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Live from SAPinsider Studio: Thack Brown on SAP Simple Finance

April 3, 2015

Thack Brown, GM and Global Head Line-of-Business Finance, SAP, joins SAPinsider Studio after delivering the SAPinsider FIN-GRC 2015 keynote to discuss SAP Simple Finance and its what it means for customers. Topics of this discussion include:

  • What differentiates SAP Simple Finance from SAP Business Suite powered by SAP HANA and how does it revolutionize the way finance is doing business forever
  • Core application enhancements to optimize performance for a real-time data platform and real-time finance processes
  • How SAP Simple Finance eliminates the need for reconciliation within various finance modules, such as FI and CO and also optimizes Intercompany Reconciliation
  • How SAP is using SAP Simple Finance to collapse close processes and lead the German stock market
  • How SAP Cloud for Planning is integrated in the Simple Finance environment supporting integrated business planning
  • How role-based solutions support real-time enterprises and the “consumerization" of the finance function


View the video, and read an edited version of the transcript here:

Ken Murphy, SAPinsider: Hi, this is Ken Murphy with SAPinsider and I am at the SAPinsider Financials and GRC 2015 event here in Las Vegas. This morning, I am pleased to be joined by Thack Brown, General Manager and Global Head of Line of Business Finance for SAP. Thack, welcome  and thanks for joining us.

Thack Brown, SAP: Thank you Ken. Good to be here with you.

Ken: You’ve just delivered the keynote address here, which I believe is your first SAPinsider event?

Thack: It is indeed. Very impressive. First, congratulations to you guys. SAPinsider did an amazing job pulling the whole thing together. I’ve been really impressed – a packed house, lots of good content. People are really excited about it, and it’s been impressive to see.

Ken: You polled your audience, we have about 2,000 attendees here, and you asked a lot of interactive questions during the keynote; what do you do, what are your needs and wants. What did you learn about that?

"It’s about simplifying that system landscape and the system architecture so that finance can focus on the job that really needs to get done."

- Thack Brown


Thack: There were a couple of very interesting things. One, we had a very nice, diverse audience. So a lot of finance folks, finance managers and executives in the crowd. A lot of IT guys who support finance specifically here learning about systems and the tools. And then a pretty significant number of specialists around SAP. So you had a nice, diverse group all oriented toward finance but sort of going the full spectrum through the technology platform, specialization, the user on the other end. And so we did some nice polling about priorities, worries about the coming years, what are you looking at? And it was very surprising to me to see the strong responses around the need to get real-time information, move to real-time processes and running your business in real-time. We asked about that, we asked about greater capabilities in terms of data analysis, which was very strong. A little bit lower on the cloud side, so you can see people starting to learn a little bit about cloud and finance, but not ready yet to make the plunge. Sort of working their way up to it. So it was very interesting, and a very diverse set of questions but the topic on getting to real-time in managing finance was by far the off-the-charts response.

Ken: One of the things you brought up was the journey to arriving at the perfect enterprise, within the c

ontext of SAP S/4HANA and SAP Simple Finance. I’m guessing some of the attendees might have a question about that; if they’re running SAP Business Suite on SAP HANA, specifically SAP ERP Financials on SAP HANA, and they’re already sort of taking advantage of the real-time capabilities that HANA delivers, what does SAP Simple Finance offer differently that helps them on that road to the perfect enterprise?

Thack: That’s a great question, and I hear that question a lot from customers these days. If you take SAP Business Suite on SAP HANA, as we’ve had it traditionally, what you really have is the suite as it’s always been on top of a real-time data platform which allows it to go very, very fast. So you accelerate some key processes, you accelerate moving away from batch to real-time. So you start to get that first flavor. But what you haven’t done is actually optimize the application itself so that it takes advantage of the power of a real-time data platform. And so the move to Simple Finance, and by extension S/4HANA. Because when you talk about S/4HANA, it is doing to the broad ERP suite what Simple Finance does for the core financials. And what is that? It’s a combination of things, but it is really going into the core of the application, it’s preserving the 40-plus years of great intellectual property solving some of the most complex financial challenges in the world, but then optimizing that to asking “What can we do differently as a business now that we can operate in real-time?” So how do I optimize my business processes? Now that I have this great data platform, how do I take away the redundancies of information so I eliminate the need to do, for example, reconciliation between FI and CO? That experience goes away. How do I optimize my processes around inter-companies as another example, so that instead of doing that as a big month-end process I can now do that in pieces every single day so that my job gets easier and gets smoother and I’m seeing my results in real-time. We bring into this updated dashboarding, so if I’m a CFO I have a role-specific dashboard that becomes my entrance-way into the system so I have a much nicer user-interface but it’s built into applications and we have that for 43 different roles within the finance organization. So you’re getting this new optimized capability, you’re getting a new user experience, you’re getting easier access. You’re really taking that next step into what it means to be a real-time enterprise as opposed to doing what you’re doing before just a lot faster.

Ken: So all of that helps finance to become a strategic arm of the business?

Thack: Absolutely.

Ken: Toward that end, how does a business plan for doing that non-disruptively? If I’mhaving to reconfigure all of my finance functions and processes to adapt to this new solution does that not change the roles themselves? How do you advise an organization to do that without disruption?

