SAP Enterprise Support

Maximize Business Process Efficiency While Minimizing Process Costs

Rely on SAP Enterprise Support for Business Process Analysis, Monitoring, and Improvement

Maximize Business Process Efficiency While Minimizing Process Costs

Table of Contents
4 Overcoming the Challenges of Business
Process Improvement Lack of Global Transparency Costly, Inefficient Processes Ineffective Document Processing System Clutter

Examples of Potential Business Process Improvements Order to Cash Archiving Sales Orders E-Commerce

5 How Does SAP Help You Meet These Challenges?

Initial Evaluation Business Process Improvement Methodology

10

Value-Added Services from SAP Active Global Support

11 Conclusion
For More Information

Benefits You Can Expect Global Transparency Greater Process Efficiency Increased Process Effectiveness Clean System Thats in Sync with Your Business

Focus on Transparency, Automation, and a Clean System

Overcoming the Challenges of Business Process Improvement

Faced with todays economic crisis, companies are striving to enhance the performance of their core business processes. The continuous quality check service of SAP Enterprise Support services can help by enabling you to analyze, monitor, and improve the core processes supported by your SAP software. The result? Maximized business process efficiency and a higher return on your software investment.
Improving the performance of your organizations core business processes can deliver a wealth of benefits including greater operational efficiency, reduced cost, and increased profitability. But challenges exist. To enable real business performance improvement, you must optimize the software that supports those processes, strengthen the relationship between business and IT, and address the following issues. Challenges of Business Process Improvement Challenges Lack of global transparency Goals Increase process standardization enterprise-wide Reduce process diversification Ensure compliance with process template Automate business processes Reduce inefficiencies and human errors associated with manual processes Avoid systematic process exceptions Increase customer satisfaction by eliminating delays in processing documents related to deliveries or shipments Avoid financial losses due to delayed invoices or payments Continually update the status of business documents in your SAP software Close all documents within your system that are closed from a business perspective

Lack of Global Transparency All of a companys operational units do not necessarily adhere to the same standardized template for each core business process. As a result, the execution of each process can differ across the global organization. Only by gaining transparency across all business units can you increase process compliance and standardization. Costly, Inefficient Processes Nonproficient system resources and inefficient processes can increase the cost of doing business. They can also trigger systematic issues like user-handling, configuration, and master data errors that can further increase process costs if not detected in a timely manner. To minimize process costs, you must automate business processes, reduce manual process inefficiencies and human errors, and avoid systematic process exceptions. Ineffective Document Processing The delayed processing of sales orders, delivery documents, invoices, or payments can lead to a decrease in customer satisfaction and a delay or even loss of revenue. Such business drawbacks can also occur if the proposed delivery dates are too ambitious, the documents are incomplete, or the system fails to generate an invoice for services or goods already delivered. To strengthen customer loyalty and optimize revenue, you must process such documents in an accurate and timely fashion. System Clutter Failure to update the status of business documents in the system can lead to inaccurate planning results and business reporting. For example, if production orders remain open in the system, the corresponding reservations, capacity requirements, and purchase requisitions are not deleted and the orders are still relevant for material requirements planning. These open documents clutter mission-critical systems and can lead to inaccurate planning results. Documents closed from a business perspective should also be closed in the system. The elimination of these closed documents also reduces database volume.

High process costs

Ineffective document processing

System clutter

Rely on the Continuous Quality Check Service of SAP Enterprise Support

How Does SAP Help You Meet These Challenges?

SAP Enterprise Support offers a continuous quality check (CQC) service for business process analysis, monitoring, and improvement. The CQC service can identify potential improvements in your core business processes and the SAP software that supports them specifically, the SAP ERP , SAP Customer Relationship Management (SAP CRM), and SAP Supplier Relationship Management (SAP SRM) applications. During this service, you will get to know the tools that support proven SAP methodology for business process improvement. Initial Evaluation As a first step, experts from the SAP Active Global Support (SAP AGS) organization conduct an initial analysis of the business processes supported by your SAP ERP, SAP CRM, or SAP SRM application. This helps you identify different problem areas such as inactive or out-of-date documents, process design gaps (for example, configuration errors or missed closing steps in business documents), standardization issues, or the lack of business-user training. Based on the results of this analysis, you can select the specific processes such as order to cash

or procure to pay that demonstrate the greatest potential for improvement. With the preliminary analysis, you can already see not only the potential for improvement but also the significance of SAPs business process improvement methodology an issue-oriented approach to measure process performance. Business Process Improvement Methodology Next, SAP AGS applies proven SAP methodology for business process improvement to maximize your software ROI and process efficiency (see Figure 1). This methodology consists of the following five steps. Step One Define During this step, you select key performance indicators (KPIs) that support your chosen processes. We provide an extensive set of problem-oriented KPIs that are ready to use. The KPIs should be chosen based on business impact, probable benefit, estimated savings, and potential improvement in subprocess lead times. During this step, you also identify the first department or unit for the initiative, gather requirements, and define target values.

