Delivering Real-Time Business Value for Engineering, Construction, and Operations

July 2013

Delivering Real-Time Business Value

for Engineering, Construction, and Operations SAP Business Suite Powered by SAP HANA

Public

© 2013 SAP AG or an SAP affiliate company. All rights reserved. 2 Public

The real-time opportunity

Construction projects carry ever higher risk because

of increasingly demanding customer requirements.

Engineering, construction, and operations (EC&O)

companies need to continuously innovate business

operations in order to meet their customers’ needs

Maximize project performance and profit margin

Find new ways to run projects more collaboratively

Reduce risk with predictive financial forecasts

Respond rapidly to evolving trends


Becoming an-innovation driven enterprise Align business operations with customer needs

Ensure project

performance and

increase margins

Monitor construction projects constantly to maximize

the margins for the individual projects

Get real-time visibility into project financials and the

planned vs. actual values of projects

Drive profitability

by running

projects in an

integrated way

Use building information modeling benefits for

engineering along with cost comparisons

Simplify project execution by using new technologies

such as mobile and integrated 3D viewer

Respond to market

dynamics in real

time

Control complex multilevel supply chains

Create flexible business models, accessing real-time

detailed data and historic business data

Respond to bursting material prices


SAP Business Suite powered by SAP HANA The next-generation business platform

Real-time business

In-memory

Business

transactions

Digital

connections

Collaborative

business

Cloud Social

Big Data Mobile

One platform bringing it all together

Advanced

analytics


Industry value map for EC&O Grow with the project-centric enterprise

Asset Management

Commercial Real Estate

Optimized Asset Maintenance

and Facility Operations

Equipment and Tools

Management

Bid to Contract Award

Opportunity and Proposal

Management

Collaborative Virtual Design

and Construction

Project Delivery

Commercial Project Management

Project Issue and Change

Management

Subcontractor Management

Environmental Health and Safety

Compliance

Revenue Optimization and

Project Profitability

Invoice to Cash

Subcontractor, Owner, Engineer,

and Architect Collaboration

Performance Analytics for Construction Projects

and Portfolios

People and

Talent

Core Human Resources

and Payroll Talent Management

Time and Attendance

Management

Workforce Planning and

Analytics

Finance Financial Performance

Management

Accounting and Financial

Close

Treasury and Financial

Risk Management

Collaborative Finance

Operations

Enterprise Risk and

Compliance Management

Procurement Supplier Discovery and

Lifecycle Management

Strategic Sourcing and

Contracting

Procurement and Order

Collaboration

Collaborative Invoice

to Pay Commodity Management

IT Management Application Lifecycle

Management

IT Infrastructure

Management

IT Portfolio and Project

Management IT Service Management

IT Strategy and

Governance

Technology

Solutions

Analytics Consumer Experience Data Management Enterprise Mobility

SAP HANA Platform

Application Development

and Integration


Industry value map for EC&O Grow with the project-centric enterprise

Asset Management

Commercial Real Estate

Optimized Asset Maintenance

and Facility Operations

Equipment and Tools

Management

Bid to Contract Award

Opportunity and Proposal

Management

Collaborative Virtual Design

and Construction

Project Delivery

Commercial Project Management

Project Issue and Change

Management

Subcontractor Management

Environmental Health and Safety

Compliance

Revenue Optimization and

Project Profitability

Invoice to Cash

Subcontractor, Owner, Engineer,

and Architect Collaboration

Performance Analytics for Construction Projects

and Portfolios

People and

Talent

Core Human Resources

and Payroll Talent Management

Time and Attendance

Management

Workforce Planning and

Analytics

Finance Financial Performance

Management

Accounting and Financial

Close

Treasury and Financial

Risk Management

Collaborative Finance

Operations

Enterprise Risk and

Compliance Management

Procurement Supplier Discovery and

Lifecycle Management

Strategic Sourcing and

Contracting

Procurement and Order

Collaboration

Collaborative Invoice

to Pay Commodity Management

IT Management Application Lifecycle

Management

IT Infrastructure

Management

IT Portfolio and Project

Management IT Service Management

IT Strategy and

Governance

Technology

Solutions

Analytics Consumer Experience Data Management Enterprise Mobility

SAP HANA Platform

Application Development

and Integration

Highest real-time

business value

for EC&O

3

2 4 5

1


Today

KPI improvements are high-level estimates and will have to be validated for each customer situation.

