Simple Finance Zurich Insurance POC Case Study

8/9/2019 Simple Finance Zurich Insurance POC Case Study

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2014 SAP SE or an SAP affiliate company. All rights reserved. 1Public

Wilco Boosman, Group FinanceProgram Manager SAP Convergence,

Zurich Insurance

Wilco is currently leading Zurichs SAP Convergence Program with the aim toimplement a common Chart of Accounts supported by a single SAP instance for theFinance functions at group and country level. The program started in 2011 and isscheduled to complete the last roll-in projects by the end of 2017. With 20 yearsexperience in various roles in Finance and IT functions, Wilco sees the current and

future challenge in financial services as the need to combine local regulatoryrequirements and group objectives in programs designed to target long-termbenefits.

Transform and Simplify Your Office of Finance.

The Webinar will start at 11:00 CEST

David Ormerod, Director EPM Solutions, EMEA CoE for EPM & LoB Finance

David has almost 20 years experience in designing and implementing EnterprisePerformance Management solutions. He has worked for a number of customer

organisations spanning a wide variety of industry sectors includingtelecommunications, financial services, media and oil & gas. In recent years he hasworked as a Solution Consultant and Technical Account Manager for severalPerformance Management software vendors including Hyperion and Oracle, prior to

joining SAP in February 2010, where he is responsible for EPM BusinessDevelopment in EMEA. David started his career as an academic in Earth Sciences,which sparked his early interest in analysis and modelling processes.

Featured speakers today are:


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Transform and Simplify Your Office of Finance

Wilco Boosman Group FinanceProgram Manager SAP Convergence,

Zurich Insurance

David Ormerod SAP EMEA CoE for Finance


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Agenda

The CFO Agenda for Finance Organizations

How SAP is Enabling Real-Time Finance

Finance Transformation At Zurich Insurance

Leveraging Real-Time Finance

Wrap-Up and Questions


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4

2014 SAP AG or an SAP affiliate company. All rights reserved. 4

SAP Simple Finance Supports The CFO Agenda

Maintain global regulatorycompliance and controls ofaccounting and tax standards,across currencies, languagesand industries.

Proactively engage with thebusiness to plan, model, analyzeand predict the financialimplications of strategic andoperational decisions.

Optimize finance processes forefficient and collaborativerelationships with customers,suppliers, banks, andgovernment authorities.


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76% of Finance executives believe at least half theirtime should be on high-value planning and analytic

activities

Source CFO.com Research 2013

Drive business

innovation

Keep thelights on

28%

72%

Forrester IT Survey, 2013

Drive business

innovation

Keep the

lights on

IT Complexity Places Limits on Finance


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7/32 2014 SAP SE or an SAP affiliate company. All rights reserved. 7Public 2014 SAP AG or an SAP affiliate company. All rights reserved. 7

Transforming Through Innovation and Customer Focus

Transact Analyze Accelerate Transactions + Analysis

directly in-memory

VS.

SAPs In-Memory Data Management Innovation

Providing Real-time Platform for Enterprise Applications

A common Database Approach for OLTP andOLAP Using an In-Memory Column DatabaseHasso Plattner

Cache

SAPIn-Memory


8/32 2014 SAP SE or an SAP affiliate company. All rights reserved. 8Public

SAP Simple Financecore component:

Financials Add-On for Suite on HANA

Business Suite on HANA

SAP HANA Platform

AlignedSingle Source of Truth

AgileReal time finance processes

PredictiveInsight and foresight

Integrated

Business Planning

New capabilities and enhancedintegration for ERP and BPC.

SAP Cash Managementpowered by SAP HANA

New product forGroup Cash Management

SAP Accountingpowered by SAP HANA

Alternative in-memoryfunctionality for ERP customers





SAP HANA Platform

AlignedSingle source of truth



SAP Accounting

powered by SAPHANA

SAPsNext Generation Accounting Solution

Characteristics

New product fullyleveraging the benefitsof SAP HANA

Only available on SAPHANA

Installation on top ofSAP ERPreplacingthe accounting in SAPERP

Same input and outputinterfaces as in SAPERP

Current processes andreporting run with littleor no changes



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Zurich Insurance Group: Testing and Validating the

SAP HANA Platform for Finance Transformation

Company

Zurich InsuranceGroup (Zurich)

Headquarters

Zurich

Industry

Insurance

Products and Services

General and Life insurance

Employees

55,000

Profit

US$4.7 billion

eb Site

www.zurich.com

Objectives

Drive a global finance transformation to align with strategic group priorities Deliver one common consolidated accounting system for all countries Enable highly integrated and standardized processes Accelerate key processes like financial close and reporting Roll out globally consistent accounting and operational procedures that

comply with company standards

Resolution

Implement a common SAP software platform, chart of accounts, andreporting dimensions across the globe

Test and validate the financials add-on for SAP Business Suite poweredby SAP HANA Simplify IT by removing data replications and redundancies

Benefits validated

Ability to redesign finance processes to make them simpler and allowthem to be completed on the fly

Completed a prototype for accelerating financial close processes andreporting and to achieve greater granularity within reports

Potential to use general ledger postings directly as one source of data forconsolidation with no data replication or redundancy

Removal of restrictions on data volume, enabling a one-client strategy Fast deployment of the add-on with limited effort

Zurich wanted to be one of the first customers to evaluate the financialsinnovation delivered with SAP HANA. Deployed as a simple add-on forSAP Business Suite powered by SAP HANA, we are really impressedby the results in terms of the performance, simplification, and agility itcould bring to our f inance community.

