Central Finance – starting the (net)work…

On one hand,  we are trying to get better understanding of the topic and

opportunities of Finance and especially “Central Finance” …

On the other hand this is to find you and building a network and to start of finding the use cases also for the insurances and banking industry,  especially as the projects so far are rather in other industries

The blog is giving an overview on Central Finance respectively “When it is applicable”,  “Why” and the key value drivers and gives and overview about the idea,  how to get started and where to find further Detail

This blog is related to

– Central Finance Engagement Initiative    https://jam4.sapjam.com/groups/about_page/804POIKUpBtgkRt3jEhyNA

Central Finance – High Level Business Scenarios for CF => When?

The business scenarios within finance is quite volatile and complex. On hand customers are looking for a next generation replacement  of their current ERP system or an update for larger subsidiaries. On the other hand, installed base customers with a complex multi-ERP  system landscape or M&A activities looking for a roadmap and approach.

The pain points an applicability of CF are spread across un-harmonized data,  a missing “One Source of the Truth”, certain consolidation preparations or period end closing are too complex…  Further on centralization should be increased i.e. for IC, Payments or reporting.

Central Finance – Value Drivers => Why?

The key goals for central finance are IT simplification (landscape, interfaces, applications…), process simplification (data preparation, insight and analysis…) and process innovation (real-time processes, integrated planning).

The key objectives include also on one hand to quickly adapt to changing within business environments (strategy & execution, also to integrate, automate, anticipate (speed & efficiency) and further on to improve working capital and operating cost

The value drivers herewith are within the range of central process execution, data harmonization, Proficiencies of Financials Add-On stack and also to enable an (non-disruptive) adoption

Central Finance – Concept and Value Flow => What is the idea?

The main idea behind central finance is ‘a dedicated Simple Finance system  (Suite on HANA, Financials Add-on at its core) and SAP planning, consolidation and reporting capabilities (optional) connected to one or more ERP systems’

Central Finance – Key Functionalities => What can it do?

The key functionalities are including the possibilities to harmonize underlying source data on the fly and get consolidated reporting but with better performance/service levels

The concept also includes to get transaction processing, and planning/consolidation/reporting off the same (real-time, harmonized, reconciled) shared data set (single source of truth)

Further benefit are possible by process optimizations (like faster close) and productivity (UI) improvements through the likes of Fiori, Lumira, and Smart Business Cockpits and a new Finance architecture, HANA optimized transactions, and unified FI/CO

From an organization perspective,  it would be possible to enable centralized processes and central reporting (cross-client, single truth) for disjointed SAP ERP or non-SAP ERP systems (like Oracle or JD Edwards)

Along the strategy and approach there are different options by either keep the central Finance instance as dedicated, permanent Finance instance for good or to migrate the existing ERP Finance systems over time

Central Finance – Approach  => How to get started…?

There is a four step roadmap idea towards a central finance platform including Instant innovation > Planning for Finance > Central Month End Closing > Centralised Processes

A sample project approach could be Scope Validation & Prototype, Productive Build-up & Pilot, Completion and Rollout

Central Finance – Outlook and Sources => What is Ongoing…?

Central Finance is based on functions and features available in S4/HANA;  There is a roadmap in place moving items into the Central Finance. These items include further functions and features in the area of reporting, reconciliations, master data loads and mappings etc.. Long-term the more central functions are within focus. Herewith central processing of functions e.g. payment processing, consolidation, fixed assets etc. are planned

Central Finance – Sources => …Where to get more?

JAM-Group: https://jam4.sapjam.com/groups/about_page/AxCsjjE4BEWIoKrQH1IxK3

Industries: https://jam4.sapjam.com/wiki/show/Fw8eMZpCW9MyZ65oa3hwmE?_lightbox=true#insurance

Summary – Material:  =>