Enterprise Business Process Management

1. Enterprise Business Process Management Optimizing Enterprise Business Processes in an SAP Environment

2. About Fiorano software GLOBAL AWARDS Offices : 10 Worldwide Founded : 1995 Fiorano ESB-"Best Java ESB” FioranoMQ- "Best Java Messaging Tool” DEPLOYMENTS Intelligent enterprise names Fiorano Software a "Company to Watch" in 2006 Deployed at over 400 customer sites globally Global Partner Network No failed Deployments Fiorano ESB - Winner of WSJ's “World Class Product Award” SD Times names Fiorano as Leader and Innovator in Integration & Middleware for third consecutive year

3. THE PROBLEM • SAP CAN BE DIFFICULT TO WORK WITH • Core processes designed for SOD (Separation of Duty) • Inefficient in a non-SOD environment • Changes to default templates are time-consuming • Significant ABAP programming • Difficult to integrate with third party applications • Good Transactional Processes: SAP serves as the “enterprise business” database • …. fails to provide agility to match changing business conditions

4. SAP BUSINESS PROCESSES -DISPATCH AND INVOICING • Default SAP methodology for Invoice Creation • Five separate steps for each Invoice, nine SAP screens • Designed for generality where multiple people may be needed to execute separate steps • Time per invoice: 12 minutes on average • Significant SAP training needed for each person creating invoices • Fiorano-Optimized Invoice Creation • Company personnel work off friendly HTML screens instead of proprietary SAP screens • Single step, two screens, no specific training required • 2 minutes per invoice: 600% efficiency improvement

5. Dispatch and Invoicing (2) • Benefits • If a company creates over 10000 invoices monthly • Solution design/implementation time: 2 weeks • Time saved: 200+ man-days • No (expensive, SAP-specific) training required at local or remote locations • Non-tech-savvy personnel in remote locations/factories can easily create dispatch requests and invoices

6. Lifting Plan and Bulk Orders • Key Processes in any Sales Organization • Lifting plan: an estimate of the sales that will possibly be made over the quarter/year/fixed-term • Bulk order: an estimate of what will be lifted in a larger order • Lifting Plan and Bulk Order concepts typically to be incorporated into the invoicing and report-generation processes in any organization • The Problem • The "Lifting plan" and "Bulk Order" concepts are not supported by SAP. • SAP's concept of "Bulk Order" is tied to a single Unit/Plant. The functionality however is inflexible and cannot be easily customized to match the needs of a given business

7. Lifting Plan and Bulk Orders (2) • The Solution • For each salesperson, the Lifting plan and all Bulk Orders are compared against actual orders and final invoices generated via automated Fiorano flows • Fiorano flows track differences between actual invoiced orders and the Lifting plan / Bulk Orders for each salesperson, enabling closer monitoring and better tracking of sales and salesperson performance • Benefits • Fully automated processes with the Lifting plan and Bulk Order concepts integrated with invoicing and report generation • Easy modification of processes without programming

8. Logistics • The Problem: credit approval requests • Company has hundreds of distributors across the country • Distributors send trucks to 45+ factories to pick up goods (Liquor) • Each Distributor has a credit limit; if the limit is exceeded, explicit approval is required from a Company manager to raise the credit limit • Situation complicated due to several issues • Distributor vehicles arrive at Company production facilities at night • Approvals delayed till the next day cause significant disruption • Company managers need to manually log on to SAP from home to approve additional credit; bad internet connectivity prevents access to IT systems from remote locations; plus, the SAP interface used (R3) was poor and difficult to learn

9. Logistics (2) • The Solution: credit approval requests on mobile phones • Company uses Fiorano flows to perform the complete “approval request” transaction over mobile phones • Initial approval request processed by Fiorano and placed on a publicly accessible portal • Fiorano generates an SMS that is sent to the GPRS-enabled mobile phone of the manager • Managers access the portal by clicking the link in the SMS and approve or reject the request in the portal • Fiorano updates SAP at the backend with the approved/rejected notice. • Benefits • Managers no longer need to access SAP via cumbersome SAP client applications; all relevant information now available on their mobile phones • Lower learning curve; lower licensing costs (less SAP client licenses) • Significant cost and time-savings for distributors due to faster turnaround times for approval requests

10. Goods Received Notes - Mego/Miro • Goods Received Notes : the process • When Suppliers send goods to a manufacturer, a GRN (Goods Received Note) is generated, recording all items received from a supplier • The GRN is compared against the original PO placed on the supplier; SAP then determines the MEGO (goods in) and MIRO (value in); at the end of the exercise, the Supplier account is debited and the Bank Account is credited (within SAP) • Issues with SAP “generic GRN” • Interdependencies between screens: and end-user has to enter values into successive screens over and over again, which takes time and is error-prone • E.g. a user has to manually pick up TAX data from one screen and re-enter it into a succeeding screen; tax data from one invoice has to be manually entered as a bill booking into the next unit (SAP does not have this functionality built-in, since the tax rules are local to India - or the local country)

11. Goods Received Notes (2) • The Solution - Fiorano flows automate GRN • Custom Fiorano flows ensure that data does not have to be manually re-entered into successive screens • Processes easily and rapidly customized to match business requirements, without programming • E.g. Tax data is picked up from one invoice and entered as a bill booking item into relevant downstream units • Benefits • Elimination of manual intervention ensures faster process execution and reduced error-rates • Rapid customization; processes easily changed to match evolving business requirements)

12. Sales Order Processing and Stock Allocation • The Problem: • SAP allocates stock immediately for any sales order • By the time one reaches the last order, one may have run out of stock • Priority orders cannot be processed because available stock has already been pre-allocated to previous orders • Rollback needs to be performed manually; not practical to enter all orders into SAP in a single shot • Orders not entered into the system until they are ready for ready for dispatch; lack of prioritized allocation of stock a major hindrance

13. Order Processing and Stock Allocation (2) • The Solution: • Fiorano flows manage Order Processing • Order Entry: All orders can be entered into the system as they are produced • Prioritization: Fiorano flows involved to prioritize orders; separation of stock allocation from order entry enables easier prioritization • Stock Allocation: Fiorano flow invoked to pick up an order, allocate stock to it “just in time” and send it for invoicing via the optimized 2-step invoicing process. • Benefits • Highly flexible order processing tailored to enterprise needs • No manual rollbacks • Easy and flexible order prioritization • Just-in-time stock allocation

14. New Regulations • The Problem: • New regulations (especially tax regulations) often result in revenue hits • E.g. a Manufacturer outsources a task to a third party contract manufacturer (CM) • CM sells directly to end-user, collects revenue and pays back the Manufacturer its share after keeping the CM commission • If the payment from the CM to the Manufacturer is subject to a new tax regulation (such as Service Tax), the Manufacturer loses money unless the Manufacturer directly sells to the End-user

15. New Regulations (2) • The Solution: • Custom Fiorano processes can be implemented to “reroute” cash flows to legally circumvent a regulation • E.g. a custom Fiorano process can re-route the payment process in the previous example as follows: • Manufacturer sells direct to End-user • Manufacturer instructs CM to dispatch goods to the End-User • Money flows from End-User to Manufacturer and from the Manufacturer to the CM, thereby avoiding service tax • Benefits • Rapid, automated business processes to circumvent new regulations • Added business flexibility and profitability

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