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SAP Net. Weaver: Enabling the Smart Enterprise Lothar Schubert SAP Labs Palo Alto, LLC SAP Net. Weaver: Enabling the Smart Enterprise Lothar Schubert SAP Labs Palo Alto, LLC lothar. [email protected] com

Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Smart Enterprises SAP Business Intelligence in Action

Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Smart Enterprises SAP Business Intelligence in Action

Few Companies Manage to Stay on Top Companies in S&P index 500 … those Few Companies Manage to Stay on Top Companies in S&P index 500 … those still remaining 74 … those that outperformed S&P index overall 12 1957 1998 Source: S&P Index, Mc. Kinsey, MMG ã SAP 2004, 4

Sustainable, Profitable Growth THE WINNING STRATEGY Refocus on GROWTH as the economic re-bound has Sustainable, Profitable Growth THE WINNING STRATEGY Refocus on GROWTH as the economic re-bound has arrived Drive PROFITABILITY of growth as you keep improving margins Ensure SUSTAINABILITY of growth as you innovate ã SAP 2004, 5

The Winning Strategy GROWTH THROUGH INNOVATION Relationship excellence Innovation Sustainable, Profitable Growth Innovation Product/service The Winning Strategy GROWTH THROUGH INNOVATION Relationship excellence Innovation Sustainable, Profitable Growth Innovation Product/service excellence ã SAP 2004, 6 Innovation Operational excellence

Business Process ã SAP 2004, 7 Business Process ã SAP 2004, 7

Departmental Perspectives “it’s just one missed sale” “will be back in inventory” “not a Departmental Perspectives “it’s just one missed sale” “will be back in inventory” “not a key customer” “extra effort costs $$$” ? ? ? “see & wait” ã SAP 2004, 8

The Bigger Picture: External and Internal Pressures Competitive Forces Macro Economical Trends § Price The Bigger Picture: External and Internal Pressures Competitive Forces Macro Economical Trends § Price competition § Vertical integration • Labor market • Interest rates • SOX • Basel II • Demographics • Buying behavior Market Trends ã SAP 2004, 9 Compliance Requirements

Integrated Management Processes Corporate Strategy Strategic Planning 1. 2. 3. 4. § Scenario simulation Integrated Management Processes Corporate Strategy Strategic Planning 1. 2. 3. 4. § Scenario simulation § Cash-Flow Forecast Increase quality of service Drive transparency Invest in innovation … Perform. Management § Operational planning § Process optimization § Operational execution § Goal setting § Alignment of interest § Goal measurement ã SAP 2004, 10

Business Process “it’s a missed sale” “will be back in inventory” “not a key Business Process “it’s a missed sale” “will be back in inventory” “not a key customer” “extra effort costs $$$” ? ? ? “see & wait” ã SAP 2004, 11

Business Process Defection Risk Inventory Forecast Returns Per Customer CLTV Delivery Performance ã SAP Business Process Defection Risk Inventory Forecast Returns Per Customer CLTV Delivery Performance ã SAP 2004, 12 Accuracy

Business Process Defection Risk Inventory Forecast Returns Per Customer CLTV Delivery Performance ã SAP Business Process Defection Risk Inventory Forecast Returns Per Customer CLTV Delivery Performance ã SAP 2004, 13 Accuracy

5 Key Business Challenges 1. Execution not aligned with Corporate Strategy § Corporate strategy 5 Key Business Challenges 1. Execution not aligned with Corporate Strategy § Corporate strategy not communicated clearly § Individual objectives not aligned with strategy § Poor measurement, and no corrective actions 2. Ineffective Decision Making Processes § Decisions delayed, or made on ‘gut feel’ only § Key stakeholders not involved § Solid information only available to small ‘elite’ 3. Increasing Competitive and Market Pressures § Lack of insight into markets and trends § Opportunities frequently missed 4. Compliance Requirements § Calls for transparency § Increasing criticality of trustworthy data 5. Budget Constrains § Need to do more with less, and need to justify expenditures ã SAP 2004, 14

Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Smart Enterprises SAP Business Intelligence in Action

Challenge 1: Execution Not Aligned With Corporate Strategy “Less than 10% of strategies effectively Challenge 1: Execution Not Aligned With Corporate Strategy “Less than 10% of strategies effectively formulated are effectively executed. ” Fortune Aligning Strategy with Execution requires: • Common set of Metrics, KPI’s and Benchmarks • Balanced Scorecards • Solid and integrated planning framework Corporate Performance Management ã SAP 2004, 16

