SAP Demand Signal Management, powered by SAP HANA
Enabling Demand Driven Supply Chains
Supply Chain Summit
April 3, 2013
Tod Stenger - SAP Solution Management
Brooke Williams - SAP Solution Engineer
© 2012 SAP AG. All rights reserved. 2 Internal
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© 2012 SAP AG. All rights reserved. 3 Internal
Agenda
Overview of SAP Demand Signal Management
Architecture and Data Acquisition
Loading Data
Integration with SAP Business Suite
Analytics and End User Interaction
Implementation Considerations
Wrap-Up
Overview
© 2012 SAP AG. All rights reserved. 5 Internal
Not Understanding what your Customer Wants can
have major consequences
Companies need to Sense and Respond to Customer
Demand using Downstream Demand Signals
Average ROI
on Trade Promotions
is -12% to -19%
Retailer Trade
Collaboration 2011
Average Out of Stock
Rate is 8% to 20%
Improved On-Shelf
Availability 2011
75% of New Product
Launches Fail
Rebuilding the
21st Century on Demand April 2011
© 2012 SAP AG. All rights reserved. 6 Internal
Today, Traditional Forecasting is not Enough to Manage
Demand
There is a need to establish another level of visibility to more accurately
manage demand, align consumer, promotional and forecast data
Demand Signal
Management
(SAP HANA)
Social
Networks
Detailed Demand
Signals
Market Research
Syndicated Data
Demand
Signal
Capture
Analysis, Mkt
Research,
Social Insight
Demand
Sensing
Promotion,
Pricing
Replenishment, Inventory,
Trade Promotions
Planning,
Promotions,
Replenishment
Demand
Response
© 2012 SAP AG. All rights reserved. 7 Internal
Challenge #1 Addressed by SAP Demand Signal Management Information Latency and Lack of Granularity
New Approach
Direct access to
Consumer Demand
Wholesale
Level
Retail
Level
Consumer
Level
Distribution Network
Finished Goods
Manufacturer
Existing Approach
Multiple Layers to
Consumer Demand
Multiple layers
leads to latency
in data
Multiple
aggregations
leads to loss of
granularity
SAP Demand
Signal
Management, powered by
SAP HANA
© 2012 SAP AG. All rights reserved. 8 Internal
Challenge #2 Addressed by SAP Demand Signal Management Lack of Cross-Functional Process Synchronization
SAP Demand
Signal
Management, powered by
SAP HANA
New Approach
Enterprise scale, single source of
latest information to synchronize
processes
Existing Approach
Disconnects due to lack
of up to date information
Supply
Chain
Sales Marketing
• Sales Targets
• Sales Promotions
• Store Listings
• Market Share Goals
• Introducing New Products
• Trade Funds
• Forecasting Demand
• Inventory Targets
• Stock Replenishment
Supply
Chain
Sales Marketing
RIGHT - Product
- Quantity
- Place
- Time
- Price
© 2012 SAP AG. All rights reserved. 9 Internal
Opportunities by Leveraging Downstream Demand Signals
Instantly identifying market trends
and customer needs
Identifying how market price
volatility will affect your promotions
Immediately see changes in
demand/supply across entire
supply chain
Monitor and analyze all deviations/
issues in replenishment process
Provide exactly the right offers and
service levels to every customer
Have a continuously-updated
window onto sales
Understand customer/potential
customer buying behavior
Identify risks and understand
promotion success in real-time
© 2012 SAP AG. All rights reserved. 10 Internal
Where does DSiM fit in my landscape?
