Taking Stock of SAP’s BI Software

Feature Article | September 10, 2010 by Marco Jordy

Grafiken aus Daten: Software die logische Schlüsse zieht

BI-Software: From Data into Graphic (photo: Frank Völkel)

Since the beginning of the 1990s, business intelligence (BI) – data warehousing, reporting, analysis, planning, consolidation, and strategy management – has become a tremendous success story, even finding its way into the academic field of business informatics. 2007 was a year of great activity on the BI market. Oracle bought Hyperion, Cognos took over Applix, IBM purchased Cognos, and SAP acquired Business Objects. Nevertheless, the number of BI software providers is on the increase. Currently, there are some 150 companies in Germany alone that provide software for mastering business intelligence tasks.

With the acquisition of Business Objects, SAP made a hefty addition to its range of business intelligence products. The new product family is known as the SAP BusinessObjects portfolio. It comprises software originally developed by the companies previously known as Business Objects and OutlookSoft. But SAP has also created new products for the portfolio, such as SAP BusinessObjects Advanced Analysis. What makes this software particularly attractive is its ease of use and its suitability for all source systems. The SAP BusinessObjects solutions excel in the areas of reporting, analysis, and enterprise information management. The area of consolidation and planning stems from the acquisition of OutlookSoft, which SAP bought in 2007. As a result of these takeovers, SAP was able to make specific improvements to individual functions.

The Rise and Rise of Crystal Reports and Xcelsius

According to Gartner, SAP is one of the 15 BI providers worldwide to offer a tool for creating reports that are optimized for presentation and printing – in this case, the Report Designer. It can be used for formatted reporting, for example, for customer fact sheets and quarterly reports. However, in the end, the Report Designer was no match for SAP Crystal Reports, the market leader from the SAP BusinessObjects portfolio. In the area of dashboards, SAP’s homegrown Web Application Designer was conceived for IT departments and – unlike the new SAP BusinessObjects Xcelsius Enterprise software – could not be used directly by the business departments who provided the data. SAP BusinessObjects Xcelsius is easy for all employees to use, because it offers clear and insightful graphics with interaction opportunities. It is also Flash-based, so can be directly incorporated into Microsoft PowerPoint presentations.

SAP’s previous OLAP front end, the BEx Analyzer, and the similar SAP BusinessObjects Voyager are soon to be replaced by SAP BusinessObjects Advanced Analysis. It will continue to offer a Microsoft Excel mode and a Web front end, and will combine the strengths of the OLAP front end. With its SAP BusinessObjects portfolio, SAP is also now separating the reporting and analysis level from the data warehouse layer. This means that SAP BusinessObjects front ends can be deployed with different data warehouses or directly on the source system. This means that, as far as front ends are concerned, SAP’s strategy is clear. In the area of consolidation, four products are offered in parallel: EC-CS, SEM-BCS, SAP BusinessObjects Business Planning and Consolidation, and SAP Business Objects Financial Consolidation. In the midmarket segment for companies comprising between 500 to 5,000 employees, the SAP BusinessObjects Business Planning and Consolidation application is the undisputed leader, because it enables business departments to manage all the necessary applications themselves.

Next Page: Costs and Benefits for SAP Customers

Costs and benefits for SAP customers

On the one hand, SAP’s acquisitions meant great upheavals for existing customers. On the other hand, it was a good opportunity to take advantage of the enhanced functionalities in SAP’s portfolio for business intelligence. Because the SAP BusinessObjects product family requires a separate license, companies that want to switch will initially encounter costs – a fact that could be especially painful for small businesses and midsize companies. And we’re not just talking about procurement costs, but also costs for ongoing maintenance and administration. However, SAP’s license model leaves great scope for negotiation.

International business consulting company ORBIS advises small and midsize SAP customers who already work with SAP NetWeaver BusinessWarehouse to opt for a starter package for up to 100 users. Known as the SAP BusinessObjects Starter Kit license, it can be converted into a full license if required – and the license fees already paid are taken into account. This is also available for companies that did not previously deploy a business warehouse system or data warehouse.

