S/4HANA. Transform Public Sector with SAP S/4HANA SAP SE or an SAP affiliate company. All rights reserved. Public

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1 S/4HANA Transform Public Sector with SAP S/4HANA 1

2 AGENDA SAP S/4HANA: Public Sector Overview 3 Procurement Deep Dive 6 Portfolio and Project Management Deep Dive 8 Assets and Infrastructure Deep Dive 10 Public Sector Finance Deep Dive 12 Portfolio of Solutions for Public Sector from SAP 13 SAP S/4HANA: Value Proposition for Public Sector 15 Customers Are Achieving Value from SAP S/4HANA

3 SAP S/4HANA: PUBLIC SECTOR OVERVIEW Transform Your Agency s Digital Core with SAP S/4HANA In today s digital society, there is immense pressure on government agencies to deliver on their fundamental mandate: to provide services, to protect the society, and to enable economic prosperity. Governments on all levels are facing new pressures and challenges. Digitally experienced citizens demand the service level and customer experience they know from shopping, banking, and social media. Disasters happen more often, and with a bigger impact. Globalization puts businesses and governments under pressure. This new digital reality has a big impact on governments at all levels. In a totally connected world, government actions and their impact are increasingly influenced by all sorts of events in other parts of the world, which increases complexity and impedes decision making. Furthermore, digitalization drives a great deal of transparency and puts decision makers under pressure, as their actions and the respective consequences are publicly evaluated and discussed in real time. On the other hand, digitalization offers many opportunities for government agencies. Policies and decisions have much better outcomes when they are based on citizens insight and ideas. Analysis of sentiments expressed in social networks and e-participation tools help governments understand the electorate. Agencies also have the opportunity to use data to drive policy decisions, set goals, measure performance, and increase government transparency thus acting on facts and insights rather than on beliefs and opinions. It is important to recognize that, at the heart of all the threats and opportunities, digitalization will allow government agencies to serve their citizens better than ever. To succeed, governments will need to put in place a coherent digital vision with a clearly articulated road map for their digital transformation. In particular, they will need to address new government models such as the individualization of government services government made for me or the possibility to scale operations up (and down) swiftly, smoothly, and productively across networks of resources. At the same time, governments are transitioning from being a provider of services to an enabler. To execute on this, government agencies not only will need to reengineer their business processes, but they will also have to evaluate if they have the right technology platform that can deliver on their vision. This platform requires an IT architecture that provides both stability and long-term reliability for core government processes, and, at the same time, allows for flexibility in areas where change is happening on a constant basis. The digital core is the foundation for the core processes that need to run consistently and flexibly. It provides uninterrupted, real-time transactions and analytics; the ability to work with Big Data; and connectivity to line-ofbusiness (LoB) extensions that enable supporting processes such as talent sourcing or emergency response. SAP S/4HANA was developed specifically to represent the digital core in this bimodal IT architecture. It provides government agencies with a proven framework to adopt industry best practices while attaining operational excellence across core financial, procurement, and planning processes European Schools Better cost control and compliance using self-service procurement The SAP S/4HANA Finance solution empowers our users with more control and drives greater accountability. We have a complete solution that meets all our needs. And SAP HANA Enterprise Cloud means that we didn't need to invest in IT staff to maintain the system. Kari Kivinen, CEO, Schola Europaea, Office of the Secretary- General of the European Schools Diakonie Michaelshoven Greater efficiency and transparency and increased liquidity To be ready to take on the future, even social institutions like us these organizations in particular, in fact need to be structured to run like a business. That s exactly why we ve implemented SAP S/4HANA. Uwe Ufer, Commercial Director, Diakonie Michaelshoven e.v. 3

4 SAP S/4HANA: PUBLIC SECTOR OVERVIEW SAP S/4HANA sources of value The value from SAP S/4HANA comes through simplification of the user experience, architecture, and process. Simplified user experience: across all devices SAP S/4HANA empowers front-line users with an user-centric, consumer-grade experience. SAP is driving simplification and innovation in how users work with a consistent, role-based user experience available on any device. Simplified architecture: no aggregates no redundancies SAP S/4HANA has a simplified data model that provides an advanced digital data architecture, which in turn provides, in real time, a single source of the truth for both transactions and analytics. This enables extensive flexibility to adapt to changing business models, such as simulating the impact of reorganizations in minutes rather than days. Simplified processes: key industry capabilities of SAP S/4HANA Public Sector $ Financials Provide holistic overview on budget situation, approval requests and alerts Tailored exception handling Increase user productivity Procurement Complete requesting process is supported in the SAP Fiori user experience Role based and quick access to the procurement information needed to analyzing purchasing spend, suppliers and contracts in real-time. Infrastructure Management Reduce costs by rating benchmarks, competitive bidding, volume discounts, leveling, and enforcement of rules Provide visibility with direct access to workforce management *This is a subset of the complete industry portfolio shown later in the Portfolio of Solutions for Public Sector from SAP section