Challenge 2: Ineffective Decision Making Processes Source: SAP Improved Decision Making requires: § Reliable, Challenge 2: Ineffective Decision Making Processes Source: SAP Improved Decision Making requires: § Reliable, up-to-date and easily accessible information § Context, Guidance, and Collaboration § Information actionable and in consumable format àSelf Service and Information Democracy ã SAP 2004, 17

Challenge 3: Increased Competitive- and Market Pressures Account Planning “If you know the enemy Challenge 3: Increased Competitive- and Market Pressures Account Planning “If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself, but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy or yourself, you will succumb in every battle. ” Sun Tsu, The Art of War, 500 B. C. Opportunity discovery and exploitation requires: • Predictive Analytics, Planning & Forecasting • Analytics embedded into Applications • Closing the Loop via Analytical Application Smart people using smart applications ã SAP 2004, 18

Challenge 4: Compliance Requirements “The keys to meeting Sarbanes-Oxley requirements will be the timeliness Challenge 4: Compliance Requirements “The keys to meeting Sarbanes-Oxley requirements will be the timeliness of the reporting, as well as the validation that the system can detect and report the ‘material events’. ” Gartner G 2, 2004 SAP Management of Internal Controls (MIC) Reporting, Section 404 Compliance and Corporate Governance calls for: • Transparency, and single version of truth • Trustworthy and auditable data (historic and current) • Right-time reporting, exception notification and alerts Reliability, completeness and transparency ã SAP 2004, 19

Challenge 5: Budget Constrains “[ETL] processes. . . can absorb up to 70% of Challenge 5: Budget Constrains “[ETL] processes. . . can absorb up to 70% of the time spent on a typical DWH project. ” DM Review, 3/01 “… it is clear that a single architecture will yield a better ROI, is more likely to come online faster, and is less likely to fail, undeniably. ” Neil Raden, Analyst, 1/04 Calls for IT budget justification and doing ‘more for less’ requires: • Out-of-the-box templates and analytical applications • Integration with applications, and openness for change • Proven methodology and comprehensive support infrastructure Buy versus build, from viable partner ã SAP 2004, 20

Meeting the 5 Key Business Challenges 1. Execution not aligned with Corporate Strategy Corporate Meeting the 5 Key Business Challenges 1. Execution not aligned with Corporate Strategy Corporate Performance Management 2. Ineffective Decision Making Processes Self Service and Information Democracy 3. Increasing Competitive and Market Pressures Smart people using smart applications 4. Compliance Requirements Reliability, completeness and transparency 5. Budget Constrains Buy from a strategic partner, don’t build A smart business requires a complete, end-to-end, reliable and open BI Platform. ã SAP 2004, 21

Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Smart Enterprises SAP Business Intelligence in Action

The Business Intelligence Platform Data. Mart Data Warehouse Integration Broker ERP/CRM/SCM/External Sources Presentation Ad The Business Intelligence Platform Data. Mart Data Warehouse Integration Broker ERP/CRM/SCM/External Sources Presentation Ad Hoc Query and Reporting Statutory Reporting Budget Plan/Forecast Balanced Scorecard Consolidation Modeling and Optimization Knowledge Management Content Management Business Proc. Management Web Presentation/Portal/Mgmt Reporting Data. Mart CPM Applications BI Infrastructure Data Sources Architecture Source: Gartner (“Managing Corporate Performance – What you need to know”; Lee Geishecker & Frank Buytendijk, 4/04) ã SAP 2004, 23

SAP NETWEAVER ONE PLATFORM – ONE PRODUCT Open integration and application platform that enables SAP NETWEAVER ONE PLATFORM – ONE PRODUCT Open integration and application platform that enables change! SAP Net. Weaver™ 1 Foundation Web AS 6. 40 PEOPLE INTEGRATION ã Collaboration INFORMATION INTEGRATION Bus. Intelligence Knowledge Mgmt Master Data Mgmt PROCESS INTEGRATION Integration Broker Business Process Mgmt Life Cycle Mgmt Composite Application Framework Multi channel access Portal 1 Platform Synchronized release dates 1 Package Coherent installation process 1 Set of scenarios Integrated components All Apps APPLICATION PLATFORM Business Suite, partner SAP delivers the complete, end-to-end, J 2 EE ABAP solutions and x. Apps DB and OS Abstraction reliable and open BI Solution. developed on Net. Weaver SAP 2004, 24

Accelerating Net. Weaver Adoption with IT Practices High Right-time data access Ability to Change Accelerating Net. Weaver Adoption with IT Practices High Right-time data access Ability to Change your Business Implement XI a V ue l Collaboration Reports for real-time data to complement the batch-oriented data access of analytic applications and operational reporting; Implement Collaboration Rooms Share documents; collaborate with colleagues for planning and resolution of business issues Information Delivery Implement Portal Low cost distribution of personalized reports and alerts to a wide audience Reports Implement BW Provide periodic operational reports to executives from multiple source Applications & Application Services Platform Integration Low ã SAP 2004, 25 High

