Since the launch of SAP Business Suite powered by SAP HANA early last year, the number of SAP Business Suite powered by SAP HANA customers has exceeded 1,200 — and is climbing — making it one of the fastest-growing products in SAP’s history. This adoption volume demonstrates how customers are viewing in-memory computing not just as a side solution for faster reporting and advanced analytics, but as a means to move away from batch-processing to real-time business. One factor that will most likely continue to contribute to the steep adoption curve is the low total cost of ownership that has brought SAP HANA to comparable cost ranges with classical disk-based databases.
There are several elements driving this TCO reduction. First, customers are experiencing a large reduction in their database size after moving to SAP HANA, bringing down the total amount of memory required for data storage and with it the overall cost. Second, SAP’s new tailored data center integration offering allows customers to reuse existing hardware investments when deploying SAP HANA, carrying additional hardware and operational savings beyond what can be achieved with the physical appliance model. Third, the recent release of SAP HANA running on VMware Vsphere 5.5 for production allows customers to scale single node SAP HANA implementations up to 1TB in virtualized environments, increasing hardware asset utilization and driving down cost.
Moreover, SAP’s announcement earlier this year that SAP Business Suite is now available with a new subscription-based pricing on SAP HANA Enterprise Cloud offers significant capital expense reduction opportunities and an easier transition for those customers who were initially slow to move to SAP HANA because of the upfront investment. Finally, SAP HANA Live, the real-time reporting engine within SAP Business Suite powered by SAP HANA, allows customers to run key operational reports within their transactional systems without the need to move them to a separate data warehouse.
The following customer examples from SAPPHIRE NOW 2014 highlight the above factors and showcase successes customers are already seeing by running SAP Business Suite on SAP HANA.
Mercedes-AMG Drives Real-Time Performance
Mercedes-AMG, the high-performance division of Mercedes-Benz, was the first automotive company to go live with SAP ERP powered by SAP HANA. During the SAPPHIRE NOW presentation, Dirk Zeller (Head of IT Consulting, Mercedes-AMG) said, “If you want to be an innovator in the high-performance segment as AMG does, you have to always be on the cutting edge technology-wise. To reach a high-performance product and innovations, you also need the support of IT to make success possible.”
To maintain the IT structure for the development of high-performance cars, the company uses SAP software and has all of its business processes linked together through the landscape. A year ago, the business did a proof of concept for SAP ERP powered by SAP HANA, which proved successful. This year, Mercedes-AMG went live with the solution in April 2014 in a virtualized productive environment using VMware enhancing asset utilization and cost efficiency. Six weeks into the implementation, there have been no disruptions to the business.
One of the challenges during this implementation was to have SAP HANA integrated within the AMG standard data center processes running alongside their other servers and using their existing data center management tools for backup, restore, monitoring and clustering, among others. In this regard, SAP HANA Tailored Data Center Integration allowed Mercedes-AMG to run SAP HANA not as an appliance but as servers linked to their enterprise storage within their own data center processes.
The mission is to close the gap between transactional computing and business analytics requirements and bring them together in real time, so there are no more batch-loading processes, copying data into a data warehouse, and experiencing time lags. With this solution, Mercedes-AMG also has a good IT foundation for the future development of the company.
Suzano Paper and Pulp Discovers the Value of Running a Real-Time Business
Suzano Paper and Pulp, one of the largest pulp providers in the world and leader in paper manufacturing in South America, was the first company in Brazil to implement SAP Business Suite powered by SAP HANA to advance innovation and meet demand for faster and better information for business users.
“We are a decision-making company, and we want to strengthen that with better information management,” said Augusto Cruz, IT Director of the company. “Because we produce paper in a made-to-order fashion, better accuracy can tell us what products are cost bleeders and what we can sell quickly. With SAP HANA, we have replaced our existing database, considered new transactions, moved to Unicode, and went to production smoothly with no disruption to the business.”
And what did this project cost in terms of effort? Out of the 76 hours of downtime through the entire project, only six of those hours were related to SAP HANA. Benefits to finance and accounting include faster access to data in the general ledger, better level of accuracy, easier reporting, faster closing, higher productivity, and real-time reconciliation. Operational reports now provide transparency into customer orders for improved credit analysis, quota fulfillment, and forecasting predictions. Real-time access to complex data like materials documents allows for faster stock reassignment and item-level inventory visibility. Also, real-time insights into supply chain information, such as order history data, accelerate decision-making processes and lead to lower operating costs.
But improved reporting and supply chain inventory management are low-hanging fruit, according to Cruz. “You can use SAP HANA to make decisions that were not possible before, and these decisions are not tangible,” he says. “SAP HANA improves performance with large volumes of data to support a large diversity of needs and increasing the ability of business users.”
