Part12 - Bi Sem

Integrated business processes with SAP ERP Script 12: Business Intelligence & Strategic Enterprise Management in SAP ERP

Prof. Dr. Heimo H. Adelsberger Dipl.-Wirt.-Inf. Pouyan Khatami Dipl.-Wirt.-Inf. Taymaz Khatami

Integrated business processes with SAP ERP

Table of contents Table of contents ........................................................................................................................ 2 Table of figures .......................................................................................................................... 3 Copyright .................................................................................................................................... 4 1 Introduction: Business Intelligence & Strategic Enterprise Management in SAP ERP .... 5 1.1 Unit objectives “Business Intelligence & Strategic Enterprise Management in SAP ERP“ 5 1.2 Scenario ....................................................................................................................... 5 2 Theory – Business Intelligence .......................................................................................... 6 2.1 Business Intelligence: Information Warehouse ........................................................... 6 2.1.1 Business Intelligence: Terminology ..................................................................... 7 2.1.1.1 InfoObject ..................................................................................................... 7 2.1.1.2 InfoCube ....................................................................................................... 8 2.1.1.3 InfoProvider .................................................................................................. 8 2.1.1.4 Operational Data Store (ODS) ...................................................................... 9 2.1.1.5 Administrator Workbench (AWB) ............................................................... 9 2.1.2 Business Intelligence: Architecture .................................................................... 10 2.2 Business Intelligence: Reporting ............................................................................... 11 2.2.1 Business Intelligence: Choose SAP BEx query ................................................ 12 2.2.2 Business Intelligence: Create query ................................................................... 13 2.2.3 Business Intelligence: Query Designer – new query ......................................... 14 2.2.4 Business Intelligence: Filtering data in the query definition.............................. 15 2.2.5 Business Intelligence – Including text elements into BEx analyzer reports ...... 16 2.2.6 Business Intelligence: Search for a query .......................................................... 17 2.2.7 Business Intelligence: Web query ...................................................................... 18 3 Theory – ERP Analytics: Strategic Enterprise Management ........................................... 19 3.1 SEM and value-based management ........................................................................... 20 3.2 SEM-BW integration ................................................................................................. 21 3.3 SEM-CPM – Corporate Performance Monitor .......................................................... 22 3.4 Strategy Management ................................................................................................ 23 3.5 Management Cockpit ................................................................................................. 25 3.5.1 Wall overview .................................................................................................... 26 3.5.2 Logical view ....................................................................................................... 26 3.6 SEM-BCS – Legal and management consolidation .................................................. 28 3.7 SAP SEM Business Planning .................................................................................... 29 3.8 Integrated enterprise planning ................................................................................... 30 3.9 Influence of stakeholder groups on companies ......................................................... 31 4 Reflections – Business Intelligence .................................................................................. 32 4.1 Questions ................................................................................................................... 32 4.2 Standard solution – Business Intelligence ................................................................. 33 5 Reflections – Strategic Enterprise Management .............................................................. 34 5.1 Questions ................................................................................................................... 34 5.2 Standard solution ....................................................................................................... 35

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Integrated business processes with SAP ERP

Table of figures Figure 1: Business Intelligence: Information Warehouse .......................................................... 7 Figure 2: Business Intelligence - InfoObjects ............................................................................ 7 Figure 3: Business Intelligence - InfoCube ................................................................................ 8 Figure 4: Business Intelligence – InfoProvider .......................................................................... 9 Figure 5: Business Intelligence - Architecture ......................................................................... 10 Figure 6: Business Intelligence - Reporting ............................................................................. 12 Figure 7: Business Intelligence: Choose SAP BEx query....................................................... 13 Figure 8: Business Intelligence: Create query.......................................................................... 14 Figure 9: Business Intelligence: Query Designer – new query ................................................ 15 Figure 10: Business Intelligence: Filtering data in the query definition .................................. 16 Figure 11: Business Intelligence – Including text elements into BEx analyzer reports ........... 17 Figure 12: Business Intelligence: Search for a query ............................................................... 18 Figure 13: Business Intelligence: Web Query.......................................................................... 18 Figure 14: Strategic Enterprise Management ........................................................................... 19 Figure 15: SEM and value-based management ........................................................................ 20 Figure 16: SEM-BW integration .............................................................................................. 21 Figure 17: SEM-CPM – Corporate Performance Monitor ....................................................... 22 Figure 18: Strategy Management ............................................................................................. 23 Figure 19: Balanced Scorecard................................................................................................. 24 Figure 20: Management Cockpit .............................................................................................. 25 Figure 21: Wall overview ......................................................................................................... 26 Figure 22: Logical view profitability ....................................................................................... 27 Figure 23: SEM-BCS – Legal and management consolidation ............................................... 28 Figure 24: SAP SEM Business Planning ................................................................................. 29 Figure 25: Integrated enterprise planning ................................................................................ 30 Figure 26: Influence of stakeholder groups on companies....................................................... 31

