2 In this session we will look at what ready-made content is available with SAP NetWeaver BI 7.0 to assess and monitor sales and distribution (SD) process performance. Pinpoint the best ways to leverage SAP NetWeaver BI analytics for SD to improve processes for sales forecasting, commission reporting, market-basket analysis, cross-selling, customer segmentation, and standardized formatted reporting. Learn how sales reps can get access to performance reports through mobile devices. Learn how to use SAP information broadcasting alerts and exception reporting to better track items such as late deliveries, exceptional orders, nonstandard billings, and unusual orders. Introduction…
3 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
4 SAP BI Adaptation is exploding SAP BI is now a Mainstream SAP Solution There are now almost 25,000 productive SAP BI systems worldwide, an increase of 3,250% in 18 months!! Source: Zia Yusuf, EVP SAP, TechEd, 2007
5 BPM on a NetWeaver Business Process Platform SAP NetWeaver is also a platform for developing and integrating value added business processes. BI can be used to support complex scenarios that increases sales and profits through process innovation and tighter SCM integration. B2BNon SAP BPM increasingly being used to manage processes that bridge multiple packaged applications. BPM is not only XI integration and data movement, but also how the data is being used. This session focuses on the CRM process, usage and BPM integration, Not on XI. Source: SAP AG, 2008
6 NetWeaver BPM tools SAP NetWeaver has process and rules composer tools that is used to define & implement complex business processes. In this session we will cover many new & innovative CRM processes you should consider as prime candidates to integrate with SAP BI and these tools. In the current release of BPM these features are pre-delivered: 1. Human Workflow Patterns: Task management (claim, complete) Sequence flow (including data flow) Decisions (XOR) Parallel branch & merge (AND) Deferred choice (eventing) Exception handling Nested (sub-)processesService Processes 2. Service Orchestration Enterprise service consumption Sequencing of automated activities Exception handling Eventing (intermediate events) Event correlation Source: SAP AG, 2008
7 BPM on SAP NetWeaver Business processes are becoming increasingly complex, integrated and comprised of more and more partners. Intelligent Process Automation must therefore be developed to provide a close link between the analytical (SAP BI) & the transaction systems Source: SAP AG, 2008
8 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
What can SAP BI do for my Sales BPM?: Pre-Sales Activities Before the sales meeting, the SAP BI system provides a Customer overview file(s): Customer's profile & financial information Past due payments Customer complaints logged in the system Previous period shipping problems The customer's orders in progress Cancelled orders Returned items in the past, Unearned discounts taken Target sales Suggestive products, prices & 'deals' The basic data is inside SAP BI and a set of process rules determine what is needed, who have access and how/when it is delivered (pdf, web, print, portal etc).
What can SAP BI do for my Sales BPM? - Order management The sales staff are pushed customer's order activities. BEx Broadcasters sends notifications about unusual events or series of events I.e.: Unusual orders (high volume, low price, short delivery time) Cancelled orders Tracking special customer's orders Tracking contracted sales Individual sales rep requests for order notifications Early demand shifts: Increased order volume for particular items.
What can SAP BI do for my Sales BPM? - Inventory Dashboards for workers & SCM leaders Improved transportation & logistics planning with SAP Advanced Planning & Optimization (APO) Web tracking of all inventory movements available to customers & partners (UPS, FedEx & Amazon) Instant mobile access to inventory data by sales reps in the field Dynamic pricing based on aging inventory & demand spikes - Done by airlines, car rental and hotels why not you?
