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Orienting Your Business to New Standards for Business Process Integration

by Alfons Wahlers | SAPinsider

July 1, 2003

by Alfons Wahlers, Director Information Technology and Organization, Keiper GmbH & Co. SAPinsider - 2003 (Volume 4), July (Issue 3)
 

Many enterprises have found it possible to set up standardized and integrated processes by introducing SAP R/3. One key subject at this year’s annual meeting of DSAG (the German SAP User Group) will be how future requirements for standardization and integration of general processes within the enterprise or business unit can contribute to increased competitiveness.

Business Process Challenges
The timeframe for launching new products is becoming increasingly shorter. For example, in the last 10 years, development time in the automotive industry has been reduced from 5 years to 11/2 years. Product variance and the quality of products have increased, while at the same time, there is continued pressure to lower costs. This can only be achieved by consistently reducing process costs using the newest in information technology.

Businesses also are facing the need to adapt processes more quickly to new value chains. This requires flexible company software. In addition, there are constantly changing responsibilities within the value chain — service providers and suppliers can suddenly find themselves responsible for an entire, end-to-end business process, for example, when:

  • Business processes are transferred to suppliers within the value chain

  • Logistics tasks are turned over to logistics service providers

  • Production processes move abroad or to suppliers

  • Production developments shift to technology partners

  • Non-core business processes are outsourced

Concentrating on core competencies makes business models simpler and more efficient; still, business processes continue to become more complex — that is, unless they can be standardized and integrated into the business model, even as an external process.

Analysts from Gartner have seen a genuine challenge for the real-time companies of the future: at the moment, IT systems do, to a large extent, fulfill these real-time requirements, but the standards to integrate processes and information are not yet in place within the companies themselves.

A New Way of Thinking About Integration
As a result, the IT systems of the future require a paradigm shift. Whereas previously one talked of application integration, nowadays one talks of business process integration. New technologies — such as SAP NetWeaver, the SAP Exchange Infrastructure, or user integration through portals — trigger a new wave of standardization within business process integration.

At the same time, process integration also means trustfully integrating all parties involved — from customers to suppliers, employees, and other stakeholders — into the flow of information. This requires enterprise-wide change management that will be the critical factor for success.

My recommendations:

  • Be prepared for these new technologies by migrating to the new infrastructure standards of SAP R/3 Enterprise, mySAP ERP, or mySAP Business Suite.

  • Take the opportunity to initially introduce small Internet-based business processes into the company to support new products and standards.

  • Make your company “ready for collaboration” electronically.

  • Start with collaborative business processes, which provide immediate benefits.

  • Take advantage of possible reductions in operating costs by upgrading to SAP R/3 Enterprise.

And, finally, DSAG invites all members and interested persons to the Annual Congress in Bremen this October, where attendees can gain insight into new standards and technology that companies can use to address the short-term need for long-term business benefits.

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