Thack: Absolutely, great question. First, we’ve tried to design this in a way that it will be non-disruptive to companies. As you make the first move to Simple Finance, from a user point of view nothing has to change so everything can be done as a technical migration that enables all of this capability in the background. Users will see some immediate benefits, some things that will run faster. You’ll start taking away the reconciliation requirements as I mentioned between FI and CO. That sort of disappears Day 1. So you get some immediate benefit from this. But in terms of new user interface, new screens, changing the way you run processes, all of that can be done over time. So you can make the decision as a company to jump right into that and make that a part of what you do, or you can say “No, I’m going to go get the technical benefits and take some good away from the system.” And then over time introduce these new capabilities, new interfaces, the more robust experience to users so that they can consume it as they need to. And then we’ve also tried to make this easy in terms of the choice of how they do it. So do they want to take this and do it within their existing on-premise environment? If they do, do they want to do it immediately, moving the core systems to this, or would they like to set it up as what we call Central Finance sort of as a sidecar bringing data from disparate systems into this and getting the benefits of that up-front and then creating a longer term roadmap for system replacement. So there’s no requirement to go into and think you have to replace your existing systems. No, you can get a nice portion of the benefit without actually having to touch your existing systems right away. You can do that on your time. You can look at whether or not you want to do that in an on-premise world, you can look at whether or not you want to do that in the cloud world. Do you want some form of a hybrid? So we’re really trying to make this non-disruptive, low risk to our customers, and then give them the choice for how they would like to move into this. And so we’ve got all the tools and experience to sit down with our customers and map out for them and create a recommendation for how we would see them moving in order to meet their business objectives. So we’re also not going to force them to sit down with a list and figure out on their own what the right thing for them is; we will help guide customers through that decision-making process and give them the right recommendation for their business.

Ken: We saw in the keynote a few demos, Cirque du Soleil which I believe is now adopting SAP Simple Finance. If not Cirque de Soleil, perhaps another organization, can you point to any specific customer benefits of SAP Simple Finance – even SAP’s own experience?

Thack: We had for example Swiss Re, was with us when we had the launch of SAP S/4HANA; and they’ve started taking a look at this concept. They’ve done a series of proof of concepts, we have to understand that the solution has now gone general availability in August of last year (2014). We’ve got our first customers who are live and then we have very important customers like Swiss Re who’ve gone through and tested the solution and are now in the implementation phase. So that’s where they’re sitting today. Now Swiss Re took a look at what they would expect in terms of this greater flexibility to drill down into the solution, into data, and understand data. They had a very interesting case in which they showed that they could do U.S. gap reporting and IFRS reporting within the same system as opposed to needing multiple systems. So they’ve tested a number of these capabilities and seen significant benefits to their organization. We’ve seen a number of other customers, including one large CPG customer of ours who’s been taking a look at this as well from this Central Finance point of view. So they’ve actually gone in and run a proof of concept where they’ve pulled in multiple environments, one is an SAP system, one non-SAP system, so they can get this single unified view of their data and the drill-down into the information. And they we have cases for ourselves, SAP, and what we’ve been able to achieve. We were the first company to take ourselves on SAP Simple Finance. One of the big benefits we saw for example is the ability to collapse the year-end close process where through system enhancements and how we’ve been able to adopt our processes, we went from already being the fastest company on the DAX index to release results; we’ve taken that down by five business days or seven continuous days through doing things like accelerating inter-company reconciliations, eliminating the reconciliation between FI and CO. So now when we do our profitability analysis we can complete that in a matter of hours instead of a matter of days. These are all tangible benefits that we and important customers of ours are getting from using the system.

Ken: And can you touch on planning. You talked about instant insight as one thing that customers are really after and increasing the importance of forecasting and predictive analytics. So if I’m running the latest version of Business Planning and Consolidation does that integrate Simple Finance?

Thack: We actually have a couple of steps on that. So BPC now integrates in with Simple Finance so you get that more robust ability to look at your actual results and then plan off of those actuals looking forward. And then we also talked about here about our new Cloud for Planning application which is all about sort of you have the industrial strength within BPC for the overall organization, but what about reaching into that recent acquisition and bringing them into your planning capabilities? What about getting out into smaller departments and smaller organizations that are doing that work today in Excel and it immediately gets lost as soon as you finish it? So it’s going from integrating into this single source of truth, extending that capability so you get real-time planning off of your real-time financials, and then using our Cloud for Planning application to get into the full organization and bring that into an integrated planning process.

Ken: Lastly Thack, for customer misconceptions that customers might have about SAP Simple Finance. I’m sure you might be talking to some customers here at this event, what is a misconception you can clear up for our viewers?

Thack: The biggest question that I get is, “Are you saying that finance is simple?” And no, in no way, shape, or form when we say ‘Simple Finance’ do we believe that finance is simple. What we do now is that there are a series of barriers and impediments like the effort that we spend on internal reconciliations of data, and trying to get to that single source of the truth to really know what the facts are that make it much more difficult for finance to do an already difficult job. And what Simple Finance is about is taking away those system limitations and those system barriers so that all of this unnecessary work goes away. Now finance can work on a single source of truth with the right data, have real-time view and access into that data, can move their processes to run in real-time without the lag so that now finance can focus on how to take care of the business, how do I become the business partner to make more strategic decisions, evaluate investments, understand risk and how we mitigate risk. Do that job which finance really wants to do as opposed to spending time dealing with broken internal processes or these internal reconciliations. So it’s about simplifying that system landscape and the system architecture so that finance can focus on the job that really needs to get done.

Ken: Thack, thank you for joining us to share your insights.

Thack: Thank you Ken. It was a pleasure.

Ken: Again, this is Ken Murphy with SAPinsider and we’ve been chatting with Thack Brown, who is the Global Head of Line of Business Finance for SAP.


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