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Integrated business processes with SAP ERP

Copyright This document is mostly based on publications for the TERP10 course “mySAP ERP – integrated business processes“– those parts are subject to the copyright of SAP AG. All figures used within this course are created in the style of TERP10, if not labeled else wise. Those parts are subject to the copyright of SAP AG. All screenshots used within this document, even if displayed in extracts, are subject to the copyright of SAP AG. Special thanks to Dipl.-Wirt.-Inf. Taymaz Khatami for his efforts preparing this course – he managed to align the TERP10 course material with our pedagogic approach in order to allow course participants to gain a profound knowledge of complex issues, i.e. to allow for the development of competences in the area of enterprise resource planning Distribution and reproduction of this document or parts of this document in any form is prohibited without the written permission of Prof. Dr. Heimo H. Adelsberger, Dipl.-Wirt.-Inf. Pouyan Khatami, and Dipl.-Wirt.-Inf. Taymaz Khatami.

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Integrated business processes with SAP ERP

1 Introduction: Business Intelligence & Strategic Enterprise Management in SAP ERP 1.1 Unit objectives “Business Intelligence & Strategic Enterprise Management in SAP ERP“ This unit aims at giving you an understanding of the solutions Business Intelligence (BI) and Strategic Enterprise Management (SEM) in SAP. At the conclusion of this unit, you will be able to: - explain the basic principles and the architecture of SAP Business Intelligence - explain, how reporting and analysis tools in SAP Business Intelligence support different business processes - explain the components of SEM including their most important functions - explain the positioning of SEM and data usage for analyses

1.2 Scenario Note: In this unit, you will exclusively deal with theory regarding Business Intelligence and Strategic Enterprise Management. If you are interested in these topics and their application, you can enroll into the courses “Introduction in SAP BI” & “SAP BI – Advanced Business Intelligence” (this semester both courses available in German only) that deals with detailed content regarding SAP BI. To this course and the subsequent exam however, only the theoretical content of this chapter is relevant.

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Integrated business processes with SAP ERP

2 Theory – Business Intelligence 2.1 Business Intelligence: Information Warehouse SAP BW (Business Information Warehouse) is a software product of SAP AG. SAP BW is a data warehouse solution, which allows for analyzing data from operative SAP ERP applications and any other business applications. Moreover, it allows for extracting and analyzing data from external sources such as databases, online services, and the internet. The system (data storage, loading and reporting) that is preconfigured by business content for core areas and processes, assures multiple views on company-wide relationships. Introducing SAP BW aims at: - providing a data warehouse system with optimized data structures for reporting and analysis , - a separate system so that operative systems (SAP ERP) are not loaded - providing an OLAP (online analytical processing) engine and OLAP functions, - providing an encompassing data warehouse architecture, - automatically management of the data warehouse, and - pre-configuration according to global business know-how of SAP. To reach these goals, SAP AG developed a separate data warehouse solution that handles reporting operating as autonomous business components and that provides a separate server with autonomous database and SAP system. The corresponding product is called SAP Business Information Warehouse. All mentioned requirements and goals were fulfilled in the conception and architecture of SAP BW. Implementing SAP BW and its metadata repository (data description) gives the customer the enormous advantage of being able to profit from comprehensive business knowhow and the many years of experience of SAP in the area of business software solutions. SAP R/3-Systeme and SAP ERP systems can be configured as source system, providing data for the entire SAP business content. Note: In this script, we use the terms Business Intelligence and Business (Information) Warehouse synonymously. This is done according to the SAP guidelines from the SAP documents, since only their content is relevant to the exam. Business Intelligence (or after taking over the French company Business Objects also referred to as Business Objects), is the successor of Business Warehouse. Correspondingly, this is not the same product. However, both SAP products are data warehouse solutions of SAP AG.

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Integrated business processes with SAP ERP

Figure 1: Business Intelligence: Information Warehouse

2.1.1 Business Intelligence: Terminology 2.1.1.1 InfoObject InfoObjects are business-related analysis objects (companies, sales volumes, etc.) in SAP BW and they can be structured in characteristics and key figures. In turn, characteristics can be subdivided into units, time characteristics, and technical characteristics (e.g., request ID). Key figures include all data fields containing values and quantities (sales volumes, net sales, costs, etc.). Characteristics define the affiliation of key figures.