A further cost factor is training, because most users also have to cope with a new system. Not just the IT department and the key users are affected, but the many end users in the business departments also need to learn how to work with the new solution. That’s why experience has shown it is better to first of all equip new reporting areas with applications from the SAP BusinessObjects portfolio, instead of replacing older solutions that are already up and running. Despite the clear added value provided by the SAP BusinessObjects portfolio, most SAP customers are taking a wait-and-see attitude. However, ORBIS predicts that most users will adopt the SAP BusinessObjects strategy when the new SAP BusinessObjects Advanced Analysis tool is launched at the end of 2010. It is quite understandable that many companies need time to make the right decision. Even if additional costs are incurred, transferring to SAP BusinessObjects offers considerable advantages, especially in terms of where BI solution development is heading in the areas of reporting, analysis, and planning.

Integration with Microsoft Office

In the area of reporting and analysis, customers can assemble the best-suited combination from a wide range of products. Reports optimized for printing and integration with Microsoft Office products such as PowerPoint and Word are also possible. All this takes the pressure off the IT department, because the business departments can do the work themselves.

In contrast, the old SAP Business Information Warehouse (SAP BW) front end catered mainly for business analysts and controllers, and could not map special requirements of other end users.

Next Page: Planning and Reporting

Planning and Reporting

Through the acquisition of Business Objects, SAP gained new approaches to reporting and analysis, and also – to some extent – to consolidation. The purchase of OutlookSoft, however, was really responsible for expanding SAP’s functionalities in the areas of planning and consolidation: The SAP BusinessObjects Planning and Consolidation application offers full consolidation and planning functionality. The application can be set up and run by the business department, and thus represents a fundamental departure from the philosophy SAP had previously adopted, whereby the entire responsibility for the system was firmly in the hands of the IT department. In the case of SAP BusinessObjects Planning and Consolidation, users in the business departments can create new planning screens and take on user management and reporting themselves.

An integrated planning solution needs everything from planning data entry and automated planning functions with top-down distribution and bottom-up aggregation through master data management. This includes data connection with manual data entry and automated data loading processing from different sources, as well as validation functions. SAP’s integrated consolidation solutions support consolidated financial statements and offer manual and automated consolidation functions. Reports can be created using the Microsoft Excel and Web front ends, while formatted reporting and dashboards are also available, as well as integration with Microsoft Office.

SAP BusinessObjects Planning and Consolidation is an enhancement of the predecessor product from OutlookSoft and is integrated with Microsoft Office, so that Microsoft Excel can be used as the interface for day-to-day use and administration, and typical requirements from business departments – such as flexible support for planning and reporting functions – can be mapped. In the future, it will be possible to fully integrate SAP BusinessObjects Planning and Consolidation into the SAP system landscape or into Microsoft environments. From version 7.0, SAP BusinessObjects Planning and Consolidation can be operated on SAP NetWeaver as well as on the Microsoft platform.

In Practice

According to ORBIS, the decision between SAP NetWeaver Business Intelligence and SAP BusinessObjects Planning and Consolidation depends in most cases on whether the business department or the IT department holds the reins. Business departments are often immediately convinced by the functions of SAP BusinessObjects Planning and Consolidation, while IT departments tend to favor SAP NetWeaver Business Intelligence.

Monitoring, identifying, and analyzing transactional business processes using consolidated figures in real time is a major challenge for business departments. When successfully mastered and combined with planning and budgeting, it can lead to processes that are controlled and evaluated more effectively. Thanks to SAP BusinessObjects Planning and Consolidation, companies can achieve standardized management reporting with automated and stable consolidation processes for a wide variety of department levels. In such a way, management can define strategies and priorities to ensure that the company is optimally aligned to meet its goals.

One of ORBIS’ upper midmarket customers from the electronics industry opted to implement Crystal Reports for formatted reporting. Previously, the company had used the Microsoft Excel front end of the BEx Analyzer for reporting. Business Explorer Report Designer was never used due to its limited functionality. The company was already familiar with Crystal Reports from other non-SAP application areas within the group. The deciding features were Crystal Report’s combination of tables and charts for presenting information and its ability to unite information from several business warehouse data sources in a single report using subreport functions. The customer is now already using Crystal Reports in many of its reporting areas – for example, monthly sales statistics are prepared for selected customers, and then automatically distributed by e-mail with a PDF attachment.

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