SAP clarifies the Roadmap: A new stepping stone for Planning & Consolidation (1)

December 3, 2019 Posted by: Machiel Grobben
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News on the FP&A front coming from SAP. An update in the strategic direction was recently announced in May. The ‘strategic solutions of choice’ are SAP Analytics Cloud for Business Planning and S/4HANA Group Reporting in the area of financial consolidation. For those who prefer a standalone datawarehouse based solution, BPC 11.1 version for BW/4HANA 2.0 is the application to go for, both for planning and consolidation. This new direction has recently been explained in several new blogs and roadmap documents. Let’s take a closer look.


In the past few years, customers could choose from a wide product range with a considerable number of SAP applications. Some of these have their origins in acquisitions, others have arisen through the development of variants aiming at improved integration with the SAP ERP and BI landscape. SAP’s investment in its cloud first strategy also provided an additional option: SAP Analytics Cloud. Choosing the right solution was often a complex process leading to long discussions with just too many parameters to compare. Now, with a new strategy presented this comes to an end.  

 

Business Planning

For planning we can find a complete update in this blog. Sheldon Edelstein presents a clear overview of all planning applications currently available. Regarding ERP, he takes the most recent on-premise version S/4HANA 1909 as a starting point and provides an explanation of the applicability, features and future possibilities of each of these applications in the rest of his blog.

BPC roadmap choices

source: Blog Sheldon Edelstein, October the 25th 2019

 

Key conclusions:

  • Netweaver based solutions are ‘out’. For standalone (BW based) planning solutions the route to BPC11.1 on BW/4HANA has been obvious for a while. As we know this solution is based on a new code line and therefore not Netweaver based. Migration tools are already available for both the classic and the embedded model. Support however remains until 2024.
  • Classical ERP planning transactions had already been replaced more or less by BPC optimized variants as from S/4HANA 1610
  • BPC Optimized for S/4HANA clearly is a different case. This solution is also based on Netweaver technology (Embedded BW 7.5) but also more or less integrated into S/4HANA. In addition, BPC Optimized for S/4HANA comes with unique content that has already been used by many customers. Main examples are the SFIN content for financial planning, but also content for CPM (Commercial Project Management).
  • The cloud is the future. SAP rewrites the content we know from BPC Optimized for S/4HANA and adds more useful components to make it available for SAP Analytics Cloud.

Darrel Zaulda goes into more detail. In his blog he refers to this contribution of Michel Haesendonckx. Michel presents the SAP vision on business planning using SAP Analytics Cloud directly on S/4HANA based on the following concept:

planning types

Detailed documentation of the components of this content can be found here.

 

Key Conclusions:


    • From a FP&A perspective, it is quite interesting to note that the majority of the planning can now be done in SAP Analytics Cloud (even Liquidity Planning). The SAP Analytics Cloud development team seems to be on top speed in developing this product.
    • We finally see CAPEX planning content! Although not yet available a long-awaited bonus!
    • The SAP strategy for planning goes well beyond financial planning only. We see integration with headcount planning (HR) for example. Additionally, we can find direct integration between logistics planning (IBP) and financial (business) planning which has also been high on the wish lists for many users for a long time
    • Is it possible to publish planned data in SAP Analytics Cloud to S/4HANA, for example into the ACDOCP table? Yes!: See this blog for details.
    • The chosen architecture makes it possible to align allocation rules for indirect costs between planning and actual data sets. Main objective here is providing full traceability of the entire value chain including simulation options and predictive applications. Discover more about the idea behind the universal allocation process here.

 

Frontend: Web vs Excel

Nothing seems to be more important for (Financial) Planners than frontend. And we all know MS Excel is the preferred solution here. Natively SAP Analytics Cloud leverages a web interface. You can choose weather to use a standard table or an excel-like grid. SAP Analysis for Excel can also be used to connect to models in SAP Analytics Cloud. Besides reporting also some planning functionality is supported. This functionality is limited however.

 

SAP recently announced a new solution for MS Excel integration: SAP Analytics Cloud, add-in for Microsoft Office. Ingo Hilgefort refers in his blog to this webinar. Highlights:

  • A separate Excel add-in is introduced for SAC integration. Analysis for Office is seen as core product for BW/BPC integration
  • The product is based on Office 365. Both Excel online and Excel desktop can be used
  • The current beta version supports only reporting. However, supporting planners with native Excel functionality on SAC is a key reason for developing this extra add-in
  • Roadmap: Planning functionality will be added asap H1 2020, Excel for Ipad is on the roadmap for future releases

 

Live Connection vs Import connection

Most of the delivered content for planning with SAP Analytics Cloud direct on S/4HANA is based on using an import connection. In practice this means data replication. With the data stored in SAP Analytics Cloud all planning functionality such as using data actions can be utilized with superior performance guaranteed.

The downside is that it is not fully real-time. Compared for example to replication in SAP BW, the process is much simpler and can be scheduled or manually triggered by (business) users. It can therefore be described as ‘near’ real-time.  This can also be seen in a positive way saying planning loops can be executed in a more controlled way. Anyhow, in future scenarios SAP has not been very concrete about planning content using live connections to S/4HANA.

Looking at on premise BPC a live connection to SAP Analytics Cloud is available. However, only when using the embedded model this option can be leveraged. The standard model is restricted to an import connection. Write back to BPC is supported however. Details can be found here and here. Also stay alert for a new blog coming from Expertum providing extra information on this topic coming soon.

 

Summary & Outlook

SAP takes a considerable step forward to support users even better in the area of effective, integrated and aligned business planning and control. The question of how fast these new features can be realized within client organizations will depend on individual factors. Those who have chosen to make the transition to S/4HANA in an early stage will be the first to reap the benefits. The amount of standard SAP used and synchronized master data will act as speed determining factors.

When it comes to direct applicability, we still see a diffuse picture at the time of writing. Both in the large and middle segment, many companies still have not migrated their ERP system to S/4HANA or are in the middle of it. When looking at Analytics, this is also the case for SAP Analytics Cloud.

A lot has been invested in the (SAP) data warehouse over the years with powerful planning and reporting solutions such as BPC and BusinessObjects apps on top. In many companies this has evolved into a platform of business truth. Those who choose to continue to follow this path will find their immediate future in BPC 11.1 for BW/HANA 2.0, possibly combined with SAP Analytics Cloud using a live connection. If, in the long term, they nevertheless choose to go for SAP Analytics Cloud directly on S/4HANA, the 2 “values of the truth” that appear (in BW on the one hand and S/4HANA exposed via SAC on the other) can certainly be seen as a project risk. In this case it will have to be carefully examined to what extent these can be unified and exist in parallel. In many cases this will be accompanied by some kind of "Back to SAP standard project" most likely.

Those who have chosen to implement BPC Optimized for S/4HANA have often already gone through this phase. It is certain that Netweaver is not part of the strategic SAP product line. From that perspective a rebuild in SAP Analytics Cloud seems the best path to follow. Given the difference in technology, it seems unlikely that migration tools will be supplied. However, these clients will be able to execute a project with a kickstart because of their experience of implementing a planning solution directly on S/4HANA. As a downside they are forced to step away from their true real time solution realized using BPC Optimized for S/4HANA. Where planning based on a live connection is still a ‘future direction’ on the SAP roadmap it is up to them to decide when to make this switch to SAP Analytics Cloud. Fortunately, there is no rush. They can still benefit SAP maintenance and support up until 2024 for their current solution. Details can be found here.

 

Stay alert for the second part of this blog where focus will be on financial consolidation.

 

If you would like to know more about Planning & Consolidation, please do not hesitate to contact us

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Machiel Grobben