A New Era Exemplified by RISE with SAP: Business Transformation as a Service for Finance
The idea of bundling services with products is not a new one. For years, when we have ordered furniture or kitchen appliances, we also took advantage of the installation service provided by the store where we made our purchases. And some car dealerships added perks, such as a quick exterior car wash after an automotive service.
The types of sellers who offer services continues to expand. Instead of ordering take-out food, we can now order from a restaurant – or more recently from grocery stores – where we can now opt for a delivery service instead of leaving our homes. And of course, it is the companies who manufacture, cook, or sell the products who must manage an ever-expanding network of partnerships, including installation and delivery services and drivers. You would never think of purchasing a meal, and then trying to find a delivery service yourself after the fact!
The idea of expanding products with services continues to evolve. It is not just a matter of installation and delivery. Especially companies who sell to the end consumer have created even more sophisticated services. One company who manufactures paints has expanded their services to advise their customers on the best color scheme for their home based on their furnishings, and then not only delivers the paint, but also provides painting services for houses and interiors.
Plus, many lifestyle companies are now taking the concept of service to a new level. Let’s take fitness and athletic wear companies as an example. They have created communities around their products, creating actual communities, allowing customers to obtain advice, purchase subscriptions to fitness programs, and to communicate with other customers on fitness tips that work. And even technology companies have forums where users of their products – from smartphones to software – respond to each other’s questions.
Services for Software Solutions
Now how does this relate to software? Simply said, it’s not just the project implementation services that are available, but the software and infrastructure itself can be made available as a service.
In the past, once customers had determined which solutions best met their needs, there were many other decisions that were necessary to determine what would be managed in-house, and what would be outsourced as a service.
Of course, one choice was always to manage everything in-house, in an on-premise installation. But piece by piece, customers leveraged services for all portions of an implementation.
We had IaaS (Infrastructure as a Service), focusing on the servers, storage, and networks, which is the lowest level of technology.
There was also PaaS (Platform as a Service), including the operating system running on a server, the databases, and any middleware needed for integration.
Then came SaaS (Software as a Service), which encompasses the actual solutions, as well as the data used in running these applications.
Business Transformation for the Enterprise and for Finance
Coming out of the pandemic, companies now need to focus on their core competencies and their own customer base, and determining the best way to move forward for stability and renewed growth. With this priority, it becomes attractive to leverage business transformation services to move forward.
While there is a range of enterprise transformation – from streamlining process to implementing new business models – Finance is a key contributor and advisor, which is possible by transforming their own organizations by focusing on three pillars:
- Process Efficiency. Finance can automate manual processes to reduce the time and errors of facilitating day-to-day transactions that are integrated with logistics processes, as well as facilitating the financial close. These time savings free up time for the finance function to spend more time on value-added activities.
- Steering Effectiveness. By leveraging predictive and AI capabilities, finance can provide value-add analysis of the financial health of the company and drive investment decisions. Also, analyzing the potential financial impact of strategic decisions, using what-if analysis, enables finance teams to recommend the best course of action to the business.
- Continuous Compliance. Finance and risk teams can ensure that all transactions and processes are monitored and analyzed for potential fraud and enterprise risk. And of course, financial results must be reported in a timely, accurate and auditable manner, while maintaining security and privacy of data and processes for the company and the data of its customers.
RISE with SAP for Finance
RISE with SAP provides Finance organizations with the business transformation services and tools to drive better results. The building blocks include SAP S/4HANA Cloud capabilities, which allows companies to quickly use innovations as they are released to support their business, without a lengthy on-premise re-implementation or upgrade process. RISE also includes business intelligence, automation and AI, and embedded tools and services, so that companies can spend less time on the systems implementation and maintenance, and more time growing their business.
From a Finance standpoint, there are many capabilities that move beyond the SAP ECC capabilities and can be easily part of a business transformation.
- Billing and Revenue Innovation Management (BRIM) allows companies to expand their offerings to include services and subscriptions and support the appropriate billing processes.
- Cash management and liquidity planning helps companies determine their financial health, and plan for investments to support future growth.
- For a continuous and compliant financial close, updated consolidation capabilities as well as new tax reporting capabilities help disclosures required at the end of financial periods.
- Finally, shared services enables consistent and efficient finance processes.
And all of these capabilities employ both automation and AI capabilities for accelerating processes without the need for manual intervention, as well as supporting predictive capabilities and profitability management.
Based on two IDC studies, ECC and SAP S/4HANA TCO Study (Nov. 2020) and IDC SAP S/4HANA Business Value Study (March 2020), estimated benefits include:
- Lower TCO: Up to a 20% reduction in TCO over five years for SAP S/4HANA, private cloud edition as compared to a traditional ERP deployment.
- Faster deployment: A more than two-month potential acceleration in deployment speed as operational lead times fall.
- Reduced in-house costs: 87% reduction in sticky costs due to the more flexible operational environment.
With these benefits, and finance transformation enabling the enterprise-wide transformation, companies can move along the path on their own terms, and on their own timeline.
To find out more about the breadth of the finance and risk portfolio, visit www.sap.com/finance, and for more information about RISE with SAP, visit www.sap.com/rise.