BUSINESS WAREHOUSE AND ERP

Shababna M Ilahi
S4 MBA(FT),Roll No:41
School of Management Studies, CUSAT,Kochi-22
E-Mail:shababna.m.ilahi@gmail.com

Abstract: In the fiercely increasing competition amongst corporations it has

become mandatory to make quick and sound crucial business decisions based
on analysis of business critical data. This is the point where data warehouses
come into play. Although many companies are relying on data warehouses, they
are still struggling to achieve positive results due to fragmented and inconsistent
data. For them SAP’s Business Information Warehouse (BW) provides a
complete information factory solution. BW is the central component in the SAP
suite of applications with an added advantage of being a software package that
can be used in both SAP and non-SAP environments. This paper deals with BW
and ERP

Key Words: BI, BW, ERP

1.0 INTRODUCTION

In today’s dynamic business scenario, organizations require tools that facilitate rapid conversion of
information into analysis, and analysis into action; thereby allowing them to gain competitive
advantage in the market place. Organizations that have set up effective systems, to aggregate,
store and retrieve data, possess a distinct competitive edge over those who have not. In today’s
intensively competitive global business market, understanding and managing enterprise wide
information is crucial for timely decision making and responding to rapidly changing business
conditions. Companies generate a tremendous amount of data through day-to-day operations.
Additionally, data is available from external sources such as market research agencies,
independent surveys and quality testing labs. Studies indicate that the amount of data in a given
organization doubles every five years. Until recently, organizations followed the traditional practice
of storing data by department or by location – usually on different systems.

With the arrival of new technologies, organizations are merging departmental databases at an
enterprise wide level. This enables them to gain insight into all aspects of their business across
departments and geographies. Monitoring their value chains, equips businesses to respond to
changes in market conditions. Corporate Data Repositories or Data Warehouses allow enterprises
to analyze data, streamline processes, improve operations, strengthen customer relationships and
improve the bottom line. This entire process is called Business Intelligence. Data warehousing has
merged as a key resource for organizations that have implemented ERP and are now revamping
their legacy DW applications by replacing them with standard DW application suites. These
standard applications offer robust technology, seamless integration with backend ERPs and
Industry specific reporting. Furthermore, they offer a complete development environment to extend
these products.

SAP BW is the market leader in business intelligence tools and works seamlessly with existing
systems in the organization. Information is at the core of BW SAP. BW SAP provides an
information infrastructure that allows an organization to store and manage data, thereby providing
end-to-end support to the organization – from planning to projections.

2.0 NEED FOR BUSINESS INTELLIGENCE

Control on large repositories of data and the ability to analyze them rapidly plays a key role in the
process of business decision making. The key success factor in this process is the accuracy and
completeness of the information source. Organizations realize that their survival and growth in the
market place is based on the speed at which they can process data to make an informed business
decision.

Business Intelligence is a method of ensuring an organization has control over the information that
it generates. Business Intelligence is an evolving strategy, vision and architecture that allows an
organization to fine tune its processes and operations so that it can attain strategic business goals.
With the implementation of BI, organizations have easy access to information on which they can
base decisions. This access is in turn achieved by timely and correct insight into business
conditions, finance, markets and customers. So as stated earlier at the core of BI is information and
systems and architecture that allow management to use this information for business actions.

Effective implementation of BI enables a company to:

 Streamline operations
 Take prompt decisions
 Go to Market faster more effectively
 Develop new products rapidly
 Realize value from existing product lines
 Enhance customer satisfaction

Thus, implementing BI successfully ensures that the company improves its bottom line. Business
Intelligence enables organizations to monitor and measure business performance in order to
establish an indication of current activity, a target for success, or a goal for the future. Almost all
organizations undertake this type of performance tracking— called Business Performance
Measurement (BPM). Usually companies measure Business Performance on various parameters
such as revenue, costs, profitability, movement of products, return on investment (ROI).
OLAP (online analytical processing) is a technology that enables BPM analysis and reporting.
OLAP systems store and access data as dimensions and measures that represent key business
factors. This information is stored the way businesses are organized—either departmentally or by
region. OLAP allows management to receive information in a business management format,
thereby facilitating informed and just in time business decisions. Organizations look for a BI solution
that includes sophisticated OLAP functionalities that enables effective utilization of data to derive
maximum value. They look for a solution that allows managers to pick up trends and new business
opportunities almost immediately. It is anticipated that implementation of such a system will reduce
their costs, increase the ROI, and most importantly make better business decisions.

