Enterprise Services Blog Outperform Your Competition: Accelerate Time-to-Value

Outperform Your Competition: Accelerate Time-to-Value

  • March 9, 2017

By Joachim Mayer and John Bennett

Accelerate your digital journey by accelerating time-to-value.

Organizations must continuously capitalize on market opportunities and adjust to market disruptors with new solutions, business models and revenue streams. Time to market is increasingly important, not just as a competitive differentiator but for business survival. Now is the right time to migrate your ERP solution to cloud by e.g. transforming your SAP core to become more flexible and agile while supporting your digital business.

With our previous blogs we outlined four major advantages to gain from a cloud based SAP solution (see figure 1):

  • Accelerate time to value
  • Continuous improvement
  • Reduce TCO
  • Always-on and resilient

 

Figure 1: Major advantages of SAP on demand

Each of these major advantages will be discussed in more detail and with examples in a series of blogs. In this blog we will focus on Accelerate time-to-value.

Now imagine which of the following scenarios would best fit to describe your current situation or plans regarding your SAP environment?

Do you plan to migrate your SAP landscape to the current release in the near term?

Many SAP customers are still on older releases (in many cases even far from current ones). Latest by 2025 the maintenance for the actual SAP ERP product will be terminated and the product will be replaced by SAP S/4HANA. What do you think about a significant reduction of effort and time for such a migration? Migration to cloud based SAP releases could take only 6 months[1] or even less while a migration of traditional SAP releases typically takes 18-20 months (or even longer depending on the degree of customization). We can help you to deploy such a migration up to 25 percent faster and will save you up to 40 percent of the respective cost.

Do you plan to implement new features extending your SAP application to support new functionality enabled by new technologies such as Internet of Things (IoT), mobility or analytics?

Having an SAP environment in place provided as Application Platform as a Service (APaaS) with respective DevOps capabilities (see figure 2) gets you into a very competitive position by saving up to 25 percent in cost and time to develop and deploy new features.

The following figure 2 visualizes the APaaS solution stack (we call it Enterprise Solutions On Demand for SAP), and it is important to understand, that rapid provisioning with this solution does not mean provision just a server, it means provision a fully functional SAP resource (i.e. an SAP instance incl. the full stack consisting of server hardware/OS, database and SAP application). So any of the mentioned examples results in a fully functional SAP environment.

Figure 2: SAP on demand solution stack (aPaaS)

Do you envisage a merger or acquisition transaction where both parties have SAP landscapes to be merged, or one party’s ERP has to be replaced by a common SAP landscape for the NewCo?

Having an SAP environment in place provided as APaaS solution would help to significantly reduce effort and time of such an SAP landscape transformation, overall you could save up to 25 percent in cost and time.

Your IT is already supporting some kind of digital business and you are very familiar with the respective IT constraints vs. business demand paradigm (see figure 3), i.e. “time is money”, every period of time applications are not up and running your business is losing significant amount of revenue. Supporting a digital business your overall objective is to avoid any disruption. So in cases where you need for example to conduct any maintenance or proof of concepts activities in your SAP landscape, you would need to apply these first to a copy or clone of your production environment. With a cloud based SAP solution you can easily provision required SAP resources much quicker, such as in minutes or hours, instead of days or weeks.

Figure 3: IT constraints vs business demands

For predefined use cases you can enable your business users to directly manage SAP resources on demand with in fact no IT involvement, just by requesting a catalog item to be executed in minutes/hours instead of days/weeks. Let those business users perform SAP copies, clones and refreshes whenever needed.

For example your project teams can provision SAP resources for patches, security assessments or other requirements on schedule or ad hoc. And further, if for whatever reason the provisioned SAP resources are finally not required on that scheduled date, let the project teams suspend/stop these SAP resources to avoid charges and let them resume the SAP resources on the new date, whenever they are ready to execute the project. The following demos give you an idea how this rapid provisioning of SAP resources would work: ESO for SAP copy, ESO for SAP suspend/resume, ESO for SAP elasticity.

Rapid provisioning and scaling of SAP resources enables your business users or project teams to adopt the digital business platform whenever the business requires it according to peak or decreasing demand (see figure 4).

Figure 4: Outperform your competition by SAP on demand

We mentioned above the implementation new features to extend SAP functionality based on new technologies such as Internet of Things (IoT), mobility, and analytics. Let’s look at some examples, what advantages such new features can have for your digital business.