Figure 2: Business Intelligence - InfoObjects

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Integrated business processes with SAP ERP 2.1.1.2 InfoCube InfoCubes are the central data containers forming the basis for reports and analyses in SAP BW. They contain key figures (sales volumes, incoming orders, actual costs, etc.) and a link with characteristics (master data in SAP BW, such as cost centers, customers, material, etc.). Key figures and characteristics are InfoObjects. Each InfoCube should contain a separate data set since queries primarily refer to one InfoCube. Master data in the BW system consist of attributes (e.g., the person in charge of a cost center), as well as hierarchies and texts of a characteristic. An InfoCube consist of several database tables that are correspondingly related according to the star schema. This includes a fact table with the key figures of the InfoCube as well as several dimension tables containing links to the characteristics. -

each InfoCube has a fact table and a maximum of 16 dimension tables each fact table can contain a maximum of 233 key figures a dimension can contain a maximum of 248 freely available characteristics

InfoCubes are stored in structures in SAP BW. For saving InfoCubes, you can use existing folders or you can create new ones. This is quite similar to data storage on your PC. In SAP BW, these folders are called InfoAreas.

Figure 3: Business Intelligence - InfoCube

2.1.1.3 InfoProvider InfoProvider is the super-ordinate term for an object that can be used for creating reports in the Business Explorer (BEx). InfoProvider are report-relevant objects or views and contain different database meta-objects, which provide data for query definition. The type of data provision depends of the used InfoProvider; however, this does not affect reporting. InfoProvider provide data that can be analyzed using queries.

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Integrated business processes with SAP ERP There are two types of data storage. -

Physical stores include (1) BasicCubes, (2) ODS objects, and (3) InfoObjects.

-

Logical views of physical data storage include (1) InfoSets, (2) RemoteCubes, (3) VirtualInfoCubes, and (4) MultiProviders.

The following figure shows an overview of reportable objects in SAP BW. They are structured into data targets with physical data and InfoProvider, which contain only logical views. BEx are only used to access InfoProvider. Thereby, it is inconsequential for the BEx functions in which way data is modeled.

Figure 4: Business Intelligence – InfoProvider

2.1.1.4 Operational Data Store (ODS) A ODS data store is used to store data on the lowest level (document level). Usually, it is used for resolving and consolidating datasets. These datasets originate often from different data sources and/or source systems. 2.1.1.5 Administrator Workbench (AWB) The Administrator Workbench (AWB) is the workplace for SAP BW administrators. The AWB functions are used for configuration, control, and administration of SAP BW.

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Integrated business processes with SAP ERP

2.1.2 Business Intelligence: Architecture SAP BW aims at analyzing business data. Thereby, you can access operative SAP applications (SAP ERP) as well as all other business applications and external data sources such as databases, online services, and the internet. Using the AWB functions (administrator workbench), you can control, monitor, and administer all processes of data procurement. SAP BW features an online analytical processing (OLAP) engine for staging information from large amounts of operative and historical data. The OLAP technology allows for multidimensional analyses according to different business aspects. The BW server is pre-configured by business contents for core areas and processes and thus assures numerous views on company-wide relations. Business contents provide targeted information for companies, structured according to roles, helping employees to process their tasks. Along with roles, business content contains other pre-configured objects such as InfoCubes, queries, key figures, and characteristics. These objects facilitate the implementation of SAP BW. The Business Explorer (BEx) component provides you with comprehensive analysis options.

Figure 5: Business Intelligence - Architecture

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Integrated business processes with SAP ERP

2.2 Business Intelligence: Reporting The SAP BW component Business Explorer (BEx) provides flexible reporting and analyses tools to execute strategic analyses and to support decision-making processes in a company. Employees with corresponding authorization can analyze historical and current data at different detail levels considering different perspectives. BEx allows access to information in SAP BW for a wide user range. Access is carried out via the enterprise portal using an iView. iViews can be used alongside applications for data extraction via internet or intranet (web application design), or can be called up using a mobile device (such as WAP-enabled mobile telephones or PDAs). The web application design enables the implementation of generic OLAP navigation functions in web applications and in business intelligence cockpits. Thus, simple and highly individual scenarios are created. Using standard languages such as HTML you can, for example, create individual scenarios with user-defined GUI-elements. Web application design includes a wide spectrum of interactive, web-based business intelligence scenarios that can be adjusted to your requirements using standard web technology. Portal Integration contains - a single point of entry, - role-based staging of information, - personalization, - publication of iViews, and - integration of unstructured data. Query, reporting, and analysis include - query design with BEx Analyzer, - multi-dimensional analyses (OLAP), - geographical analyses, - ad-hoc-reports, and - alerts. Web application design contains - interactive analytical content, - information cockpits and dashboards, - the basis for creating analytical reports, - the creation of iViews for a portal, and - an assistant as a help-tool.

