DLK16 L3 Wilke, Deuker (Freigegeben) PDF

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WEGE ZUR DIGITALEN SUPPLY CHAIN

Methodik, Anwendungsszenarien und Beispiele
Dr. Jörg Wilke & Roland Deuker, SAP Business Transformation Services
20. Oktober 2016
https://surveys.sap.com/SE/?SID=SV_bDfylbn5vRxKQdL
BTS CSCO ADVISORY
What we do
 Thought Leadership in the value chain
 Strategy and process consultants with sound background, particularly in
Vision  Supply Chain Strategy and Design
 Supply Chain Planning
 Supply Chain Execution
 Manufacturing
Mission Strategy
Consulting  Sourcing and Procurement
 Go-to-Market (C4C, Omnichannel Commerce, Digital Customer …)
 Best practice knowledge from many successful international projects
Strategy
 Well-established methods and SCM toolbox for supporting analysis,
modeling, simulation, and optimization of supply networks and
manufacturing processes
Implementation Process IT  IT mapping w.r.t. entire SAP solution portfolio (e.g., S/4 Logistics, IBP, IoT)
Consulting Consulting
 Access to experienced international SAP partner network to supplement
specialist skills where necessary
SAP Business Transformation Services offers Strategy Consulting combined with Process Expertise and IT Know-how and
facilitates transformation projects from the vision to successful implementation.
© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 2

AGENDA
1 BTS / FIR Studie “Digitale Supply Chain” – Überblick
2 Digitale SCM Use Cases und Praxisbeispiele
3 Online Survey und erste Ergebnisse
4 Methodischer Ansatz: Wege in die Digitale Supply Chain
5 Fragen und Antworten / Wie geht es weiter?

THE SCM EVOLUTION
First research work Applying operations Exploring principles of Using digital

(MIT and others), research techniques N-tier coordination, technology and data
particularly on supply and new IT solutions e.g. contract design, to support new
chain dynamics to optimize production flexibility management, business models
 Bullwhip-Effect planning based on “supply chain visibility”
centralized data ?
SC Digital
Advanced Collabo- SCM
Planning ration
Systems
First
Research
1950 1960 1970 1980 1990 2000 2010 2020

NEW TECHNOLOGY AND CHANGING BUSINESS NEEDS
DRIVE DIGITAL SUPPLY CHAIN INNOVATION
Supply Side / Technology Push Demand Side / Customer Pull
Mobility Omnichannel Commerce

Today, mobile devices are the New demand streams and customer
primary method of internet access. requirements driven by the internet.
Cloud Computing
Any access, any workload anywhere.
Real-time Business
Decisions in real-time, merge of
planning and execution levels for
coping with volatility and dynamics.
Social Networks DIGITAL
Billions of users provide a new SUPPLY CHAIN
source of data relevant for business. INNOVATION Segment of One
Precise targeting of customers,
In-Memory and Big Data personal recommendations,
individual products.
Exploding volume, variety, and velocity
of data, new processing capabilities.
Global Demand and
Internet of Things Supply
Availability of cheap sensors Managing worldwide distributed
everywhere. supply networks for global markets.

BTS DIGITAL SUPPLY CHAIN STUDY
Approach
 Step 1 - Future picture:
A vision of a digital SCM2020 (and beyond)
 Digital SCM2020 vision from the perspective of thought leading companies/ SCM champions
 Contribution of emerging technologies to a digital SCM 2020 vision
 Whitepaper „Digital SCM Vision 2020“
 Step 2 - Current situation:

Digital supply chain maturity assessment
 Maturity assessment of companies based on the digital SCM2020 vision (categorization into
different maturity levels)
 In cooperation with:
 Step 3 - Transition path:

Roadmap(s) towards the digital SCM2020
 Leverage of available and emerging technological innovations to move from lower maturity
levels to a digital SCM leader or champion

A VISION OF A DIGITAL SCM 2020
Emerging technological innovations related to SCM
Big & smarter data
(Near) live analysis of large
Mobility volumes of (non)structured data Cloud computing
Mobile applications for highly Highly collaborative processes in
automated processes the Cloud
Social media
3D printing &
High value capabilities for
scanning supply chain planning and
Mass customization of execution
products to individual
customer needs
Predictive & prescriptive
analytics
Robotics
Proactive risk management on
Machines with own intelligence
strategic, tactical and operational
level
Internet of things, machine-to-machine
communication & autonomous vehicles
Seamless integration of machines/ objects into the information
network as active participants in business processes
List of interviewed companies and expert groups – Phase I
 Duration: 1-2h per interview

