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Innovative Product Development: New SAP Functionalities Promote Consumer-Driven, Sustainable Innovation

by Thomas Ohnemus | SAPinsider

April 1, 2010

To profit and to grow, manufacturers cannot focus only on cutting costs. They need to innovate, and they need end-to-end processes to support that innovation. Discover which new enhancements to SAP Product Lifecycle Management and SAP Portfolio and Project Management will help you drive innovation and growth in your company.

As the world economy moves from recession to recovery, product manufacturers and service providers that concentrated only on cost savings and operational efficiencies a year ago are now slowly shifting their approach. The time has come to make smart investments that will drive revenue growth and position your business to gain market share once again.

Now, beyond maintaining a focus on cost cutting, product and service providers are also challenged by these questions:

  • How should I adjust my product strategy to benefit the most from the economic upswing?
  • How can I develop successful, highly innovative, top-quality, sustainable, and compliant products at competitive prices?
  • Where should I invest to see the best results?

To master these challenges, manufacturers need end-to-end process support for all aspects relating to innovation, and these processes need to be coupled with other enterprise business processes; they can’t operate in a vacuum. That’s why SAP has developed a long-term strategy to continuously invest in applications, like SAP Product Lifecycle Management (SAP PLM) and SAP Portfolio and Project Management, that support innovation and development processes.

In this article, I’ll showcase the innovative ways that new functionalities and products from SAP can help you set the course for a successful future.

SAP Portfolio and Project Management 5.0 is not just a project system — it’s a project system embedded in a portfolio application that’s seamlessly connected with the entire enterprise. This is its key differentiator.

Make Smart Investments with a Clever Portfolio Management Strategy

To ensure that your product portfolio investments are smart and focused, you need to align these investments with your overall business strategy — which, for most companies, is now centered on overall growth and market share increase. Accordingly, you’ll be able to make precise investments in the most promising programs and products while keeping an eye on overall portfolio performance.

Consider, for example, the innovation process. Identifying opportunities, bottlenecks, and risks early is crucial when developing successful products and services — roughly 70% of product costs are locked down during the design phase. By aligning the operational spend of product innovation with the overall business strategy, you ensure that every development-related effort or resource deployment will have a positive impact on your product sales.

SAP Portfolio and Project Management 5.0 is an easy-to-use solution that you can access through your Web browser. It provides improved visibility and management capabilities for your product portfolio and helps you manage even complex development projects through an effective stage/gate process.

New functionalities within SAP Portfolio and Project Management 5.0 enable you to align activities, resources, and budgets with business priorities, resulting in better use of limited resources, timely performance monitoring, avoidance of bottlenecks, and more-informed decision making.

What’s more, including sustainability standards, corporate policies, and best practices in the early phases of your innovation and development processes is paramount to reducing compliance risks. That’s why we’ve built fact-based, real-time decision support capabilities into our portfolio and project management solution. You can measure the impact of every change in your operational project and check whether it coincides with your compliance mandates.

Couple Portfolio Management with Project Management

Even if additional cost cutting is not your top priority this year, operational efficiency will still remain important; your ability to deliver products on time and within budget is a prerequisite for success. To achieve your operational targets, comprehensive project management functionalities available in SAP Portfolio and Project Management 5.0 can help you facilitate collaboration with internal and external stakeholders, giving you full visibility into project performance. For example:

  • A multi-project monitor makes it easy to oversee all your ongoing projects (see Figure 1).
  • A project editor helps project managers update and maintain complex project definitions.
  • Powerful workbench administrator capabilities allow you to manage, change, and configure projects from an overall administrator perspective.
Figure 1 The multi-project monitor in SAP Portfolio and Project Management 5.0 makes it easy for managers to oversee all of their in-progress projects and maintain high performance levels

Another strength of SAP Portfolio and Project Management 5.0 is the tight integration of its project management capabilities with business execution processes, including design, manufacturing, service, and purchasing. For example, to compare available resources against those required, you can leverage reliable resource data that comes directly from your central resource management software. The result of this integration? Significantly reduced operating costs.