Hidrovias do Brasil Operates Faster in the Cloud
Hidrovias do Brasil, a start-up business that manages transportation of commodities like soybeans through the waterways in Latin America via pushers and barges, was experiencing aggressive growth and wanted to implement a hosted solution based on a single global SAP instance that would drastically reduce operation costs. As a native cloud company that doesn’t have any on-premise systems or data centers, the business was the first in Latin America to go live with SAP Business Suite on SAP HANA Enterprise Cloud.
The journey started in March 2013 with a rollout in Brazil that was complete in just four months — with rollouts scheduled every three months thereafter. “We saw this cloud implementation as a big opportunity to get a real-time view of the information we need to run our business and provide logistics insight into the field,” said Dr. Rogério Dutra, former IT Head and SAP Program Director of Hidrovias do Brasil. “We selected the cloud-packaged approach and followed the rapid-deployment solution template because we saw it would save us a lot of money and time.”
The business expects to see a cost savings of 70% over five years with SAP HANA Enterprise Cloud compared to a traditional on-premise solution. This reduction in cost is calculated from a combination of server, storage, network, environment, and administration resources, according to Dutra.
So far, the company’s database footprint has already been reduced tenfold. “Streaming data will require more storage space so the compression is very important,” Dutra said.
Pacific Drilling Supports Ultra-Deepwater Drilling with Real-Time Performance Management
Rapidly growing Pacific Drilling, which operates offshore in very remote locations off the Gulf of Mexico, Brazil, and West Africa, creates very challenging conditions for IT. In July 2013, in an effort to speed up reaction time to fast-changing conditions, Pacific Drilling migrated to SAP Business Suite powered by SAP HANA as part of a company-wide business performance management initiative.
“We see our move to SAP Business Suite powered by SAP HANA as a ramp-up customer as not just a best approach to solve the problem of providing new insight to the business through real-time operational reporting and analytics, but it also positions the organization strategically for the future,” said Yoram Borodaty, Senior IT Manager at Pacific Drilling. “It takes the vision of ‘one version of the truth’ one step farther; it’s not only having all your ERP business data in one place, but it’s how you report on it.”
Using SAP HANA has also led to a simplified landscape with a smaller footprint, which costs less to deploy and maintain. There’s no need for a data warehouse or cubes so building reports is much faster, as aggregates are now run on the fly. And because reports are based directly on top of live data, users have a higher level of confidence in the information they receive in the report.
Unilever Going Beyond Acceleration with SAP HANA
Unilever has two billion consumers using one of its personal care, food, refreshment, or home care products every day. And the company’s growth strategy is expected to double its business by 2020. With 16 billion transactions every year and 10 million stores to ship products to, the scale of the amount of data the business produces, uses, and needs to process daily is enormous.
“As we grow, we will possess more and more data, and we see this as a challenge and an opportunity,” said Thomas Benthien, Global IT Director for Unilever. “All that data runs through integrated SAP systems, wall to wall, and we need technology that will accelerate and support those transactional systems. We decided to do a proof of concept of SAP ERP powered by SAP HANA deployed in the SAP HANA Enterprise Cloud.”
This proof of concept included successful backup, restore, and failover testing, which all confirmed the viability of the solution. Big compressions during testing have significantly reduced the database size, compressing an SAP ERP system that was 38TB to only 8TB in-memory after migrating to SAP HANA. The company also had a successful validation and testing of a multiple node scale out configuration with SAP Business Suite on SAP HANA.
Unilever also ran a proof of concept for SAP Advanced Planning and Optimization powered by SAP HANA, which saw a 2TB data footprint reduced to only 360GB in-memory. Beyond data compression, the business saw process improvements such as the ability to include 6-8% more sales orders in the demand-sensing process. In addition, the business co-innovated with SAP to develop the Goods and Invoice Receipts Reconciliation cockpit running on SAP HANA that simplified a complex process of 10 activities, showing outstanding items in one simple screen without the user having to extract any historical data, which resulted in a 12-hour extraction and reconciliation process reduced to only eight seconds. Unilever also developed a Material Ledger Report based on SAP HANA Live, the real-time operational reporting engine in SAP Business Suite powered by SAP HANA, which cut 22 hours out of the original process.
Snapshot of Success
SAP itself is proving to its customers that it is walking the walk and talking the talk. During the keynote presentation on day two of SAPPHIRE NOW 2014, SAP CIO Ingrid-Helen Arnold presented how SAP has moved its SAP ERP system to be powered by SAP HANA.
This implementation provided 65,000 users across the globe with significant improvements in financial reporting and IT maintenance processes. As a result, more than 420 hours of processing time were cut from the closing cycle, and the global quarter-end close timeline was reduced to 8.5 days. Additionally, the SAP ERP database size was decreased by more than 70%.
These snapshots of SAP Business Suite on SAP HANA customer successes point to where SAP and its customer base are headed regarding the adoption of SAP HANA technology for transactional processing — and also give a good idea of what the coming year will bring for customers not migrated yet. Keep an eye out for more details from these customers and others in the near future.