INCTURE 2010 / 1 Engineering Your Success

Bring Velocity to Your "New Product Introductions" with SAP BPM

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About the Presenter

• SOA-BPM Solution Architect • Over 8 years of SAP solutions

experience in PS, MM, EAM etc.

• Co-inventor of multiple patents in Enterprise SOA

• Worked on several BPM projects, including areas such as Claims Processing, Materials Mater Data and New Product Introduction

• Worked at SAP Labs in the past wherein was responsible for PIC Governance and Enterprise Services Repository

• Managed and Architected three large projects on Enterprise SOA

Abhinava Pratap SinghSOA-BPM Solution ArchitectIncture Technologies Pvt. Ltd.abhinava.pratap@incture.com

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About Incture TechnologiesLed by a strong team of ex-SAP employees with singular focus on SOA-BPM driven innovation for SAP customers.

•Largest BPM implementation partner in Asia –5 major SAP NW BPM implementations in Asia

•Enabling BPM adoption by customers with series of BPM Workshops

•Thought leadership in SOA-BPM with large investments on solution and technology assets in SAP BPM

•Located close to SAP Labs and SAP Global Delivery Centre in Bangalore and has strong multi year collaboration (over 2000 man months) with SAP Development teams

•Combined advantage of deep skills and competitive cost (100+ delivery team is centred in Bangalore, IT hub of India)

•Member of SAP Design Partner Council – Advisor to SAP BPM, BRMS, CE, Java technology teams

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Agenda

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Industrial Context of NPDI

Over 30.000 products introduced annually costing the industry over $60 billion a year, do not bring the expected outcome

Average 15 months to launch a new product, and up to 80% of new products fail

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Key Factors in NPDI

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NPDI

NPDI is Cross Functional

NPDI is everything from conceptualizing ideas and concepts, to productizing approved concepts to commercializing the new products

New ProductDevelopment &

Introduction

MatureBusiness

ServiceManagement

Product Life Cycle Management

Supply ChainManagement

Customer Relationship Management

Supplier RelationshipManagement

Life Cycle

Applic.Use

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NPDI Is a Complex Process

NPDI is the process of managing all activities and resources to bring a new product to market that meets customer needs and supports the business goals.

Marketing R&D Supply chain Manufacturing Marketing

Designs Bills of material

Customerneeds

Launchplans

Opportunity Product

External partners

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Agenda

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Corporate Profile Leading International firm that owns many of the world's consumer product

brands in foods, beverages, cleaning agents and personal care products

Operating companies and factories on every continent

Over 163,000 employees in 100 countries

Over 17,000* SAP users

Challenges for the NPDI process Multiple research labs across continents

Cross-country Supply Chains

Complex Organization Structures

Multi-vendor IT Landscape

Around 800 users

Case Study

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The New Product in this case is a material (SKU) which comprises of the following

Multiple Raw Materials to be sourced from multiple vendors Semi-finished Materials to be produced in-house at different plants Finished Product to be sold from multiple selling plants Packaging Material

New Product

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R&D team

Shared Service Center

SU Planner – TH

SU Planner – SG

SU Planner – ID

SU Approval – TH

SU Approval – SG

SU Approval – ID

Consolidation & Wait

Purchasing – TH

Purchasing – SG

Purchasing - ID

Sales Plant – TH

Sales Plant – SG Sales Plant –

ID

Quality Mgmt – TH

Quality Mgmt – SG

Quality Mgmt – ID

Finance– TH

Finance– ID

Finance – SG

Warehouse – TH

Warehouse – SG

Warehouse – ID

Sales Team – TH

Sales Team– SG

Review Update

• Co-ordinates across countries over email & phone

• Data entry with inadequate/vague inputs from marketing

• Non proficient data quality checks• Product initiation runs to 3-4 weeks

due to communication tossing back and forth with marketing

• Co-ordinates across countries over email & phone

• Data entry with inadequate/vague inputs from marketing

• Non proficient data quality checks• Product initiation runs to 3-4 weeks

due to communication tossing back and forth with marketing

• Scenario based approvers identification is a challenge

• Non availablity of the approver results the entire process to halt

• Poor data quality• Injects delay of a week or even more• No escaltion mechanism to address

delays

• Scenario based approvers identification is a challenge

• Non availablity of the approver results the entire process to halt

• Poor data quality• Injects delay of a week or even more• No escaltion mechanism to address

delays

• Costing across countries and plants are prone to error

• Unsynchronized costing -- redoing costing results in a huge Cost overhead

• Multi-material products result in exponential cost overhead on redoing costing.

• confidential documents sent via e-mail -- Security risk

• Costing across countries and plants are prone to error

• Unsynchronized costing -- redoing costing results in a huge Cost overhead

• Multi-material products result in exponential cost overhead on redoing costing.