Business Intelligence – Overall Solution ã SAP 2004, 26 Business Intelligence – Overall Solution ã SAP 2004, 26

Business Intelligence – Overall Solution ã SAP 2004, 27 Business Intelligence – Overall Solution ã SAP 2004, 27

Capabilities Data Warehousing and Analysis § § § Data Warehouse Management Extraction, Transformation and Capabilities Data Warehousing and Analysis § § § Data Warehouse Management Extraction, Transformation and Loading Business Modeling OLAP Technology Data Mining and Predictive Analytics Alerting Information Delivery • • Query Design Reporting and Analysis Alert Notification and Report Broadcasting Security and Personalization Measurement and Management § § § KPI’s, Metrics and Dashboards Business Planning and Simulation Business Consolidation (delivered via my. SAP ERP Financials) Business Performance Measurement (delivered via my. SAP ERP Financials) Collaboration and Guided Procedures Best Business Practices § § ã Business Content and Industry Templates Metadata Management SAP 2004, 28

my. SAP ERP powered by SAP Net. Weaver Application my. SAP ERP Edition 2004+ my. SAP ERP powered by SAP Net. Weaver Application my. SAP ERP Edition 2004+ Additional Components my. SAP ERP Edition 2003 Self Service Procurement Additional Components Internet Sales Self Services … and more Self Service Procurement Internet Sales Strategic Enterprise Management Application SAP 2004, 29 SAP R/3 Enterprise Core SAP Net. Weaver™ ‘ 04 PEOPLE INTEGRATION Multi Channel Access Portal Collaboration INFORMATION INTEGRATION Bus. Intelligence Knowledge Mgmt Master Data Mgmt PROCESS INTEGRATION Business Integration Process Mgmt Broker APPLICATION PLATFORM J 2 EE ABAP DB and OS Abstraction SAP ECC Core PEOPLE INTEGRATION Multi Channel Access Portal Collaboration INFORMATION INTEGRATION Bus. Intelligence Knowledge Mgmt Master Data Mgmt PROCESS INTEGRATION Business Integration Process Mgmt Broker APPLICATION PLATFORM J 2 EE ABAP DB and OS Abstraction Life Cycle Mgmt ã SAP Web Application Server Industry Enablement Life Cycle Mgmt Technology SAP Basis SAP ECC Extension Set Composite Application Framework up to 4. 6 C Strategic Enterprise Management SAP Enterprise Extension Set SAP R/3 Enterprise Core Self Services SAP R/3 Enterprise Composite Application Framework SAP R/3 SAP ERP Central Component … and more SAP R/3 Enterprise Composite Applications

Roadmap BW 2. 0 - Operational Data Store - Rich Functionality - Web Reporting Roadmap BW 2. 0 - Operational Data Store - Rich Functionality - Web Reporting BW 1. 2 - All-in-one - Application Integration - Business Content ã SAP 2004, 30 BW 3. 0 - Easy of use - Openness - Tool Integration BW 2. 1 c - Content Release SAP Net. Weaver xx - Expanded Enterprise - Active BI - Advanced user experience SAP Net. Weaver 04 - Extending the reach - Planning and forecasting - SAP Net. Weaver integration

Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Business Challenges for Smart Enterprises Meeting the Key Business Challenges SAP Net. Weaver enabling Smart Enterprises SAP Business Intelligence in Action

SAP Net. Weaver™ at Aventis ã SAP 2004, 32 SAP Net. Weaver™ at Aventis ã SAP 2004, 32

SAP Net. Weaver™ at Dow Corning ã SAP 2004, 33 SAP Net. Weaver™ at Dow Corning ã SAP 2004, 33

The SAP BI Advantage n Enabling of accurate, faster and actionable information n Compliance The SAP BI Advantage n Enabling of accurate, faster and actionable information n Compliance with industry regulation thus mitigating business risks n Connecting Corporate Goals, Objectives and Strategies to an individual contributor level n Information Democracy and Self-Service n Predictive analytics and smarter applications to grow the business n Quick wins and faster Return on Investment SAP Net. Weaver delivers the complete, end-to-end, reliable and open BI solution, enabling the smart enterprise. ã SAP 2004, 34

SAP Net. Weaver: Enabling the Smart Enterprise Lothar Schubert SAP Labs Palo Alto, LLC SAP Net. Weaver: Enabling the Smart Enterprise Lothar Schubert SAP Labs Palo Alto, LLC lothar. [email protected] com