Published on July 19, 2021 – Dr. Oliver Blau, Managing Director at Westernacher
Reading the postings and comments to our recent article “Financial Planning with SAP Analytics Cloud”, we realize that there is a clear wish for more detailed information. In particular, the question “why are we so much faster today?” merits further discussion – financial planning with SAP used to involve massive effort. Back in 2010 it was taken for granted that implementing an SAP financial planning solution would demand a substantial budget and a daunting timeline; today, we claim we can deliver a better solution at a fraction of those budgets and at what looks like breakneck speed. Quite rightly, we are being asked how this is possible?
Today’s SAP Analytics Cloud-based financial planning solutions are technically and functionally lightyears ahead of the multitude of decentralized, standalone, and Excel-based solutions that companies are still struggling with. Moreover, these solutions are cleverer and simpler in many respects when compared to classic integrated SAP solutions such as SAP BPC or SAP BI-IP. Let us now expand on why this is and what the many reasons are why we keep coming back to the cloud solutions being both better and faster to implement.
What is of immediate help nowadays (and this is something completely independent of the target system or solution) is that there is a much broader level of experience within a company’s business team. These functional planning experts are already working on their financial plans using one or the other tool, and there are established processes on which we can build and get clear ideas of what needs to change and be improved on in the future. With such levels of detailed know-how, we see a broad demand in the market for standardized solutions and packaged offerings that can serve as starting points and tempt with quick wins.
Involved parties and shifts in responsibility.
From an organizational standpoint, there are notably fewer stakeholders and participants when designing and implementing a financial planning solution based on SAP Analytics Cloud. This is in sharp contrast to complex IT-specialist driven solutions such as SAP BPC or SAP BI-IP: with these, the IT department has to be heavily involved throughout the entire process. Cloud solutions like SAC have now greatly shifted the focus during design and implementation to where it needs to be – to the business teams. IT involvement is much reduced, namely to providing the genuine technical basis of the cloud application, such as systems connections and user administration.
This trend is further encouraged by the self-service options within SAC. While self-service reporting has long been the dream of business users, in most cases they have been continually disappointed when grandiose promises and expectations met cold reality. However, when we define self-service as the ability of business users to build their own stories (reports) in SAC based on data models they have created themselves, then we can safely say that these dreams are finally being realized in our planning projects. Not only does such direct hands-on participation from the business team generate enthusiasm and a sense of fun, but it reduces external consultant efforts and costs.
SAC offers a variety of out-of-the-box functionality for planning (for example, allocations and intelligent distributions) that other SAP planning tools do not. While admittedly there is great flexibility in classical planning platforms like SAP BPC or BI-IP that let you design whatever you want, such complete freedom comes with a clear downside: all those complicated, custom developments need to run through the complete cycle of design, development, testing and bug-fixing. Not only must business and IT create and run test case after test case to support this, which are ongoing efforts, but there are often endless workshops and countless hours spent defining and programming business logic, exception handling, performance measurement and improvements, etc., naming just a handful of those common effort drivers.
The benefits that come with integration of a financial planning tool into the underlying SAP S/4HANA platform is one of the main drivers to choose an SAP planning tool. Swift integration of past and current data into the planning process or write-back functionality requires a solid data foundation often already available in SAP BW systems that are easily connected to the SAP Analytics Cloud. This way data acquisition for the planning process – even if some enhancements should be needed – is not a real effort driver anymore.
Agile delivery model.
While there was no alternative to the high development efforts (in the area of 50+%) to build the core functionalities in SAP BPC and BI-IP before they could be shared with business users for “early access” preview and involvement, today we are facing a completely different setup when using SAP Analytics Cloud for financial planning.
Data preparation itself is now something that the business users can take care of directly in the tool, and this is often a great way to introduce key users to the tool and give them their initial training. Moreover, by having the business teams taking an active part in the development process from the very beginning, they are empowered to take ownership and build the planning stories in SAC to do what they need and in the way that helps them best with their work. In smaller iteration cycles, more IT-driven topics like versioning, authorizations or data connections are developed in parallel with key business users testing their new processes with carefully chosen end users.
Thus, the whole development process becomes much more interactive and is kept closer to the business users than ever before despite shrinking the overall effort. Another huge advantage of being able to work together in this way is that the developments are business driven throughout and the usual risks of misconceptions and fundamental design error become practically impossible.
Performance issues in classical tools have historically presented ongoing technical challenges when developing new planning tools. Often the ambitions of the business and IT teams had to be carefully weighed against the poor responsiveness that the end users were prepared to put up with. Thankfully, the advent of modern in-memory platforms has more or less consigned these considerations to history. Those inevitable performance-tuning efforts are obsolete in modern SAP HANA-based planning applications insofar as the development team has the deep knowledge necessary to leverage them to their fullest advantage. Such deep knowledge of the technology stack, of course, is quite unnecessary in SAP Analytics Cloud as it is built to use HANA accelerations optimally and invisibly to the end user.
In the end it will always be the specific functional requirements that determine whether the simple and straightforward SAP Analytics Cloud or the complex, full-freedom SAP BPC platform is needed. Complicated and difficult business requirements inevitably justify the greater development effort with SAP BPC. However, it is our experience that financial planning applications are very rarely among these. Often SAC can be used preferentially to BPC, and leads to better results with greater customer satisfaction despite lower implementation cost and effort.
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