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Integrated business processes with SAP ERP

Figure 6: Business Intelligence - Reporting

2.2.1 Business Intelligence: Choose SAP BEx query Using the SAP BW reporting functions, the dataset from an InfoProvider can be evaluated according to different characteristics and key figures. To do so, you need to define a query for your selected InfoProvider in the BEx query designer. By choosing and combining InfoObjects in a query, you determine the way in which data from an InfoProvider are evaluated. There are different options to call up the query designer: - by opening the dialog box from the BEx Analyzer as separate program: Start  Programs  Business Explorer  Query Designer - using the web application designer; with Crystal Reports (Crystal Reports 8.5 or newer release, including CR add-ons for SAP) When using the open dialog box, you need to do the following: When accessing the query designer via BEx Analyzer, the dialog box SAP BEx: choose query appears first. This dialog box is context sensitive, i.e., different options are displayed, depending on the object type you choose. Object type: dialog box available: - workbooks: history, favorites, roles, - queries: history, favorites, roles, InfoAreas, - stored query views: history, favorites, roles, InfoAreas, and - exceptions: history, InfoAreas In the respective dialog box, you can create new queries or you can search and select existing queries. Subsequently, you can modify or execute queries.

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Integrated business processes with SAP ERP

Figure 7: Business Intelligence: Choose SAP BEx query

2.2.2 Business Intelligence: Create query To define a new query, start the query designer and choose the option new query. Subsequently, the required InfoProvider is chosen from the dialog box new query: InfoProvider. The SAP BW system displays subsequently the screen shown in the figure. The query designer is structured into six subareas: 1. Directory tree of the selected InfoProvider – After selecting the required InfoProvider, all available objects (dimensions, key figures, and structures) are displayed in the directory tree on the left hand side of the query designer. In the example shown below, you can see the directory tree for the InfoProvider InfoCube Customer Cube T_SDDEMO2. 2. Columns – In this area, columns concerning the report to be generated are created. 3. Rows – In these areas, the rows for the report to be generated are created. 4. Free characteristics – The characteristics that are not displayed in the initial view of the results when executing the query in the BEx analyzer or on the web are transferred to the free characteristics area. Subsequently, these characteristics can be integrated into the results over several navigation steps. The free characteristics are used to select filter values in the report. 5. Filter – The characteristics in this subarea are displayed neither in the drilldown nor as free characteristics in the query analysis. These characteristics are merely used as global filter for the InfoCube data. You have the option to use a key figure as filter (also in combination with characteristics). 6. Preview (highlighted grey in the following figure) – In this area, a preview of the query results is displayed. To create a query, the InfoProvider directories can be expanded or collapsed using the plus or minus symbols. By expanding, for example, the node “key figures”, you branch into the list of all key figures in the InfoProvider.

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Integrated business processes with SAP ERP

Figure 8: Business Intelligence: Create query

2.2.3 Business Intelligence: Query Designer – new query Using drag & drop the selected objects must subsequently be dragged of the InfoProvider to the relevant subarea (e.g. rows, columns, or free characteristics) on the right hand area of the screen.

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Integrated business processes with SAP ERP

Figure 9: Business Intelligence: Query Designer – new query

2.2.4 Business Intelligence: Filtering data in the query definition The following figure shows the selection screen for the material characteristics. Quite often, you have to filter characteristics according to particular values in a report. For example, if you are interested in the sales volume of a particular division of a global group, but the InfoProvider contains only the sales volumes for the entire company, you can limit the query definition to a particular division. Thus, the report contains only the key figures for the desired division. Characteristic values of a characteristic can be filtered according to rows, columns, user-defined characteristics, and filters by the QueryDesigner. There are two options to limit characteristics: 1. A characteristic is selected from the InfoProvider (the tree structure on the left hand side). Subsequently, you call up the selection menu for fixed values by doubleclicking values. You can select individual values or value ranges. The selected fixed values are displayed in the directory under values. You can add them to a query definition by drag & drop. 2. Characteristics that were already included into the definition can also be limited. To do so, call up the context menu and choose restrict. Thus, you see the dialog screen selection for. On the left screen area, all characteristic values available for the selected characteristic are displayed. The right screen area contains the characteristic values that can be used for filtering the characteristic. You select a characteristic value on the left screen by highlighting it. You can select one or several characteristic values. Using the entry field on the bottom left screen area, you can enter the description or the technical name to find particular characteristic values. The found values are then automatically selected. After that, use drag & drop to copy the values to the right area of the screen. You can also use the arrow to do so. To remove the restriction, execute the described procedure the other way around.

