The world of ERP changed with the introduction of SAP’s in-memory database HANA and it started to move even faster with the introduction of S/4HANA Enterprise Management, SAP’s new ERP system.
A lot has already been said about the possibilities in-memory computing technology offers in terms of realizing “the Real Time Enterprise”: Lightning-fast access to data anytime and anywhere, reporting directly on transactional data without latency, and so on...
However, the new capabilities in S/4HANA show that the real impact goes beyond “real time”: The real game changer in S/4HANA is the capabilities to look ahead. To predict. To simulate. To anticipate what is going to happen, before it happens.
Think about it: Lightning-fast, real time access to huge amounts of data sounds great, but how do you use this power to your benefit? Not by analyzing history, but to predict the future.
It’s great to have real-time insight into your supply chain so that you immediately can see that you’re missing a delivery deadline... but if you see it as it happens, it’s already too late. To see a customer disappear in real time is not much different from seeing it as a matter-of-fact in a report the day after. It’s already too late!
However, a lot of the new functionalities we see in S/4HANA are focused on looking ahead:
- Prediction: Discover and respond to future opportunities and challenges and act on them before it’s too late. Or before your competition does.
- Simulation: Explore the impact of business decisions and the outcomes of your proposed actions.
- Recommendation: Use built-in data driven decision support systems to make sure you chose the best possible alternative in any given situation
A few examples from different areas:
- Real Time Cash Management and Forecasting: Real time information on all cash balances and ability to instantly drill down into detail on any potential problem. Anticipate cash flow issues before they happen and take preventive action. Simulate the outcome of your actions before you make them happen.
- Soft Financial Close Anytime: Real time access to financial data, with all KPI’s instantly refreshed, and continuous intercompany reconciliation allows a soft financial close to happen anytime, in real time. No need to wait for various reports to arrive and the batch jobs to finish... When the hard close is finally done, it will not bring any surprises!
- Material Requirements Planning (MRP) is done in minutes over large volumes of data. Be demand driven by immediately sensing short term demand and respond quickly with fast planning, re-planning and simulation.
- Decision support in evaluating alternative solutions: Should you move raw material from another plant to allow a critical production order to be fulfilled? Or procure more material from secondary supplier? Or reschedule the order? S/4HANA will provide you with the alternatives and simulate the outcome of your decisions.
These new capabilities allow you to look ahead. It allows you to take timely decisions to prevent problems from happening. And it’s all based on real time data, not historical data processed through several layers of data warehouses over days or even weeks.
They say the best way to predict the future is to study the past. However, what constitutes “past” is rapidly changing. “Past” is getting old very fast... But now we can use what is happening as we speak to predict the immediate future, thanks to the processing power of modern in-memory platforms such SAP HANA. The more up-to-date “past” we use, the more accurate our predictions will be!