SAP Demand
Signal Management
CRM
SAP BW on HANA
Supply
Chain
Planning
Core ERP
Trade
Promotion
Management
External
Demand
Signals
© 2012 SAP AG. All rights reserved. 11 Internal
Scalable and centralized in-memory database for BIG DATA Capture large volumes of downstream demand data (e.g. Point of Sales) and Market
research data in a single instance
Automate the process to cleanse, validate, harmonize and enrich data with additional
information during data upload
Central source of truth for advanced analytics Pre-packaged analytics to instantly analyze large volumes of demand and market data
along multiple dimensions
Extend and create purpose built analytics and mobility applications to meet specific
needs of various roles in the organization
Combine social media data with analytics like e. g. sales
Richer demand data for enterprise business applications Provide cleansed and harmonized demand data to supply chain, sales & marketing
business applications
SAP Demand Signal Management powered by SAP HANA
SAP’s Demand Signal Management solution provides a holistic view of how customer demand
and sales are materializing by analyzing massive volumes of external downstream data (like
POS data and Social Media), market research data as well as internal data like sales
© 2012 SAP AG. All rights reserved. 12 Internal
Key Value Propositions Of SAP Demand Signal Management Supply Chain, Sales and Marketing
Promotion
Effectiveness
Track promotion participation and
compliance
Track price variation by store Market Share
Analysis
Monitor market share changes
across geographies
Perform root cause analysis of
declines in sales
Forecast
Accuracy
Monitor demand and market data
Analyze historic sales and
promotions
Input to Demand Planning process
Out of Stock
Reduction
Monitor Inventory
Quickly spot stores with low or no
stock
Product Launch
Success
Track store sales and listings
Track price compliance
Ensure stock availability
Sales Analysis
& Planning
Analyze store level demand data
Benchmark store sales
Identify stock issues and prioritize
sales visits
Adjust – add builds and simplify text
Architecture and Data
Acquisition
© 2012 SAP AG. All rights reserved. 14 Internal
SAP’s HANA Technology – a Uniquely Powerful Foundation
to Enable the DSiM Value Proposition
Data
Harmonization
& Storage
Data
Sources
Data
Consumption
Data
Collection &
Transformation
HANA Repository (DSiM)
Retailer
1
Retailer
2
… Retailer
n Households Distributor/
Wholesaler
Market
Research Data Point-of -Sales
Internal
Data
SAP
Business
Suite
Mobile Apps SAP Business Suite
(e.g. ERP, SCM, CRM) etc…
Out-of
Stock / Shelf
Data Acquisition Data
Upload
…
Analytics
Standardized
Interfaces
SAP Demand Signal Repository Application
© 2012 SAP AG. All rights reserved. 15 Internal
Architecture Built for Extensibility and Flexibility
Netweaver/BW
HANA
Application Foundation
Consumption Layer
Extension at Any
Layer Possible
Capability to process
large data volumes at
high speed
Leverage existing
BW knowledge and
know-how
Various user
experience options
Robust
foundation
© 2012 SAP AG. All rights reserved. 16 Internal
Flexible Data Acquisition Options SAP Information Interchange, BOBJ Data Services or Third-Party solution
Retailers /
Distributers
Portal
Flat Files
EDI
Data Acquisition
Options
Third-Party
Solution
3
1
SAP Business
Objects Data
Services
2 SAP Demand
Signal
Management
SAP
Information
Interchange on
Demand
Data Collection
Loading Data
© 2012 SAP AG. All rights reserved. 18 Internal
Control, Cleanse, Harmonize & Enrich
Cleanse & Check Quality
• Flexible functions to check data quality
& completeness
Control & Monitor
• Automated data upload and
processing
• End-to-end monitoring
Harmonize
• Harmonization of external
data with internal data
• Automated harmonization
process using rules.
Enrich
• Enhancement of incoming
data to make it more usable
Rules for quality check, harmonization and data enrichment are contained in
an open and extensible framework
© 2012 SAP AG. All rights reserved. 19 Internal
Load Manager and Process Flow Control initiate and control the data upload
process
File system monitoring and PSA monitoring can be scheduled separately via jobs
Job-schedules can be defined via customizing
Load Manager & Process Flow Control
Interaction
Evaluate process
schedule
Load Manager Process Flow Control
Trigger
process chain
Update
status
Check
completeness
Monitor
file system
& incoming PSA’s
Schedule
process
Create
instances
© 2012 SAP AG. All rights reserved. 20 Internal
Data Agreement Concept
• Defined by data source (retailer, market
research provider) and determines
• What data is sent?
• What do the files look like?
• How often to I get data?
• How do I process the data?
