05 Pranav Bhushan Utility Industry

Utilities Industry A Benchmarking PresentationPranav Bhushan, Value Engineering June 5, 2008 Agenda 1. 2. 3. 4. 5. 6. 7. Benchmarking Program Overview Corporate Services Enterprise Asset Management Customer Contact Center Management Best Run IT Participant Testimonials Appendix: Links to Surveys © SAP Summit 08 / Page 2 What is Benchmarking? What? Enables continuous improvement Allows to target what does and does not work well Allows to adopt best practices Allows to put evidence behind decisions Why? Build a Business Case Assess value realization Compare performance Prove success When? Before business transformation During business transformation After business transformation © SAP Summit 08 / Page 3 ASUG/SAP Benchmarking – Designed to get Actionable Results Strategic Service by ASUG and SAP. Latin America. who leverage the program to: Build a business case for change Compare performance to industry peers and between regions/divisions Assess value realization.000+ participants from over 1. TPMA and SCL Program covers 20 processes. with 2. launched end of 2004 as a forum to exchange metrics and best practices Additional industry partnerships include APICS. year-over year Prove success Survey participation is free of charge Survey content relevant for business as well as IT audiences Core surveys also available in Spanish and Portuguese (global benchmarking) Focused 360o Approach to Problem Identification and Resolution © SAP Summit 08 / Page 4 .000 companies spread across North America. Asia Pacific and Europe. : Industry peers Companies running on SAP © SAP Summit 08 / Page 5 .The Link Between KPIs. Best Practices and Enabling Technology What makes SAP Benchmarking Unique KPI achievement is linked to best practice adherence to assess business process maturity Results can be used to establish a technology roadmap to increase your business process maturity and realize quantifiable business value Large number of participants allows for a very robust benchmarking comparison.g. e. Benchmarking Methodology and Study Deliverables 1 Company-Specific Report Detailed. confidential report comparing your performance to peers Gap to Q1 & Average 2 Intercompany/Global Benchmark Inter-divisional comparison to peers and each other 3 Business Process Health-check Key Performance Indicators Best Practice Adoption Executive-level summary of findings across business units and processes 4 Year-over-Year Analysis Comparison of current performance to peer and past performance 5 Business Transformation Study Study on leading SAP customers who realize higher value from SAP solutions © SAP Summit 08 / Page 6 . SAP Benchmarking Study Deliverables © SAP Summit 08 / Page 7 . SAP Benchmarking Study Deliverables Thought Papers (Example) © SAP Summit 08 / Page 8 . Available Benchmarking and Best Practices Surveys Corporate Services Human Capital Management NEW: Talent Management Supply Chain SRM/ Procurement Customer Lifecycle NEW: Order to Cash/ Contract to Cash Customer Contact Centers Best Run IT Total Cost of Ownership (TCO) Business Intelligence/ Analytics Centers of Excellence Organizational Change Management Value Realization NEW: Winning the ERP Marathon AMR – Terabyte Survey Enterprise Data Management IT Strategy Supply Chain Planning Transportation Management Warehouse Management Finance NEW: Sales Effectiveness Trade Promotion Management1 Channel Management1 Financial Compliance Manufacturing NEW: Enterprise Health Check Under Development: Shared Services NEW: Retail Merch./ Category Management Enterprise Asset Management NEW: Business Network Transformation Under Development: EH&S Compliance Under Development: S&OP Note: 1) SAP owned surveys © SAP Summit 08 / Page 9 NPDI . co m/usa/solutions/be nchmarking/index.e px or www.sap.asug.com Validate data provided in the survey Assess KPI and Best Practice Adoption Summarize key business pain points Present findings to process owner(s) 1 Week Post-survey Submission 1-2 Weeks Postdata Validation Key Stakeholders: Survey Participant Engagement Sponsor Business Process Owner(s) Process level IT Owners(s) Key Stakeholders: SAP Engagement Sponsor VE Team Member(s) VE Business Process Expert(s) © SAP Summit 08 / Page 10 .Survey Registration and Completion Survey Registration Data Validation Analysis & Report Creation One-toOne session Register and complete survey at: http://www. 4. 