• confidential documents sent via e-mail -- Security risk

• Undocumented ,user-governed Business rules result in erroneous entries

• Lack of data enrichment results in plunging user efficiency

• Unclear accountabilty and missing SLAs induce a huge delay

• Undocumented ,user-governed Business rules result in erroneous entries

• Lack of data enrichment results in plunging user efficiency

• Unclear accountabilty and missing SLAs induce a huge delay

AS – IS – PROCESS

• Co-ordination across plants spread across various countries is a nightmare

• Co-ordination across plants spread across various countries is a nightmare

• 3-6 months for a product completion largely due to cross border co-ordination challenges, lack of SLAs, automatic escalation and automation

• 3-6 months for a product completion largely due to cross border co-ordination challenges, lack of SLAs, automatic escalation and automation

Countries named above are representative and not the actual names

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Pain Points in NPDI

Long Cycle Times NPDI takes around 3-6 months time creating a huge competitive disadvantage

Poor Data Quality Overhead of a shared service centre to co-ordinate and run human eye based data quality

checks Leading to 100+ material rejects every month Low visibility into the process leading to monitoring challenges Costing of materials across countries and departments lead to miscalculation Process document integration and Auditing capabilities missing

Non-uniform process Different Countries follow different processes Email and telephone based co-ordination Inability to quickly adapt new business rules User having to work with monolithic MIRO SAP GUI screens and supplement them with excels,

mails, calls

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Streamline NPDI process Powered by SAP NetWeaver BPM

Before Coordinating activities and capturing the

information for a decision point (phase gate meeting) is mostly manual

From …

After Explicit process that tracks and manages

decisions, task and deadlines for a decision point

ProjectManager

Marketing

R&D

Finance

Manufacturing

To…

Powered by SAP NetWeaver BPM

ProjectManager

Marketing

R&D

ManufacturingFinance

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Manage New Product Development (NPD) as a project

Deal with various materials types in a consistent and coordinated way across the project

Automatically assign tasks only when pre-requisite tasks are completed, thereby removing the need for individual to monitor that each pre-requisite task is completed

Remove the co-ordination overhead of costing across countries and entities

Assign tasks to the team or individuals that can action the item, thereby removing from the process delays associated with individuals managing task assignment

Remove manual data collection

Ensure that a material is available to procure, make or sell according to business requirements

Objectives -1

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Ensure that the access and authorizations are consistently applied across the ECC (ERP) and BPM platforms

Impose an order on the process that conformed to the sequencing requirements of ERP material master creation

Accommodate the country based diversities

Provide the business with a uniform, consistent and generic view of material master creation that accommodates

New product development requirementsCosting orchestration - Plant levelThe variety of business scenariosProvide a basis for discussing and structuring the in country variability

Objectives -2

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Agenda

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Process with SAP BPM

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Process Flow

Workflow

DefineProject & Materials

Material Usage

Analysis

Basic Attributes

Plant basic(MRP

WRKschd)

Storage Location

Other plant details

Costing pre-requesites

(BOM, producton version,

Purch info & src list, FI/CO)

Cost material/plant

Plant Status

Review, correct and approve

Material determination

Sales Org

Warehouse

Dchain status

Material Determination

Project Starter

Workflow structure

Project Done

Scoping Material Definition Open PlantCosting Open Sales Org

Designed Process Comprises of 5 phases1. Scoping – define the business requirements2. Material definition – turn the business requirement into a materials3. Costing – cost and transfer price the material 4. Open Plant – make the material available for use in the plant5. Open Sales Org – make the material available to sell

ServicesServices

UI ScreensUI Screens

Business Rules

Business Rules

BPMN ModelBPMN Model

Process ChartProcess Chart

Process Flow

Process Flow

Process PhasesProcess Phases

Business Process Mapping

Product Data Creation Project Initiation

Basic Data Flow

Plant Flow

FICO & Costing Flow

Warehouse Flow

Sales Org Flow

Business Rules for determining user/role to execute a process step

Business Rules for selecting the process variant

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What was Achieved?

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Why SAP NW BPM?

Reference: http://www.sdn.sap.com/irj/scn/weblogs?blog=/pub/wlg/18701

(Darwin Deano, Deloitte Consulting)

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Process Velocity. BPM tool based solution cuts down the process cycle times Efficiency. BPM tools excel at bulletproof automation of complex processes and can

dramatically increase the efficiency and productivity of data management resources resulting in Process Optimization, Streamlining, increased Through put and Improved operating efficiency

Repeatability. Top-notch data stewards know their data intimately and can quickly find and fix anomalies. But a downfall of manual data governance is that this person becomes unavailable or is lured to another company. BPM engines mitigate this risk and provide Improved operating consistency and quality.

Auditability. The business activity monitoring component of BPM ensures that every step of every process is recorded and traceable to its original input at any time.

Scalability. Increased automation and elimination of human touch points wherever suitable resulting in reduction of TCO and better scalability of business.

Transparency. Because data governance processes are modeled in a BPM tool, it's easier to get sign-off from business owners. BPM makes business processes transparent, improving visibility and efficiency, ending the "trust me" risks of data governance. Process Operational Visibility & Transparency, Improved process performance measurement and reporting

Change Agility & Operating flexibility for rapid and continuous change to deliver optimization

Stronger User adoption and inclusion in process activities resulting in increased satisfaction in user, customer, partner, vendor and employees

Main Advantages of BPM

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Why BRMS?

BRMS rules are primarily used forTasking - Based on Country, Plant, Material Group, Key customer, MRP Type,

Purchasing group, Product Hierarchy

SLA Values - Based on the Workflow step and milestone

Defaulting Rules - Based on the Country, Material Type, Screen name, Tab name

Mandatory Rules -Based on the Country, Material Type, Screen name, Tab name

UI Dependent Default rules - Based on country, screen name, tab name, attribute name

MDM country team rules - Based on country, material type, P.H

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Agenda

Engineering Your Success

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