Target Nielson Wal-Mart
DSiM Data Store
© 2012 SAP AG. All rights reserved. 21 Internal
Data Upload Steps
Stages & Process Chains
Data Quality
Validation Data Harmonization Data Enrichment Analytics Data Upload
Step0:
Load Management
Step6: Data Enrichment
Step5
Data Propagation
Step4: Data Harmonization*
Step3:
Creation of internal
IDs (optional)
Step2:
Quality Validation
Step1:
Data Acquisition
Legend: No process chain attached
process chain attached
Step7:
Data Consumption
© 2012 SAP AG. All rights reserved. 22 Internal
Data Quality Validation
Goals of Data Quality Validation
Save Costs in the overall process
Avoid time consuming manual re-work
of data
Check the data quality at an early stage,
where the cost for fixing the data quality
issue is comparably low
Improve decision quality
Avoid the use of incomplete and
inconsistent data which leads to wrong
decisions
Load Validate Enrich .. <DSiMProcess>
Cost of Data Quality Issues
© 2012 SAP AG. All rights reserved. 23 Internal
Data Quality Validation
Validation Functions
• Standard Validations
oAbsolute KPI’s
oComparative KPI’s
oOut-of-Sequence KPIs
Customer Defined Validations
Validation Life Cycle
Customizing
• Functions, Sequences, Steps, Thresholds
• Delivery Agreement Specific
1 Million units sold this week
Sales decreased by 75% week
over week
Data from three weeks ago just
showed up
© 2012 SAP AG. All rights reserved. 24 Internal
Purpose of Harmonized Data
Harmonized Object Attributes
Harmonized Object Attributes
Local objects can have their own
attributes and attribute semantics
Each object has some attributes that
are provided by each data origin with
the same meaning
Global location number (GLN)
for locations
Global trade item number
(GTIN) for products
Local attributes are harmonized into
global data that can be used for
reporting
Specific attributes can be governed,
that means that only specific attribute
values are allowed for global objects
Manufacturer
Master Data
Retail
Master
Data
Market
Research
Data
Other
External
Data
Global
Master Data
Object
© 2012 SAP AG. All rights reserved. 25 Internal
Data Harmonization enabling combined data usage
Global ID approach
© 2012 SAP AG. All rights reserved. 26 Internal
Data Enrichment in DSiM: Overview (simplified)
Calculation of Out-of-Stock and Out-of-Shelf
DSiM Data Foundation
DSiM Analytical Reporting
Master Data
(Product,
Location)
Transactional
Data
(Sales, Stock)
Harmonization
External
Master
Data
Internal
Master
Data Sales
Data Stock
Data
Data Enrichment
Data Enrichment on Mass Data
Evaluate high volume of data
Add indicators
Calculate additional key figures
SQL Script based
Algorithms for Out-of-Shelf and Out-
of-Stock calculations in DSiM 1.0
Integrated in Data Upload process
using BW process chains
Integration With SAP
Business Suite
© 2012 SAP AG. All rights reserved. 28 Internal
Side by Side with the SAP Business Suite S
AP
DS
iM
(De
ma
nd
Sig
na
l M
an
ag
em
en
t)
SAP ERP
■ Synchronize Master Data
■ Receive Transactional Data (e.g. Sales Order Data, Deliveries)
SAP CRM
■ Synchronize Master Data
■ Receive Transactional Data (e.g. Promotion Plans)
SAP Advanced Planning and Optimization (APO)
■ Provide external sales history data (POS) information to APO DP
■ Improve Forecast Accuracy
SAP Trade Promotion Optimization
■ Provide harmonized, external sales history data
for SAP Trade Promotion Optimization
© 2012 SAP AG. All rights reserved. 29 Internal
Respond faster to demand fluctuations Integrate your business processes
© 2012 SAP AG. All rights reserved. 30 Internal
Use cases for DSiM data in APO
Improve Forecast Accuracy –
1. Statistical Forecast - Point of Sale Algorithm
• Correlate POS Demand with Shipment History
• Fine tunes short term forecast (<12 week horizon)
2. Automated comparisons -
• Use macros to detect patterns between POS and Shipment data
• Highlight exceptions with alerts
© 2012 SAP AG. All rights reserved. 31 Internal
Integration: SAP DSiM & APO Demand Planning
DSiM APO DP
POS Data
Store
Configured
DataSource
Master
Data
InfoCube
Planning
Area
© 2012 SAP AG. All rights reserved. 32 Internal
DSiM and APO Integration demo
Analytics and End User
Interaction
© 2012 SAP AG. All rights reserved. 34 Internal
Aligning stakeholders to achieve effective
Supply Chain Management
Effective Supply Chain Management requires alignment between several stakeholders
with differing objectives
Sales Director
Analysis for Sales
How is the market
receiving our new
product? Are we gaining
market share?
How effective is my
promotional spend this
month?
How much did my
customer order last
month?
Analysis for
Marketing
Analysis for Supply
Chain
How can I quickly respond
to fluctuations in consumer
demand?