3. 6. 2.Agenda 1. 7. Benchmarking Program Overview Corporate Services Enterprise Asset Management Customer Contact Center Management Best Run IT Participant Testimonials Appendix: Links to Surveys © SAP Summit 08 / Page 11 . 5. 9% Overall Q1 195 21.1% 48.5% 1.9% Effectiveness Finance Cost as a % of Revenue Days Sale Outstanding (Days) Efficiency Error rate in bills sent out Practices that Differentiate the Top Performers © SAP Summit 08 / Page 12 .2% 23.3% Utilities Average 77 39.7 2.2 0.9% 49.1% Q1 107 18.8 0.7% 0.6 2.7% 0.Best-Run Corporate Services: Analysis Framework Type Metric Average Employees per HR FTE % HR Staff allocated to Transactional Activities 101 40.4% 29.3% 0. Human Capital Management Sample Insights Shared Services Reduces HR Costs HR Costs per Employee depending on Shared Services Adoption “Right” Pyramid Drives Employee Productivity Operating Income per Employee +74% HR Costs as % of Revenues -29% Strategic Decision Support Talent Management Degree of Integration Reduces HR Costs HR Costs per Employee by Number of HR Applications in addition to ERP system Transactional Support Average Top Performer © SAP Summit 08 / Page 13 . Annual Closing Times (Days) “Right” Pyramid Drives Employee Productivity Operating Margin +38% Finance Costs as % of Revenues -30% Strategic Decision Support Planning/ Expertise Based Integration of Billing with Order Entry Systems Reduces Invoice Error Rates Invoice Error Rate (in %) Transactional Support Average Top Performer © SAP Summit 08 / Page 14 .Finance Sample Insights Integration of G/L with Downstream Systems Reduces Closing Times Avg. Agenda 1. 3. 6. 2. Benchmarking Program Overview Corporate Services Enterprise Asset Management Customer Contact Center Management Best Run IT Participant Testimonials Appendix: Links to Surveys © SAP Summit 08 / Page 15 . 5. 4. 7. 5% 41.4% 6% 1.2% 16.8% Overall Average Q1 75% 75.8% 11.2% Q1 80.8% 36.Best-Run Supplier Relationship Management : Analysis Framework Metric % of spend managed strategically (Indirect) % of spend managed strategically (Services) Average Annual Savings in Indirect spend as a % of Total Spend Average Annual Savings in Services spend as a % of Total Spend PO Error Rate 35.1% 7.1% 2.8% Practices that Differentiate the Top Performers © SAP Summit 08 / Page 16 .6% 0.5% 3.2% 9.9% Utilities Average 38.3% 17.9% 6.7% 3.8% 79. Best-Run Enterprise Asset Management – Analysis Framework Defining EAM Top Performing Organizations Effectiveness Return on Assets: >20% Annual Penalty Costs: <$1M Annual Lost Time Performance: <100 days Unplanned Annual Outages: <10% Monthly Asset Downtime: <15% Efficiency Schedule Attainment: >80% Maintenance Budget Adherence: 76-100% Cycle Time: <5 days Wrench Time: >50% Strategy Maintenance Approach: Emphasis on Reliability Centered Maintenance & Continuous Improvement Advanced Planning and Scheduling Practice High Strategic Importance of EAM Periodic Reporting and Analytics Updates Limited number of Software Applications © SAP Summit 08 / Page 17 . Enterprise Asset Management .Sample Insights KPIs Schedule attainment Correlation between Maintenance Program and Compliance performance 87% 41% 34% 13% Planning & Scheduling Reliability Functions 48% 70% % allocation of time in maintenance function Repair & Preventive Maintenance High performers have a more productive utilization of time across different functions Analyzing Readings Troubleshooting Looking for Materials Reporting Traveling Note: 1) Figures mentioned for Utilities Industry © SAP Summit 08 / Page 18 . Enterprise Asset Management .Sample Insights Significant Differences in Performance Results on EAM KPIs Between “Top Performing” and Other Companies Effectiveness: Return on Assets Efficiency: Schedule Attainment Strategy: Maintenance Approach (Sum of Reliability Centered Maintenance and Continuous Improvement as % of Overall Maintenance Approach) Top Performing EAM organizations All Other EAM Organizations © SAP Summit 08 / Page 19 . 