3.0 SAP BW

To ensure business success organizations have to assimilate and absorb data coming in from
different sources. Many organizations have built data warehouses to do that. These data
warehouses store data and provide tools to interpret data into meaningful information. However,
many organizations that have put in place a data warehouse are struggling to achieve their
business performance targets – primarily because of the inconsistent nature of data across the
organization, and also the complexity of tools used to analyze the data.

Companies want a one-stop solution for their data warehousing and processing. This solution
called the Corporate Information Factory (CIF) is made up applications running on top of data
stored in a data warehouse. Additionally it also contains an operational data store (ODS), data
marts, OLAP, and decision support systems. SAP BW is the only product available on the market
that meets all these requirements. SAP BW is a solution that helps organizations come to grip with
their data– that they can store, analyze and use, almost instantaneously for business gains.

Developed with established business know-how and advanced data warehouse technology, SAP
BW serves as a key organization-wide information center. It is an end-to-end data warehouse
solution that allows rapid access to data from SAP systems, other enterprise applications, and from
external sources. It provides a flexible foundation for advanced data analysis and provides the
flexibility so that different levels within the organization can utilize the system effectively for their
own business needs. SAP BW also provides for an organizational view on information. By providing
a solution that is based on the end user’s requirement for value-based information, SAP BW
provides the user meaningful information. In a nutshell, SAP BW extracts data from across the
organization and converts it into a information that is used in enterprise wide planning, controlling
and decision-making.

SAP BW extracts data from across the enterprise to be able to provide the end user with Business
Content. This extracted data is stored in multi dimensional data stores known as InfoCubes that are
designed to fulfill real world business information and reporting needs of managers. While
organizations can build their own InfoCubes, SAP BW comes with predefined InfoCubes that cut
down time for implementation.

3.1 EVALUATION OF SAP BW

The first wave of data warehousing that emerged around Legacy systems encountered a number of
difficulties. These included technical integration as well as laborious and lengthy implementation
processes. One major obstacle has been gearing the warehouse to changing business processes
of the organization. Moreover, most systems simply deliver information, but do not provide the
means for knowledge workers to act immediately upon the insight they gain. In other words, they
fail to “close the loop”.

The need for rapid access to accurate business information has never been so acute. Yet many
companies are wary of the costs and drawbacks of many conventional data warehousing systems.
One of the major drawbacks of conventional data warehousing tools is the lack of seamless
integration with backend ERP systems. Data warehousing projects are often lengthy and
expensive, taking months and sometimes even years to achieve viable results. It has often been
difficult if not impossible, to leverage the existing strengths of the business and IT environment.
Moreover, data warehousing has often entailed the cumbersome combination of many different
tools and techniques, creating a patchwork rather than a homogeneous, comprehensive solution.
With this in mind, the challenge has been to build a data warehouse that serves an organization’s
information needs that can be implemented rapidly and cost effectively and is easy to use and
maintain. Additionally the system needs to be flexible and can be easily adapted in a changing
market.

SAP BW has achieved this:

 By integrating business processes to create a comprehensive, homogeneous

environment, that guarantees effective workflow, higher productivity, greater efficiency and
lower costs.
 By building an information warehouse on the established foundations of business
processes and the IT environment that supports those processes.
 By creating a system for the collection of data from operational applications and the
provision of information to knowledge workers in a form that is comprehensive, reliable
and timely.
 By ensuring openness with regard to many types of information sources, both in-house
and external, and to diverse analysis and reporting tools.
 By implementing data warehouse capabilities quickly, efficiently and across the entire
enterprise for a rapid return on investment.
 By enabling decision-makers to act immediately on the information they obtain by using
analytical applications to “close the loop” back to operational applications.

