CO-PA and BW A Winning Team

Stefan Kraus (Product Manager Profitability Management) SAP AG

2000 ASUG Annual Conference & Vendor Fa i r May 7-10, 2000 Georgia Worl d Congress Center Atlanta Georgia

A M E R I C A S

S A P

U S E R S

Copyright G R O U P Copyright 20002000

Overview
1

Concepts of Profitability Analysis 1.1 An Integrated Business Model for Revenues and Costs 1.2 Integration of Master Data and Valuation 1.3 Integration of Actual Value Flows and Planning

2 3

Concepts of SAP Business Information Warehouse (BW) Interplay between Profitability Analysis and BW 3.1 Technical Interplay (Extracting and Retracting Functions) 3.2 Profitability Reporting with Delivered Business Content 3.3 Business Scenarios

Profitability Analysis and CRM with BW

SAP AG 2000 filename (author) / 2

Overview
1

Concepts of Profitability Analysis 1.1 An Integrated Business Model for Revenues and Costs 1.2 Integration of Master Data and Valuation 1.3 Integration of Actual Value Flows and Planning

2 3

Concepts of SAP Business Information Warehouse (BW) Interplay between Profitability Analysis and BW 3.1 Technical Interplay (Extracting and Retracting Functions) 3.2 Profitability Reporting with Delivered Business Content 3.3 Business Scenarios

Profitability Analysis and CRM with BW

SAP AG 2000 filename (author) / 3

Integrated Business Model in Financials

V A L U E F L O W

COOM Manufacturing Administration Marketing Sales

COPC Standard costs Variances

COPA

FI

Business Process

Procurement Production

Goods movement

Sales/Billing

MM
SAP AG 2000 filename (author) / 4

PP

MM

SD

Integrated Business Model to Collect Revenue and Costs

Documents Value flows SD Planning

FI

COPC

COPC

COOM

Act. Transfer of Sales quantity billing docs Sales revenue Direct po - Rebates sti nNet revenue gs Valuation - Direct costs using cost- Var. prod. costs estimates Contrib. margin I - Fixed prod. costs Contrib. margin II FI - Variances - Overhead costs Transfer of Operating profit overhead

Plan

Customizing
SAP AG 2000 filename (author) / 5

Typical Questions in Profitability Analysis

Contribution of Individual Market Segments

Which are the largest and fastest growing customers?

Margin goals of Individual Sales Entities

Did the salesforce reach their contribution margin goal? What was the success of the most recent sales promotion for a product line?

Success of Marketing Activities

Revenue and Cost Structure

What is the impact of a pricing strategy for a group of customers?

SAP AG 2000 filename (author) / 6

Overview
1

Concepts of Profitability Analysis 1.1 An Integrated Business Model for Revenues and Costs 1.2 Integration of Master Data and Valuation 1.3 Integration of Actual Value Flows and Planning

2 3

Concepts of SAP Business Information Warehouse (BW) Interplay between Profitability Analysis and BW 3.1 Technical Interplay (Extracting and Retracting Functions) 3.2 Profitability Reporting with Delivered Business Content 3.3 Business Scenarios

Profitability Analysis and CRM with BW

SAP AG 2000 filename (author) / 7

Characteristics Derivation Concept

Customer group Input

Strat.BU Sls reg. Prod.grp Cust.grp State District Sls rep. Product Cust.

Customer

G1
District State

Output
Strat.BU Sls reg. Prod.grp Cust.grp State District Sls rep. Product Cust.
SB SR PZ G1 S1 D1 R1 P1 C1

C1

D1
Product Product group

S1
Strategic business unit

P1
R1 P1 C1

PZ
Sales region

Sales rep.

SB

R1

SR

SD
DERIVATION

COPA

SAP AG 2000 filename (author) / 8

Valuation Concept

Input Billing Document Customer 1000 Product P-100 Quantity 10 Revenue 10,000 Discounts 1,000
Quantity Var. prod. costs Fixed prod. costs Special handling Revenue Sales commision 10 5,200 1,800 200 10,000 500
Quantity

Output
10 10000 1000

Revenue Customer Disc. Var. prod. costs Fixed prod. costs Sales commision Special handling
COPA

5200 1800 500 200

SD

Valuation

SAP AG 2000 filename (author) / 9

Overview
1

Concepts of Profitability Analysis 1.1 An Integrated Business Model for Revenues and Costs 1.2 Integration of Master Data and Valuation 1.3 Integration of Actual Value Flows and Planning

2 3

Concepts of SAP Business Information Warehouse (BW) Interplay between Profitability Analysis and BW 3.1 Technical Interplay (Extracting and Retracting Functions) 3.2 Profitability Reporting with Delivered Business Content 3.3 Business Scenarios

Profitability Analysis and CRM with BW

SAP AG 2000 filename (author) / 10

Transfer Billings Document to CO-PA: In Detail

FI-Document
FI

SD

Billingdocument

Header : Customer 47 SD Item 10: Product A Item 20: Product B

SAVE
Info missing ?