4.Agenda 1. 7. 2. 5. Benchmarking Program Overview Corporate Services Enterprise Asset Management Customer Contact Center Management Best Run IT Participant Testimonials Appendix: Links to Surveys © SAP Summit 08 / Page 20 . 3. 6. ) Interaction Center Call Handle Time (Sec.) Abandonment Rate (%) 9.9% Practices that Differentiate the Top Performers © SAP Summit 08 / Page 21 .2% Utilities Average 6 23 240 105 3.38 26 238 90 3.) Interaction Center Post Call Work Time (Sec.4% Overall Q1 2.7% Q1 3 12 145 30 0.74 12 119 16 1.Best-Run Customer Contact Center Management : Analysis Framework Metric Average Interaction Center Cost per Interaction ($) Interaction Center Average Queue Time (Sec. 3. 2.Agenda 1. 7. Benchmarking Program Overview Corporate Services Enterprise Asset Management Customer Contact Center Management Best Run IT Participant Testimonials Appendix: Links to Surveys © SAP Summit 08 / Page 22 . 4. 6. 5. 5 1.Best-Run IT: Analysis Framework Overall Type Metric Average Support equivalent FTE per 100 Active Users 4.8 © SAP Summit 08 / Page 23 .4 2.1 4 Utilities Q1 0.1 60.7 8 1 Efficiency Support équivalent FTE per 100 Named Users Number of critical interfaces Effectiveness Number of production instances Practices that Differentiate the Top Performers Best Practice Listing 1 Gap 2 The COE/Support organization is as centralized as possible within the constraints of the business model 2 The level of input form the business into the design and implementation of the COE/Support Organization is high 1 3 We have regular.1 Q1 1.9 0. formal reviews of the COE/Support Organization design and services 0.9 0.5 3.8 43 2.8 1 Average 3. 3. Benchmarking Program Overview Corporate Services Enterprise Asset Management Customer Contact Center Management Best Run IT Participant Testimonials Appendix: Links to Surveys © SAP Summit 08 / Page 24 . 4. 5. 6. 2.Agenda 1. 7. We want to be the best forest product company in the world and a global leader among all industries. and to learn about potential areas of improvement” Senior Manager. IT Enterprise Systems SAP Support. Director. ASUG and SAP helped us identify opportunities that enable that vision. With the findings of the Benchmarking study. DuPont “ “We don’t want to just be better than our competition. Assistant Director. Weyerhaeuser “ “Very valuable information … it is good to see where we stand with respect to other Best in Class companies. Canada Post “ “ Great information. SAP Center of Excellence. very well presented.” Mike Stoko. We know what each business process costs and we can go after technical improvements to reduce the costs. and very useful explanations … we will participate again next year” SAP HR Support Supervisor.” Chris Van Liew.Sample Participant Testimonials “ “Since participating in the Benchmarking and Best Practices program we can compare apples to apples. SAP Global Operations and Value Capture. Marathon Oil © SAP Summit 08 / Page 25 . 2. 3.Agenda 1. 4. Benchmarking Program Overview Corporate Services Enterprise Asset Management Customer Contact Center Management Best Run IT Participant Testimonials Appendix: Links to Surveys © SAP Summit 08 / Page 26 . 5. 6. 