With SAP Business Suite on SAP HANA

Financial performance management Business value for financial performance management

Inability to adapt (plan, replan, monitor, and control) the business model, operations, product, and services provided in volatile market environments

Need to quickly adapt finance and business operations

Long performance-management

cycles with complex consolidation

landscapes

Inefficiencies due to multiple

disruptions between planning and

closing

Real-time simulations of planning and

costing scenarios

Real-time enterprise profitability with

large volumes of item-level data

Real-time modeling and simulation of

product costing

No latency through heterogeneous

consolidation landscapes and

quasi-instant response times (even

with large number of very

complex calculations)

Real-time closing activities

Integrated planning for new and

customer-defined scenarios

Increased efficiency, reducing

operating cost and improving

stakeholder satisfaction

Reduce

Reduce

monthly end-

closing time by

4%

operating costs by

4%


Today



Subcontractor management Business value for strategic purchase optimization

Unclear what sources of supply

should be negotiated and used

Long cycle time to secure new

sources, and significant overhead to

manage suppliers

Real-time access to high volumes of

purchasing data

Fast and complete search across all

related business documents

Increase process

efficiency by

3%

Optimize working capital by

5%

Lack of visibility into organization-

wide demand

High volume of maverick buying

Need for greater efficiencies and

savings from purchasing

Real-time calculation of savings and

simulations

Visibility into supplier relationships,

performance, spend, and savings in

place to reduce supply risk and

missed savings opportunities


Today



Performance analytics for construction projects and portfolios (1) Business value for enterprise portfolio and project management

Long wait times along business

processes that hinder project

execution

Time consuming maintenance and

analysis of data for complex projects

Today the engineer-to-order process

is a tight combination of controlling

and logistics processes. The

integration into ERP logistics is key

but is also a challenge due to the

need to load huge data volumes.

Inability to monitor and analyze all

aspects of large projects

simultaneously and drill down into

relevant details

Improved run time of critical project

management transactions

Real-time access to large volumes of

data

Higher end-to-end process efficiency

and improved employee productivity

On-the-fly analysis and calculation

Complete progress monitoring along

the project lifecycle

Analysis and calculation of data

directly on SAP HANA database

Enhanced process transparency that

improves quality of work

Increase efficiency by

3%

Decreas

Improve

lead time from

development to

delivery of product by

2%

project

profitability by

6%


Today



Performance analytics for construction projects and portfolios (2) Business value for enterprise portfolio and project management

Time-consuming analysis and

progress monitoring of complex and

long-lasting projects

Poor resource productivity and

project profitability

It is impossible to monitor all aspects

of a project due to high volume of

data and detached analytics

Project progress monitoring cannot

be done sufficiently to support

decision processes

Deviations in costs, time, resources,

or quality are detected too late in the

process

Decisions to mitigate risks and

opportunity costs are taken too late

Improved run time of project

monitoring reports

Combined analysis of financials and

logistics data

Real-time access to large volumes of

data

On-the-fly analysis, calculation, and

decision making

Early insight into deviations and risks,

enabling timely corrective measures

Increase efficiency of work on

large projects by

5%

Improve

Reduce

transparency of

project related

resources by

6%

project failure

rate by

4%


Today



Equipment and tools management Business value for asset operations and maintenance

Maintenance scheduling that

consumes a great deal of time.

Manual and error-prone process of

preselection of maintenance plans

Potential to miss necessary objects

for maintenance calls

High number of maintenance plans

that need to be scheduled frequently

Accelerated mass transactions

Instant analysis on top of

transactions

Preselection of due plans, which

speeds up the process significantly

Real-time analytics on all data,

including machine sensor data

Scheduling of all maintenance plans

within a specific timeframe

Planning several times a day

(instead of once a week) results in

up-to-date scheduling information in

maintenance operations

Faster response times lead to more

accurate maintenance scheduling

Increase asset utilization and

reduce unplanned

asset downtime by

15% Maximize

Improve

asset uptime by

5%

scheduling information

on maintenance

operations by

3%


Next step Business scenario recommendation and value discovery workshop

SAP offers a proven methodology and approach to

discover the customer-specific business

improvement areas and quantify value potential.