 Location: onsite or web conference (SAP Connect)
 Corporate participant(s): senior level SCM executives with visionary view

Intermediate results
Use Case Library with ~140 digital use cases

Vision Paper SCM 2020 described and evaluated for 4 different industries
DIGITAL SUPPLY CHAIN STRUCTURE
Seven views on SCM (based on Porter’s Value Chain)

SCM 2020 KEY CHALLENGES
Numerous challenges are shared across industries
Our initial interviews in phase 1 showed that many challenges are shared across industries. In the second phase of our
digital SCM research, we wanted to get a detailed understanding to what extent the mentioned challenges are reflected
in the answers of the participants of our digital SCM survey.
Supply chain visibility

Demand volatility and new demand channels
Complexity in managing the supply chain
Globalization and sales growth
New Business Models and Innovation
Flexible Response Management
Collaboration
Process standardization and automation
Fixing the Supply chain basics
Supply volatility
Segmentation of products and customers
0 0,2 0,4 0,6 0,8 1
Percent of Interviewees who shared this challenge*
© 2016 SAP SE or an SAP affiliate company. All rights reserved. * Preliminary survey results Public 11
AGENDA

REIMAGINE YOUR BUSINESS MODELS
and transform your supply chain
 Use Cases & proven digital

success stories of companies
 Be inspired for your digital
transformation, e.g. using the
Digital Supply Chain Maturity
Model

DIGITAL USE CASE EXAMPLES
Supply Chain Control Tower
Mobile Talent Development

Digital Performance Measurement
and Training
Digital HR & Talent
Digital IT & Technology

Flexible on-demand
Business IT
Digital Digital
Digital Digital
Production Logistics &
Suppliers Customers
Systems Inventory
Business Networks
 Predictive Quality  Selling Pattern & Customers

 Real-time Geo-
 Predictive Maintenance Buying Behavior Analysis
Located Shipping
 Intelligent Product  Digital Product History
 Augmented Reality
 3D Printing  Trend Mining
 Automated
Commissioning &  Scenario Analysis for S&OP
Packing  Customer 360 Degree Analysis

SCM 2020 DISCUSSED DIGITAL USE CASES
IoT-based Predictive Demand Sensing
Digital Product History Predictive

Use Case Predictive Quality
& Intelligent Product Maintenance
 Products and parts store own  Usage of high amount of machine  Use technology to permanently
identity and history over time (sensor) data to predict machine measure tolerances and quality
(and send it to a cloud platform) failure indices during the production
 Enables Real-time tracking,  Store data central and run pattern process
analysis of product or component analysis to detect potential  Model statistical cause-and-effect
Content & characteristics, event-driven back machine weak points dependencies
Feedback tracking capability  Also relevant as value-added  Reduce re-work and scrap
 Used to steer and automate service to the sold product/  Better plan maintenance
production, logistics or machine operations if machine data runs
maintenance processes. out of range
SC visibility Process standardization Process standardization and

Process standardization and automation automation
Meets the
and automation New business models New business models and
Challenge and innovation innovation
New business models and
innovation Flexible response management Flexible response

THE PREDICTIVE SUPPLY CHAIN VISION
Customer Project Example 1

HIGHLIGHTS FROM THE AUTOMOTIVE INDUSTRY
Product Lifecycle Data
Gathering and analyzing product lifecycle/ history data offers companies in the automotive industry potentials to significantly
improve product characteristics and provide new or enhanced customer services. In the most digital scenario data is also gathered by
sensors attached to the car/ components and all information is centrally stored on and accessible via a single database.
Supplier information and

20%
information about supplied parts
Product identity/ 16% Production modifications
14% Serial number
What kind of information
from the product lifecycle
15% Production history 8% Maintainence and repair data
do you store?