The SAP BW guarantees the enterprise-wide availability of meaningful information. It is a ready-to

go solution built on the firm foundations of R/3, but by no means limited to R/3. It allows for the
rapid and user-friendly delivery of business content to planners and decision-makers at all levels of
the company. SAP BW can be smoothly integrated into the existing IT environment. BW is based
on an organization’s business processes, that can be found in the R/3 system, making use of
R/3™s openness, integration and meta-data concepts to provide the organization with a much
more efficient and illuminating view of your data. Data is extracted, loaded and aggregated in
accordance with organization’s individual business processes and presented in a user-friendly and
flexible form tailored to the needs of it’s users. There is no need to spend long and expensive man-
days coding extraction routines, and there is no need to cobble together diverse reporting tools.
The SAP BW is pre-configured for R/3 environments, but at the same time remains open to third-
party data sources and analysis software. It includes pre-designed reports, that can be customized
to you’re an organization’s unique needs, and it provides you views up-to-the-minute facts and
figures from a wide variety of perspectives. It is user-friendly - for both the end-user and the
administrator. Data can be accessed easily and the warehouse can be managed and modified with
the click of a mouse.

4.0 OVERVIEW OF SAP BW

Information is at the core of SAP BW. An architecture that allows data from various systems to be
extracted seamlessly and powerful OLAP tools that converts this data into Business Content.

4.1 Components of BW architecture

SAP BW is based on integrated metadata concept with metadata being managed by metadata
services. SAP’s BW has following layers:

1) Extraction, Loading and Transformation (ELT) services layer.

2) Storage services layer, with services for storing and archiving information.
3) Analysis and access services layer, which provides access to the information stored in
SAP BW.
4) Presentation services layer, which offers different options for presenting information to end
users.
5) Administration services.
6) Metadata services.

4.2 SAP BW Info Cubes

SAP’s BW is based on "Enhanced Star schema" or "Info Cubes" database design. This database
design has a central database table, known as ‘Fact Table’ which is surrounded by associated
dimension tables. These dimension tables contain references to the pointer tables that point to the
master data tables which in turn contain Master data objects such as customer, material and
destination country stored in BW as Info objects. An Info Objects can contain single field definitions
such as transaction data or complex Customer Master Data that hold attributes, hierarchy and
customer texts that are stored in their own tables.

The BW product is designed to store all business-critical information contained in the R/3 OLTP
(online transaction processing) system and other non-SAP systems in a form that is easy to access
and analyze using the BW client tools. The database design used to meet these objectives is an
"Enhanced Star Schema" or "InfoCube" (the data against which the end user runs queries).
The complexity of the objects in this design leads to the challenge of maintaining up-to-date and
accurate data in all the BW data tables. However, loading data into the BW is accomplished by
using InfoPackages. InfoPackages are tools for organizing data requests that are extracted from
the source system and are loaded into the BW system. With the progress of BW project the number
of info packages increases emphasizing the importance of good performance of each info package.
Although the DBMS underlying the BW system is monitored by the standard software’s for the R/3
functionality but this leaves a gap between the table spaces and table names as they appear at the
DBMS level and the BW application level entities to which these objects belong. To bridge this gap,
the new BW functionality for R/3 includes reports that place DBMS objects in a BW context. These
reports allow the user to take an object at the DBMS level and associate it with its application-level
entity.

In case of any problem in order to enable the administrator to identify the problem the Info
Packages are organized on the basis of the object to which they are transporting data- Info cube,
ODS or Master Data. The overall request status for the object is displayed, and an alarm is
triggered if any Info Package run from any Info Source fails. In this way, the administrator is able to
locate the exact position where a failure is going to impact the users and the BW system. Also, for
Info Cubes, Master Data and the ODS to give an overview of the history of requests for the system,
the progress of the last N requests through each stage of extraction and load is displayed, and for
any failures, the step that failed is displayed. The performance of requests can be monitored by
display of performance statistics for each stage of extraction and load in the form of graphs.

4.3 SAP BW Metadata Modelling

Metadata modeling: Metadata modeling component is the main entry point for defining the core
metadata objects used to support reporting and analysis. This includes everything from defining the
extraction process and implementing transformations to defining flat or multidimensional objects for
storage of information.

Modeling Features

* Metadata modeling provides a Metadata Repository where all the metadata is stored and a
Metadata Manager that handles all the requests for retrieving, adding, changing, or deleting
metadata.