NO
CO PA Release to Accounting

YES

Line-item 1 Line-item 2
Customer 47 Product A Revenue ... Disc. ... COGS ...

Error

SAP AG 2000 filename (author) / 11

Source Related Allocation of Overhead Costs

Kunde/Artikel Kunde/Artikel Customer A/ Kunde/Artikel Product 1
revenue rebates ./. net revenue ./. var. prod. costs CM1 ./. fix prod. costs CM2 ./.

Product Group 1
revenue : : : CM1 : CM2 production variances CM3

Customer Group 1
revenue : : : CM1 : CM2 : : CM3 ./.
overhead costs sales dept.

Company
revenue : : : CM1 : CM2 : : CM3 : : : CM4 ./.
overhead

Cost Centers cost center production cost centers sales dept. cost center administration

CM4

Operation Profit

SAP AG 2000 filename (author) / 12

Reporting on Contribution Margins & Profitability

SAP AG 2000 filename (author) / 13

Profitability Planning

Full Excel Macro functionality available

SAP AG 2000 filename (author) / 14

Fix SAP Sheet and flexible Customer Sheet

Overview
1

Concepts of Profitability Analysis 1.1 An Integrated Business Model for Revenues and Costs 1.2 Integration of Master Data and Valuation 1.3 Integration of Actual Value Flows and Planning

2 3

Concepts of SAP Business Information Warehouse (BW) Interplay between Profitability Analysis and BW 3.1 Technical Interplay (Extracting and Retracting Functions) 3.2 Profitability Reporting with Delivered Business Content 3.3 Business Scenarios

Profitability Analysis and CRM with BW

SAP AG 2000 filename (author) / 15

SAP BW: Foundation of Business Intelligence

Customer Relationship Management

Strategic Enterprise Management

Supply Chain Management

strategy, plan and optimize analyze

Business Information Warehouse

Financials, Procurement, Real Estate, Operations, Sales, etc

Headquarters Human Resources (SAP & Others)

Legacy Non-SAP

Info Provider Economy Demographics (D&B, AC Nielson)

execute

SAP AG 2000 filename (author) / 16

Closed Loop Mgmt Process

The mySAP.com Landscape

CRM

SEM

APO

Retractor

Extractor

BW R/3 Financials

NonSAP

SAP AG 2000 filename (author) / 17

Reporting in BW

SAP AG 2000 filename (author) / 18

Overview
1

Concepts of Profitability Analysis 1.1 An Integrated Business Model for Revenues and Costs 1.2 Integration of Master Data and Valuation 1.3 Integration of Actual Value Flows and Planning

2 3

Concepts of SAP Business Information Warehouse (BW) Interplay between Profitability Analysis and BW 3.1 Technical Interplay (Extracting and Retracting Functions) 3.2 Profitability Reporting with Delivered Business Content 3.3 Business Scenarios

Profitability Analysis and CRM with BW

SAP AG 2000 filename (author) / 19

Extraction of Data from CO-PA to SAP BW

SAP BW Server

InfoSource

Communication structure

Mapping Transferstructure

DataSource

Metadata upload

Flow of Metadata
OLTP R/3
SAP AG 2000 filename (author) / 20

CO-PA Metadata

Flow of Transaction Data

CO-PA

Retraction of Data from BW to CO-PA

SAP BW Server

Create BW Query

Mapping between field catalog & CO-PA

BW 2.0B Add-on

CO-PA

Flow of Metadata
OLTP R/3
SAP AG 2000 filename (author) / 21

CO-PA

Flow of Transaction Data

Retract data from BW and back into CO-PA

CO-PA in the mySAP.com Landscape

CRM

APO

Co st Dr (C ive us rs to m er Pr of ita bi lity )

n ) ctio du ility ro ab P fit rm Pro Te uct ort rod Sh P n( rgi rting Ma Repo P.com mySA
cation Repli

t as ec r Fo

M ar gi n

BW

R/3

Targets Profitability Key Figur es

SAP AG 2000 filename (author) / 22

SEM

Overview
1

Concepts of Profitability Analysis 1.1 An Integrated Business Model for Revenues and Costs 1.2 Integration of Master Data and Valuation 1.3 Integration of Actual Value Flows and Planning

