PROS Integration with SAP

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PROS INTEGRATION WITH SAP

Unlock Your Data • Unleash Your Sales

By Andy Dysart

PROS Integration with SAPPROS Integration with SAP

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Copyright © 2013, PROS Inc. All rights reserved. This document is provided for information purposes only and the contents hereof are subject to change without notice. This document is not warranted to be error-free, nor subject to any other warranties or conditions, whether expressed orally or implied in law, including implied warranties and conditions of merchantability or fitness for a particular purpose. We specifically disclaim any liability with respect to this document and no contractual obligations are formed either directly or indirectly by this document. This document may not be reproduced or transmitted in any form or by any means, electronic or mechanical, for any purpose, without our prior written permission.

PROS Integration with SAP

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The PROS Pricing Solution Suite (PPSS) empowers companies to implement more dynamic and flexible pricing policies and perform more meaningful analysis of pricing performance than possible when using SAP alone. With hundreds of pricing software implementations involving ERP and CRM systems, PROS has a long history of delivering proven pricing software solutions to complement and enhance customized SAP implementations. PROS provides rich out-of-the-box integration with SAP, primarily with the SAP Sales and Distribution (SD) module for pricing, cost, and discount information, the Materials Management (MM) module for product and customer reference information, and the Controlling – Profitability Analysis (COPA) module for allocated costs. PROS also provides rich integration with SAP CRM to bring the value of pricing excellence to your sales staff through real-time price optimization and price guidance.

PROS provides a unique SAP partnership advantage through both real-world experiences in implementing PPSS in large global IT environments and through its participation in SAP’s formal certification processes.

PROS’ customers that have successfully integrated with SAP include many Fortune Global 500 manufacturing, distribution, and services companies such as an $85 billion European-based global chemicals manufacturer, a $35 billion high-tech manufacturer, and three of the top five integrated energy companies. Some of the largest and longest running SAP installations in the world are also in production with PROS Pricing Optimization Software. In one case, the customer has 50,000 SAP seats and has been a PROS customer since 2002.

PROS is a partner in good standing in SAP’s PartnerEdge program as an SAP software solution partner and has earned certification under SAP’s “Powered by SAP NetWeaver” program.

PROS is fully committed to maintaining our SAP certifications and enhancing our SAP. As part of our SAP partnership, PROS continuously monitors SAP’s roadmap and ensures that we incorporate new capabilities into our products as they become available.

PROS creates prices – SAP uses pricesPROS creates and updates prices; SAP uses them to do business. PPSS has the capability to create science-optimized prices, price lists, and manage mass price updates. These prices are sent to SAP as records in SAP price condition tables for later inclusion in formal SAP documents, such as contracts, sales orders, invoices, goods issue and postings to accounting receivables. In this way, PPSS becomes the system of price origin and SAP maintains the system of record functionality.

PROS allows for more flexible pricing policiesWithin SAP, price policies are implemented using price condition tables, specifying the situation in which a

Using PPSS, PROS customers can implement

dynamic and flexible pricing policies that

calculate and manage prices in complex pricing

designs.

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particular price list (condition table) applies, as well as which price from the list (condition table record) is selected and used for a business document. This SAP feature allows prices to be held for many conditions and at many levels, but it does not provide any ability to effectively calculate and manage the large number of prices that a complex pricing design can contain.

Using PPSS, PROS customers can implement dynamic and flexible pricing policies that calculate and manage prices in complex pricing designs. These policies can take full advantage of all available pricing information and tools that are available to your enterprise.

PROS maximizes the value of SAP CRMMany companies have chosen SAP CRM to provide their

sales teams improved management of customer accounts, opportunities and quotations. PROS integrates with SAP CRM to provide rich interactive analytics, real-time price optimization and price guidance, and opportunity scoring – all within the same familiar SAP CRM user interface.

PROS proven integration processNo two SAP implementations are identical. SAP implementations are extensively customized to meet business needs. As a result, the precise way in which PPSS interacts and sends prices to SAP can be configured to integrate with a customer’s specific SAP customizations. PROS has configured 200+ implementations in many different ERP, CRM, inventory, order processing and other environments. The breadth of this experience is an important added value to PROS customers.

Competitor Rate Information in the PROS HROS System

Sources of PricesSource of Master Data

and Business Documents

Master Data

Prices, Contracts, Agreements

System of Origin

- Build Prices- Build Deals- Approvals- Analysis

System of Record

- Orders- Invoices- Receivables- Master Data

System of Origin vs. System of RecordPPSS integrates with SAP’s Sales and Distribution (SD) module by working with the pricing, cost and discount information in SAP condition tables. This information includes the pricing design that is implemented in the SAP access sequence logic. The PPSS configuration also includes definitions of pricing routines which model the logic defined in SAP pricing procedures. The PPSS interface is highly

PROS has configured 200+ implementations

in many different ERP, CRM, inventory, order

processing and other environments.

configurable to allow the addition and modification of condition tables, access sequences and pricing procedures with minimal interface updates.