Figure 1: SAP Methodology for Business Process Improvement

Control and sustain results

Define small number of key performance indicators (KPIs) with process owners (3-5 per process)

Implement measures with process owners, IT, and key users

Business process analysis

Measure KPIs and review data with process owners and key users

Perform Root Cause Analysis with process owners, IT, and key users

Maximize Business Process Efficiency While Minimizing Process Costs

Step Two Measure Step two focuses on measuring the respective KPIs and reviewing the results with process owners and key business users. The measurements are drawn using the business process monitoring and analytics functionality in the SAP Solution Manager application management solution. During this step, it is essential to incorporate the feedback of business process owners as well as IT colleagues in order to find the system setup fitting your specific needs. Step Three Analyze In step three, your business and IT stakeholders analyze the different root causes for deviations and exceptions from expected business process performance determining, for example, what led to a high backlog. Using the detailed analysis functionality of SAP Solution Manager, we can provide a comprehensive list of all documents in backlog, along with the ability to jump directly into an affected business document for detailed root cause analysis. Step Four Implement This step includes the actual change and adaptation of the business process based on the implementation of countermeasures to correct the underlying issues. Working closely

with SAP experts, your project team defines and executes actions to reinstall or adjust business process designs. For each root cause identified, one or more action items must be created, including the assignment of deadlines and responsibilities. Step Five Control The final step focuses on controlling and sustaining results such as reduced document backlog using the trend analysis functionality of SAP Solution Manager (see Figure 2). Additionally, the team sets up monitoring and alerting functionality for the respective business process to stabilize the new level of process performance and improve process efficiency and effectiveness. This is managed by defining thresholds and alerting the appropriately identified business person(s) in case of critical deviations. In addition, business process operations (BPO) dashboards can provide an overview of a specific business topic (such as a business process) or business area. All information needed by the executive user is available at a glance on a single screen. BPO dashboards can be used as a management tool to quickly gain insight into selected KPIs. The setup of BPO dashboards is part of the expert-guided implementation service for business process improvement available from SAP AGS.

Figure 2: Reduction in Document Backlog for Plant 2

Trend analysis 1500 Orders in phase released
Plant 1

1250 1000 750 500 250

Plant 2

10

11

12

01

02

03

04

05

Day, Month

Improve Your Business Processes and ROI in SAP Software

Benefits You Can Expect

To improve business performance, process-driven companies like yours must maximize process efficiency and minimize process costs. That means your core business processes along with the systems that support them should be stabilized and improved continuously to optimize the return on your initial investment. By relying on SAP Enterprise Support to analyze, monitor, and improve your key business processes and related software via the CQC service, you can achieve these objectives and enable real performance improvements Global Transparency The CQC service includes internal benchmarking that reveals how business units throughout your enterprise handle business processes. This benchmarking makes it fairly simple and fast to identify the best organizational units to serve as role models in rolling out best practices. Additionally, the CQC service provides out-of-the-box KPIs that significantly reduce

the high manual effort normally required to gather the same information. Consider the impact of these KPIs in finance. All finance departments must identify open items for major accounts before period-end closing. The predefined KPIs automate the analysis of open items and let your finance teams see immediately which accounts and which legal entities are affected. Greater Process Efficiency Through the CQC service, you can increase process efficiency by identifying process steps that are currently wasting valuable resources, like system resources. For example, too many old yet still open production orders have a negative impact on processing time during period-end closing. Thats because they will still be considered for calculations that are no longer relevant, such as work in progress, overhead costs, reservation planning, and capacity planning.

Benefits of Business Process Improvement using SAP Enterprise Support Benefits Global transparency Examples Automate analysis of open items in finance (accounts payable, accounts receivable, general ledger) across all legal entities to reduce manual efforts Identify incomplete sales documents in all respective business units to avoid delays in the sales and distribution process Identify old yet still open production orders that can negatively impact processing time and delay period-end closing Eliminate manual steps and automate the execution of complete, accurate business processes, avoiding a high postprocessing workload and increased selling, general, and administrative costs Improve revenue stream by eliminating invoice delays and generating accurate invoices for all deliveries and orders Increase customer satisfaction by confirming desired deliver dates with sales schedules Minimize credit memos due to price corrections Eliminate old yet still open planned orders and purchase orders that lead to inaccurate supply chain planning Reduce database size and cost

