Business Benefits (Use-Case) of SAP S/4 HANA

MPS4HANA · ‎10-13-2015

Benefits of S4 HANA ?

While one might be quick in identifying the “technical” differences and principles of SAP S/4 HANA, how do one tackle the question --> Does SAP S/4 HANA offer any tangible and immediate Business Benefits to my business?

In this blog, I try to answer this question from perspective of business owners and users alike.

The coverage has been limited to :

S/4 HANA Business Benefits

S/4 HANA Business Benefits – Simple Finance

S/4 HANA Business Benefits – Simple Logistics

S/4 HANA Business Benefits – Simplified User Experience (Ux)

S/4 HANA Industry* Specific Business Benefits - Govt., Utilities, Chemical, Retail & CPG.

*Business Benefits for Manufacturing, Mining, Mill-Products - coming soon....

So grab a cup of coffee before you begin reading, cause this one is a relatively long blog.

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S/4 HANA Business Benefits

With S/4 HANA Business-houses, get an opportunity to “Reimagine Business” – in terms of “Reimagined Business Model”, “Reimagined Business Processes” as well as “Re-imagined Business Decisions”.

Ability of “simple & fast” connect with people, devices and business networks will benefit business-houses in working towards a simplified and flexible Business Model. With IoT, Big Data Analytics, Hybrid scenarios (cloud and On-premise applications) and native integration and connectivity with various business-network (like Ariba, Hybris and so on SAP S/4 HANA will open up the world-space as playground to do business.
Ability to “process simple“ by very limited (and only if business requires) batch processing, job scheduling and monitoring , latency or delay in receiving important information is reduced, thus enabling business-houses to operate and processes work in Real-time and on Live-data. The online, real-time availability of information and power of faster and smart processing, will enable business-houses to think and look forward to “what is happening NOW” as well as how can impact immediate future, thus leading way to “predictive analytics” and “what-if-simulations” scenarios and way of doing business.
The “simple and real-time processing” will lead to “reimagined business decisions”, the way decisions are taken today viz-a-viz how they can be improved in future. Business can expect to reduce efforts and time, as there would be little “Manual consolidation” of data. Most of the decisions when taken in “real-time” , “on-the-fly” and with help of “predictive analytics” and “what-if-simulations” will lead to better control and decision making.
The integrated and simplified data-model will support “decisions based on “single-source of truth” and also make it possible to “drill-down to highest level of granularity and easy viewing and linkage between KPI and its underlying transactional data.

S/4 HANA Business Benefits – Simple Finance

For Simple Finance the benefits primarily focus around the CFO: faster close, reduced debtor days, streamlined approvals.
Innovations support business in area of Cash Management, Integrated business planning & SAP Accounting.
Some of the sFIN benefits are: Fast month end closing, Enhanced profitability analysis, improved operational analytics, Value-added FI-CO reconciliation, and Performance improvement, Reduction in data volume, enriched financial planning process, and Enhanced cash management. The extent of benefit may differ from client to client and will need assessment taking into consideration client’s main objective for looking for improvisation, their current pain area and their current landscape.

S/4 HANA Business Benefits – Simple Logistics

HANA-Live Analytic, processing powers of HANA, the innovations based on New-Data Models supported by easy-to-use FIORI applications expect to bring following benefits in the Logistics area. (This is indicative list and the benefits-list would be revised based on the actual release of each-innovation)
Thru Sales Analytics and SMART Sales Fulfilment Cockpit, SAP S/4 HANA offers better visibility and control over Sales Order Fulfilment. It will help business to closely monitor the KPI and take required corrective actions well in time. It supports managing the issues, blocks and un-completed Orders (Sales, Delivery & Billing transactions) and processing them in real-time. It thus ensures business to fulfil the commitment to their clients in required time and frequency.
Faster and quick MRP Runs with interactive-simulations ability will be especially useful in Retail and Trading scenarios.
Reduction in the locking issues and cutting down the post-processing time and thus leading to faster and hassle free Material Valuation process. Business that use standard pricing will benefit from this innovation.
New data-model will result into faster inventory closing, event-based reactions and Real-Time High Volume Backflush
With new Analytics apps that help measure and monitor Procurement KPIs (e.g. Spend & Contract Management and so on) will result in increased efficiency in the P2P processes. In addition, native integration with Business-Network systems like Ariba Networks will ensure a smoother Integration for PO Order and Procurement process.
Utilizing Material Ledger, (multi-currencies), & valuation methods per different accounting laws like GAAP will be a major Innovation that Business-houses would be interested to explore.
With NEW HANA based Comprehensive and Advanced ATP (AATP) Algorithm and optimized back-order processing would increase business efficiency in sales order processing. Organizations with single instance of ERP and not want to invest in a full-fledge APO, however want advantage of richer functionality would benefit from AATP. Business with high-volume and frequent changes in sales orders would benefit majorly from optimized and back-order processing.