Released in April 2010, SAP Portfolio and Project Management represents the merger of SAP Resource and Portfolio Management (SAP RPM) and Collaboration Projects (cProjects).

Ease Design Collaboration for Global Teams

Product development teams are often spread all over the world and, as a result, collaboration processes suffer from fragmented, ineffective, time-consuming communication. Accordingly, product development organizations need integrated software that allows them to share data not only with team members or departments, but also with external parties involved in the design process. This collaboration must be secure, especially when confidential product information extends beyond company borders.

With SAP PLM, collaboration is based on highly secure, direct access to back-end systems. This direct access enables companies to create collaborative design networks with sophisticated authorization concepts and role-specific data access. All access rights to product-related information are project driven; team members are linked to specific roles in a project, and these roles inherit role-specific rights to view, update, or create product data. For example, consider an automotive supplier supporting two OEMs with two innovative new products that happen to share some of the same components. The supplier defines two teams that work separately to develop the product for their respective OEMs. Despite the major component overlap, each team can only view their own product’s details when they navigate through their product structures, 3D models, and product information. The system guarantees data consistency and the security of OEM innovations.

This sophisticated authorization concept, based on new contextual access control capabilities within SAP PLM, eases collaboration with suppliers: Suppliers can access or provide product data in the development process without delays, and manufacturers can be assured that the company’s intellectual property is protected. Overall, the amount of shared data is reduced, and the speed of collaboration increases.

To learn more about the features and functions of SAP PLM, visit

Promote Easier Handover to Manufacturing

The handover of the engineering bill of materials (BOM) to the manufacturing department is a challenging, work-intensive process. Companies routinely have to restructure the whole engineering BOM for the handover — and then do it all over again if any changes are made to the BOM.

To alleviate this re-work, SAP PLM now delivers Guided Structure Synchronization, a feature that allows the guided transition of engineering data structures over to manufacturing production processes, enabling faster time-to-market. This synchronization between the BOMs helps product developers and their manufacturing colleagues seamlessly manage the transition between different BOMs (see Figure 2). All changes during the handover from engineering to manufacturing are “memorized” in the system, reducing the effort of continuous changes and ongoing transitions between the departments.

Figure 2 The new Guided Structure Synchronization feature of SAP PLM offers a guided process for reconciling engineering BOMs and manufacturing BOMs, ensuring a seamless handover between the two areas

Better Manage Complex Product Structures and Variants

Any given product may have multiple BOM structures to describe it — from the product’s high-level concepts (concept BOMs) down to its specific product details (engineering design BOMs). Consider a car, for example. It might have a concept structure for its basic infrastructure, a different BOM for its design elements, and yet another BOM for its first prototypes or variant calculations. As a result, product manufacturers spend considerable time navigating and managing all of these different BOMs, as each product structure has its own user interface (UI).

Within SAP PLM, new Product Structure and Assembly Management capabilities enable manufacturers to easily manage and configure complex product structures. This functionality supports variant management and configuration management and combines variant-driven product management with CAD-driven product assembly management. Manufacturers can also define different types of structures, such as high-level product definitions representing a concept BOM.

Facilitate Recipe Development and Product Labeling

Serving customers in the process manufacturing industries, SAP PLM includes a new UI supporting the needs of users involved in recipe development and formulation. SAP PLM offers other advanced functions for process manufacturers, such as a process-oriented work center, advanced cross-object searching, efficient object navigation, and UIs to interact and manage the output of formulation development. Also, enhanced product labeling in SAP Recipe Management, an application within SAP PLM, supports the process of assembling and transforming formula information into the final view of product technical data to be used for labeling on packaging. You can use product definition information developed and managed in SAP Recipe Management to create the three main components of food product labeling: nutrition, ingredient statement, and dietary information.