Master or reference data such as customers and products is also brought into PPSS from SAP’s Materials Management (MM) module using the PPSS data integration interface. In addition, currency and unit of measure conversion factors are integrated to enable price and measure conversions.

Data integration with SAP is supported using open and flexible data interfacing technologies supported by PPSS,

including HTTP/SOAP web services and XML formatted files. Both methods provide high performance, scalability and robust data validation and error handling capabilities. Both methods are well supported by a variety of ETL middleware solutions, including SAP NetWeaver Process Integration, BizTalk, Informatica and WebMethods.

SAP CRM – Powered by PROS

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The PROS Difference with SAP

A leading global manufacturer of paper products was facing multiple challenges in trying to manage pricing across a wide array of products through a complex distribution network using established global, national and regional price levels. The company faced several pricing challenges driven by prices for specific SKUs negotiated with commercial end users via price agreements and a complex rebate structure necessary to ensure payment and channel compensation accuracy. As a result, pricing decisions did not get the attention or analysis needed, and price requests were approved that negatively affected margins and profits.

This manufacturer’s major pricing challenges included:

• Time-consuming Manual Pricing Analysis and Review — Setting price agreements required an extensive analysis using spreadsheets and Microsoft Office Access databases. With more than 12,000 pricing agreements, each went through a complex review and approval process involving price analysts, category managers and sales management. When a price agreement was finally approved, it had to be manually entered into SAP.

• Out of Date Information — Gathering data for pricing was hampered by nearly 100 pricing and volume-tracking spreadsheets, Access databases and other tools that were only periodically updated. Even after updates, analysts and category managers could spend days extracting and analyzing data and even longer when multiple analyses were needed. In many cases, guidelines used to evaluate price request quality did not accurately reflect what end users were willing to pay.

• Faulty Integration with SAP — Changing prices for distributors or end users required a frustrating, labor-intensive effort. Data was downloaded from SAP into spreadsheets for analysis and approval, and new prices were uploaded manually back into SAP --- a time-consuming and error-prone process.

The PROS Pricing Solutions Suite was implemented to automate the process of making pricing decisions, integrated with SAP. Using PROS, the company’s strategy, category and pricing analysts can now effectively reallocate their time from data collection to data analysis, resulting in reduced costs from faster analyses and higher margins due to better pricing decisions that generate more revenue and increase sales volume.

PROS’ Price Optimizer and Deal Optimizer modules, for example, allow the sales force to efficiently enter pricing requests and automate the pricing data input process into SAP. Integrated with an opportunity management system, the Deal Optimizer module automates price entries into SAP and offers offline capabilities to allow sales representatives to use their mobile BlackBerrys® to quickly enter price requests and work in areas where access to the Internet is limited. Thus PROS enabled the company to accelerate pricing analysis, identified profitability for thousands of deals and empowered sales reps to efficiently enter pricing requests and update price agreements.

To date, the manufacturer has been able to reap millions of dollars in additional margin and revenue after implementing prescriptive pricing software from PROS.

PROS & SAP joint commitment to ongoing PPSS certificationPROS has fulfilled SAP’s rigorous requirements and testing to achieve certifications for PPSS with SAP NetWeaver version 7.3. SAP NetWeaver is an open integration and application platform that integrates people, information, and processes. It powers not only SAP Business Suite solutions but also partner solutions and customer-specific, custom-built applications.

These “Powered by SAP NetWeaver” certifications verify the ability to run PPSS on SAP NetWeaver Application Server, use SAP’s single sign-on features, deploy the modules of PPSS as portal components within SAP Enterprise Portal, and most importantly, verify a library of PROS-developed integration content for SAP NetWeaver Process Integration.

PROS integration content library eases integration with SAPSAP NetWeaver Process Integration (SAP PI), a component of the NetWeaver platform, supports business process modeling and data exchange across different applications. SAP PI centrally manages integration knowledge (integration content).

The integration content library provided by PROS

not only includes the Process Integration content

objects but also a Configuration Guide that

describes how the interfaces can be customized

for your specific SAP environment

SAP SD Integration with PROS

AnalyzePricing

ExecutePricing

ManagingPricing

CreateReceivables

CreateInvoice

CreateOrder

ImplementPricingStrategy

EstablishPricingStrategy

AnalyzePerformance

ObtainTransaction &Master Data

UploadDeals

ApproveDeals

BuildProposal

MaintainMaster Data

PricesAvailable

UploadPrices &Discounts

ApprovePrices

Build andMaintainPricingPolicy

BuildList

Prices

MaintainMaster Data

Legend

SAP

PROS

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Because many SAP customers are now choosing to standardize on SAP PI as the mechanism for interfacing SAP to other applications in their environment, PROS has enhanced its data integration capabilities by developing a library of integration content for SAP PI to ease integration of PPSS with SAP. Using this integration content, PROS customers who choose SAP PI as their integration middleware solution can more quickly integrate PPSS with their SAP ERP implementation.