HIGHLIGHTS FROM THE AUTOMOTIVE INDUSTRY
Product Lifecycle Data
What do you do with product performance data directly sent from the car?
 Capturing product lifecycle data from
57% the car is still a rarely applied and
leveraged use case in the automotive
industry.
 Companies applying pattern
recognition in that area use the
insigihts rather for product
24% improvements than for identifying
future maintenance demands.
14%
 Surprisingly, 24% of companies
5% answered that they just store data
0% without actively using it indicating a
lack of analytical system capabilities.
We do not Just store the Run pattern Run pattern Run pattern
receive such data (to have it recognition and recognition and recognition and
performance available if draw conclusions on draw conclusions draw conclusions
data issues occur) maintenance tasks on product on maintenance
improvements tasks & product
improvements

THREE WAYS OF MAKING MONEY
A visionary idea for vehicle manufacturers and the aftermarket
Generating
Availability Parts Data
profit by selling
Customers buy Insurances Parts Value-added Services
What makes New Business Model &

Predictive Analytics & SC Customer Bonding
it exceptional? Customer Bonding

SELLING INSURED AVAILABILITY…
…WITH A PREDICTIVE SERVICE PARTS SUPPLY CHAIN
Vehicle Driver Dealer / Service Point Supply Chain
Physical World
MRO service Availability Inventory levels Actions:

scheduling check  Replenishment orders
Alerts, Capacities  Stock transfer
Notifications, Diagnostics,  Cross-docking
MRO service Lead times
Online repair  Purchase orders
scheduling support  …
Open orders
Sensor data …
Digital World
sent to a cloud
platform
PREDICTIVE CONFIGURATION SERVICE PARTS
ANALYTICS ENGINE DATABASE PLANNING
 What to do and when?  Which parts and/or

 How can everything be
(Reactive / Preventive / software versions will
provided on time?
Predictive Maintenance) be necessary

CREATING A SYSTEM OF MAINTENANCE MANAGEMENT
https://youtu.be/583aGe0xIGY
FROM SELLING MACHINERY TO SELLING A SERVICE LEVEL

HIGHLIGHTS FROM THE MACHINERY INDUSTRY
Predictive Maintenance
TRENDS: MACHINERY
Predictive maintenance Condition-based maintenance
Machine maintenance
0%
Is reactive and mostly manually
24%
monitored
Predictive maintenance
41%
Technology is not used to predict
equipment failures or downtimes,
applies to all examined industries Preventive maintenance
Experts foresee How do you monitor most of 35%

a change in maintenance your supply chain assets
handling driven by digital (machines, vehicles etc.) and
technologies (sensors etc.) plan their maintenance?* Reactive maintenance
© 2016 SAP SE or an SAP affiliate company. All rights reserved. * Preliminary survey results Public 23
NEW BUSINESS MODEL: PREDICTIVE MAINTENANCE
Kaeser Kompressoren
Business Challenge Move from selling machinery to selling a service
Market pressure and shrinking margins led to a “re-thinking” of the level to the customer.
business model: From selling compressors to selling compressed air.
Process Innovation
 Compressor operating status automatically reported via machine-to-
machine interface and compared to statistical models in real-time to
predict potential problems and avoid them by taking the right action
 Energy consumption monitored and analyzed continuously to
optimize efficiency
 Maintenance service (field service visits, spare parts logistics) can
be better planed leveraging optimization algorithms
:
Solutions
 Compressors equipped with sensors
 SAP Predictive Maintenance & Service
 SAP HANA, SAP CRM Service on HANA
Benefits
 Customers: Lowered operating costs and improved availability of
machinery
 Kaeser: Market share

PREDICTIVE MAINTENANCE OF WIND TURBINES
https://youtu.be/4VOI_uZOwo0
IOT BASED DEMAND SENSING
https://youtu.be/eQysQLxjlTI
Big Data, Smart Data and In-Memory Technology
Selling Pattern and
€ Scenario Analysis
Use Case Customer Behavior Trend Mining
O S for S&OP
Analysis
 Analyzing sales on the product  Aligning sales, production and  Using predictive / prescriptive
level regarding potential options, financial planning within one analytics to improve mid-term
option bundling, services, environment forecast and planning accuracy
promotions etc.  Reacting quickly on any kind of  Include unstructured data and
 Tracking customers ordering changes using scenario based new data sources, e.g. social
Content & patterns to simulate and predict planning incl. financial and media
Feedback buying decisions performance impact assessment  First initiatives by OEMs and
 “Demand visibility” in n-tier supply suppliers
chain management  Very interesting also for spare
parts business
SC visibility SC visibility New business models and

SC complexity management innovation
Meets the Flexible response management
SC visibility
Challenge Collaboration with customers
and suppliers Sourcing and production in
emerging markets
DEMAND ANALYTICS

DEMAND ANALYTICS FOR HIGHLY CONFIGURABLE PRODUCTS
SAP Research Example
The customer behavior with regards to configurable products is hard to predict.

