Business intelligence gives companies a real knowledge edge
That’s an alarming figure: 62 percent of business users say that relevant and contextual data is important for their work, but only 13 percent of them have access to it. More than half of respondents find real-time information elemental, but only a fraction work with it. These are the findings of a study commissioned by SAP and conducted by Harvard Business Review magazine. The reason for the poor flow of information: operational and analytical IT systems traditionally work separately from one another. As a result, business users are either unable to access data analytics at all or can only do so in a roundabout way.
Data is the oil of the 21st century, we know that already. This is true not only for Facebook and Google, but also for machine builders and pharmaceutical companies. Today’s industrial companies have more and more granular data at their disposal than ever before. But simply collecting data does not add value; the available information must be up-to-date, meaningful, and contextually relevant. Only then can they facilitate strategic decisions and promise a competitive advantage. And that is exactly what is lacking at many organizations, still. Companies in Germany, Austria and Switzerland are not generating enough business impulses and strategic insights from data.
A whole new BI architecture
The initial situation is similar in many companies today. The transactions run via the ERP system and the reporting takes place in the Business Warehouse (BW). Due to this separation, there is a certain operational complexity because the data must first be transferred into suitable data models with the help of ETL processes – and this is relatively time-consuming and has some disadvantages in everyday business.
During the digital transformation that many companies are now facing, both areas are now growing much closer together. And that is urgently needed. My message: Those who are now considering the switch to S/4HANA should address the topic of analytics early on and think about their future BI architecture right away! If you have a target picture, the next steps will be easier. Because with embedded analytics in S/4HANA, there is a wealth of new possibilities that should definitely be exploited.
Many customers ask me: “We already have enough to do with S/4, can’t we postpone the topic of BI for now?” I strongly advise against that. What would be the consequence? You spend three years on an elaborate transformation project that keeps the entire organization busy and hundreds or sometimes even thousands of users on their toes, and at the end the user sees nothing in the reporting area! They must work with the same tools as before and the added value is rather low. That would be suboptimal and demotivating.
Back to the topic of the convergence of transaction and reporting: What makes it possible? First, through the HANA database, which thanks to its in-memory technology simply works much faster, more flexibly and can spit out data in real time. Second, we have the Fiori Apps in the front end accessible from any web browser. Alone this is nothing but a new UI, but in the background, there is also a new technical element, which is SAP’s Core Data Services (CDS), which are HANA views that allow business users to react very flexibly to new reporting requirements.
This means that you can do real-time reporting with Excel (Analysis for Office) on the S/4 database or create special reports directly based on the data in S/4 with the SAP Analytics Cloud (SAC). Advantage: CDS provide a uniform data model for all application areas, whether transactional or analytical. So, you could say: CDS greatly simplifies a company’s use of data.
Of the standard analytical apps, there are about 500 that SAP already delivers, and of the CDS views for reporting, there are another 400 – so that’s a huge bouquet of functionality that is delivered here as part of S/4. Last but not least, S/4 also offers the option of developing analytical apps yourself. This means that companies will be able to raise their reporting to a completely different level in the future – and with a comparatively manageable amount of effort.
Access to relevant data at any time
The management level of most companies now classifies business intelligence and analytics as business critical. With dynamic global markets, rapidly changing business models, ever-changing competition and the shift away from manufacturing to services, there is a need for much better and faster decision support than ever before. And that is exactly what embedded analytics delivers. The information already exists in the company, somewhere. The task is to make it usable. Every division manager, every top decision-maker must have access to it, at every location, worldwide. If you want to stay competitive, you have to become a Data Driven Company! That must be clear to everyone.
By the way: BW will not disappear, you will still need it, but it will be used somewhat differently in the future. Complex data preparation for reporting purposes, for example, is not easy to do in S/4. You need BW for that. Furthermore, it is needed for the integration of data from different data sources and the mapping of snapshot scenarios.
Also exciting is the development of the SAP Data Warehouse Cloud (DWC), which can complement BW and perhaps even replace it in the future. But more on that later.