7. benchmarking.com/cgi-bin/qwebcorporate.com/cgi-bin/qwebcorporate.Links to Surveys (1) Area Corporate Services Survey HCM Comprehensive HCM Talent Management Finance Comprehensive Finance Financial Compliance Enterprise Health Check Demo URL https://www.benchmarking. Manufacturing NPDI Retail Merchandising © SAP Summit 08 / Page 27 .com/cgi-bin/qwebcorporate.sap.com/cgi-bin/qwebcorporate.benchmarking.com/cgi-bin/qwebcorporate.sap.com/cgi-bin/qwebcorporate.com/cgi-bin/qwebcorporate.dll?idx=R4CWC2&lg=english&rk=446653 https://www.dll?idx=GB37M2&lg=english&rk=266747 https://www.sap.benchmarking.benchmarking.dll?idx=Q7NFJH&lg=english&rk=567899 https://www.com/cgi-bin/qwebcorporate.benchmarking.dll?idx=SQPPX4&lg=english&rk=444498 https://www.sap.benchmarking.com/cgi-bin/qwebcorporate.dll?idx=ZUBWSK&lg=english&rk=536067 https://www.sap.com/cgi-bin/qwebcorporate.benchmarking.benchmarking.com/cgi-bin/qwebcorporate.benchmarking.sap.sap.sap.benchmarking.dll?idx=2AGQX2&lg=english&rk=973912 https://www.com/cgi-bin/qwebcorporate.dll?idx=JAC6QW&lg=english&rk=790520 https://www.benchmarking.dll?idx=3G8CAK&lg=english&rk=361218 https://www.sap.sap.dll?idx=A5BRHN&lg=english&rk=328516 Supply Chain SRM/Procurement Comprehensive SRM/Procurement Supply Chain Planning Comprehensive Supply Chain Planning Transportation Mgt.sap.benchmarking.dll?idx=B4Z3GU&lg=english&rk=704783 https://www.dll?idx=ZSNNN9&lg=english&rk=536709 https://www. Warehouse Management Manufacturing Compreh.dll?idx=WDPMCX&lg=english&rk=451449 https://www.dll?idx=MAT52Z&lg=english&rk=333120 https://www.com/cgi-bin/qwebcorporate.benchmarking.com/cgi-bin/qwebcorporate.sap.sap.sap.sap.benchmarking.dll?idx=U69DGN&lg=english&rk=215418 https://www.com/cgi-bin/qwebcorporate.dll?idx=FSBEHS&lg=english&rk=810548 https://www.com/cgi-bin/qwebcorporate.benchmarking.dll?idx=ZRKEM8&lg=english&rk=920118 https://www.benchmarking.dll?idx=DP7WSQ&lg=english&rk=791296 https://www.sap.com/cgi-bin/qwebcorporate.sap. sap.sap.sap.dll?idx=7VXYFY&lg=english&rk=314685 https://www.benchmarking.dll?idx=WUB8EM&lg=english&rk=490272 https://www.com/cgi-bin/qwebcorporate.dll?idx=FD32FA&lg=english&rk=434471 Best Run IT Business Intelligence TCO © SAP Summit 08 / Page 28 .sap.com/cgi-bin/qwebcorporate.benchmarking.benchmarking.sap.com/cgi-bin/qwebcorporate.com/cgi-bin/qwebcorporate.com/cgi-bin/qwebcorporate.benchmarking.dll?idx=9Z76SB&lg=english&rk=222560 https://www.benchmarking.com/cgi-bin/qwebcorporate.sap.Links to Surveys (2) Area Customer Life Cycle Survey Order to Cash Contract to Cash Customer Contact Centers Sales Effectiveness Trade Promotions Management Food Services Channel Management Demo URL https://www.benchmarking.com/cgi-bin/qwebcorporate.dll?idx=H9SR6B&lg=turkish&rk=324580 https://www.dll?idx=6Y84UQ&lg=turkish&rk=759333 https://www.com/cgi-bin/qwebcorporate.sap.sap.dll?idx=K5DW3E&lg=english&rk=705234 https://www.dll?idx=7BYDYS&lg=turkish&rk=430754 https://www.sap.benchmarking.com/cgi-bin/qwebcorporate.benchmarking.dll?idx=EE5Y3H&lg=english&rk=429224 https://www.benchmarking. benchmarking.com/cgi-bin/qwebcorporate. Comprehensive registration page (all ASUG surveys + TPM. Benchmarking Veki – Access to Sample Reports: https://wiki. ASUG registration page (all ASUG surveys): https://www.sap.corp/display/VEISGWiki/Benchmarking+Toolkit © SAP Summit 08 / Page 29 .wdf.sap.dll?idx=7UUCAD&SRP1Q5=SAPPHIRE2008 3.com/cgi-bin/qwebcorporate. Access to Portuguese and Spanish registration pages: http://benchmarking.sap.sap.Other Important Links 1.com/Register/ 4.dll?idx=N4J5ND&SRP1Q5=SAPPHIRE2008 2.benchmarking. CHM and Food Services + Best Practices surveys): https://www. Thank you! © SAP Summit 08 / Page 30 . ByDesign. This document contains only intended strategies. special. xApps. einen bestimmten Geschäftsweg. The information in this document is proprietary to SAP. Texte. Grafiken. und SAP unterstützt nicht die Nutzung von Internetseiten Dritter durch Sie und gibt keinerlei Gewährleistungen oder Zusagen über Internetseiten Dritter ab. Produkte können länderspezifische Unterschiede aufweisen. Alle Rechte vorbehalten. The information contained herein may be changed without prior notice. including but not limited to the implied warranties of merchantability. product strategy. either express or implied. unterliegen nicht dem Einfluss von SAP. indirect. Dieses Dokument enthält nur vorgesehene Strategien. Die Angaben im Text sind unverbindlich und dienen lediglich zu Informationszwecken. SAP. ohne die ausdrückliche schriftliche Genehmigung durch SAP AG nicht gestattet. Data contained in this document serves informational purposes only. Duet. graphics. SAP