sap manufacturing industries forum 2015 update: auto ...fm.sap.com/data/upload/files/automotive for...

Chet Harter, SAP Auto, Truck, and Heavy Equipment

June 2015

SAP Manufacturing Industries Forum 2015

Update: Auto, Truck, and Heavy Equipment

© 2015 SAP AG or an SAP affiliate company. All rights reserved. 4

Telemetry analysis

keeps McClaren on

the track and winning

Volumes of Telemetry Data generated by race cars

• Terabytes of data generated per minute

• Telematic and Head Unit Data

• Analyzed by HANA

• Predictive and Advanced Visualizations

Spot defective parts, preventative maintenance,

out of spec performance, driver or crew

optimization and performance

https://www.youtube.com/watch?v=5jOzUGvD_X8

SAP Auto, Truck, and Heavy Equipment 2015 Top Customer Objectives

© 2015 SAP SE or an SAP affiliate company. All rights reserved. 5 Public

Enterprise Globalization

and Unification

• Consolidation, standardization, and simplification of business processes and IT

• Retirement and replacement of legacy apps

Operational Effectiveness

and Efficiency

Customer Engagement

Product Cost

Management

New Technology

Applications

• Improving relationships with dealers and end customers, and streamlining dealer interaction and

customer awareness

• Continuous improvement projects which focus on manufacturing and supply chain cost reduction,

including planning and plant floor execution

• Improving the ability to more accurately identify component and vehicle costs to improve current and

future profitability

• Leveraging SAP new technology to enhance the driving experience, improve product and service quality,

and gain insight into consumer preferences

• Includes vehicle connections and truck/machine telematics (M2M) and predictive maintenance

Market Scenario Description and Customers

Enterprise Planning and

Performance Management

• Ability to establish better short-range and long-range enterprise plans for better capacity planning,

profitability planning, raw material contract management, etc.

SAP Manufacturing Industries Forum 2015 Update: Auto, Truck, and Heavy Equipment


HANA: Telematics Focus for Auto, Truck, and Heavy Equipment

HANA: The New Real-Time Enterprise

CEC: Customer Engagement

SPM: Service Parts Management

Central Finance with S4HANA

PLC: Product Lifecycle Management

Remanufacturing


Internet of Things at SAP Strategic Industries

SAP Data Platform for Vehicle Telematics


Data Integration & Virtualization

Da

ta

Fou

nd

atio

n

Physical Data & Virtual Models (HANA Data Services)

Data Harmonization Mashup Data Sources Augment & Enrich Datasets Non-materialized Virtual Model

Logic & Rules Engine Application (leveraging SAP HANA embedded capabilities)

Predictive

Libraries

Text

Analysis

Geospatial

Engine

Diagnostic Rules Diagnostic Models Statistical Patterns

Time Series

Data

Processing

Dynamic

Tiering

Smart Data

Integration &

Data Quality

Smart Data

Access

Smart Data

Streaming

Change History & Snapshots logic

Log

ic/R

ule

s

En

gin

e

Pre

se

nta

tio

n

Log

ic

Lumira Server Data exploration & visualization

XS Engine

Foundation Configuration UI + Reusable UI component Library

Presentation Logic

Vehicle

Telematics

OEM UI Logic Dealer UI

Logic Operator UI Logic

Strategy 1

Vehicle data used for analysis:

• Defect Pattern Identification

• Vehicle Health

• Emerging Issues

• Quality Assurance

• Product Improvement in R&D



Vehicle

Telematics


Da

ta

Fou

nd

atio

n



Predictive

Libraries

Text

Analysis

Geospatial

Engine

Diagnostic Rules Diagnostic Models Statistical Patterns


Time Series

Data

Processing

Dynamic

Tiering

Smart Data

Integration &

Data Quality

Smart Data

Access

Smart Data

Streaming


Log

ic/R

ule

s

En

gin

e

Pre

se

nta

tio

n

Log

ic


XS Engine OEM UI Logic Dealer UI



Presentation Logic

Strategy 1



• Vehicle Health

• Emerging Issues



Strategy 3

Use machine data and analytics to feed other

processes:

• Sales – Promotions, loyalty programs, real-time

offers

• Service – Remote diagnostics, service

notifications

• Quality – Product issues

• Product Design – Design issues

• Service Parts – Leading indicators of product

failures

Bay

Diagnostics

Customer

Sentiment

Service

History Dealer Data

Customer

Data

As-Built

Config Call Center

Production

Records

Other ERP

Warranty

Records

Telematics Vehicle

Data

Diagnostic

Rules Service

Instructions

Service

Records

Support

Cases Warranty

Cases Master

Data

Dealer Parts

Inventory

Strategy 2

Combine vehicle data with other data sources:

• ERP – As-built configuration, warranty claims

• CRM – Customer data, interaction history

• MES – Production execution records

• DMS – Dealer systems

• Social media – Customer sentiment

MES CRM DMS



Bay

Diagnostics

Customer

Sentiment

Service

History Dealer Data

Customer

Data

As-Built

Config Call Center

Production

Records

Vehicle

Telematics

Other ERP

Warranty

Records


Telematics Diagnostic

Rules Service

Instructions

Service

Records

Support

Cases Warranty

Cases

Da

ta

Fou

nd

atio

n


Master

Data


Predictive

Libraries

Text

Analysis

Geospatial

Engine

Diagnostic Rules Diagnostic Models

Dealer Parts

Inventory

Statistical Patterns


Time Series

Data

Processing

Dynamic

Tiering

Smart Data

Integration &

Data Quality

Smart Data

Access

Smart Data

Streaming


Log

ic/R

ule

s

En

gin

e

Pre

se

nta

tio

n

Log

ic


XS Engine OEM UI Logic Dealer UI



Covered by Pre-built

content form SAP

Presentation Logic

Strategy 1



• Vehicle Health

• Emerging Issues



Strategy 2

Combine vehicle data with other data sources:

• ERP – As-built configuration, warranty claims

• CRM – Customer data, interaction history

• MES – Production execution records

• DMS – Dealer systems

• Social media – Customer sentiment

Strategy 3

Use machine data and analytics to feed other

processes:

• Sales – Promotions, loyalty programs, real-time

offers

• Service – Remote diagnostics, service

notifications

• Quality – Product issues

• Product Design – Design issues

• Service Parts – Leading indicators of product

failures

MES CRM DMS

Vehicle

Data


[Deere] can identify problems in running machines two to three

months faster, resolve problems faster, and also significantly reduce

downtime.

Larry Brewer, Director of Global Information Technology


Our EID (Emerging Issue Detection) program is providing a

complete business transformation for Deere. For one, we replace

only what is needed to replace. Secondly, we follow “find, correct,

validate” which is an entirely new reality that wasn’t feasible before.


Mercedes-AMG Engine testing with HANA-powered analytics

• Supports core process of engine development /

testing

• Big Data Computing

• Uses predictive functions in order to find engine

quality improvement options

Real-time analysis of test bench data from AMG high performance

customer engines during Quality Assurance on

SAP HANA Database Technology


ARI Fleet Management ARI Analytics and Insight 2.0

Vehicle & Fleet

Management

Vehicle Data for Business Process Input Southern California Edison


Company

One of largest utilities companies in California serving

14M people, 180 cities, 50,000 square miles

6,000 Service vehicles

Business Drivers

Vehicle utilization

Vehicle maintenance

Environmental impact

Application

Preventative Maintenance - Vehicle telematics data

used to create measurement documents and

performance-based maintenance plans

Corrective Maintenance - Vehicle DTC’s trigger

maintenance notifications / orders in ERP (PM)

Dashboards used by upper-management and middle-

management for fleet performance monitoring and fleet

utilization analysis

SAP Vehicle Business Network Connected Fueling, Parking, and Hospitality


http://youtu.be/N36XOWNpJtk

http://youtu.be/0mDlTJ6jlzQ

http://www.news-sap.com/sap-toyota-itc-verifone-connected-cars/













http://www.news-sap.com/sap-vw/





http://youtu.be/N36XOWNpJtk

http://youtu.be/0mDlTJ6jlzQ

HANA in use today


Examples…..

Deere, ARI, Faurecia, BASF, BorgWarner, AMG, McLaren

HANA in use today CO-PA with In-memory Processing

Co-PA was the most interesting thing to look at in the first step. We saw response times reduce from about 620 seconds to about five seconds in one

case. Andrew Pike, (former) CIO

“ ”

Product: CO-PA

Business Challenges

Changing business environments require improved real-time access and

analysis of data

Need more powerful analytics at a detailed level for better decision making

Technical Challenges

For profitability accounting, faster cost allocation run is required as part of the

month-end closing

For product costing, faster order settlement is required as part of the month-

end closing

Benefits

Unprecedented business insights to managers at very good cost to

performance ratio

Analyze contribution margins per product or customer at entirely new levels of

granularity—down to the SKU or customer level

Shorter run time allows repetition of cost allocation run in case of errors

Shortened month-end closing process

Enhanced, more efficient month-end closing reporting with CO - PA

124x faster analytics -

drilldown by alphacode -

from 620 sec. to 5 sec.