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Integrated business processes with SAP ERP

Figure 10: Business Intelligence: Filtering data in the query definition

2.2.5 Business Intelligence: Including text elements into BEx analyzer reports The SAP BW system allows you to include different text elements with additional information in a query (e.g., author, date of last change, InfoProvider, etc.). These text elements are also referred to as header data of the query. To display text elements, choose Layout and then display text elements. You can either display all or individual text elements (general, filter, variables). The text elements are displayed between the filter cells and the results area. Using the menu functions in Microsoft Excel, you can move or delete corresponding cells to move or delete text elements. Explanation of text elements: - Author: user who defined the query. - Last changed: user who last changed the query definition. Navigation steps are not displayed as changed to the definition. . - InfoProvider: InfoProvider whose data is evaluated in the query. - Query, technical name: the technical name that was entered when the query was saved. - Key date: the date for which the time-dependent master data is selected. The key date is either determined in the query definition (under query properties) or can be entered by the value of a variable. If no key date is set, the system date is used instead. - Changed at: date and time of the last change to the query definition. - Status of data: time at which the data from the last request was copied to the InfoProvider. This can be evaluated in reporting. Note: For MultiProviders, current InfoPackages are determined from individual BasicCubes. Thereby, the one with the oldest date is referred to the status of the data. - Current user: the user that currently opened the query or who inserted it into a workbook. - Last refreshed: date and time of the last update of query data. This update is carried out when displaying text elements (the system must update queried to be able to display text elements). page 16 Copyright Prof. Dr. Heimo H. Adelsberger/Dipl.-Wirt.-Inf. Pouyan Khatami/ Dipl.-Wirt.-Inf. Taymaz Khatami

Integrated business processes with SAP ERP -

Depending on the current query definition, these text elements (variables, filter values, and exceptions) can be displayed additionally.

Figure 11: Business Intelligence – Including text elements into BEx analyzer reports

2.2.6 Business Intelligence: Search for a query Looking for a query for which you know a part of the description or other information can be carried out using the find function. On the search for queries screen, you have to enter the technical name or the description of the query. If required, you can limit your search according to additional criteria. After that, choose find. When working with the BEx Analyzer and after calling up the dialog box choose query, you receive the result in form of an analyzer report. When using the search function in the query designer, the query definition is displayed.

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Integrated business processes with SAP ERP

Figure 12: Business Intelligence: Search for a query

2.2.7 Business Intelligence: Web query To publish a query on the web, you have to save it and then choose query on the web. The query is displayed in a standard web template. If required, the standard template can be modified.

Figure 13: Business Intelligence: Web Query

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Integrated business processes with SAP ERP

3 Theory – Management

ERP

Analytics:

Strategic

Enterprise

Strategic management including the balances scorecard is an instrument to convert business strategies into comprehendible, meaningful goals. Individual targets are assigned to a perspective or view. The standard scorecard contains 4 views: - financial, - customer, - internal processes, and - learning & growth. Performance measurement and other created visual information units allow the management to grasp complex situations at a glance and to decide more quickly. The management cockpit in its traditional form features 4 walls, one for each view of a company. Business consolidations take care of settling interdependent accounting entries and allows for integration planned and operating results with consolidation of investments. Business Planning (BPS) allows for an integrative operative and strategic planning on application level using data from a specified InfoCube for each planning area. Stakeholder Relationship Management (SRM) allows for data management and documentation of different business partners and for the option to execute corresponding queries. Business Document Service (BDS) represents general and easy to integrate document management functionalities for different SAP applications.

