Process Observer – a new SAP approach to analyze Business Suite processes!

Introduction

SAP NetWeaver BPM and SAP Business Workflow are good tools to model new processes or enhance existing processes. But what about built-in SAP Business Suite processes such as Order-to-Cash or Procure-to-Payment? Looking at and measuring Process KPIs in these areas was quite difficult so far but is essential for every company to gain competitive advantages.

The new and license-free (yes, really!) SAP component Process Observer provides opportunities to monitor and analyze these processes without much effort.

I had the great opportunity to get in contact with the SAP Process Observer responsibles Mr Bernd Schmitt and Mr Jens-Christoph Nolte from SAP who are also writing blogs on this topic here in SCN: http://scn.sap.com/docs/DOC-24983

In these blogs, the system requirements are described as well as guidelines for the first steps with Process Observer are given.

After trainings, building demos and the first customer project I would like to share my experiences with you.

Approach

Process Observer is a quite new SAP Business Suite component – activated via a Business Function – that reacts on any event that is correlated to an activity in a process model. What does this mean in real life?

Example for a Process Model “Order to Cash” defined in SAP Process Observer

At first, design the process model i.e. define the activities you want to monitor. In Order-to-Cash process, there are e.g. following activities involved: Create Sales Order, Create Outbound Delivery, Post Goods Issue, Receive Payment.

These activities have – via so called tasks – an indirect correlation to events, i.e. SAP BOR events (e.g. “Sales Order created”), SAP Workflow events or custom events even callable via Remote API. If such an event is triggered, it is matched by Process Observer with correlating activities in existing process models and logged. This makes it very flexible to monitor and analyze any process with this new SAP standard component.

Custom events mean that you can monitor also activities that are processed in another SAP system, e.g. CRM, or even a  non-SAP system, e.g. an external warehouse management system – what a great thing for measuring End-to-End processes!

But activities are not sufficient to measure process efficiency or detect process weaknesses.

With custom-defined KPIs such as “How many times was a Sales Order changed after creation?”, “How long does it take from Sales Order creation to Payment on average?” or “How often was the requested delivery date changed in an Order-to-Cash process?”, you can achieve real Process Visibility.

A quick start with Process Observer is possible by using BOR Events that are used in nearly all SAP standard transactions.

Process Analytics

Often, you will find functional or application silos in the companies when you look at the reporting: Sales reporting is strictly separated from Finance reporting. With SAP Process Observer, you are able to get a Process view, for both strategic and operational purposes.

You can report directly on SAP ERP (e.g. via Transient Providers), but BI systems have the advantage of providing harmonized business context data.

With a SAP BI Content “Process Analytics”, it is possible to combine all process data, coming from any system such as SAP Process Observer or SAP NetWeaver BPM, with both business transactional data (e.g. order or invoice information) and business master data (e.g. companies or cost center hierarchies).

Questions like “In which sales organizations there are bottlenecks for a certain process?” or “Which cost centers need most of the time for a certain activity inside a business process?” can be answered. In this context, Process Benchmarking can be done by simply using SAP BW queries on top of the SAP BW data model.

Example for a Process Dashboard (in German language) with information from SAP Process Observer

Example for a Process Performance Dashboard (Order-to-Cash; in German language) with information from SAP Process Observer and other sources.

Use Cases

Possible Use Cases are

• Real-time-Monitoring of unfilled Sales Orders
• Backlog of open Outbound Deliveries
• Visibility of Sales Pipeline
• Process Benchmarking between companies
• Tracking of Master Data Changes
• Alerting in case of field changes, e.g. Billing Block or Requested Delivery Date
• Analysis and Monitoring of Document Flow
• Calculation of Cycle Times of End-to-End processes or sequences of activities
• Tracking of SLA Violations
• Process Visibility for Sales, HR, Finance and Logistics processes

Conclusion
Overall, Process Observer is a quite new SAP component but already very stable. As you probably know, you can’t say this about all products…and it comes for free!

But what’s much more important: Analyzing and Monitoring End-to-End business processes will be reality with the Process Observer. This will bring customers in a convenient situation where they can improve their processes and gain competitive advantages.

Nevertheless, there is still room for improvements. The process model is defined within a view cluster so the maintenance can be done only by one person at a time.
Pre-delivered sample process models only exist in client 000 so you will have to transfer these data at first to the productive client.

But the main advantage of this new component is really impressive: Get a better insight into your business processes!

I hope that this blog has given you a brief overview about the Process Observer approach and its benefits.
This is my very first blog here at SCN and I’m already excited about your comments.