37x faster cost

allocation – drilldown by

sending cost center -


40x faster reporting –

Runtime reading line

items for EBIT with

commodity sales - from

260 sec. to 7 sec.

9x faster cost

allocation initial report -


The New Real-Time Enterprise

The ability to immediately recognize threats and opportunities and take

immediate action to minimize the negative and maximize the positive

impacts.

Issue Resolution - Today

Monitor and Alert

Resolution Options

Evaluation

Execution

Symptoms: Untimely, Incomplete, Inconsistent, Unprioritized, Unreliable

• Mostly manual alerts of issues

• Phone calls, word of mouth post-it notes casual observation

• Unreliable, untimely, may be too late

• Up to each individual to determine the right fix

• Sometimes based upon tribal knowledge

• Inconsistency

• Incomplete availability of information necessary to make a good

decision

• Easiest resolution options usually taken without regard to cost

• Execution of resolution is all or mostly manual

• Enterprise system incapable of helping


Enterprise Management A View from the Past (and probably Current)

Process Failures

- Unfortunately, unplanned things occur that threaten customer service and generate unplanned costs.

A formal, systematic planning process is executed daily (or less

frequently) to match supply with demand to:

Meet customer demand and/or desired stocking levels

Maximize profitability by reducing costs

Based upon expected demand and supply

100%

Revenue Planned

Costs

Planned

Margin

Customer “all-

stop” issued

Planning

Process

Planning

Process

6AM 6AM • Production Schedules

• Procurement Schedules

• Production Schedules


Labor

shortage

Potential

machine

issue

Power

outage

Inventory

loss

Obsolescence

increase

Customer line

speed change

Lost tool

High scrap

Truck down

Inventory

loss

Freight delay

Supplier over-

shipment

Supplier under-

shipment

Mislabeled

stock

Customer

rejection

Obsolescence

receipt

Damaged

material Skill

shortage

Machine

down

Late supplier

shipment

Container Shortage

Quality issue

Demand

change Tool

shortage Premium freight

requested

Unplanned

maintenance

Engineering

change

External Systems

(IoT / M2M)

Enterprise System

Issue Resolution – In Real Time

Results: Timely, Complete, Consistent, Prioritized, Reliable

Monitor & Alert

Resolution Determination

Simulation & Evaluation

Corrective Action

• Continuously monitor key performance indicators and causal elements

• Alert the appropriate individuals immediately

• List resolution options based upon company standard operating guidelines

• Simulation of resolution options to determine probable impact in

terms of key performance indicators

• Take action to resolve issue or to minimize the negative impact

of the issue

• Use Standard automation or custom automation when possible

Issue Resolution – In Real Time Monitoring and Alerting of Events, Circumstances, KPI’s

Inventory Alert

Potential material shortage. Item BP-1922. Details: Click here

Issue Resolution – In Real Time Problem Analysis

Issue Resolution – In Real Time Execution Options

Issue Resolution – In Real Time Simulation Results with Immediate Action


Advanced Enterprise Management Enabled by In-Memory Processing

Key Principals

Monitor and Alert - Early alerting of issues and potential issues will allow

management to completely avoid the problem or greatly reduce the negative

impact of the issue

Options – Action proposals based upon anticipated failure modes

Evaluations – Simulations performed to estimate the expected impact on

corporate and departmental key performance metrics

Execution of Corrective Action – Expeditiously taken to minimize the impact on

cost and customer service

100%

Revenue Planned

Costs

Planned

Margin

Planning

Process

6AM • Production Schedules


Planning

Process



Planning

Process

6PM • Production Schedules


Planning

Process

12PM • Production Schedules


Planning

Process



Boardroom of the Future

Boardroom of the Future

Plant

Manager

Quality

Manager

Production

Manager

Materials

Manager

Program

Manager

Engineering

Manager

HR

Manager

Plant

Asset Utilization

Inventory Turnover

Premium Freight Cost

Employee Attendance

Downtime

Scrap Rate

Excess and Obsolete Inventory

Shortages

Product Compliance Issues

Late Supplier Shipments

Plant Efficiency

Shipment Status

Supplier Quality Issues

Training Status

Capacity Projections

Customer Demand Changes

RFQ Status Customer Satisfaction

Employee Turnover

Purchase Price Variance

SAP Auto, Truck, and Heavy Equipment 2015 Top Customer Objectives


Enterprise Globalization

and Unification

• Consolidation, standardization, and simplification of business processes and IT