Figure 14: Strategic Enterprise Management

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Integrated business processes with SAP ERP

3.1 SEM and value-based management Focusing on the company value, you have to ensure that this value is measurable, since only if the company value is measurable, the success of a strategy can be determined. Organizations are often valuated by the capital market. Thus, it is not obvious for the management, which business areas contribute to generating corporate value and which business areas destroy value. This information is however required when you want to get the maximum return out of resources. Only when this information is available, you can perform the required measures to invest capital wisely with a maximum return (creation of value). The key to this level of transparency and to managing a company or business area is value based management and with this, in the principles to recognize relationships between key value drivers and measures of operational business performance. The following figure shows the key value drivers according Alfred Rappaport: - sales growth - operative margin - cash tax rate - working capital investment - fixed capital investment - competitive advantage period

Figure 15: SEM and value-based management

The decisions of the management regarding operative business, investment, and financials, directly affect the 7 key value drivers. In turn, these drivers influence the corporate value. These procedures use the key figures Shareholder Value Added (SVA) and Discounted Cash Flow (DCF) to determine the company value. The benefit of this is that they consider future cash flow generation at multiple levels of business (e.g., individual business areas, Entire Corporation, etc.). Analyzing likely cash flows can allow for determining strategies that page 20 Copyright Prof. Dr. Heimo H. Adelsberger/Dipl.-Wirt.-Inf. Pouyan Khatami/ Dipl.-Wirt.-Inf. Taymaz Khatami

Integrated business processes with SAP ERP generate and acceptable rate of return and thus provide additional value to shareholders. This valuation method is also useful because it is increasingly used by financial markets as important method to determine future value potentials of a company.

3.2 SEM-BW integration The following figure represents the link of the SEM component with the BW. Please note that all components use the same data base. Thus, data consistency and data actuality are ensured, regardless of the location from which data are accessed. For example, managers often access balanced scorecards for their monthly reports since the balanced scorecard focuses only of the most important key figures. Subsequently, you can navigate to the BW database to further evaluate data in more detail. After that, a manager can decide to perform a rolling forecast or to enter new data in the BW. Both tasks can be carried out with the link from the balanced scorecard to the BPS. In the BPS, you can execute forecasts or enter new data. After saving, the data are immediately available for reports in the balanced scorecard. This procedure is subject to the buffering policy. Another example of the link of the components is that the stakeholder can call up important reporting information or balanced scorecards or from the cockpit using a special web tool and SRM. You can also use the system to return data to SAP ERP, e.g., planning data of the BPS. Alternatively, data can be transferred from BPS to BCS to consolidate the plan and to return it to the BW. This integration between the SEM components and the BW and other SAP tools via the BW (Portals, ERP, APO, CRM etc.) is a major benefit of SEM.

Figure 16: SEM-BW integration

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Integrated business processes with SAP ERP

3.3 SEM-CPM – Corporate Performance Monitor The InfoCubes in the SEM database are part of OLAP structures of the SAP Business Information Warehouse. This can be the SEM system instance itself, or a remote SAP BW that stores additional data in the SEM database. The Balanced Scorecard is a management tool for modeling and applying strategies. Applying strategies can be measured by linking them to the corresponding Key Performance Indicators (KPIs). Risk Management is the representation and valuation of strategic risks in the context of the scorecard function. Value Driver Trees allow for the visualization and simulation of value creation relationships, independent of strategy. The Management Cockpit is an ergonomic concept for the representation of Key Performance Indicators (KPI). The Measure Builder is a tool for creating a central key figure database containing standardized business descriptions of key figures. You are already familiar with the Business Explorer. The Business Explorer allows for a multi-dimensional analysis of BEx reports and can be linked with SEM-CPM so that it can be used from there directly.

Figure 17: SEM-CPM – Corporate Performance Monitor

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Integrated business processes with SAP ERP

3.4 Strategy Management The Balanced Scorecard is a tool to transfer business strategies into understandable, communicable, and meaningful goals. It is a collection of financial and non-financial aspects of the business. The individual objectives are assigned to perspectives, e.g., financials, customer, internal business processes, and learning and growth. The Balanced Scorecard contains the four mentioned perspectives: - financials: strategy for growth and profitability from a shareholder point of view - customer: strategy for creating value and differentiation from a customer point of view - internal business processes: priorities for excellent performance in different business processes to increase customer and shareholder satisfaction - learning and growth: measures to generate a climate supporting changes, innovation, and growth within a company

Figure 18: Strategy Management

The four described views represent the standard perspectives of the balanced scorecard. These perspectives are presented in the context of their main focus. Each perspective contains strategic goals with assigned activities and strategic initiatives.