What can SAP BI do for my Sales BPM? - Inventory Proactive delivery management using SAP BI Notify customers about delivery problems before they contact you - BEx Broadcaster Manage shippers and their on-time, on-cost, delivery performance - SAP BI scorecards Improve on-time delivery by predictive modeling based on past performance - SAP BI Analysis Process Designer (APD) Create external facing dashboards for your key customers and partners, providing them insights into the supply chain - SAP BI Visual Composer & Web Application Designer
What can SAP BI do for my Sales BPM? - Billing Externalize billings and provide insights Customer can manage their own accounts (SAP Portal) Invoiced electronically - no paper, /fax (SAP Portal) Access old statements and invoices (SAP BI) Dispute billings electronically (X-Apps) We can do detailed profit analysis on billing condition data (SAP BI) We can do statistical analysis & data mining on detailed billing information (BI-analysis process designer - APD)
What can SAP BI do for my Sales BPM? - Payment Allow customers to set up accounts, credit lines, banker's letter of acceptance, letters of credits, electronic payments cards, automatic drafts, check payments and pre-payments on-line. Use SAP Portals to give customers secure access and SAP BI for all account statements, reports and loyalty programs.
15 Available Standard CRM and SD Content SAP BI content for SD and CRM has been developed over the last 10 years and now have data stores for most content areas used in sales processes Don't start a multi-year SAP BI project for SD BPM. Instead do a quick project that leverages standard content
16 Most of what your sales representatives are looking for (orders, deliveries and billing) are in InfoCube SD_C03 - "Sales Overview" There are 127 InfoCubes for user access with data extraction programs and 108 Data Store Objects (DSOs) for CRM in SAP BI version 7.0. Use these and focus on the process models & presentation to end users. Available Standard CRM Content (continued)
17 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
18 Key Inputs to real Sales Forecasts -Determine Customer Lifetime Value Are you using customer life-time value, retention & attrition analysis processes in your sales forecast? I.e. a major US phone company, has determined that the lifetime value of a customer is so high, that it can afford to give incentives (such as checks up to $100) if key private customer is willing to switch companies. Do you know what a new customer is really worth long- term? SAP BI can be used to determine the total Customer Lifetime value (CLV) and build this dynamically into the forecasting process.
19 Key Inputs to real Sales Forecasts - What should you charge? SAP BI is also used to track the price sensitivity of certain geographical regions and customer groups. This type of analysis, called price elasticity analysis, is often performed against the historical data in SAP BI in order to determine the best price to charge for a certain product. SAP BI models can also be built to monitor the effect of changes in pricing strategies, i.e.. did we sell more widgets in France after we reduced the price by 10%, or did a "clearance sale" have the intended effect. This is often done in the food industry, where the same product may be packaged, labeled & priced differently, while being sold in the same store. BPM is a prime resource to help answer such price analysis processes Image Source: SAP AG, 2008
20 Key Inputs to real Sales Forecasts - What must you charge? From the other side, SAP BI can provide a unified cost picture of all activities related to a sale. SAP BI can be used to evaluating minimum sales price of each product, in each region, and to designated customer groups. BPM and SAP BI can answer complex analysis processes dynamically This is frequently done at construction projects such as road and bridge building, construction of utilities plants, as well as in sales of commodity goods, where large overheads directly related to sales have to be evaluated.
21 Key Inputs to real Sales Forecasts - Predict Customer Behavior If we know which customers are likely to leave us for a competitive offering, we can flag them for improved customer service or target them for a promotional marketing campaign designed to keep them as a customer. The key is that SAP BI have the data to support analysis of complex purchasing patterns over time. If we know that a man under the age of 25, with an income less than $35,000 who buys a Mercedes, is 1.8% more likely to default on his loan than a woman in the same customer group, why should the creditor not increase the interest rate by 1.8% to reflect the increased risk? SAP BI is the enabler of this type of analysis (Hint: look at SAP BI Analysis Process Designer).
22 Complex scenarios can be built for structured analysis such as risk modeling, customer segmentation, market basket analysis, predictive modeling and much more Analysis Process Designer (APD) “New data” based on the findings can be loaded back into data targets and used by others for reporting i.e.. CRM analysis.
23 SAP BI & BPM - a Natural choice for Category Management Category Management is the process of managing a category of similar products across suppliers. 'Category Captains' (CM) are responsible for everything from the product mix to the store layout. SAP BI Information needed for category management includes: Efficient Assortment, Efficient Promotion, Competitive Pricing Analysis, Product Profitability Analysis, Shelf Presentation, Scorecard With SAP BI, you can empower a CM with full responsibility for assortment decisions, inventory levels, shelf-space allocation, promotions & buying. With the SAP BI, authority & responsibility, the CM may be able to judge more accurately the consumer buying patterns, product sales & market trends of that category. By emphasizing profits & sales for entire product groups instead of individual items, CM encourage a longer-term, joint retailer-supplier focus without being confounded by the complexity of analyzing 1000s of different SKU’s.