5 SAP S/4HANA: PUBLIC SECTOR OVERVIEW EXAMPLE: Purchaser order simplification SAP S/4HANA provides reengineered and simplified business processes that can yield significant benefits. Transform the execution from multistep processes with latency to real-time processes with actionable insights to accelerate the procure-to-pay process. Traditional ERP Multiple screens for document searching No preprovisioning of existing documents No prefiltering of search results Requestor Start purchase order creation YES Supplier identified? NO Provide supplier Search for reference documents used in past purchases Enter overview information: validity dates, type of purchase order, supplier, and so on Enter and reuse relevant purchasing data Provide item data step by step Save purchase order and work on errors SAP S/4HANA Personalized lists of your specific requisitions Preprovisioning of existing purchase orders to facilitate manual purchase order creation Restricted list of values to avoid subsequent error in purchase order Personalized requester list Purchase order provisioning on one screen Save purchase order - 5-5

6 PROCUREMENT DEEP DIVE Typical challenges Traditional ERP SAP S/4HANA enhancements Benefits* Manual processes extend transaction cycle times Inconsistent information flow across supply chain creates fulfillment inefficiencies Searching for existing purchase orders is time consuming with little prefilled content and provisioning of existing documents User must manually check existing sources of supply, info record, and agreements separately by constantly changing search parameters Consumer-like interface to manage purchase orders, existing purchase orders, and purchase info records, which are preprovisioned to facilitate manual purchase order creation Consumer-like interface enables users to manage purchase requisitions and automatically proposes available sources of supply for a specific item with dynamic search and filtering capabilities Improved transactional procurement FTE productivity and reduced cycle times Improved user compliance (spec and vendor) Increased tactical sourcing savings (on noncontracted spend) Contract compliance is not applied consistently Time-consuming and complex process for buyers and suppliers to collaborate A separate add-on needs to be implemented on top of ERP to exchange messages with the Ariba Network Searching for existing purchase orders is time consuming with little prefilled content and provisioning of existing documents Business network integration native to SAP S/4HANA for purchase order change, order confirmation, and advanced shipping notification Consumer-like interface to manage purchase orders, existing purchase orders, and purchase information records, which are preprovisioned to facilitate manual purchase order creation Increased collaborative sourcing savings (services spend) Continuous improvement in spend under e-procurement *Benefits are based on early adopters of SAP S/4HANA or conservative outside-in benefits due to moving from a traditional ERP to enhanced SAP S/4HANA and LoB/cloud capabilities. As each public sector agency is at a different level of maturity, we recommend working with you to determine the value proposition for your enterprise

7 SAP S/4HANA: PUBLIC SECTOR OVERVIEW EXAMPLE: Portfolio and project management process simplification SAP Portfolio and Project Management is all about making decisions about investment mix, matching investments to objectives and aligning them to strategy, allocating the right resources to the right projects and balancing risk against performance. Traditional ERP Multiple entry points with traditional system Project-related information is distributed across various ERP applications Details are lost due to aggregation and replication Project/program manager starts with multiple entry points to optimize the project portfolio Traditional systems (finance, HR, materials management, and so on) Batch Establish program budget, resources, and milestones Prioritize project portfolio Capacity planning and project staffing Batch Cross-project and -portfolio optimization SAP S/4HANA and SAP Portfolio and Project Management Live, predictive, real-time insights for better project and program decisions Intuitive user experience providing a single, consolidated source of truth for all projectrelated information Real-time access to resource availability and skill sets for better resource utilization Project/ program manager Integrated components (finance, HR, materials management, and so on) Direct access real-time, cross-project analysis Master project cockpit 7