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Integrated business processes with SAP ERP

Figure 19: Balanced Scorecard

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Integrated business processes with SAP ERP

3.5 Management Cockpit The visual information units of the management cockpit allow the management to understand complex situations at a glance. Thus, management decision processes are facilitated and accelerated. In correspondence to the classic balanced scorecard concept, the management cockpit room features four walls: - the black wall contains financial key figures and critical success factors - the red wall contains markets, customers, and competitors - the blue wall shows internal processes - the white wall is used to monitor strategic processes The virtual management cockpit room in SAP-CPM can contain up to nine walls. Each wall reflects predefined goals for the area and key figures to measure them. The key figures can be combined freely from accounting, logistics, or human resources data. The management cockpit in SEM-CPM uses many different informative graphics. These graphics provide an easy navigation and a well thought out structure for displaying visual information. The management cockpit in SEM-CPM is entirely compatible with leading web browsers and can thus be called up from the web.

Figure 20: Management Cockpit

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Integrated business processes with SAP ERP

3.5.1 Wall overview The wall element is subordinate to the cockpit element. A presentation can contain up to nine wall elements and summarizes data in a particular manner. By clicking a wall, a logical view, or a frame you can open a new screen displaying the presentation object. In case of the logical view, a window is displayed containing the selected view with the corresponding frames. The current data are obtained at the time of presentation from the data source (BW system, query, cube, key figure) determined for each frame when the cockpit was created.

Figure 21: Wall overview

3.5.2 Logical view The logical view element is subordinate to the wall element. A wall element consists of up to six logical views. Logical views are used to summarize information in a particular manner. A logical view is created to focus on an area presented in a wall in more detail, for example, internal view. Simultaneously, a logical view can be used to define general business factors (e.g., product quality) resulting from several key figures (e.g., scrap rate, sales returns, guarantees). The following figure shows possible logical views for profitability.

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Figure 22: Logical view profitability

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3.6 SEM-BCS – Legal and management consolidation The smallest unit used as basis of consolidation in a corporate structure is the consolidation unit. In the consolidation tool in SAP ERP (EC-CS), the unit for management reporting is a combination of companies and profit centers or business areas. The consolidation unit of legal consolidation is the company. The two units are structured into different views. Accordingly, subsidiaries receive two data records: one for the legal unit and one for the management entity. In each period, adjustments must be made between the two views accordingly. With consolidation on the basis of BW, you have the matrix consolidation option. Thus means that two consolidation units can be processed in one data record. To use two entities as consolidation units, two InfoObjects must be assigned to the consolidation unit role in the BCS database. In thus business scenario, the subsidiaries are obliged to unify values before data is transferred to SEM-BCS. Each data record in the entire consolidation process contains two consolidation units. You have also the option to retain the dual accounting approach, i.e., to process legal and management entities in two records. This would be the same architecture as in the ECC-based EC-CS. Thus, it is up to you with which architecture you set up your SEM-BCS.

Figure 23: SEM-BCS – Legal and management consolidation

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3.7 SAP SEM Business Planning The intention is not to replace other SAP planning systems with SEM business planning. SEM is merely an addition with special tools, such as planning in the operational area of the SAP system. SEM could for example be used in a supply chain for modeling strategy and measuring the overall success of a sales and production plan regarding increased customer satisfaction, increased shareholder value, reduced inventories, increased efficiency of cycle times, and maximized return on assets. Detailed planning can be processed with special systems such as APO/CRM that are rather oriented at customers and vendors. Another example is CO-PC (product costing) in the SAP ERP system. From a SEM point of view, decisions could be of interest in higher-level strategic dimensions as well. For example, barriers to product marketing or which plant in which country produced the product cost and time efficient could be of special interest. You might be interested in an overall summary of product costing information, but you would expect that SAP CO-PC provides detail aggregation since CO-PC has the transaction data and the required functions. This does not exclude the option that you can also execute operative planning in SEM if desired. You can carry out budgeting for cost centers in SEM and subsequently retract data for further processing into the operative area of the SAP system.

Figure 24: SAP SEM Business Planning

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Integrated business processes with SAP ERP

3.8 Integrated enterprise planning The following figure shows an integration scenario in enterprise planning. Starting from market analysis and market simulation, you can set targets in the SEM system for sales planning. In the APO system (Advanced Planner and Optimizer), the sales targets are transferred to the sales plans and aligned with the entire supply chain. The results of the logistics components are then in turn considered in profitability planning in SEM.