Example: Price adjustments.

DEMAND ANALYTICS FOR HIGHLY CONFIGURABLE PRODUCTS
SAP Research Example
Solution: Statistical model for analysis of demand for configurable products

 Simulation of “virtual customers”
What-if Simulation
 Price changes
 Marketing mix
 Options, Option bundling
 Scenarios of customer behavior
Optimization
 Balancing Revenue and Operating
Profit
 Optimization of prices and bundles
over product portfolio

REAL-TIME MRP FOR MANUFACTURING

LEANER PROCESS: MRP FOR MANUFACTURING
Traditional Process
Major Business Issues

 Outdated demand situation on components as changes are not
propagated near-time
 Evaluation of snap-shot planning situation, not real-time situation
MRP Controller
Display / Change
Production Order
Evaluate Stock
Requirements List
Evaluate
Execute MRP Evaluate Stock /
MRP Lists
Planning Run Requirements List
(snapshot)
Display / Change
! !
Long (and Limited, static analysis capabilities (e.g., Planned Order
therefore rarely) shortages).
running MRP run
No simulation or decision support. Display / Change
Purchase Requisition
!
Manual changes in individual
transactions w/o supply
demand context
Source: SAP

LEANER PROCESS: MRP FOR MANUFACTURING
Re-engineered HANA-based process
Major Business Benefits

 Instant detection of critical situations in the material flow based on real time
data
 Decision support by evaluating and simulating various solution proposals
 Instant execution of resolution options
MRP Controller
MRP Cockpit
1) Evaluate Supply & Demand situation based
on real-time data
Execute MRP 2) Monitor KPIs and alerts
Planning Run 3) Identify most urgent issues
4) Choose and execute from a set of pre-
Factor 10+ faster evaluated solution proposals
Management by Exception (KPI Alerts)

Decision Support & Simulation Demo Video
Insight to Action
Source: SAP

Digital Manufacturing and Logistics
Automated Packing Augmented Real-time

Use Case
& Commissioning Reality Geo-Located Shipping
 Robots for Commissioning  For picking & commissioning  Track-and-trace, e.g. enabled
(Analytics, B&SD)  Wearables already tested in through RFID with GPS. Data
 Applicability of robots depending pilots by some companies stored in central data hub.
on costs  Concerns about battery life,  ETA simulation
 Maybe useful for spare parts accuracy and ergonomic aspects  Rather interesting for long-
Content & distance shipments (sea, rail)
packaging  Potential extension beyond
Feedback
warehousing considered  Relevant for emergency
deliveries
Process standardization and SC complexity management SC Visibility

automation
Meets the New business models and Process standardization Collaboration with customers
Challenge innovation and automation and suppliers

EVOLVING FROM A PURE PRODUCT TO A SERVICES COMPANY
https://youtu.be/eZNsqj4ju6g
AUGMENTED REALITY PICKING

LEANER PROCESS: AUGMENTED REALITY PICKING
Bechtle AG
Business Challenge
 Improve productivity in warehouse operations.
Process Innovation
 Providing workers all relevant information in their field of view
and completing barcode scanning via smart glasses allows
employees to use both hands to handle merchandise, and
make the use of handheld scanners obsolete.
 Picking operations data directly integrated in SAP EWM
warehouse processes
Solutions
 SAP AR Warehouse Picker App (Co-Innovation SAP Montreal)
 SAP EWM
Benefits
 Reduced lead times
 Improved handling costs
 Less errors in picking processes