With these new functionalities for process manufacturers and consumer products companies, users can:

  • Automatically create ingredient, allergen, and nutrition statements and calculate recommended dietary requirements
  • Make compliance checks quickly and at an early stage in the development process
  • Easily gain an overview of all product-related data using the Business Context Viewer embedded in SAP PLM (learn more about this in the next section)
  • Leverage the substance database to support compliance, which is important for process manufacturers adhering to stringent REACH regulations

Boost Usability Through Simplicity

To help manufacturers increase development efficiency (and therefore reduce costs), SAP has deployed three major usability improvements.

1. Enhance Productivity Through a New UI

If software is not intuitive, users are unlikely to adopt it. Accordingly, the new easy-to-deploy, easy-to-use UI within SAP PLM provides information in an intelligent way to foster efficiency and productivity for all users. Based on Web Dynpro technology, the UI includes an enhanced PLM dashboard with analytics and supports material master management, BOM management, document management, and change management. New 3D-viewing capabilities are also embedded as an integral part of the solution.

Power users and casual users work with one system and select the appropriate client: Web, Portal, or Business Client. This helps drive process uniformity, which in turn helps improve user satisfaction, lower the training efforts, and increase data quality.

2. View Product Data in a Business Context

Development efficiency depends on the amount and quality of the information that is provided to all team members during the development process. To avoid costly errors, you have to open departmental borders and also consider data from other sources.

SAP’s Business Context Viewer provides embedded analytics in the context of product-related business processes. Directly in the SAP PLM interface, users can see advanced product information — such as product costs, quality notifications, or availability of materials in stock — within the new side panel or within individually defined dashboards (see Figure 3). This product-related information can derive from any source and can be embedded in the UI in a context-sensitive way. Managers can then make more informed decisions based on accurate, up-to-date product data.

Consider, for example, a designer creating a new pair of boots who needs information on a particular textile she wants to add to the design. Using the Business Context Viewer, she can access various details about the textile, including its in-stock availability, quality record, compliance record, and pricing. She can even calculate the carbon footprint of the product as she designs it. With the right enterprise information easily accessible on one configurable screen, one user can do more, driving efficiency, reducing cost, and enhancing sustainability.

Figure 3 Within SAP PLM’s new UI, the Business Context Viewer is flexible; it can incorporate numerous user-specific reports and dashboards

3. Allow Engineers and Manufacturing Technicians to Visualize Products

When companies can clearly visualize their products and share those visualizations across relevant departments, they can communicate more clearly and succinctly. And it’s not just 3D product representations — through videos, companies can also communicate instructions much more easily, increasing the speed and quality of communication across the company.

SAP’s Product Visualization capability offers design and manufacturing process reviews, configuration control and management, visual routing, and quality inspection and reporting capabilities. This intuitive UI is embedded in SAP Business Suite, allowing users to access the viewer through SAP PLM and through SAP Customer Relationship Management (SAP CRM). Different users can access different views of a product, depending on their needs or roles (see Figure 4). For example, an engineer can view a product from a functional point of view, while service technicians can see how the same product is assembled or disassembled.

Figure 4 Product visualization capabilities are embedded within SAP Business Suite; different users can access different product views depending on their role


As business leaders drive their companies out of the recession and into recovery, they cannot focus solely on cutting costs. To profit and to grow, companies must once again concentrate on new products and new ideas. They must innovate, develop, and re-invest — and any new investments must be smart ones. With enhancements to its SAP PLM and SAP Portfolio and Project Management solutions, SAP is providing the functionalities companies need to support innovation and growth. For more details, visit

Thomas Ohnemus ( is Senior Director of Solution Marketing for SAP Product Lifecycle Management (SAP PLM) and product and service leadership (PSL) at SAP AG. He is responsible for SAP PLM and PSL marketing strategy, market analyses, and long-term strategy. He has over 20 years of experience as a PLM expert. Thomas has spent most of his career in the PLM software area, working primarily in implementation consulting, product management, and marketing. He holds a master’s degree in engineering.

1 For more details about SAP Business Suite 7, see “Establish Your Product and Service Leadership” by Thomas Ohnemus in the April-June 2009 issue of SAPinsider. [back]

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