* Reporting and scheduling mechanism: Reporting and scheduling are the processes required for
the smooth functioning of SAP BW. The various batch processes in the SAP BW need to be
planned to provide timely results, avoid resource conflicts by running too many jobs at a time and to
take care of logical dependencies between different jobs. These processes are controlled in the
scheduler component of AWB. This is achieved by either scheduling single processes
independently or defining process chains for complex network of jobs required to update the
information available in the SAP BW system. Reporting Agent controls execution of queries in a
batch mode to print reports, identify exception conditions and notify users and pre compute results
for web templates.
* Administering ETL service layer in multi- tier level: SAP’s ETL service layer provides services for
data extraction, data transformation and loading of data. It also serves as the staging area for
intermediate data storage for quality assurance purposes. The extraction technology of SAP BW is
supported by database management systems of mySAP technology and does not allow extraction
from other database systems like IBM, IMS and Sybase. It does not support dBase, MS Access
and MS Excel file formats. However, it provides all the functionality required for loading data from
non- SAP systems as the ETL services layer provide open interfaces for loading non-SAP data.

4.4 SAP BW ETL Fundamentals

ETL service comprises of two parts: Staging engine and Storage Service. Staging engine manages
staging process for all data received from several source systems. It interfaces with the AWB
scheduler and monitor for scheduling and monitoring data load processes. However, Storage
Service manages and provides access to data targets in SAP BW and the aggregates that are
stored in relational and multidimensional database management systems.

It is true, however, that the extraction technology provided as an integral part of SAP BW is
restricted to database management systems supported by mySAP technology and that it does not
allow extracting data from other database systems like IBM IMS and Sybase. It also does not
support proprietary file formats such as dBase file formats, Microsoft Access file formats, Microsoft
Excel file formats, and others. On the other hand, the ETL services layer of SAP BW provides all
the functionality required to load data from non-SAP systems in exactly the same way as it does for
data from SAP systems. SAP BW does not in fact distinguish between different types of source
systems after data has arrived in the staging area. The ETL services layer provides open interfaces
for loading non-SAP data.

SAP BW can be integrated with other SAP components based on application programming
interface (API) service. It provides a framework to enable comprehensive data replication based on
data extractors that encapsulate the application logic. Data Extractor fills the extract structure of
data source with a data from data source and offers sophisticated handling of changes. In addition
to supporting extractors, the service APIs also enable online access via RemoteCube technology
and flexible staging for hierarchies. On the other hand SAP provides an open interface called
Staging Business Application Programming Interface (BAPI) to extract data from non-SAP sources.
BAPI serves the purpose of connecting third- party ETL tools to SAP BW and provides access to
SAP BW objects which facilitates use of customer extraction routines. Data can be extracted at the
database level by using: DB connect, flat files and XML. DB connect facilitates extraction directly
from DBMS. In this the metadata files are loaded by replicating metadata tables and views into the
metadatory repository of SAP BW. Data can also be uploaded from flat files by creating routines for
extraction of data and XML files can be extracted through XML via Administrator Workbench in
SAP BW.

SAP BW provides three ways to extract data at the database or file level: DB Connect, flat file
transfer, and XML. SAP BW provides flexible capabilities for extracting data directly from RDBMS
tables using DB Connect.
4.5 SAP BW ETL Components

* Operational Data Store: It stores detailed data and supports tactical, day-to-day decision making.
A SAP view ODS as a near real-time informational environment that supports operational reporting
by interacting with existing transactional systems, data warehouses, or analytical applications. SAP
BW allows flexible access to data in the ODS, the data warehouse, and the multidimensional
models.

* Data Marts: A data mart provides the data needed by a decentralized function, department, or
business area. You need to weight the pros and cons before developing a data mart. For example,
a data mart can be implemented faster and cheaper than a data warehouse, sometimes costing
80% less than a full data warehouse. But as data marts proliferate, the cost advantages can
disappear. The IT organization must maintain the individual data marts and the multitude of ETL
and warehouse management processes that go with them. Multiple data marts can complicate data
integration efforts, increase the amount of inconsistent data, require more business rules, and
create the data stovepipes that data warehousing strives to eliminate.

* Interfaces: The data mart interface enables users to transfer and update transactional data and
metadata from one SAP BW system to other SAP BW systems.

* Open Hub Services: The open hub service is used to share data in SAP BW with non-SAP data
marts, analytical applications, and other applications. This service controls data distribution and
maintains data consistency across systems. With the open hub service, actual data and the
corresponding metadata are retrieved from InfoCubes or ODS objects.