Marketing Director
Analysis for Key
Accounts
Demand Planner Key Account Manager
New Product Launch
Marketing Analysis
Sales Analysis
Promotion Analysis
Account Analysis
Account details
Out of Stock Analysis
On Shelf Availability
Inventory Analysis
© 2012 SAP AG. All rights reserved. 35 Internal
Key Analytics delivered in Demand Signal Management
Analytics delivered:
On Shelf Availability (by location
or product)
Out-of-stock Analysis (by location
or product)
Stock Analysis (by location or
product)
Sales Analysis (optionally with
Social Media)
Promotion Analysis
Product Launch Analysis
Market Share Analysis
© 2012 SAP AG. All rights reserved. 36 Internal
Business
Area
Pre-built Embedded Analytics Delivered with SAP Demand
Signal Management
Analysis for Sales Key Account Manager
/ Sales Director
Analysis for Marketing Marketing Director /
Product Manager
Analysis for Supply
Chain Management
Head of Logistics /
Demand planner
Sales Analysis
Promotion Analysis
Market Share Analysis
Product Launch
Out of Stock Analysis
On Shelf Availability
Inventory Analysis Roles
© 2012 SAP AG. All rights reserved. 37 Internal
Extensibility of the User Interface
• Customers can modify/enhance the existing reports with minimum of effort, all is integrated in the framework.
Existing Analytics
• Customers can build their own reports and integrate them in the user interface.
New Analytics
It’s possible with minimum effort to extend the existing Analytics or to add
new ones to DSiM
© 2012 SAP AG. All rights reserved. 38 Internal
Option to Create Your Own Analytics with Business
Objects
© 2012 SAP AG. All rights reserved. 39 Internal
Unstructured data Meaningful information
■ Brand / Product
■ Location / Region
■ Time
■ Sentiment
(positive / negative / neutral)
■ Gender
■ …
Option to Capture Demand Signals from Social Media Turn unstructured data into meaningful information
© 2012 SAP AG. All rights reserved. 40 Internal
Option to Build Mobile Apps for Key Roles Mobile app for Key Account Manager (Showcase)
© 2012 SAP AG. All rights reserved. 41 Internal
Analytics Demo
Implementation
Considerations
© 2012 SAP AG. All rights reserved. 43 Internal
The Value that Ramp-Up delivers for you
Accelerated Pay Back Via intensive project coaching
By a comprehensive Ramp-Up knowledge transfer Model
By getting a head start on achieving business value with leading edge solutions
Reduced Risk Because of Scoping and Coaching
Higher product quality because of prior pilot phase and validation
Higher Customer Satisfaction You become first mover in your industry
You influence the future development of the solution
Your IT department becomes strategic role model for other business units
© 2012 SAP AG. All rights reserved. 44 Internal
SAP Rapid Deployment solutions
Fast
• Quickly address specific needs
• Gain fast time to value with seamless
rapid-deployment tools, embedded best
practices – 9-12 weeks
• Speed end-user adoption with guides and
educational materials
Simple
• Clearly priced services and project time
frames – help ensure a predictable outcome
• Modular yet integrated solutions – help
ensure long-term landscape integrity
• Support across all environments (on-
premise, mobile, and cloud) – leveraging
the cloud to accelerate projects and
deployment
A complete solution
Deployed in weeks
© 2012 SAP AG. All rights reserved. 45 Internal
Two Main DSiM Scenarios Covered with this RDS
• Increase the demand visibility
into your supply chain
• Process and analyze massive
volumes of retailer point-of-sale
(POS) data
• Leverage standard reports in
the areas of Sales, On-shelf
availability, and Out-of-Stock
• Integrate SAP ERP master
data (material, customer, plus
hierarchies)
• Get a holistic view on your
markets
• Process and analyze massive
volumes of syndicated data
from market research institutes
• Leverage market share
analyses
• Integrate SAP ERP master
data (material, customer, plus
hierarchies)
Demand Analysis (Leveraging Point-of-Sale Data)
Market Analysis (Leveraging Market Research Data)
© 2012 SAP AG. All rights reserved. 46 Internal
Deliverables
Data Sets delivered with the DSiM RDS:
SAP ERP eCATT with ERP product and location master data
POS data set: Retailer sales data for 1 year on a daily basis.
Market Research data set: retail panel information covering one year timeframe, 1
country and 2 product categories
Documentation / Config Guides delivered with the DSiM RDS:
DSIM System-set-up
File System Set-Up
NWBC Set-Up
BOE Set-Up
DSiM configuration
SAP ERP configuration for master data upload
Test cases to test Data Upload, Data Quality Validation, Data Harmonization, Data
Enrichment and the Analytical UIs
Wrap-Up
© 2012 SAP AG. All rights reserved. 48 Internal
SAP Demand Signal Management Key benefits
Increase sales
Real time insights down to retail store level
Performance improvements in planning & execution
Improved market understanding
Improved end consumer understanding
Thank You
Contact information:
Tod Stenger
Brooke Williams