Greater process efficiency

Increased process effectiveness

Clean system

Maximize Business Process Efficiency While Minimizing Process Costs

Optimize the Performance of Core Business Processes

The service can also help optimize a second valuable resource working time of employees. By automating manual process steps, the service helps free up time that employees can use for value-added activities. And by enabling the execution of complete business processes that do not deviate from the standard template, the service helps eliminate high manual workload in postprocessing and decrease selling, general, and administrative costs. Increased Process Effectiveness By maximizing the effectiveness of your business processes, the CQC service can help increase customer satisfaction. For example, the success of your business depends on your ability to deliver the right goods to your customers on time. The CQC service can help ensure that your system processes all sales orders and outbound deliveries in an accurate and timely fashion to strengthen customer loyalty and minimize returns. The service can also help increase your revenue stream and minimize credit memos by enabling your system to generate the proper invoice without delay for all sales orders and deliveries.

Clean System Thats in Sync with Your Business To achieve correct planning results and accurate business reporting, it is crucial to have a clean system meaning that the system reflects business reality. For example, old yet still open planning orders or purchase orders need to be closed properly to ensure the accuracy of supply chain planning. The CQC service helps ensure that all documents closed from a business perspective are also closed in your system. In addition to enabling more accurate planning and reporting, this also reduces the size and cost of your database.

During the recently performed continuous quality check business process analysis and monitoring service, potential for business process improvement has been identified. During a workshop, the results were presented. However, we werent left alone with them. SAP showed us how to work with their tools in a structured way bringing business and IT together to solve the issues that occurred in the past in a sustainable way.
Freddy Berghmans, Manager of Competence Center Applications, Fabory Group B.V.

Optimize the Performance of Core Business Processes

Examples of Potential Business Process Improvements

Through the CQC service, you can identify potential improvements in the core business processes supported by your SAP ERP, SAP CRM, or SAP SRM application. Order to Cash By setting up analytics for a KPI such as overdue deliveries, the CQC service lets you identify the number of outstanding deliveries overdue for each shipping point, determine their root causes, and accelerate the order-to-cash process. The service further improves the order-to-cash process by providing visibility into the root causes of credit memos. Archiving By providing visibility into which documents are incomplete, open, or out-of-date, the CQC service enables you to archive more effectively reducing database size and increasing system performance. You can capture core statistics on open business data and drill down into individual documents for root cause analysis and processing.

Sales Orders You can identify KPIs for incomplete sales orders, orders on delivery block, orders on credit block, and outbound deliveries overdue. Easy-to-interpret dashboards can then reveal how seasonal peaks affect trends in backlog and throughput for each KPI so you can take immediate action. E-Commerce If e-commerce orders are not processed promptly, it can have a negative impact on credit card authorizations. Through the CQC service, you can automatically generate e-mail notifications when e-commerce orders are not processed within a certain time period.

Maximize Business Process Efficiency While Minimizing Process Costs

Expert-Guided Implementation Services

Value-Added Services from SAP Active Global Support

With a valid SAP Enterprise Support agreement, you also have access to expert-guided implementation services from SAP Active Global Support. These services offer direct guidance from SAP experts in implementing best practices for projects involving SAP Solution Manager. Combining classroom training, practical experience, and expertise on demand, the services focus on the following areas:

Expert-guided implementation Business process monitoring Expert-guided implementation Stabilization (with a focus on monitoring) Expert-guided implementation Business process improvement (with a focus on analytics) For more information on expert-guided implementation services from SAP AGS, visit www.sap.com/services/education /catalog/solutionmanager.epx.

The CQC service applies proven business process improvement methodology from SAP enabling you to increase business process efficiency, minimize process costs, and realize tangible performance improvements.

Ramp Up Process Efficiency and Increase Your ROI in SAP Software

Conclusion

Improving core business processes while lowering the total cost of ownership in the software that drives them is a common goal for IT and business professionals alike. By relying on the CQC service of SAP Enterprise Support to analyze, monitor, and improve your key business processes and related software, you can achieve this goal. The CQC service applies proven business process improvement methodology from SAP enabling you to increase business process efficiency, minimize process costs, and realize tangible performance improvements. Flexible in design, the service even supports industry-specific business processes.

For More Information To learn more about the CQC service for business process analysis, monitoring, and improvement or about other SAP solutions for business process management visit the SAP Service Marketplace extranet at www.service.sap.com/bpm.

The continuous quality check service from SAP Enterprise Support can unlock potential improvements in your core business processes and the SAP software that supports them specifically, the SAP ERP, SAP CRM, and SAP SRM applications.

Maximize Business Process Efficiency While Minimizing Process Costs

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