• Retirement and replacement of legacy apps

Operational Effectiveness

and Efficiency

Customer Engagement

Product Cost

Management

New Technology

Applications

• Improving relationships with dealers and end customers, and streamlining dealer interaction and

customer awareness

• Continuous improvement projects which focus on manufacturing and supply chain cost reduction,

including planning and plant floor execution

• Improving the ability to more accurately identify component and vehicle costs to improve current and

future profitability

• Leveraging SAP new technology to enhance the driving experience, improve product and service quality,

and gain insight into consumer preferences

• Includes vehicle connections and truck/machine telematics (M2M) and predictive maintenance

Market Scenario Description and Customers

Enterprise Planning and

Performance Management

• Ability to establish better short-range and long-range enterprise plans for better capacity planning,

profitability planning, raw material contract management, etc.

SAP Capabilities for Automotive Suppliers All process areas supported by SAP Applications

OEM’s and

other customers

N Tier

Suppliers

Tier I Automotive

Supplier

SAP Applications

Manufacturing Operations

• Repetitive manufacturing

• Make-to-Order manufacturing

• Multi-plant planning and scheduling

• Shop floor connectivity

• Integrated maintenance and quality

Sourcing and Replenishment

• Strategic sourcing

• Responsive material replenishment

• Management of outside processes

• Supplier portal

Customer Demand Management

• Forecast and delivery schedules

• Sequenced delivery processing

• Internet sales

Product Development

• Central repository

• Engineering change control

• CAD integration

• Project management

Global Business Foundation

• Financials

• Business planning & consolidation

• Labor management and HR

• Information technology

• Multi-currency –language, -plant

Customer Support

• Warranty management

• Service parts management

Marketing, Sales, and Service Processes Auto, Truck, and Heavy Equipment


End-Customers expect a consistent and compelling brand and customer experience across channels

Sales

Service and Warranty

Marketing

Vehicle Telematics

Understanding the market, important trends, customer preferences, and turning this knowledge into executable sales leads

Establish new products and services for customers, store and process volumes of vehicle data for product quality improvement and improved customer service

Provide customers with a great owning experience, equip dealers with required

service tools, efficiently process claims and recover funds

Provide an easy customer purchase experience, equip dealers with effective

sales tools

Service Parts

Manage parts inventories for service orders and over-the-counter sales,, manage suppliers,

establish internet sales to dealers, repair shops and vehicle owners

Call Center

Quickly respond to questions and concerns from dealers and vehicle owners, equip call center people with the tools for maximizing the customer touch point

SAP Customer and Dealer Processes A Roadmap for Improvement and Differentiation


Vehicle Sales and Marketing Vehicle Service Management

Standardize Improve Differentiate

Parts

Man

ag

em

en

t

Service Parts Management

Complaint Management

Contact Management

Lead Management

Promotion Management

Interaction Center and Help Desk

Learning Management (e-Learning)

Warranty Analysis

Real-time Offer Management

Collaborative Campaigns

Social media analytics

Customer Information

Consolidation

Dealer Performance

Analysis

Warranty Claims Management

Service Documentation

(online)

Service Analytics

Vehicle performance

analysis

B2B e-Commerce

Parts Manuals (online)

Real-time Ad Bidding

Warranty Prediction

Fleet monitoring

Electric vehicle services

In-Vehicle Commerce

Service Prediction

B2B2C e-Commerce

Service Management

Global Service History Database

Loyalty Management

LEGEND

Available application

Technology application

ERP

360-degree View of Vehicles, Customers, and Dealers


CUSTOMER AND DEALER PROCESSES

Marketing

Promotion

Management

Collaborative

Campaigns

Lead Management

Real-Time Bidding

Sales

B2B e-Commerce

B2C e-Commerce

B2B2C e-Commerce

Real-Time Offer

Management

Service

Warranty Analysis

Warranty Prediction

Service Analysis

Service Prediction

Vehicle performance

analysis and monitoring

Customer Support

Interaction Center

Help Desk

Fleet Monitoring

Electric vehicle services

In-Vehicle Commerce

Dealer Enablement

Customer Information

Consolidation

Learning Management

Online Parts and Service

Manuals

Dealer performance

management

REAL-TIME PLATFORM

Operational Analytics

REAL-TIME ANALYTICS

Sense & Respond Planning &

Optimization

Consumer

Engagement

REAL-TIME APPLICATIONS

Predictive,

Spatial & Text

Analytics

Big Data

Warehousing

Application Data (SAP and non-SAP)

Contact Management

Loyalty Management

Complaint Management

Warranty Claims Management

Service Management

Global Service History Database

Social Media Analytics

Vehicle Telematics Financial Institutions

Dealer Systems

Social Media

OEM Systems

3rd-Party Data

Komatsu - Australia


Objective Increase financial transparency for different

customer revenue streams including

equipment, rentals, services, contract and

more, with a single view of the customer

Solution SAP HANA Platform

Benefits

Real-time reporting based on single

view of customer data that defines

logistic, drives sales and improves

service Ian Havison

CIO, Komatsu Austrailia, Ltd.

