • For low priority shipments, choose B or E. If both are unavailable, then choose carrier with lowest cost based on a Quotation.

 

Solving the Problem with SAP NetWeaver

 

As part of the solution, this company decided to put in a place new business process for Selecting Carriers for Shipments. This new business process will lower the cost of transportation & shipping by efficiently using the carriers based on lessons learnt. This new business process will be modeled in Galaxy.

 

Below is roughly an equivalent model also modeled in Galaxy. For a good introduction to Galaxy and to SAP’s newest BPM offering, read Thomas Volmering and the BPM Roadmap.

 

 

The automated activity in the process model marked in red is the process step where we are enforcing the company policies for carrier selection. The company policies have been modeled using the new SAP NetWeaver Business Rules Management capability. Here is the representation of the company policy when modeled using SAP NW BRM

 

 

The automated activity in red calls a “Rules Service” that internally calls a rule engine which applies these “Carrier Selection” rules. So, thats how it works.

 

Value Proposition

 

What you have seen above essentially means the following

  • This company was able to model and put in place a new carrier selection process for optimizing and minimizing the cost of Shipping & transportation
  • The company was able to effectively enforce company policy on carrier selection by externalizing the business rules
  • Because the policy is not modeled in code, it can change these policies as and when the business wants without touching code
  • Because the process is not locked in code, the business gains the confidence of doing what was intended with the flexibility of changing when business requirements demand.

 

Key Takeaway

 

  • SAP NetWeaver Business Process Management allows you to easily model and put in place composite human-centric collaborative business process
  • SAP NetWeaver Business Rules Management enables you to enforce[through automation] and manage critical company policies
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