2 3

Concepts of SAP Business Information Warehouse (BW) Interplay between Profitability Analysis and BW 3.1 Technical Interplay (Extracting and Retracting Functions) 3.2 Profitability Reporting with Delivered Business Content 3.3 Business Scenarios

Profitability Analysis and CRM with BW

SAP AG 2000 filename (author) / 23

Delivered CO-PA Business Content

Goal: Ready-to-Run Business Content for CO-PA Scenario 1: Connecting live CO-PA to BW and reporting of live data with queries (for testing) as easy and quickly as possible

Assign elements of your Key Figure Scheme to elements of a delivered CM structure Extract live data to delivered InfoCube Report your data with delivered queries

Scenario 2: Providing pre-defined Operating Concern Templates and matching BW InfoCubes for new installations and demos

Use/copy delivered Oper. Concern Templates Extract demo data/live data to delivered InfoCube Report data with delivered queries

SAP AG 2000 filename (author) / 24

Scenario 1: Connecting live CO-PA

CO-PA
Elements of customer-defined Key Figure Scheme are assigned to...
Sales Quantity Gross Revenue Customer Discount Material Discount Cash Discount ........ ........ ........ ........ ........ ........ ........ ........
SAP AG 2000 filename (author) / 25

... pre-defined key figures which are used in ...

Sales Quantity Sales Revenue Total Sales Discount Total Dir. Sales Costs Net Revenue Cost of Goods Sold Contribution Margin I Variances Contribution Margin II Total Overhead Costs Operating Result

SAP BW

...a pre-defined InfoCube + ready-to-run Queries

Steps: Connecting live CO-PA

Assign elements of Key Figure Scheme to pre-defined key figures which are used in InfoCube

Where: R/3 System -> Transaction SBIW -> Customer-defined DataSource -> Prof. Analysis -> Assign Key Figures

Create DataSource and select the pre-defined key figures which are to be populated in BW

Where: SBIW -> Create DataSource -> Calculated key figures from the key figure scheme (instead of 'value fields' !)

Map DataSource to pre-defined InfoSource 0CO_PA_1

Where: BW System -> Admin Workbench -> InfoSource 0CO_PA_1 -> Transferstructure / Transfer rules

Execute standard steps for connecting Business Content (MetaData Upload, Create InfoPackage, Execute InfoPackage,...) using InfoCube 0COPA_C01 Publishing Key Figures

SAP AG 2000 filename (author) / 26

Scenario 2: Demo Content for BW and Workplace

Workplace

Delivered queries

BW Infocube (S_GO)
Extraction of

R/3
Demo data

Operating Concern Template S_ GO

SAP AG 2000 filename (author) / 27

Delivered Oper. Concern Templates and InfoCubes

Quickstart: simple Operating Concern (basic characteristics and CM)

Template: S_GO / InfoCube: CO-PA: Quickstart (S_GO) 0COPA_C03

Consumer Products: industry-related characteristics and CM

Template: S_ CP / InfoCube: CO-PA: Consumer Products (S_CP) 0COPA_C04

Airline Profitability: industry-specific characteristics and CM

Template: S_AL / InfoCube: CO-PA: Airline Profitability (S_AL) 0COPA_C05

SAP AG 2000 filename (author) / 28

Overview
1

Concepts of Profitability Analysis 1.1 An Integrated Business Model for Revenues and Costs 1.2 Integration of Master Data and Valuation 1.3 Integration of Actual Value Flows and Planning

2 3

Concepts of SAP Business Information Warehouse (BW) Interplay between Profitability Analysis and BW 3.1 Technical Interplay (Extracting and Retracting Functions) 3.2 Profitability Reporting with Delivered Business Content 3.3 Business Scenarios

Profitability Analysis and CRM with BW

SAP AG 2000 filename (author) / 29

High-Volume and Cross- Application Reporting

COPA

SAP AG 2000 filename (author) / 30

Collecting Data from Several R/3 Systems

COPA

COCO- PA PA

SAP AG 2000 filename (author) / 31

Collecting Data from Legacy Systems

Legacy System

COPA

SAP AG 2000 filename (author) / 32

Overview
1

Concepts of Profitability Analysis 1.1 An Integrated Business Model for Revenues and Costs 1.2 Integration of Master Data and Valuation 1.3 Integration of Actual Value Flows and Planning

2 3

Concepts of SAP Business Information Warehouse (BW) Interplay between Profitability Analysis and BW 3.1 Technical Interplay (Extracting and Retracting Functions) 3.2 Profitability Reporting with Delivered Business Content 3.3 Business Scenarios

