1. Copyright © 2003 Americas’ SAP Users’ Group How to Implement Supplier Performance Management Using BW, SEM, and SRM Paul Halley Director, SEM Consulting Business Information Solutions (BIS) paul.halley@bisamerica.com

2. What Is Supplier Performance Mgt? *Your implementation of mySAP Supplier Relationship Management (mySAP SRM) can include the following SAP application components: SAP R/3 -- The foundation of mySAP Business Suite, SAP R/3 is the leading software for enterprise resource planning (ERP). The software is currently in Release 4.6C. SAP Enterprise Portal -- SAP Enterprise Portal Release 5.0 enables organizations to manage enterprise data -- including applications, databases, and Internet information -- and deliver content based on user roles. SAP Advanced Planner and Optimizer (SAP APO) -- SAP APO Release 3.0 is a planning and scheduling tool that enables real-time decision support and network optimization across the extended supply chain. SAP Business Information Warehouse (SAP BW) -- SAP BW Release 2.1C goes beyond traditional data warehousing to provide a complete solution for enterprise-wide information capture and evaluation. SAP Enterprise Buyer -- SAP Enterprise Buyer enables organizations to connect to e-marketplaces, streamline purchasing, and address a broad range of e- procurement needs. SAP Bidding Engine -- SAP Bidding Engine provides dynamic pricing mechanisms, such as reverse auctions and requests for quotations. A decision support tool helps identify winning suppliers and stipulate follow-up processes. *From www.sap.com

3. Issues That Can Benefit from SPM Warehouse productivity and receiving are down due to mismanagement of suppliers/vendors Price discrepancies with suppliers Inability to monitor poor suppliers and fix their problems Inventory coverage must be higher to cover poor suppliers Unable to change supplier behavior Suppliers are unable to self-manage their performance in relation to my organization.

4. How Do I Implement SPM? 1.Document your AP and supply chain pains in regards to suppliers. How are they hurting you? How can they help you better? 2.Based upon the documentation above, decide what kind of data you would like to use to evaluate your suppliers/vendors 3.Find the source of that data. 4.Create a strategy to get that data into the Business Warehouse, whether automatically or manually 5.Decide how you would like to present that data to end users. Balanced Scorecard? BW Queries? Digital Dashboard? Web? 6.Implement BW 7.Implement SEM 8.Optional: Implement Portal

5. Where Will the Data Come From?  Whether R/3 or non-R/3, all data will be stored in the Business Warehouse (BW).  Standard Business Content in BW 3.1 that can help:  Infocube 0FIAP_C02 – Accts Payable Transaction Items  Infocube 0FIAP_C03 – Accts Payable Line Items  Custom infocubes can be created to source non-R/3 data  Other standard infocubes can pull in R/3 data (APO, MM, etc)  Can implement SEM-BPS to create Excel input template so data can be manually saved into BW

6. The Architecture of SEM Extraction Retraction OLAP SAP BW Reporting SAP BW SAP SEM Non-SAP Systems

7. Example of Supply Chain Dept Scorecard

8. Supplier Delivery Time via BW

9. Supply Chain Dept Scorecard via SEM

10. Supplier Quality via BW

11. POs by Vendor via BW

12. Price Trends by Supplier by Product via BW

13. Supplier Backorders for Comparison

14. Supply Chain Dept Internal KPIs via SEM

15. Project Staffing for SEM  While SEM is technically a BW add-on, it is its own application. Furthermore, it is a business application, not a technical data warehousing application. Therefore, BW team members should be different from SEM team members. They should be different people with different skills (functional vs. technical)!  Resources in a typical first BW/SEM project  40% Business users  20% IT (technical BW)  40% Consulting  Resources in a typical follow-on BW/SEM project  70% Business power users  20% IT (technical BW)  10% Consulting (for support with new functionality)

18. Copyright © 2003 Americas’ SAP Users’ Group Thank you for attending Session 4209! Paul Halley Director, SEM Consulting Business Information Solutions (BIS) paul.halley@bisamerica.com