We suggest such a workshop with your

line-of-business and IT experts.

As starting point, we recommend a performance

and usage analysis of your current system.

© 2013 SAP AG or an SAP affiliate company. All rights reserved.

Thank you

Contact information:

Michael Quadt

Solution Management EC&O

D-69190 Walldorf Dietmar Hopp Allee 16

+49-6227-764394 M: +49-170-8555610

© 2013 SAP AG or an SAP affiliate company. All rights reserved.

Appendix with detailed customer cases


Customer case: construction company in Canada Summary validated scenarios

Feasibility

Bu

sin

ess v

alu

e

Legend

Lo

w

Hig

h

Low High

SAP Business

Suite on

SAP HANA

SAP HANA

applications

SAP HANA

Platform

Predictive analytics

(US$1.5 million)

Automated

reporting

(US$477 ,000)

Optimized asset

maintenance

(US$1.2 million)

Financial

performance

management

(US$477,000)

Phase – deployment road map Annual revenue: US$1.2 billion

1 Short term

Optimized asset maintenance: Increase asset

utilization, reduce equipment cost

Financial performance management:

Reduce operation cost

2 Medium term

Automated reporting: Reduce operation cost

Predictive analytics: Increase project margin

3 In evaluation

Other functions – To be discussed in future

discovery workshops

SAP HANA use cases mapped to industry value map end-to-end solutions


Customer case: construction company in Canada SAP HANA Platform

2176 2176

1943

0

500

1000

1500

2000

2500

3000

3500

4000

4500

2013 Phase 1 Phase 2

Costs SoH Applications Platform

SAP HANA Platform: Anything built on the platform that is customer specific ‒ new business processes and business models

SAP HANA products: SAP NetWeaver BW on SAP HANA, high-performance apps (HPAs), applications powered by SAP HANA

mapped to IVM E2E solutions

$’000

Currently available functionalities (SP0, 1, 2) – 23 scenarios mapped to IVM E2E solutions, and planned functionalities (all of

the end-to-end solutions on the IVM are in scope)

Based on actual SAP

customer business case

Annual benefits, SAP HANA

Platform

Annual benefits, SAP HANA

applications: US$1.9 million

Annual benefits, SAP Business

Suite on SAP HANA: US$ 2.2 million

Estimated deployment costs

Total transition cost

SAP HANA Platform

SAP HANA products

SAP Business Suite on SAP HANA


Note: Use cases in the global use case repository are captured directly from customers and internal SAP innovation

sessions and may not be completely validated.

A construction and industrial services company- financial

performance management Engineering, construction, and operations

Business context and goals

Managing performance from a financial perspective is becoming more crucial every day. On-time

results for all audit- and analysis-related inquiries and an ability to react to risks and opportunities

exemplify the need for a transparent and efficient process to deliver financial information on time

and accurately. You need to manage operations and related performance successfully in today’s

volatile business conditions.

Business challenges

You need to plan, replan, monitor, and control the business model, business operations, the

products and services offered, the markets served, and the technologies brought to your

customers in volatile market environments. At the same time, you must increase efficiency, reduce

operating costs, and improve stakeholder satisfaction.

Process innovations

Real-time financial close ensures accelerated closing activities through faster processes, reporting

without data latency within an heterogeneous financial consolidation landscape.

Contribution of SAP HANA

SAP HANA offers features for custom planning with dimensions and at the aggregations level for

real-time simulations. Critical-path processes and reports are accelerated in a central,

comprehensive, and real-time consolidation environment. You can achieve almost instant

response times – even with a large number of calculations for products or across companies.

An enlarged analytical footprint for enterprise profitability is also available.

Value drivers/KPIs

Service-level performance. Staff alignment. Transaction-to-analysis time

Innovation scope

SAP Business Suite on SAP HANA

(now and future)

End-to-end (E2E) solution

Engineering, construction, and operations -

financial performance management

Value potential 2

Feasibility 4

Low High

1 5

Low High

1 5