8 PORTFOLIO AND PROJECT MANAGEMENT DEEP DIVE Typical challenges Traditional ERP SAP S/4HANA enhancements Benefits* Inability to prioritize project portfolio decisions in alignment with government strategy Delayed project milestones; inability to deviate until it s too late Lack of transparency into project resource demands and allocation leads to project delays as well as low resource utilization. Slow access to project and task details reduces productivity. Inability to plan project costs and budgets efficiently and track actual versus planned costs lead to budget overruns Visibility into complete project portfolio, and investment structure. Planning, progress, rollup, analysis, and simulation done in batch runs. Milestone-driven projects along with scheduling give project management operations transparent and accurate view of true project status Capacity planning, detailed project role planning, and project staffing in a single application Work breakdown structure (WBS) serves as basis for hierarchical project accounting; actual project cost and cash-flow visibility by using multiple applications Live tracking of financial project KPIs by leveraging SAP S/4HANA, in-memory technology. and role-specific interface Simplified access for project members to confirm milestones and network activities Real-time access to resource availability, skill sets, and organizational assignment during project staffing process Change status of a WBS element easily. Obtain actual project cost using one integrated application. Single entry point for project financial controller. Better, faster, and more accurate decision making Increased portfolio and project management resource productivity Reduced project expenses Reduced fines resulting from noncompliance Reduced budget overruns *Benefits are based on early adopters of SAP S/4HANA or conservative outside-in benefits due to moving from a traditional ERP to enhanced SAP S/4HANA and LoB/cloud capabilities. As each public sector agency is at a different level of maturity, we recommend working with you to determine the value proposition for your enterprise

9 SAP S/4HANA: PUBLIC SECTOR OVERVIEW EXAMPLE: Predictive maintenance and service process simplification SAP Predictive Maintenance and Service provides real-time information of assets based on critical values and trends, thus allowing the most-efficient asset maintenance strategies to manage cost, risk, and performance better. Traditional ERP Time and/or conditionbased inspection and maintenance Real-time risk of failure and performance are not known No optimization of cost, risk, and performance Time-based inspection planning Inspection Inspection triggers maintenance Maintenance SAP S/4HANA and SAP Predictive Maintenance and Service Trigger maintenance orders just in time, avoiding unnecessary inspections and decreasing cost and risk of unplanned failure Asset health monitor Maintenance scheduled based on real-time asset health status and failure prediction Maintenance Increase Return on assets Increase First-time fix rate Reduce Unplanned asset downtime or outages - 9-9

10 ASSETS AND INFRASTRUCTURE DEEP DIVE Typical challenges Traditional ERP SAP S/4HANA enhancements Benefits* Lack of real-time view into ongoing maintenance activities and asset performance indicators hinders timely decision making Multitiered landscape consisting additional of SAP ERP application component extensions and business intelligence solutions makes it challenging to obtain real-time view of maintenance activities Real-time view into ongoing maintenance activities with the ability to reschedule multiple times a day in order to better plan and schedule maintenance activities to achieve higher efficiency Increased return on assets Decreased unplanned asset downtime or outages Limited ability to analyze data by machines and sensors leads to high asset downtime and increased time to determine the root cause of failures Limited ability to share and learn vital best practices on installation, usage, and performance of equipment between different stakeholders hampers asset performance Analysis based on past performance and lagging indicators increases time to identify potential activities that can improve asset performance. Sophisticated analytics are disconnected from real-time operational data. Information sharing is only possible through direct interfaces between individual systems, which makes it difficult to achieve effective collaboration among differentstakeholders Improved performance of many transactions, such as scheduling of maintenance plans SAPS/4HANA integratedwith SAP Asset Intelligence Network Improvements in operational efficiency Reduced service and maintenance cost Limited ability to effectively analyze environment, health, and safety (EH&S) data to reduce workplace risk. Inability to develop proactive safety measures leads to EH&S issues. Analysis is based on past performance, which limits the ability to proactively drive down EH&S risk. Data is processed in batches, which increases the time required to analyze EH&Srelated information. Embedded analytics based on live data that help EH&S practitioners act in themoment *Benefits are based on early adopters of SAP S/4HANA or conservative outside-in benefits due to moving from a traditional ERP to enhanced SAP S/4HANA and LoB/cloud capabilities. As each public sector agency is at a different level of maturity, we recommend working with you to determine the value proposition for your enterprise

