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"The SAP BusinessObjects Supply Chain Performance Management application
helps you measurably improve the effectiveness of supply chain operations and better deliver on
corporate mandates, such as lowering costs and improving return on working capital."
Source: SAP
Improving Supply Chain Effectiveness
Supply Chain Performance Management Application is also known as :
Supply Chain,
SCM,
Supply Chain Best Practices,
Effective Supply Chain Management,
Supply Chain Network,
Supply Chain Metrics,
Evolving Supply Chain Needs,
Improving Supply Chain Effectiveness,
Impact of Supply Chain,
Overall Supply Chain Cost,
Supply Chain Goals,
Supply Chain Processes,
Enhancing Supply Chain Performance,
Reducing Total Supply Chain Cost,
Optimize Supply Chain Effectiveness,
Performance Measures for Supply Chain Management,
SAP Businessobjectst Supply Chain,
IT-Heavy Supply Chain Networks,
Supply Chain Operations Reference Model,
Scor Model,
Strategy-aligned Supply Chain Execution,
Measure Supply Chain Performance,
Basic Supply Chain Information,
Supply Planning,
Supply Chain Strategy,
Supply Chain Practitioners,
Supply Chain Managers.
The SAP® BusinessObjectsTM
Supply Chain Performance
Management application
helps companies make
their supply chains more effective
and responsive in the
face of complex and fast changing
market conditions.
By focusing on the right process
metrics, companies can
track performance, diagnose
bottlenecks, and uncover opportunities.
This way, companies
can take informed action
towards improved supply
chain performance. Enhanced
supply chain performance will
in turn improve financial performance
by reducing costs,
increasing working capital,
and strengthening customer
loyalty.
CONTENT
Actively managing the performance of
your supply chain has never been more
important. Increased globalization, volatility
in demand and commodity costs,
regulatory requirements, and greater
dependency on suppliers and other
partners have significantly increased
the risk of doing business. Knowing
your inventory positions, delivery
dates, and fill rates is not enough. You
must also understand the impact of
supply chain changes on total cost or
cash flow and optimize supply chain
effectiveness for better corporate
results. This requires end-to-end visibility
into factors that drive performance -
such as cash-to-cash cycle time, overall
supply chain cost, or the quality of
your order fulfillment.
There is no shortage of data for this
purpose. However, much of this critical
information may be buried within your
enterprise systems and dispersed
across multiple documents, system
records, and databases. You may not
even know what data you need to make
crucial decisions. Your supply chain
metrics may also lack formal definitions
and standards common in finance and
other areas of your business. In addition,
it's likely that neither your business
managers nor your IT department
has the time to create the modern and
flexible information architecture your
enterprise requires to address its
evolving supply chain needs.
The SAP® BusinessObjectsTM Supply
Chain Performance Management application
helps you measurably improve
the effectiveness of supply chain operations
and better deliver on corporate
mandates such as lowering costs and
improving return on working capital. In
addition to providing a more accurate
measure of whether you are meeting
your supply chain goals, the application
can warn you of potential bottlenecks
and identify new opportunities. Functions
for root-cause diagnostics let you
take measured responses where
needed.
As a packaged application, SAP
BusinessObjects Supply Chain Performance
Management can significantly
reduce the complexities, cost, and risk
associated with deploying this type of
solution. Relying on best-in-class technology,
embedded data-integration
functionality, a calculation engine, and
an intuitive user experience, the application
has been purpose built, preconfigured,
and preintegrated to work
effectively. Built from a business perspective,
the application contains data
models and metadata based on leading
industry standards. It can automate
data collection wherever it is available
and proactively diagnose a given situation.
This means faster time to value at
a significantly reduced price point and
lower risk versus custom-built
applications.
Today, you may design, manufacture,
ship, or sell products almost anywhere
in the world. At the same time, you
may deal with a complex network of
business partners including suppliers,
manufacturers, and logistics services
providers. To succeed, you require
actionable and timely insights into your
entire supply chain performance across
end-to-end business processes.
The SAP BusinessObjects
Supply Chain Performance
Management application
helps you measurably improve
the effectiveness of
supply chain operations and
better deliver on corporate
mandates such as lowering
costs and improving return
on working capital. In addition
to providing a more accurate
measure of whether
you are meeting your supply
chain goals, the application
can warn you of potential
bottlenecks and identify
new opportunities.
SAP BusinessObjects Supply Chain
Performance Management provides
you with much-needed visibility into
supply chain processes such as order
to cash. You stay clearly informed
about performance metrics such as
shipment reliability, perfect-order fulfillment,
or supply chain cost (see Figure
1). Furthermore, you get to understand
the underlying factors such as production
cycle times, order backlogs, or
warehouse cost, and even correlations
and mutual impacts of one on the
other.