Profitability Analysis and CRM with BW

SAP AG 2000 filename (author) / 33

Customer Value - Examples

Key Customer Development Top Ten Customers

Customer Lifetime Value Analysis

SAP AG 2000 filename (author) / 34

Customer-Related Revenues and Costs

Cust:Jones A&P

Collect customer-related revenues and costs

Net Profit

Order handling & delivery Marketing campaigns Customer visits Quotations Complaints

Service Time Billing and payments

SAP AG 2000 filename (author) / 35

Interplay between CRM and CO-PA

SAP BW Market Data
COPA

Customer Profitability

Customer Evaluation in the Workplace

Workplace

Info cubes

R/3
Info cubes

Customer Profitability

SAP AG 2000 filename (author) / 36

Source-Related Allocation of Customer-Related Costs

CustomerRelated Activities Customer

Net Revenue Cost of Sales

Customer Profitability

Transport and Distribution Customer Visits Customer Complaints Order Handling & Delivery

Direct Sales Costs Customer Service Processing

SAP AG 2000 filename (author) / 37

Source-Related Allocation of Customer-Related Costs

Customer

Net Revenue Cost of Sales

FI

Direct posting Activity alloc. of customer visits Accruals dependent on order size

Direct Sales Costs Customer Service Processing

COOM

Cost Centers SALES & SERVICE

Allocation of costs based on cost drivers in CRM

SAP AG 2000 filename (author) / 38

Profitability Management Workshops

Workshop Location Chicago Chicago San Francisco San Francisco San Francisco San Francisco Date July 1 &1 1 1 July 1 &1 1 1 October 11 11 December 11 11 January 11 11 January 11 11

Performance Tuning in CO-PA BW/CO-PA Configuration & Integration SD/COPA Integration Workshop Integrated Profitability Planning Performance Tuning in CO-PA BW/CO-PA Configuration & Integration

SAP AG 2000 filename (author) / 39

Where to sign up
Please check SAPNET for exact dates, location and further details:

http://www.sap.com/usa/education

Use keyword Workshop

To register:

Use SAPNET: http://www.sap.com/usa/education Call Central Registration at 1-888-777-1SAP (1727) Fax 1-888-FAX-1SAP (329-1727)

SAP AG 2000 filename (author) / 40

Links to Further Information

CO-PA Home page

SAPNet -> Alias 'co-pa'

Factsheets

Profitability Management (mat. no. 50030578) Sales and Profit Planning in Profit. Analysis (mat. no. 50030579) CO-PA and SAP BW - A Winning Team (mat. no. 50034426)

Delta Study Guides

SAPNet -> SAP Store / SAPShop -> Knowledge Shop

SAP AG 2000 filename (author) / 41

Copyright 2000 SAP AG (All rights reserved)

No part of this brochure may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG. The information contained herein may be changed without prior notice. Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors. Microsoft, WINDOWS, NT, EXCEL, Word and SQL Server are registered trademarks of Microsoft Corporation. IBM, DB2, OS/2, DB2/6000, Parallel Sysplex, MVS/ESA, RS/6000, AIX, S/390, AS/400, OS/390, and OS/400 are registered trademarks of IBM Corporation. ORACLE is a registered trademark of ORACLE Corporation, California, USA. INFORMIX-OnLine for SAP is a registered trademark of Informix Software Incorporated. UNIX, X/Open, OSF/1, and Motif are registered trademarks of The Open Group. HTML, DHTML, XML, XHTML are trademarks or registered trademarks of W3C, World Wide Web Consortium, Laboratory for Computer Science NE43-358, Massachusetts Institute of Technology, 545 Technology Square, Cambridge, MA 02139. JAVA is a registered trademark of Sun Microssystems, Inc. , 901 San Antonio Road, Palo Alto, CA 94303 USA. JAVASCRIPT is a registered trademark of Sun Microsystems, Inc., used under license for technology invented and implemented by Netscape. SAP, SAP Logo, mySAP.com, mySAP.com Marketplace, mySAP.com Workplace, mySAP.com Business Scenarios, mySAP.com Application Hosting, WebFlow, R/2, R/3, RIVA, ABAP, SAP Business Workflow, SAP EarlyWatch, SAP ArchiveLink, BAPI, SAPPHIRE, Management Cockpit, SEM, are trademarks or registered trademarks of SAP AG in Germany and in several other countries all over the world. All other products mentioned are trademarks or registered trademarks of their respective companies.

SAP AG 2000 filename (author) / 42