Basic understanding about leveraging BPC with IBP and BPC vs IBP:
- BPC is a full feature planning and consolidation tool based on BW, it requires its own BW namespace and its own cubes in its “classic” version. Version10.1 of BPC on HANA introduced the BPC “embedded” option, taking advantage of native BW cubes and allowing leveraging existing BW-IP logic.
- Previously S/OP (Sales & Operational) Planning tool transited into IBP. IBP is a new family of application in SCM under Hana whereas BPC belongs to analytic family.
- IBP uses source system tables as source data whereas BPC uses BW objects.Main difference in IBP is the direct access to Actual and Master Data tables via HANA views instead of data replication into BW persistence’s.
- IBP on Simple Finance is to replace planning functions from FI/CO which are not there anymore in Simple Finance
- Front-end Excel add-in (Analysis for Office) for IBP and EPM Add-in for BPC.
BPC along with IBP to improve corporate forecast accuracy:
Moreover, IBP can be integrated with BPC. For example – IBP can take input from BPC for Annual Operation Plan (AOP), Monthly/Quarterly Finance Plan and Use this information for Demand/Supply/S&OP planning.
Then IBP can send output like mid and Long Term Plan, Constrained Collaborative Plan, Revenue and Profit Plans to BPC as a detailed starting point for financial planning in BPC.
This integration brings the value by – Align financial plan with IBP inputs, Improve corporate forecast accuracy.
A process led by senior management that evaluates and revises time-phased projections for demand, supply, new product development, strategic projects and the resulting financial plans. This is done on a monthly basis, on a planned 24-month rolling horizon. It is a decision-making process that realigns the tactical plans for all business functions in all geographies to support the company’s business goals and targets.
A primary objective of IBP is to reach consensus on a single operating plan, to which executives of the management team hold themselves accountable, and allocates the critical resources of people, equipment, inventory, materials, time and money to most effectively satisfy customers in a profitable way.
- IBP is primarily a supply chain focus of balancing demand, supply, and inventory.
- Improved operational risk visibility and management
- Gap identification and improved decision making
- Easy, effective translation of aggregate plans to detail plans, and vice versa
Resources must be available and approved to execute all functional plans. Resource planning (manufacturing, operations, sales, marketing, product development, and financial) is a key element of S&OP/IBP.
- IBP and BPC both are Capable for all company functional plans which are aligned (product and portfolio management, demand management, supply management, and financial management). The process focuses on making decisions to keep plans aligned and agreeing on the tactics required to execute the plan (with a strong set of KPIs)
- BPC as a top down planning tool which considers many factors like inventory and sales. IBP is more of a bottom up planning solution focused on the inventory and its movements, through sales etc.