11 SAP S/4HANA: PUBLIC SECTOR OVERVIEW EXAMPLE: User experience simplification SAP S/4HANA enables an anywhere, any-device, mobile-first, role-based user experience that simplifies and enhances employee engagement and productivity, transforming the way work gets done. Traditional ERP Multiple screens and transactions to monitor budget data, commitment actuals, and budget consumption, and approve commitment data Budget officer receives approval request Reviews high-level aggregated view Drills down to commitment item level Looks through legal support documents Approval SAP S/4HANA Intuitive user experience facilitates decision making with live insights Simplified processes help drive efficiency, compliance, and performance Single point of entry for approval with relevant data for decision making Budget launchpad Approval

12 PUBLIC SECTOR FINANCE DEEP DIVE Typical challenges Traditional ERP SAP S/4HANA enhancements Benefits* Time-consuming process to control budget and approve earmarked funds Various reports and variants are required to provide required data at a detailed level Role-specific access to all relevant applications and tasks on one launchpad Better, faster, and more accurate decision making Inability to easily analyze budget availability for budget object under the responsibility User needs to know reports, variants, and budget objects required to provide required insight on budget availability Personalized overview of availability and spending status for all budget objects under the user s responsibility; specific areas of the budget can be set to focus on important objects Increased budget-responsible productivity thanks to accelerated insight Reduced budget overruns Difficult to manage budget objects with critical spending and to investigate the individual reasons to prevent overspending Various reports and variants are required to provide required data at a detailed level to enable the budget responsible to take action An overview of alerts for budget objects where budget availability is nearing critical threshold and simple drill-down to the underlying data by clicking a tile No 360-degree view of all relevant information regarding budget master data Master data information and transactional data could only be accessed individually and with different reports and transactions 360-degree view on budget master data objects, like funds center combining master data attributes, relations, and transactional data in one object page *Benefits are based on early adopters of SAP S/4HANA or conservative outside-in benefits due to moving from a traditional ERP to enhanced SAP S/4HANA and LoB/cloud capabilities. As each public sector agency is at a different level of maturity, we recommend working with you to determine the value proposition for your enterprise

13 PORTFOLIO OF SOLUTIONS FOR PUBLIC SECTOR FROM SAP In addition to asset and infrastructure management, asset maintenance, and procurement provided by SAP S/4HANA, the digital core also provides native, prebuilt integration to allow agencies to leverage the entire portfolio of SAP solutions to comprehensively address their needs demanded by today s digital economy. Processes are designed from the outset to flow end to end across the cloud-based solution extensions, listed in the white bands, and are fully integrated to SAP S/4HANA Enterprise Management and are optionally deployed to address business needs. The solution capabilities in the dark blue band,the digital core, are delivered as part of SAP S/4HANA Enterprise Management. The lighter blue band, also in the digital core, are part of SAP S/4HANA Enterprise Management, but added only as needed. Budget and financial excellence Government funding Service delivery Digital constituent experience Suite Products Digital Core Products Suite Planning, budgeting, and forecasting Monitoring and reporting Governance, risk, and compliance for finance SAP Fraud Management Financial planning and analysis Accounting and financial close Treasury management Receivables management Budget maintenance Invoice management and Budget execution Budget accounts and financial payable closing and reporting Grantee management Cost management Accounting and closing operations Core human resources and payroll Time and attendance management Human capital analytics Core human resources and payroll Talent management Time and attendance management Human capital analytics Taxpayer online services Collection online services Debt enforcement Tax payer identification and processing Receivables management and payment handling Credit and collection management Enterprise Management Operational purchasing Collaborative sourcing and contract mgmt. Invoice and payables management Supplier management Procurement analytics Extended procurement for public sector Supplier collaboration Business network Guided end-user buying External workforce management Constituent experience Inbound/outbound contact center Benefit decision making Grantor management Receivables management and payment handling Credit and collection management Maintenance and repair Portfolio and lease management Space and facility management Investment and construction Portfolio and lease management Infrastructure strategy and performance SAP Mobile Asset Management SAP Predictive Maintenance and Service SAP Asset Information Network Constituent engagement Case management Inbound/outbound contact center Constituent self-service SAP Cloud Platform Customize applications Integrate apps, data, and processes Build new apps HUMAN RESOURCES PROCUREMENT ASSET AND INFRASTRUCTURE