These insights help you to take immediate
action for short-term benefits -
adjusting batch sizes to compensate for
fuel cost increases, for example - and
to improve supply chain effectiveness,
responsiveness, and performance in
the long run. Enhanced supply chain
performance will in turn improve financial
performance by reducing costs,
increasing working capital, and
strengthening customer loyalty.
In today's IT-heavy supply chain networks,
there is no shortage of data
points. In any given situation, however,
only a few numbers are truly important.
Unable to identify the right key performance
indicators (KPIs), managers may
focus only on improving the measures
under their immediate control - an
approach that fosters silo thinking and
frequently sacrifices overall supply
chain network effectiveness for departmental
efficiency. For example, isolated
focus on capacity utilization may result
in excess inventories. Likewise, merely
reinforcing departmental efficiencies
such as reducing departmental cost
may simply shift costs across
departments.
As a packaged
application, SAP
BusinessObjects Supply
Chain Performance
Management can significantly
reduce the complexities,
cost, and risk
associated with deployment
of this type of
solution. Relying on
best-in-class technology,
embedded data integration
functionality,
a calculation engine,
and an intuitive user experience,
the application
has been purpose
built, preconfigured,
and preintegrated to
work effectively.
With the right metrics architecture, an
organization can break down functional
silos and align stakeholders behind
common goals - such as improving
cash-to-cash cycle time, reducing
total supply chain cost, or delivering
on perfect-order goals. The SAP
BusinessObjects Supply Chain Performance
Management application helps
you identify and monitor the metrics
that really matter for your organization
(see Figure 2). At the enterprise level,
these might be perfect-order fulfillment
rate, forecast accuracy, or supply chain
cost. At the department level, such
metrics might include on-time delivery
by suppliers, plant utilization, or order cycle
time.
The prebuilt metrics architecture within
the application is based on the supply
chain operations reference (SCOR)
model and other industry standards
frameworks, yet is flexible enough to
meet your particular requirements.
Metrics are defined, documented, and
associated with specific individuals
within your supply chain network. This
fosters accountability - a key premise
for strategy-aligned supply chain execution.
In the end, the right metrics drive
individual behavior, and behavior drives
enterprise performance. And when it
comes time to upgrade, the metrics
you've defined will still be intact.
Transactional IT systems are optimized
for efficient document processing, not
for easy information access. Vital data
is captured in enterprise systems
across multiple points along the order
management process, from order capture
over goods issue, shipment,
invoicing, and accounting. Unlocking
this information is key to accurately
measure supply chain performance, to
proactively identify opportunities and
bottlenecks, and hence to improve supply
chain effectiveness. However, the
traditional way to capture this information
is via extensive, custom-built business
intelligence projects, involving
business requirement analysis, data
modeling, and custom development.
This approach is risky and expensive,
often prone to failure or budget overruns.
As a result, despite significant
advances in business intelligence technology,
many business users still can
access only basic supply chain information
because development time is so
long. And all too often, information is
not presented in the proper context
because of lack of time and business
user expertise. For example, dashboards
could highlight only primitive
data - such as line-item details of a
shipping notice or its aggregated number
for a specific plant.
SAP BusinessObjects Supply Chain
Performance Management uncovers
hidden information from enterprise systems
by retrieving and semantically
linking relevant pieces of information
across supply chain management and
related financial processes. The application
then automatically calculates the
resulting metrics, providing you with a
full picture of supply chain performance
across end-to-end business processes.
For detailed analysis, you can even
drill down into operational detail in the
underlying enterprise resource planning
system to display, for example, a sales
order that had to be delivered via
express shipment.
This automated data collection and
analysis is delivered at a fraction of the
cost and with considerably less IT project
risk than associated with traditional
custom-built solutions. And because
the data is based on reliable sources
(through prepackaged integration
with SAP transactional software, for
instance), you can be confident in its
accuracy and relevance. Various business
scenarios are supported, such as
collaborative demand and supply planning;
manufacturing network planning
and execution; and logistics and fulfillment
management.
With change the only constant today,
you must adjust enterprise strategies
and tactics more frequently than in the
past. If, for example, raw-material prices
spike unexpectedly, you must review
your cost management strategies. Similarly,
increased competition or new
market opportunities may force a new
product strategy. It pays to stay agile
and responsive in such environments.
SAP BusinessObjects Supply Chain
Performance Management helps IT
stay in control and react swiftly to
changing market requirements - without
lengthy project-change requests.
Business users can define new metrics
(see Figure 3), adjust threshold values,
and customize dashboard views - without
draining scarce IT resources. If the
impact of fuel costs on transportation
costs declines with the introduction of
hybrid vehicles, for example, the application
can immediately reflect those
changes. Business users can change
relationships and definitions for KPIs
and immediately see the results of
those changes. It is also possible to
change scorecard contexts as the supply
chain strategy evolves - for example,
moving from a geographical orientation
to a category orientation. As
business requirements and metrics
architectures evolve, the data structures
built into the application assure
information integrity, without expensive
project rework.