The PROS integration content library includes data structures, interfaces, mapping programs, integration processes and integration scenarios synchronized with the latest versions of both applications (PPSS and SAP ERP). This integration allows PPSS to calculate list prices and negotiated deal or contract prices on the basis of existing pricing information and master data from SAP, and send those prices back to SAP where they can be used during different SAP sales processes such as invoicing and order creation.

The integration content library provided by PROS not only includes the Process Integration content objects but also a Configuration Guide that describes how the interfaces can be customized for your specific SAP environment. This customization can be performed by your internal SAP technical resources or by using resources available from a variety of third-party consulting companies.

Some of the data entities supported in the PROS integration content library for PPSS include:

Sales Transactions: This interface allows sending different sales documents (invoices) to PPSS where they can be analyzed to to find profit leaks and pricing opportunities and to calculate updated prices.

Pricing Conditions: Pricing conditions are interfaced from SAP to PPSS to reflect current prices. Prices calculated in

PPSS are then interfaced back from PPSS to SAP for use in invoicing, sales orders and other processes. The pricing condition interfaces support SAP IS-OIL formulas, scales, and optional fields.

Contracts and Sales Orders: Users of PPSS generate customer-specific pricing agreements that are interfaced into SAP to create sales quotations, contracts or sales orders, depending on the configuration of the interface.

Rebates: Users can create rebates and model their impact on profitability, and, when approved, create the corresponding rebate agreements in SAP.

Material Master Data: Material Master records created in SAP are distributed to PPSS for use as reference data for sales transactions and other business documents.

Customer Master Data: Customer Master records created in SAP are also distributed to PPSS for use as reference data for sales transactions and other business documents.

Exchange Rates: Exchange Rates maintained in SAP can be distributed to PPSS for currency conversion purposes, facilitating consistency.

Customer and Material Hierarchies: PPSS can leverage different types of SAP ERP customer and material hierarchies for use during price condition determination and transaction analysis.

Data distribution in both directions between SAP PI and SAP ERP is implemented using SAP Intermediate Documents (IDOCs), that are the standard SAP format for electronic data interchange between systems. Interfaces based on IDOCs are very reliable as this technology has been used with SAP solutions for many years and offers extensive possibilities of posting business documents and master data scenarios as well as robust error handling features.

ConclusionWith the complexities inherent in enterprise application deployments of both Pricing and SAP ERP software applications, it is critical to select a Pricing Excellence partner with proven experience and expertise. PROS

PROS provides rich out-of-thebox integration

with SAP and is committed to longterm

improvements in line with the latest releases of

NetWeaver and other SAP initiatives

provides rich out-of-thebox integration with SAP and is committed to long-term improvements in line with the latest releases of NetWeaver and other SAP initiatives. Above and beyond certifications, PROS has unrivaled real-world experience in implementing PPSS with some of the largest and most complex global SAP deployments. PROS professional services and implementation teams can quickly deploy PPSS so PROS’ customers can realize a powerful return on investment and pricing performance above what is possible using SAP alone.

For more detailed information about PROS integration with SAP and how PROS can help your organization achieve Pricing Excellence, please contact us at info@PROS.com or visit us online at www.PROS.com

Andy Dysart has over 30 years of experience in interface design, data interfaces, system architecture and enterprise software design and systems implementation, including experience at Scalable Software, PLATINUM Technology, HP, Compaq, and Landmark Graphics. Andy is a senior member of the PROS Product Architecture Team and works closely with the Product Management, Professional Services, Science and Research and Technology teams to design software that delivers Pricing Excellence. He received a B.S. in computer science with highest honors from New Mexico Tech.

Andy Dysart

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PROS Holdings, Inc. (NYSE: PRO) is a big data software company that helps customers outperform in their markets by using big data to sell more effectively. We apply 27 years of data science experience to unlock buying patterns and preferences within transaction data to reveal which opportunities are most likely to close, which offers are most likely to sell and which prices are most likely to win. PROS offers big data solutions to optimize sales, pricing, quoting, rebates and revenue management across more than 30 industries. PROS has implemented more than 600 solutions in more than 55 countries. The PROS team comprises more than 700 professionals around the world.

To learn more, visit www.pros.com.

About PROS

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Copyright © 2013, PROS Inc. All rights reserved. This document is provided for information purposes only and the contents hereof are subject to change without notice. This document is not warranted to be error-free, nor subject to any other warranties or conditions, whether expressed orally or implied in law, including implied warranties and conditions of merchantability or fitness for a particular purpose. We specifically disclaim any liability with respect to this document and no contractual obligations are formed either directly or indirectly by this document. This document may not be reproduced or transmitted in any form or by any means, electronic or mechanical, for any purpose, without our prior written permission.