S/4 HANA Business Benefits – Simplified User Experience (Ux)

Benefits of Simplified User Experience (Ux) thru FIORI Applications for Business Users will be many-fold. It will help Improve employee productivity and influence business results by getting the job done anytime, anywhere. It would also help in reducing work completion time. Easer UI will increase faster adoption of business processes. It would also reduce or lead to Zero-time in User training.
FIORI SMART Applications based on HANA-LIVE Analytics will help Business Leaders improve management productivity, streamline processes, and affect business results. Because of reduction in dependency on “desktop-only” environment and increase in being able quick approve thru any device from any-where on network, it would help reduce travel, procurement and other costs that normally add up because of process approval delays. It would also Free up employee’s spent on admin tasks, for more creative and high value use.

S/4 HANA Industry Specific Business Benefits

Retail & CPG and many other industries can benefit in area of Sales & Marketing by targeting to strengthen margins through real-time Price and Order Management. This is possible as system simulates prices and margins anytime, anywhere and at any given level of granularity. It would also support developing a real-time pricing quotes for customers & prospects, integrated with available to promise/capable to deliver commitments.

Utilities Industry can benefit by targeting for Fuel supply chain optimization, thru reduce fuel costs and speed order to delivery. This could be made possible by an Integrated supply chain which brings suppliers and buyers together through business networks and by provide an faster and correct reconciliation between production capacity and demand. Further Operational efficiency can be targeted for plants and grids by Maximizing asset availability and reducing unplanned outages. SAP S/4 HANA would help Offer a single, real-time view of plant and business performance and business-houses can Analyze the asset performance in real-time. The Utility Grid will become “Intelligent Grid” by reducing energy waste and eliminating energy shortages, by Optimized energy consumption through smart meters and demand-side management and would optimize operational performance through the convergence of IT/OT systems and processing big data.

For Chemical Industry – one of the benefit from SAP S/4 HANA comes in Product Innovation & Integrity area. One can drive sustainable Growth and Innovation thru consolidation of data from databases and devices / machines for predictive analytics during experiment design (Knowledge Hub). The SMART Lab’s will Design, execute and capture experiments in a closed loop process leveraging history lab data and knowledge base (Smart Lab). Business –houses can Predict technical properties of new formulations (E-Chemistry). Another Area of benefit will be Supply Chain Management. SAP S/4 HANA will help ensure agile and responsive Order Fulfillment. It would support capturing the demand in real-time via sensors (e.g. VMI, 3D Printing), run “ad-hoc” S&OP simulations and automatically fulfill and deliver order according to safe and sustainable practices (incl. ASN, MSDS, COA, etc., “no touch order to delivery”).

Delivering Instant Value for Government Organizations: a digital value chain enabling flexible, agile, interconnected operations and new levels of business insight. Smart-Cities are already in Pilot phase. Another classic use-case can be Digital Business Scenario: Intelligent Infrastructure Management and Harness the power of the Internet of Things (IoT) and machine-to-machine (M2M) technology to transform field service and asset management. For Health Facilities and Services, improving life across the state with big data and better analytics will become a reality. SAP S/4 HANA supports combine huge volumes of data from dissimilar sources and perform intricate analyses to uncover new insight. It is build a high-security environment to protect personally identifiable data and it empowers policymakers and analysts with interconnected, user-friendly interaction and reporting tools.

S/4 HANA IT Benefits

Reduction in data footprint, TCO, development costs , Faster transaction processing and reporting, Landscape simplification if multiple transactional system exists
For FIORI Applications the IT benefit includes: Customer satisfaction, cross device support for majority of the functions they use, without core software upgrade, Take advantage of an easy way to mobilize your business, Reduce investment in custom UX, reducing overall TCO and TCD, without core software upgrade.