Figure 25: Integrated enterprise planning

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3.9 Influence of stakeholder groups on companies Globalization is a double-edged sword by offering benefits but also by challenging your company and the management in a new way. Each company today must satisfy its stakeholders; otherwise, management can find itself in trouble quite rapidly. Institutional investors have a relatively great influence and do not hesitate to use it to replace management teams that do not meet their requirements. Also other stakeholder groups such as business partners, customers, employees and communities are more demanding. Considering that a bad reputation on the employee market, the customer market, or, more generally, in the community can significantly decrease a company’s ability to carry out proper business operations, the management needs to consider the stakeholders expectations when making major business decisions. Therefore, in the last couple of years changes to the best practice techniques of enterprise management occurred. Instead of managing a company inside-out, which is based on the assumption that proper product development and efficient production and efficient customer service are the basis of a company’s success, today’s approach of successful management is rather oriented at a real understanding of stakeholder expectations and the ability to outperform it. Hence resulting, the principle of enterprise management shifts from inside-out to outside-in.

Figure 26: Influence of stakeholder groups on companies

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4 Reflections – Business Intelligence 4.1 Questions 1.

Fill in the blank to complete the sentence

Business analysis objects (product line, net sales, sales volumes, and so on) are called __________ in SAP BW.

2.

Fill in the blank to complete the sentence

The central data containers that form the basis for reports and analyses in SAP BE are called _________.

3.

Fill in the blank to complete the sentence

_________ is the super-ordinate term for an object that you can use to create reports in Business Explorer (BEx).

4.

Determine whether this statement is true or false.

The query designer is divided into six subareas.

5.

Determine whether this statement is true or false.

There are four ways of restricting characteristics.

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Integrated business processes with SAP ERP

4.2 Standard solution – Business Intelligence 1.

Fill in the blank to complete the sentence

Business analysis objects (product line, net sales, sales volumes, and so on) are called InfoObjects in SAP BW. These InfoObjects can be divided into characteristics and key figures. Characteristics can be further divided into units, time characteristics, and technical characteristics.

2.

Fill in the blank to complete the sentence

The central data containers that form the basis for reports and analyses in SAP BE are called InfoCubes. They contain key figures (sales volumes, incoming orders, actual costs, and so on) and a link to the characteristics (master data of the SAP BW system such as cost centers, customers, materials, and so on).

3.

Fill in the blank to complete the sentence

InfoProvider is the super-ordinate term for an object that you can use to create reports in Business Explorer (BEx). InfoProvider are objects or views that are relevant to reporting.

4.

Determine whether this statement is true or false.

The query designer is divided into six subareas. True: 1. 2. 3. 4. 5. 6.

5.

Directory tree of the selected InfoProvider Columns Rows Free Characteristics Filter Preview

Determine whether this statement is true or false.

There are four ways of restricting characteristics. False! There are two ways of restricting characteristics. - By selecting a characteristic from the InfoProvider - You can also restrict a characteristic that you have already included in the definition. page 33 Copyright Prof. Dr. Heimo H. Adelsberger/Dipl.-Wirt.-Inf. Pouyan Khatami/ Dipl.-Wirt.-Inf. Taymaz Khatami

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5 Reflections – Strategic Enterprise Management 5.1 Questions 1. Name the five components of SEM. ___________________________________ ___________________________________ ___________________________________ ___________________________________ ___________________________________

2.

Determine whether this statement is true or false

The underlying data used by SEM is stored in the main OLTP system. ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________

3. List the four perspectives if the Balanced Scorecard. ___________________________________ ___________________________________ ___________________________________ ___________________________________

4.

Determine whether this statement is true or false.

The management cockpit is used in strategy management. ________________________________________________________________________

5. List the components of the management cockpit. ___________________________________ ___________________________________ ___________________________________ ___________________________________

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Integrated business processes with SAP ERP

5.2 Standard solution 1. -

2.

Name the five components of SEM. BPS (Business Planning and Simulation), BCS (Business-Consolidations), SRM (Stakeholder Relationship Management) SM (Strategy Management) and PM (Performance Measurement).

Determine whether this statement is true or false.

The underlying data used by SEM is stored in the main OLTP system. False, it is stored in BI.

3.

List the four perspectives if the Balanced Scorecard.

Financial, Customer, Internal Business Process, and Learning and Growth.

4.

Determine whether this statement is true or false.

The management cockpit is used in strategy management False, the management cockpit is used in performance measurement. The Balanced Scorecard is a component of strategy management.

5. List the components of the management cockpit. The cockpit is made up of up to 9 walls, which in turn could each have up to six logical views to represent some contention that needs to be supported, and each view in turn could have up to six configurable frames representing the data or “answer” to the contention.

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