24 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
25 Incentive & Commission Process Management Accurate and complete commission reporting is critical to build trust in agency relationships. SAP offers a package known as Incentive and Commission Management (ICM) for CRM. In SAP BI it is supported by the standard InfoCubes: ICM - (0CRM_ICO1) Remuneration and Liability (0CRM_ICO1) Jump-targets to show detailed BI analysis on how the commission was calculated can be added in any SAP BI query. T-Mobile Deutschland processes over 2 million commission checks each month with SAP ICM ( whitepapers.techrepublic.com.com/abstract.aspx?docid= )
26 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
27 Market basket Analysis with SAP BI & BPM This is a type of analysis where the user is attempting to find out which products are bought in combination, where should they be positioned within the store, catalog or web site, and how much space they should they have in your store, catalog, web site, marketing campaign etc. Your analysis should also be designed to find: SAP BPM can help you answer product mix questions dynamically & continuously better than guessing and intuition can The appropriate product breath (the number of products offered) The optimal product depth (the number of items within the product breath) The best product line extension (product variety)
28 Using Market-Basket Analysis: Cross, Upgrade & Suggestive Selling The world's largest on-line bookstore, Amazon.com, uses active market basket analysis to suggest what you should also buy (suggestive selling). They can also offer special deals to customers that are generated automatically in sales processing The banks are also good at cross-selling products such as VISA cards to high saving account holders, & car loans to good mortgage customers. 1.Do you know what your customers are likely to also buy. 2.Do you know what to suggest to a customer that buys any product? 3.Are you good at spotting new demand trends & can price dynamically?
29 Using BI for Cross-Selling Delta is an airline, but through market basket analysis, they cross sell many other products: - Hotel rooms - Rental cars - Activities SAP BPM models can track what customers are searching for and what products are logical compliments. Cross selling and suggestive selling works, but composite applications are needed to make it executionable
30 Suggestive Selling Suggestive selling started with waiters suggesting what to order to the customer and have moved into mainstream marketing rapidly, because it works… Some banks in the US are already experimented with pre-approving car loans, and sending out vouchers to its prime customers a few months before their current loan has been paid off (no application needed). Does your SAP BI system tell you when your customer are likely to make their next purchase and what you should suggest? - BPM rules can be created to take advantage of existing data & knowledge The bank has the customer's payment history and the customer's personal information, and can, therefore, cross-sell its product through a push-strategy. The bank does not have to compete for that same customer every time the customer is making a new financial decision.
31 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
32 Customer Segmentation with SAP BI and BPM SAP BI provides significant insights to your customer behaviors and what drives profits. BPM can analyze segmentation by Sales volume Sales amounts Total sales (-returns and complaint costs) Total profitability Sales growth and potential Long-term customer value Customer behavior such as reference customers, early product adaptors and marketing customers
33 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
34 Integrate on-line access to formatted statements in your BPM processes Customizable font styles (i.e.. bold, italic), colors, etc. Group-level changes with individual formatting Layout options, e.g.: Height of rows, width of columns Multi-line column headers Flexible field positioning Merging cells Support for hierarchies Rules for the presentation of special characteristic values Integration of text, pictures, and charts Header & footer for reports BEx Report Designer 7.1, (last release in 2008) will be available under maximum maintenance until 2016 and will be replaced with the Crystal Light product.
35 BEx Report Designer In SAP BI This SAP BI tool was created to simplify the formatting of reports and fix printing issues in previous versions. Use it to externalize customer & partner information. Source: SAP AG You have color control, header-footer control and many new features such as location control of cells and integration of pictures, charts and fixed text.