Wilco Boosman, Director SAP Convergence, Zurich Insurance Group (Zurich)

>50%Faster runtime for foreigncurrency revaluation*

1,000xFaster reporting (from 15minutes to 1 second)*

>65%Faster financial closeprocesses*

4hours

Saved on allocation runtime*

*Results of a validation projectby Zurich.
http://www.zurich.com/http://www.zurich.com/



1. Data volume restriction will shortly violateSAP table size recommendations

2. Lack of flexibility for multi-dimensionalreporting (limitation on reporting dimensions)

3. Long running batch processes (allocation,closing and report run times)

4. Business distrust in todays reportinglandscape preventing business insights

5. Complex closing processes driven by systemlimitations and current architecture

Current Pain PointsFinancials add-on for SAP Business

Suite powered by SAP HANA1. Restriction on data volume has been

eliminated

2. Limitation on dimensions has been removedenabling higher reporting granularity

3. Performance improved by factor 24, andwith system optimizations by factor 10+

4. New tool set provides trusted real-timereporting capability e.g. during closing time

5. Closing process will be simplified andaccelerated by eliminating several closingsteps and data reconciliation

Outcome of ZURICHs Customer Validation (CuV)

The CuV and extended testing have proven that Financials add-on for SAP Business Suitepowered by SAP HANA is stable with significant benefits in higher performance for fastclosing and (real-time) reporting. The main focus of the SAP innovation is simplification,which would also address Zurichs current pain points and enables further standardizationof the system landscape and business processes.



Runtime Comparison

Closing

CO Allocation FI Allocation Open ItemRevaluation

GL BalanceRevaluation

Open ItemRegrouping

GL BalanceRegrouping

IFRS RollupCluster

Cross Checks Download forConsolidation

Balance C/F

Closing Process*

ECC 6.0

188%

188%257%

1450%

223%50%

67%511%

1667%

932%

449% Runtime Reduction

495minutes

90minutes



Runtime Comparison

General Accounting

Line ItemReport

CustomReport

Inbound Idoc OutboudInterface

BatchProcessing

1750%

3900%

7%

ECC 6.0

Financials add-on for SAPBusiness Suite poweredby SAP HANAConclusions

Extremely fast reportingcapabilities

Idoc processing does

not show much improvement

332%

Further Optimization

233%



Benefits seen by local business

15

Allocation:

Performance improvement of 1200% (advantage reduces a bit due to improvements implemented on ECC6)

Improvement enables removal of aggregation cost center (PoC to follow)

This enables backtracking functionality which is the desired functionality

Enables cost controlling and reduces dependencies on additional systems for aggregation & analysis

Process simplification from 31 to 13 steps

Reporting:

Availability of BW Real-Time reporting directly on the FICO data base, without data extraction and time delay

will remove distrust in today reporting landscape Powerful Line Item Browser enabling any kind of reporting over all dimensions and high volume in seconds e.g.

search over text field in 20 million records in 3 seconds

Reduction of workarounds and developments

Reduction of dependencies to IT

Closing:

Simplification of closing as e.g. Rollup and BCS file generation on the Fly

Chance for reengineering for further simplification

Proven Performance Improvements based on test results :

Batch processing 233%

Outbound Interface 200% - 300%

Local closing app 300 - 400%

Core closing processes overall 449%

Line Item Report 1750%

Business Unitfeedback



Interfaces, localprocesses, rollupon-the-fly prototypeCompleted

Customer Validation Timeline

16

Infrastructure

Upgrade SandboxDB2 and install En-hancement packs

Completed

Copy Productionto Sandbox

Completed

Migrate to Hana(loan)box (HE4) andInstall the Add-on

Completed

321

6,7 h

Sub-ledgers &reporting

Completed

Closing Test Cases forCuV Feedback to SAP

Completed

Compile separate projectapproval documentation

Sep - Oct

654

Mar-Jun

2014

Dec-Mar

2013

Test cycle scope

Sep-Oct

2014



Simple receivables

management through

integration of finance &

sales functions

10% DSO Reduction

Account ReceivablesReceivables Management

Changes focus from data

preparation to analysis &

interpretation

28%

40%

Books ClosingFast Close Enablement

Improvementonprocessing time

Reductionin GLposting corrections

I/CO reconciliation moved

to a real time process

70%

Intercompany ReconciliationReal-time

HANA

No aggregates

Increased performance

Reductionin time toprocess

reconciliation issues

SAP Simple Finance @ SAPMajor Values Realized



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SAP HANA Platform




Integrated

Business Planning








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20 2014 SAP SE or an SAP affiliate company. All rights reserved.

