This week SAP announced that there are now over 1,000 licensed users of SAP HANA – its in-memory calculation engine. Many of those will be harnessing the processing power of HANA for analytics and reporting but since the January launch of the SAP ERP Business Suite on HANA, we can expect that to change as more businesses make the shift towards becoming a real-time enterprise.
Clearly having insight into the exact levels of inventory in different warehouses and being able to combine it with materials and stock in the supply chain and work in progress with suppliers with actual and forecast customer orders allows a production controller to make more informed decisions about whether they need to place another order with a supplier or whether the can fulfil current requirements by reallocating existing stock. Being able to assess the situation in real time and run simulations of proposed changes in mere seconds should result in better decisions that reduce both inventory costs and supply chain risks.
But finance should not feel left out. Running the SAP Business Suite on HANA will transform accounting including the ever-stressful month-end close. Typically most subsidiaries need to make some adjustments to their submission before they sign off on their numbers and today that usually means making an adjustment and then waiting for 3-4 hours for the next update to see what impact that has – and then perhaps making some further adjustments. Inside any company with a score or more of reporting entities all making a couple of iterations each that can add up to a delay of 4-5 days. With SAP HANA all the waiting goes away as the impact of changes can be assessed in seconds so that all the amendments from around the globe can be completed in a far shorter period of elapsed time speeding the monthly close by at least a day – and typically much more.
To me that’s a compelling argument in itself, but some finance folk may say that in itself it’s not worth the investment. However they should remember all the other user cases for SAP HANA such as speeding up the running of material ledger reports and cost and profitability analysis reports, where the cummulative of productivity improvements result in major improvements. And if that still fails to impress, perhaps they should try to conceive of the issues that would arise in a business where sales and operations have made the transition to real time while finance remains in batch mode. Reports coming back from those companies that are already running SAP Business Suite on SAP HANA suggest that they quickly conclude that to gain the full benefits of becoming a real-time enterprise, their entire estate needs to make the move, finance included.