5.0 BW IMPLEMENTATION APPROACHES

The approach to check relevant business content for your project mainly depends on what type of
project you are running. If it is R/3 driven or at least R/3 is part of the source systems then the
bottom-up approach is recommended, however the top down approach is possible as well.

5.1 BOTTOM UP APPROACH

In the bottom up approach we begin with the lower level objects provided with the Business
Content of the BIW release. This is an off-the-shelf solution wherein the organization’s existing
business processes are mapped with the data warehouse solution provided by the BIW Business
Content.
The feasibility of this approach would depend heavily on the extent of customization carried out on
the SAP R/3 system used.

The implementation would involve the following activities:

 Determination of DataSources and InfoSources for the Master (InfoObjects) and

Transactional (InfoCubes) Data.
  Generation and Activation of DataSources in SAP R/3.
 Replication of DataSources in BIW.
 Initial Extraction (Full upload) of data into BIW.
 Verification of data extracted into BIW.
 Verification of query results (data in Reports/Workbooks).
 Scheduling and Monitoring of Delta extraction of data.
 Web enabling of queries.

The approach would comprise of the following steps.

 Selection of the initial area (module) for implementation of BIW. This could for example be
the Sales and Distribution Module.
 Determination and Activation of InfoObjects for the related InfoAreas in BIW.
 Determination and Activation of InfoCubes for the related InfoAreas in BIW.
 Determination of Master Data InfoObjects.
 Implementation and Activation of the pre-configured business content for a specific
functional area (activities given above).
 Training from the user’s perspective.
 Analysis of User comfort with the existing reports and requirement fulfillment by means of
interviews.
 Enhancement of provided reports according to business needs (If required)
 Slight customization of Business Content to map to customized business process (If
required). This phase would involve data modeling and design phases to create a
multidimensional model in BIW to meet user requirements.
 Go-Live for the functional area.
 Use the above steps iteratively to cover all functional areas and business processes of
your organization.

Effectively organizations should always use the business content as a reference and customize it
whenever required. By using Business content organizations make sure that they follow a path that
is integrated and covers most of their business processes. It is the Business content that enables
companies to create an enterprise wide warehouse step by step.

5.2 TOP DOWN APPROACH

The Top Down approach is a little bit harder since the requirements of the customer do not usually
match with the requirement of Standard Business Content. Consequently organizations have to find
a method to communicate on an abstract level and then compare this with the existing solution. In
the top down approach we begin with the User requirements. The steps comprising this approach
are as follows.
 Interview users to gather their Reporting and Analysis requirements.
 Implementation of a gap-analysis between the User requirements and provided Business
 content.
 If the requirements do not adhere to the pre-configured content of BIW, data model and
 design will be prepared conforming to the user requirements.
 Pre-configured objects will either be modified or new InfoObjects and InfoCubes will be
created.
 As per the modifications or new developments, DataSources will be enhanced or created
in the SAP System.
 The implementation steps (as discussed in the bottom-up approach) will then be followed.
 Training from the user’s perspective.
 The above steps will be iterated through for all customer requirements and functional
areas of the organization.

It is recommended to use this approach only when Source Systems other than SAP are being used
or if the SAP System is heavily customized.

6.0 ILLUSTARTIONS

6.1 Figure: SAP BW Database Design

6.2 Figure: Analytical View of Business Information Warehouse Model

7.0 CONCLUSION

With the growing network of processes and systems, the need for efficient management support
systems is also increasing. However for this it is not enough to place a company strategically and
give guidelines for its further development. Instead it is essential to have real time analysis and
graphical visualization of the key performance indicators. In BW automatic assimilation and
analysis of information is possible. BW gives a holistic view of the company by considering both the
financial data and non- financial assets of the company. As corporate planning is often not done in
one common planning tool (e.g. turnover plan in a sales system and cost center plan in excel)
studying interdependencies and coordination among them has become even more tedious. Thus
the strategic management system must establish a planning process through all levels of planning
in the company to make the data available for all responsible persons in one system. With BW it is
possible to upload data of different planning tools, manipulate planning data and write back
changed data to the operational system. BW can also be used as early warning system to inform
the responsible persons about critical indicators on the basis of already defined thresholds of these
indicators.

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