Home

Cash Manager

Bank Statement

Success RateFeb 1st2014

95.0%

Cash Pool Amount ByDeficit - Feb 1st 2014

(M)

-26.8

Bank RiskFeb 1st 2014 (M)

15.7

Cash PositionToday (M)

26.0

Liquidity StructureFeb 1st 2014 (M)

Current Account 1.2

Investment 0.78

Debt 1.4

Cash Flow

Week-to-date (M)

Inflow 200.2

Outflow 192.5

Liquidity Forecast

Whole Company, In 30 Days

1,98M

2,47M

Feb. 1st, 2014 24%

Payment StatisticsToday (M)

Accepted By Bank 200.2

In Approval 42.5

Rejected by Bank 55.0

Overdraft LimitFeb 1st2014 (M)

Available 200.2

Consumed 42.5

Exceeded 55.0


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SAP HANA Platform




Integrated

Business Planning








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Ope

rationalPlannin

g

StrategicPlanning

P

rofitabilityPlann

ing

ProcurementPlanning

CostPlanning

ProductionPlanning

RevenuePlanning

Marketing

Planning

InvestmentPlanning

PricePlanning

BalanceShee

tandProfit&

Lo

ssPlanning

Sales

Planning

HeadcountPlanning


Dynamic Planning Through Integrated Business Planning


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SAP HANA Platform

Single source of truth

SAP

ERPSAP

BPC, BW

Customer benefits

Seamless integration of planninginto SAP ERP user interface andworkflows

No need for Data Replication

Plans developed in SAPBusiness Planning andConsolidation will be accessiblein SAP ERP for variance analysis

Fully harmonized master dataand data between accounting,

planning, and financial riskmanagement

End-to-end simulation capabilities

Shared data and

methods Master data (e.g., cost centers) Planning model Actuals, plans, budgets, forecasts Planning engine

Entry oftransactional andmaster data

Variance analysisactuals vs. plan

Entry of planningmodels and plandata

Flexible reportingand analysis ofactuals

Technology Driven Transformation: Financial Planning



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SAP Simple FinanceYour Key for a Technology Driven

Finance Transformation


SAP HANA Platform




Integrated

Business Planning








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Adopt Innovation at Your Own Pace

SAP Business Suite

SAP HANA asside-by-side

scenario

Any DB

SAP

ERP

SAP HANA


SAP Business Suite

powered bySAP HANA

SAP ERP

SAP HANA

Financials

add-on *

SAP/OtherERP

SAP Business Suite

powered bySAP HANA

* optional

SAP ERP

SAP HANA

Financials

add-on *


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SAP Simple Finance: On Premise and Cloud Deployment


Comprehensive Broad Business Scope Best in Class Managed Cloud Services

Access to Latest Releases

Simple

Modern Architecture Subscription Price Seamless E2E Experience Rapid Onboarding

Flexible

Extensible Solution

Integrates into the SAP Portfolio Clear Service Levels Scalable Scope Options Highest Level Security & Privacy


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Summary and OverviewSummary and Overview


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The Rewards of Real Time Finance

2014 SAP AG or an SAP affiliate company. All rights reserved.

28

3xLower financecost as % ofrevenue

76%Higher operating

margin

22%Lower auditcosts

56%Fewer treasury

FTEs

44%Fewer financeFTEs

26.1%Fewer days to

close the books

Source: SAP Benchmarking Services


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Now Its Your Turn

CFO Financial

LeadershipCenter

www.sapcfo.com

Simple

Finance

www.sap.com/simple-

finance

SAP Solutions

for FinanceNewsletter

www.sap.com/finance-

newsletter

2014 SAP AG or an SAP affiliate company. All rights reserved.
http://www.sapcfo.com/http://www.sap.com/simple-financehttp://www.sap.com/simple-financehttp://www.sap.com/finance-newsletterhttp://www.sap.com/finance-newsletterhttp://www.sap.com/finance-newsletterhttp://www.sap.com/finance-newsletterhttp://www.sap.com/finance-newsletterhttp://www.sap.com/simple-financehttp://www.sap.com/simple-financehttp://www.sap.com/simple-financehttp://www.sapcfo.com/


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Key Take Aways

Technology innovationssuch as inmemory computing and Cloudwilltrigger a new process revolution,enabling Real Time Finance.

Simple Finance is a next generation setof solutions to help CFOs acceleratetheir global Finance transformation.

It offers simple and unified experiencefor easy adoption and a smoothdeployment with on-premise, cloud

and hybrid options.



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Thank You

Contact

information:

Dr David Ormerod

EMEA CoE for Finance

[email protected] http://twitter.com/dormerod
mailto:[email protected]://twitter.com/dormerodhttp://twitter.com/dormerodmailto:[email protected]

Simple Finance Zurich Insurance POC Case Study

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