garantiert nicht die Richtigkeit oder Vollständigkeit der Informationen. Alle anderen in diesem Dokument erwähnten Namen von Produkten und Services sowie die damit verbundenen Firmenlogos sind Marken der jeweiligen Unternehmen. This document is provided without a warranty of any kind. Links oder anderer in diesen Materialien enthaltenen Elemente. All other product and service names mentioned and associated logos displayed are the trademarks of their respective companies. SAP assumes no responsibility for errors or omissions in this document. weder ausdrücklich noch stillschweigend. © SAP Summit 08 / Page 31 . R/3. xApps. SAP has no control over the information that you may access through the use of hot links contained in these materials and does not endorse your use of third-party Web pages nor provide any warranty whatsoever relating to third-party Web pages Weitergabe und Vervielfältigung dieser Publikation oder von Teilen daraus sind. SAP übernimmt keine Verantwortung für Fehler oder Auslassungen in diesen Materialien. Die in diesem Dokument enthaltenen Informationen sind Eigentum von SAP. spezielle. National product specifications may vary. links. Some software products marketed by SAP AG and its distributors contain proprietary software components of other software vendors. xApp. die Eigentum anderer Softwarehersteller sind. Die Informationen. SAP NetWeaver. PartnerEdge and other SAP products and services mentioned herein as well as their respective logos are trademarks or registered trademarks of SAP AG in Germany and in several other countries all over the world. This document is a preliminary version and not subject to your license agreement or any other agreement with SAP. SAP NetWeaver. zu welchem Zweck und in welcher Form auch immer. aber nicht ausschließlich. indirekte oder Folgeschäden im Zusammenhang mit der Verwendung dieser Unterlagen. a. PartnerEdge und andere in diesem Dokument erwähnte SAP-Produkte und Services sowie die dazugehörigen Logos sind Marken oder eingetragene Marken der SAP AG in Deutschland und in mehreren anderen Ländern weltweit. Duet. Einige von der SAP AG und deren Vertriebspartnern vertriebene Softwareprodukte können Softwarekomponenten umfassen. SAP Business ByDesign. R/3. xApp. auf die Sie möglicherweise über die in diesem Material enthaltenen Hotlinks zugreifen. eine Produktstrategie bzw. and/or development. einschließlich und ohne Einschränkung für direkte. Entwicklungen und Funktionen des SAP®-Produkts und ist für SAP nicht bindend. SAP Business ByDesign. hinsichtlich der Gewährleistung der Marktgängigkeit und der Eignung für einen bestimmten Zweck sowie für die Gewährleistung der Nichtverletzung geltenden Rechts. text. fitness for a particular purpose. Diese Einschränkung gilt nicht bei Vorsatz oder grober Fahrlässigkeit. SAP. or consequential damages that may result from the use of these materials. or other items contained within this material. bereitgestellt. -entwicklung einzuschlagen. developments. SAP does not warrant the accuracy or completeness of the information. Dies gilt u. or non-infringement.. ByDesign. Die gesetzliche Haftung bei Personenschäden oder die Produkthaftung bleibt unberührt. The statutory liability for personal injury and defective products is not affected. SAP shall have no liability for damages of any kind including without limitation direct. SAP übernimmt keine Haftung für Schäden jeglicher Art. and functionalities of the SAP® product and is not intended to be binding upon SAP to any particular course of business. Dieses Dokument ist eine Vorabversion und unterliegt nicht Ihrer Lizenzvereinbarung oder einer anderen Vereinbarung mit SAP. This limitation shall not apply in cases of intent or gross negligence.Copyright 2008 SAP AG All rights reserved No part of this publication may be reproduced or transmitted in any form or for any purpose without the express permission of SAP AG. In dieser Publikation enthaltene Informationen können ohne vorherige Ankündigung geändert werden. Diese Publikation wird ohne jegliche Gewähr.