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Finance Challenges Meet Their Match

by James Fisher | SAPinsider

April 1, 2012

A precarious market and slow economic growth have taken finance challenges to the next level, spurring CFOs to develop a growing range of skills. To help, SAP has developed a number of innovative solutions that use today’s most valuable technologies – in-memory, mobile, and cloud -- to drive down costs and improve the predictability of earnings. This article details how CFOs and their teams can leverage these technologies to conquer their most daunting financial challenges.
 

When speaking with finance professionals, I consistently hear that they are facing these core challenges:

  • Ensuring that the organization complies with external reporting regulations and follows effective risk management processes
  • Delivering on financial objectives and creating sustainable value for stakeholders
  • Driving advancements in transactional areas like invoicing to improve service and reduce costs

A precarious market and slow economic growth have taken these challenges to the next level, spurring finance organizations to develop a growing range of skills. To help CFOs and their teams meet evolving business needs, SAP has developed a number of innovative solutions that use today’s most popular and valuable technologies — in-memory, mobile, and cloud — to drive down costs and improve the predictability of earnings.

The Speed of In-Memory Technology

Handling large amounts of data from profitability reports generated by the controlling modules of SAP ERP Financials can be daunting. Long run times inhibit the rapid analysis needed to support pressing decisions.

But these constraints have been removed with the launch of SAP CO-PA Accelerator, a solution that uses the in-memory capabilities of the SAP HANA platform to report on the data generated in the Controlling-Profitability Analysis module of SAP ERP Financials. The difference in calculation speeds is astounding. For instance, it usually takes minutes to run 120 million records in a traditional environment. Using SAP CO-PA Accelerator, these records can be available in less than one second with complete drill-down to line-item-level capabilities, without the need to load data into a data warehouse for analysis. Business users involved in product and customer management can instantly access detailed reports, enabling them to make more-informed decisions about prices and discounts that, cumulatively, can significantly affect overall profitability. 

Similarly, SAP Finance and Controlling Accelerator, based on SAP HANA, gives finance organizations instant access to vast amounts of general ledger and cost and material ledger data in SAP ERP Financials. The solution also allows users to explore data down to granular detail, which was impractical in the past because of long calculation times. Four implementation packages are available: Financial Accounting, Controlling, Material Ledger, and Production Cost Analysis. Delivered as rapid-deployment solutions, these packages can be implemented quickly at a known cost and with a fixed scope.

SAP HANA’s ability to process large amounts of data will also transform the way companies plan and budget. A soon-to-be-released update to SAP BusinessObjects Planning and Consolidation version for SAP NetWeaver will support the SAP HANA engine. It will be a key enabler for a new level of enterprise business planning that unifies the often disparate areas of strategic planning, sales and operational planning, and financial planning. Changes to granular data, such as sales volumes of an individual product, will be able to ripple straight through to the profit and loss account. As a result, more accurate budgets can be forecasted and reworked on demand, and multiple scenarios can be collated more easily — a necessary feat to cope with market uncertainty. Be on the lookout for more in-memory applications designed to assist finance departments, scheduled for release throughout the year.   

The Essential Role of Mobile Technology

Mobile technology innovations play an important role in assisting finance organizations. With the 10.0 release of SAP BusinessObjects enterprise performance management (EPM) solutions, SAP delivered performance management capabilities on a mobile platform. Employees can use these solutions on their mobile devices to track performance and receive automated alerts directing them to items that need their attention. Recently released mobile apps also allow employees to use their mobile devices to approve payments (SAP Payment Approvals), requests for access rights (SAP GRC Access Approver), and travel expenses (SAP Travel Expense Approval), as well as capture travel receipts with a smartphone camera (SAP Travel Receipt Capture).

But according to a recent study conducted by the Canadian Financial Executives Research Foundation, the most beneficial use of mobile technology currently focuses on sales.1 Survey respondents valued the ability to use mobile apps to provide their customer-facing colleagues in sales with timely access to financial data — amounts of outstanding or overdue invoices, credit limit, credit limit utilization, and credit risk class, for example — to help them manage customer accounts more effectively. The SAP Customer Financial Fact Sheet mobile app addresses these requirements by providing real-time updates about a customer’s financial status and helps enable finance teams to better support line-of-business operations.

The Allure of the Cloud

Until now, the majority of finance applications used by large enterprises have been on-premise solutions that IT teams must install and that are enhanced through new releases. SAP continues to deliver innovations in the core financial modules of SAP Business Suite (such as more embedded analytics and contextual information shown in side panels of SAP ERP Financials user interfaces) and a more intuitive user experience with the 10.0 releases of SAP BusinessObjects governance, risk, and compliance (GRC) and EPM solutions. But we do recognize evolving trends in the business. The need for quicker time to value and lower total cost of ownership is now driving many companies to turn to cloud-based solutions.

With this in mind, SAP released SAP Travel OnDemand. This cloud solution allows business travelers to plan their trips and manage their expense reimbursements, all while staying within corporate policies and requirements. This offering gives finance departments a quick and simple way of containing expenses at a time when travel costs are creeping up. SAP plans to release other cloud solutions geared toward finance organizations, including e-invoicing.

The Bottom Line

To help your finance department perform better than ever in today’s precarious marketplace, SAP offers innovative solutions, many of which were developed in collaboration with customers. For example, the new commodity management functionality that we added to SAP Treasury and Risk Management resulted from working directly with customers. This focus on understanding customers’ needs and helping them transform finance into a value-creating function is highlighted with last year’s launch of our CFO and Finance Leadership Center (www.sapcfo.com), which showcases numerous examples of customer success and our game-changing innovations.

For more information about the SAP roadmap for finance, please visit http://service.sap.com/roadmap.2

         
     

James Fisher (james.fisher@sap.com) is Vice President of Marketing for Enterprise Performance Management and Finance Solutions at SAP. James has over 15 years of experience in the enterprise  group reporting, compliance, and performance management industry. Previously, he held global and EMEA marketing and consulting roles at Business Objects, PricewaterhouseCoopers, and KPMG.

         

1 Canadian Financial Executives Research Foundation, “Enterprise Mobility: Executive Perspectives on Mobile Business Applications,” 2011. [back]

2 To learn more about how SAP and partners arm finance departments with tools for success, see the “Solutions for the CFO” special report in this April-June 2012 issue of SAPinsider. [back]

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