  • Real-time analysis[2]: Integrating cloud and application key performance indicator (KPI) monitoring can provide detect-to-correction capabilities. It will track infrastructure and application performance on business and technology KPIs, determine when specific issues might impact the business, and engage automated mitigation methods to resolve them before they become an issue. Such resolutions can take minutes, too, instead of the days it takes to manually mitigate problems after they arise.
  • Real-time analysis to reduce DPO[3] [4]: Cloud ERP-based accounts-receivable operations can analyze customer payment patterns in real time. Analysis also makes recommendations on which customers to target in bill collection efforts, to be initiated immediately.
  • IoT[5]: Improve asset utilization by cloud ERP finance asset valuations. Assets typically are put on a balance sheet and depreciated over time. Put sensors on the assets so valuation can be based on use, enabling you to write off underused assets.

The above described examples of new features can be much easier implemented with cloud based ERP than with traditional ERP solutions. More and more of these new capabilities will come as embedded features with latest cloud-based ERP releases. Cloud-based ERP relies on configuration, since the vendor must maintain consistent system code for all customers. That consistency enables benefits beyond the elimination of upgrades. APIs can be standardized, and systems work more reliably and are easier to keep up to date. ERP vendors can build richer API libraries, which broadens the scope of data available for analysis and reporting in the ERP system.

Let’s now look at the business perspective, and how a cloud based SAP solution can better support an agile digital business by supporting new business models, generating additional revenue, reaching new markets and customers.

Aberdeen Group[6] [7] [8] [9] [10] has researched for a couple industries, how much better cloud based ERP is supporting various business outcomes (KPIs) than traditional ERP. We consolidated the results from the various Aberdeen studies into a single table (see figure 5). Here we focus only on KPIs which contribute to Accelerate time-to-value.

By the use of cloud ERP Professional Services shows across all reported metrics better than factor 2 improvements (complete on-time delivery, internal schedule compliance, improvement in the cycle time of business processes), while for “improvement data available in time to decision” improvement was above factor 3. Manufacturing shows for two observed KPIs improvements better than factor 2 (improvement in time to decision, improvement in the cycle time of business processes), while Midmarket is near to factor 2 improvements for these metrics, and Wholesale & Distribution gains better than factor 2 for “improvement data available in time to decision”. But don’t forget, even improvements above factor 1 are significant, as for example a factor 1.1 stands for an improvement of 10%. So overall cloud ERP provides solid if not outstanding improvements for a couple of “agility” KPI examples across selected industries. We will discuss other KPIs such as cost, customer satisfaction, etc. in the following blogs.

Figure 5: KPI improvements from cloud ERP vary across industries

 

Stay tuned for further blogs being published during the coming months, such as:

  • a series of blogs will discuss the specific values you can gain from our on demand SAP solution
    • Accelerate time to value (week March 6th)
    • Continuous improvement (April)
    • Reduce TCO (April)
    • Always-on and resilient business (May)

In our previous blogs we have provided you access to all information about this new offering we have shared with our clients at HPE Discover London, a webinar we hold on January 31st, and the point of view paper we have published in February.

We are interested in hearing your thoughts on this subject.  What reasons can you identify to move your SAP environment into the cloud?

About the Authors

21784e8Joachim Mayer, Workload and Cloud Marketing, Hewlett Packard Enterprise. Joachim is the HPE global marketing manager for continuity services and ESO for SAP. With prior experience in product management, sales enablement, sales, and consulting he is able to provide insight from this diverse experience.

 

 

21784e8John Bennett, Enterprise Services Marketing, Enterprise Services, Hewlett Packard Enterprise. John has been with the company for over 35 years, currently responsible for WW Enterprise Services Marketing. Before joining HPE Enterprise Services, John led the development and marketing of the pan-HPE Data Center Transformation Solution and revival of its Business Continuity and Availability solution. Based in Massachusetts, he has an MBA from Clark University, Master of Science in computer science and Bachelor of Science in mathematics from Rensselaer Polytechnic Institute.

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[1] CIO online: ERP heads to the cloud, Michael Nadeau, Sep 20, 2016

[2] CIO online: ERP heads to the cloud, Michael Nadeau, Sep 20, 2016

[3] Days Payment Outstanding

[4] CIO online: ERP heads to the cloud, Michael Nadeau, Sep 20, 2016

[5] CIO online: ERP heads to the cloud, Michael Nadeau, Sep 20, 2016

[6] Cloud ERP’s Time has come! Nick Castellina, Aberdeen Group, July 2016

[7] Cloud ERP in Wholesale and Distribution: Driving Success Across a Wide Network; Nick Castellina, Aberdeen Group, February 2017

[8] Improve Your Midmarket Business Operations With Cloud Applications; Nick Castellina, Aberdeen Group, September 2014

[9] Cloud ERP Provides The Upgrade Your Professional Services Firm Needs; Nick Castellina, Aberdeen Group, October 2015

[10] ERP’s Role In The Modern Manufacturer: Supporting The Needs Of Industry 4.0; Nick Castellina, Aberdeen Group, February 2017