SAP HANA gives us a complete view of our customers.

Having real-time access to centralized data helps our

sales and services teams get the information they need

to serve our customers better.”

“

At a Glance

Vehicle, Parts, and Merchandize Retail B2B, B2C, and B2B2C with hybris


Pan-European network of tire service dealers

comprised of over 2000 dealers across 25

countries

hybris provides a complete multichannel commerce software solution that integrates product content,

commerce operations, and the extended channel to help retailers, manufacturers, and other

businesses create a unified and seamless cross-channel experience for their customers — from

online, to in-store, to mobile and beyond.

http://www.firststop.eu/

Toyota Material Handling - US


Solution

SAP Customer Relationship Management

Benefits • Increased win rates with integrated lead

management and marketing analytics

• Improved sales team productivity

• Enhanced the accuracy of sales quotations

• Improved visibility into sales pipelines and

end-user pricing

• Achieved significant savings due to

eliminating variance in dealer discounts

At a Glance As the country’s leading lift truck supplier,

Toyota Material Handling U.S.A. Inc.

(TMHU) supports independent dealers

nationwide.

Objective Improve sales visibility and accuracy of

dealer sales quotations. Gain efficiency in

order processing and the management of

its dealer discounts.

15% 85% 100% Improvement in market awareness Reduction in order confirmation times Accuracy of sales quotation and dealer

discount spend


SAP ERP

Ariba SPP EWM hybris C4C

Option: Service Parts

Planning (SPP) for

forecasting and

distribution planning

Option: Extended

Warehouse

Management

Option: Hybris

platform for e-

Commerce

Analytics

Key points:

Service parts can be managed using only ERP core functionality for forecasting, inventory, warehouse

mgmt, sales, procurement, etc.

Optional solution components will provide advanced functionality as required with the bonus of SAP ERP

integration

Option: SAP

Warehouse Picker

(augmented reality)

Option: Ariba for

supplier

replenishment

Option: Customer

Engagement

SAP’s applications for Service Parts Management are already proven for use in

the Truck and Heavy Equipment industry.

Aftermarket and Service Parts Management


US Plant 1

• Manufacturing

• Shipping

• Receiving

• Quality

• Maintenance

US Plant 2

• Manufacturing

• Shipping

• Receiving

• Quality

• Maintenance

Europe Plant 1

• Manufacturing

• Shipping

• Receiving

• Quality

• Maintenance

Asia Plant 1

• Manufacturing

• Shipping

• Receiving

• Quality

• Maintenance

Asia Plant 2

• Manufacturing

• Shipping

• Receiving

• Quality

• Maintenance

Europe Plant 2

• Manufacturing

• Shipping

• Receiving

• Quality

• Maintenance

A dedicated Simple Finance system connected to one or more ERP systems

A Simple Finance adoption option, not a separate product.

It’s capabilities are based on the underlying software components deployed - allowing a number of processes to be implemented as

“centralized” processes.

Enterprise

• Enterprise Financials

• GL / AR / AP

• Budgeting

• Treasury

• Consolidation

• Fixed Asset

Management

• Procurement

• Sourcing

• Spend Analytics

• Planning

• Global Capacity

• Sales & Operations

Planning (5 year)

• New Business /

Programs

• HR and Payroll

• Warranty

• Travel Management

• Product

Management

• Sales

Analytics

Central Finance with S4HANA


Next Steps

Where do we go from here?

• Solution Evaluation – Deep dive into applicability of SAP technology or

applications for solving business problems or providing new opportunities for

your company. Could include demonstrations, workshops, etc.

• Business Process Review – SAP will work with your team to review current

business objectives, current SAP and non-SAP usage, and offer suggestions

for improvement and opportunity.

• Road Mapping – Collaborative review of current business strategies and

objectives, current landscape, and current and planned projects to determine

short-term and long-term road maps.

Chet Harter, SAP Auto, Truck, and Heavy Equipment

June 2015

SAP Manufacturing Industries Forum

Update: Auto, Truck, and Heavy Equipment

sap manufacturing industries forum 2015 update: auto ...fm.sap.com/data/upload/files/automotive for...

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