36 Crystal Report a SAP BI tool to support BPM With BW you get access to Crystal reports. In fact you have many pre-developed reports that comes with SAP-BW. Currently, you can modify, or develop and deploy a few Crystal reports without additional licensing cost. Crystal is a great tool for batch reporting of "pixel controlled' formatted reports.
37 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
38 SAP NetWeaver Mobile 7.1 With SAP NetWeaver 7.1 users of mobile devices can carry out their tasks without a connection to a back-end system. The required applications and the user interface exist on the mobile device. Data is exchanged with the back end during the synchronization. Supported SD & CRM scenarios include: Track customer information remotely Create and display orders in real time Update new opportunities instantly Improve pipeline visibility Account Management Sales order management Opportunity management Activity and task management Product and Price Information Surveys on handheld Service Functionality What was cool 5-10 years ago are now expected by many customer & employees Source: SAP AG, 2008
39 A SAP Mobile Application Example – Book a flight This is accessing the backend system using a handheld device and searching the products catalog. The available products can be stored in ECC or in SAP NetWeaver BI. For a sales application, you can add many search features and also allow for pick-lists (drop-downs). But the trick to fast processing is to keep it simple. Source: SAP AG, 2007
40 A SAP Mobile Application Example – Look up products After the search results is returned, you can allow the users to access more product information. Since these screens are used frequently, you should keep them free for graphs, images and other high bandwidth features. Source: SAP AG, 2007
41 A SAP Mobile Application – Data Entry & confirmation For rapid data entry, keep the required fields to a minimum. You should pre-fill as much as possible based on: User log-on Previous navigation Previous purchases Pre-defined “user preferences” Since External users cannot print from the PDA and Mobile phones you should also offer to confirmations on the last process screen Source: SAP AG, 2008
42 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
43 What Is BEx Information Broadcasting ? It’s a standard part of SAP NetWeaver. It lets you send “reports,” BEx queries, Workbooks, and Web Applications to a variety of recipients i.e.: addresses, BW users, BW roles SAP Enterprise Portal Knowledge Management folders SAP Enterprise Portal Image: SAP AG
BEx Broadcaster: Exception Reporting integration in BPM You can make BEx Broadcaster send you an exception report when an exception occurs or if the system reaches a certain level We can make a query and define any exception. In this example we are tracking the returned items by customers. If they return many items we want to be proactive and call them to ask why…
Making Alerts text based and Intuitive Using the Central Alert Server, by selecting the distribution type “Create Alert” and selecting the" Alert Category”, you can also insert text from BEx Broadcaster into the alerts to make them more relevant to the recipient.
46 What We’ll Cover … Introduction How to use BI in SD Business Process Management Core Analytics Sales forecasting Commission reporting Market-basket analysis & cross-selling Customer segmentation Standardized formatted reporting Mobile Analytics Broadcasting and Alerts Wrap-up
47 7 Key Points to Take Home You need to be proactive and provide advanced services in SD and CRM before your competitors act. You should plan for composite applications and don’t feel restricted by the system boundaries and current capabilities. SAP BI is an integral part of the external facing partner community and business processed, not just a reporting tool. Advanced analytics should be integrated in every step of the Order- to-Cash scenario to push target information, instead of relying on users to log-on and ‘pull’ reports every day. Mobile computing is a key component of sales force automation. Data should be available everywhere…
48 7 Key Points to Take Home Integration and BPM can take place in composite applications inside the portal so that data transparency is enforced (users don’t care which system provided the data). BPM is not just another way of linking the same old processes, but instead BPM allows companies to provide new innovate processes that adds value to the SD and the CRM experience -benefits to seller & buyers The key to success in BPM is to re-examine the old process scenarios, decide on new capabilities, and creating a strategy for new technology enabled processes. “Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat”. – Sun Tzu, The Art of War
49 COMERIT (Presentations, tutorials & articles) The SAP Business Process Expert Community bpx.sap.com SAP Global: Next-Generation BPM on an Open Business Process Platform presentation (need free registration) SAP Global: Road Map for BPM and Event-Driven Architecture (need free registration) Resources
50 Your Turn! How to contact me: Dr. Bjarne Berg