14 PORTFOLIO OF SOLUTIONS FOR PUBLIC SECTOR FROM SAP An end-to-end solution for public sector Public sector organizations need to manage the end-to-end lifecycle of their infrastructure. This includes detection of risk issues resulting from asset inspections by the mobile workforce or sensor measurements using Internet-of-Things technology. Depending on the risk assessment, this leads to maintenance orders or the setup of capital infrastructure projects. SAP procurement software supports public sector tendering and sourcing of internal or external resources. Externally, opengovernment policy requires new transparency for constituents, which can be delivered by SAP Hybris solutions. Internally, integrated and efficient budgeting, project controlling, invoice matching, and payment processing are needed in order to ensure compliant, sustainable government spending in line with planned milestones. Once infrastructure projects are completed, intelligent maintenance plans are generated in order to maximize asset reliability and minimize risk and cost. Assets, Internet of Things, and mobile workforce Public Sector Infrastructure Project Management Detect infrastructure issues Manage ongoing inspections in real time or according to maintenance plan Set up capital project Send abnormalities for risk assessment Manage resources and contractors Inform and request feedback Share project status with constituents Monitor budget and project Manage invoicing and payments Manage maintenance Citizen engagement Provide information according to security classification. Manage applications, feedback, complaints, and so on Analyze previous bids and resulting engagements Allow internal and external sourcing according to government policies Provide restricted and open data to appropriat e audience Monitor project progress and control budget availability Match invoices and initiate payments according to contractual agreements Plan maintenance for future operations Third-party labor Leverage talent networks for flexible capacity Sourcing for material and services Source and contract Talent supply Develop talent based on needed skills Facilitate sourcing against material and service providers in line with existing contracts Enterprise Management Digital core

15 SAP S/4HANA: VALUE PROPOSITION FOR PUBLIC SECTOR SAP S/4HANA provides government agencies a proven framework to adopt industry best practices while attaining operational excellence. Strategy enablement Support new business models Enable agility for policy and legislation Reorganize on the fly Collaborate with other agencies and external stakeholders Reduce complexity Manage risk and ensure compliance Business benefits* 30% faster analytics 5% 10% reduction in business and operations analysis and reporting costs 40% 50% reduction in days to close annual books 20% 40% reduction in G/L and financial closing costs 20% savings in procurement function cost Strategy enablement Business benefits Empowered employees Empowered employees Establish finance as a partner for strategic decisions Empower informed, real-time decision making Increase user productivity and user adoption through tailored UIs enabled by the SAP Fiori user experience (UX) IT benefits and TCO IT benefits and TCO Reduce data footprint up to 70%* Merge online analytical and transaction processing (OLAP and OLTP) Eliminate many desktop clients Lower testing costs Simplify landscapes Take advantage of native integration *Benefits are based on early adopters of SAP S/4HANA or conservative outside-in benefits due to moving from a traditional ERP to enhanced SAP S/4HANA + LoB/cloud capabilities. As each enterprise is at a different level of maturity, we recommend working with you to determine the value propo sition for your enterprise

16 CUSTOMERS ARE ACHIEVING VALUE FROM SAP S/4HANA European Schools European Schools replaced an outdated and siloed legacy system with a modern, cross-compatible solution to remake the institutional operations of this complex multinational and multilingual organization into a leading integrated operational environment. The cloud-based system running of the SAP HANA platform reduced logistics and administrative efforts, and improved operational consolidation and transparency. All schools across the organization are accurately aligned with standardized, secure, and integrated financial processes in a comprehensive reporting environment. The SAP S/HANA Finance solution empowers our users with more control and drives greater accountability. We have a complete solution that meets all our needs. And SAP HANA Enterprise Cloud means that we did not need to invest in IT staff to maintain the system. Kari Kivinen, CEO, Schola Europaea, Office of the Secretary-General of the European Schools Company Schola Europaea, Office of the Secretary-General of the European Schools Industry Public sector education SAP solutions Nursery, primary, and secondary education Customer Web site Diakonie Michaelshoven Diakonie Michaelshoven implemented SAP S/4HANA to standardize and streamline structures and processes across the organization and recast departments as internal service providers. Diakonie Michaelshoven was able to make administration faster, simpler, and more cost effective. To be ready to take on the future, even social institutions like us these organizations in particular, in fact need to be structured to run like a business. That s exactly why we ve implemented SAP S/4HANA. Uwe Ufer, Commercial Director, Diakonie Michaelshoven e.v. Company Diakonie Michaelshoven e.v. Industry Public sector SAP solutions Social services Customer Web site Click here for the source reference Click here for the source reference

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