In a dynamic marketplace, changes in
a single parameter (intentional or not)
may significantly affect your entire supply
chain - as well as your financial
position and market capitalization.
Changes in safety stock may simultaneously
impact supply chain cost, ontime
delivery, and carrier utilization.
How do you set the right target values
for your supply chain strategy? How do
you handle transportation costs that
rise to unacceptable levels? Supply
chain practitioners must often choose
among competing requirements and
understand why programs fail. They
must know the right questions to ask
and have the right diagnostics functionalities,
as well as proper alerts and contextual
guidance, to identify potential
problems as quickly as possible.
Functions for impact analysis within
SAP BusinessObjects Supply Chain
Performance Management help you
qualify relationships between supply
chain metrics (see Figure 4). You can
tie back performance issues (such as
increase in overall transportation cost)
to functional issues (such as an increase
in fuel cost by a certain carrier
or an increase in express freights for
a certain region). That helps identify
possible root causes for breakdowns
or potential bottlenecks, and then
improve the success rate of decisions
by understanding broader decision
impact.
Today's supply chain managers and
executives are busy people. They don't
want to spend time surveying dashboards,
no matter how well-designed.
Instead, they need to manage by
exception - driving immediate attention
to the real issues requiring informed
action.
With SAP BusinessObjects Supply
Chain Performance Management, deviations
are indicated via alerts, and
interdependencies across metrics are
clearly marked. In addition to knowing
that there is an issue, you can gain
insights into the underlying operational
drivers - and their possible resolution -
by analyzing interdependencies across
the supply chain network. Besides up-to-
date information on current supply
chain metrics, the application can provide
alerts based on historical trend
analysis, plan-versus-actual comparisons,
and internal or external benchmarking
comparisons.
SAP BusinessObjects
Supply Chain Performance
Management helps you
identify and monitor the
metrics that really matter
for your organization. At the
enterprise level, these might
be perfect-order fulfillment
rate, forecast accuracy, or
supply chain cost. At the
department level, such metrics
might include on-time
delivery by suppliers, plant
utilization, or order-cycle
time.
SAP BusinessObjects Supply Chain
Performance Management is part of
SAP BusinessObjects enterprise performance
management solutions - a
comprehensive set of solutions that
help your company capitalize on the
value of your existing data assets. The
solutions can make your enterprise
more agile - with the greater organizational
alignment, visibility, and confidence
you need for optimal control and
competitive advantage. The solutions
are built on a proven intelligence platform,
and are designed to integrate
smoothly with SAP Business Suite
software; SAP BusinessObjects governance,
risk, and compliance solutions;
and SAP BusinessObjects information
management solutions. This lets you
maximize business profitability, manage
risk and compliance, and optimize your
corporate systems, people, and
processes.
Functions for impact
analysis within SAP
BusinessObjects
Supply Chain Performance
Management
help you qualify relationships
between
supply chain metrics.
You can tie back performance
issues (such
as increase in overall
transportation cost) to
functional issues
(such as an increase
in fuel cost by a certain
carrier or an increase
in express
freights for a certain
region).
For more information on SAP
BusinessObjects Supply Chain Performance
Management, please call your
SAP representative or visit us online at
www.sap.com/sapbusinessobjects/epm.
Summary
The SAP® BusinessObjectsTM Supply Chain Performance Management application helps
companies measurably improve supply chain effectiveness, for more responsive supply
chain networks and improved cost control. By focusing on the right process metrics, companies
can identify and diagnose bottlenecks and uncover opportunities to take informed
action towards improved supply chain performance.
Business Challenges
- Misaligned targets due to lack of understanding of the impact of supply chain activities on
enterprise performance
- Lack of timely visibility into end-to-end operational processes such as order to cash
- Daily surprises and firefighting due to lack of proactive insights
Key Features
- Business content - Comply with leading frameworks such as the supply chain operations
reference (SCOR) model
- Data extraction and transformation - Access data and gain insight more quickly thanks
to preintegration with transactional systems and precalculation of metrics
- Analysis and reporting - Produce more useful reports with semantically consistent navigation
across information
- Impact analysis - Qualify relationships between supply chain metrics
- Metrics management - React quickly to changing market conditions by readily defining
or refining metrics and threshold values
Business Benefits
- Insight into operational and related financial performance while complying with performance
management standards, thanks to standards-based support for end-to-end
processes
- Relevant and timely information with automated data collection derived from actual business
processes
- Full understanding of operational drivers, opportunity discovery, and timely awareness
of deviations from performance targets thanks to proactive diagnostics
For More Information
Call your SAP representative or visit us online at www.sap.com/sapbusinessobjects/epm.