INTERNET OF TRANSPORT

INTERNET OF TRANSPORT
BPW Group
Business Challenge
 Increase transport transparency & predictability of potential
threats by continuously monitoring and tracking trailers
Process Innovation
 Collect and integrate all available data from telematics
devices, ERP and logistics systems on a central platform
 Enable process optimization and new business models for
various stakeholders, e.g. forwarder, consignee, etc.
 Open platform, provides information about freight
Use Cases
 Cold Chain Monitoring
 Open on Arrival
 …
Solutions
 SAP Vehicle Insights
 SAP HANA Cloud Platform
 Common InnovationLab to provide user specific solutions

Integrated Use Cases
Supply Chain
Use Case Business Networks Connected Logistics
Control Tower
 Single point of interaction with  Real-time, demand-driven supply  Single point of entry regarding
suppliers, customers, and service networks accelerate the process end-2-end SC performance
providers flow and reduce lead-times from providing insights, root cause
 Automation of trans-actions, order prediction to delivery analysis and decision support
enable real-time business,  Integration of warehouse & (simulation and assessment)
Content & end-to-end SC visibility transportation management  General belief across all
Feedback  Semantic web? solutions with tracking capabilities industries: key asset for
 Feasibility regarding engineered and logistics networks transparency & visibility
items still questionable  limited  Applied by some companies
scope (< 50%)
Sourcing and production in Process standardization and

SC transparency & visibility
emerging markets automation
Meets the Flexible response management
Collaboration with customers SC Visibility
Challenge and suppliers
SC Visibility SC complexity management

CONNECTED LOGISTICS
https://youtu.be/zKZDgsni0Y4
BETTER DECISIONS: CONNECTED LOGISTICS
Hamburg Port Authority
Business Challenge
 Geographical limitations and constantly growing container
throughput
 No transparency through data overflow
Process Innovation
 Location sensors on trucks and trailers
 T-Systems telematic solutions
 Data sources for real-time information like traffic
 Information connected and processed in the cloud
Solutions
 HPA solution: smartPORT Logistics (SPL)
 SAP HANA Cloud Platform
 SAP Connected Logistics
Benefits
 More efficient operations – higher throughput
 Less idle times for truck drivers
 Less traffic jam
Youtube-Video: https://youtu.be/Zv46j2WZ3jU

IOT AND SUPPLY CHAIN VISIBILITY

LEANER PROCESS: IOT AND SUPPLY CHAIN VISIBILITY
Premium Automotive OEM (“Digital Logistics 2030”)
Business Challenge
Strong growth of global supply  new logistics strategy shall
increase efficiencies in operations on basis of digital technologies.
Particular goal: Increased visibility in inbound logistics.
Process Innovation
 Central data pool (Cloud) for collection and processing of
transactional (supplier release plans, ASN) as well as unstructured
data, e.g. weather and traffic information  Predictive analytics
 Use of geo data for track and trace
 Use of online sensor data
 Automatic identification of containers with RFID
 Monitoring of truck loads
 Planning and simulation
Benefits Solutions
 Enhanced delivery service and reliability  SAP Event Management  SC Control Tower
 Reduced inventory  HANA Analytics  SAP IoT Repository
 Reduced cost of emergency deliveries  SAP SC Execution Platform  IBP
 S/4HANA

AGENDA

Next step: Global Online Survey on Digital SCM Maturity
 Step 1 - Future picture:

A vision of a digital SCM2020 (and beyond)
 Digital SCM2020 vision from the perspective of thought leading companies/ SCM champions
 Contribution of emerging technologies to a digital SCM 2020 vision
 Whitepaper „Digital SCM Vision 2020“
 Step 2 - Current situation:

Digital supply chain maturity assessment
 Maturity assessment of companies based on the digital SCM2020 vision (categorization into different maturity
levels)  target group of ~ 3.000 SCM leaders, build opportunities for offering SCM Business Assessments

DIGITAL SUPPLY CHAIN MATURITY MODEL
Overview
• Seven views on SCM based on Porter‘s

value chain Digital Performance Measurement
• 19 use cases were mapped to Porters
value chain to derive a digital maturity Digital HR & Talent
model
Digital IT & Technology
• Four tailor-made models were derived for
the discrete industries: automotive, high-
tech, machinery and consumer products
industry
Digital Suppliers Digital Production Digital Logistics & Digital
• A synthesis of the model and its stages is Systems Inventory Customers
shown on the following pages
Generic level overview

Level 1: Deficient Level 2: Basic Level 3: Defined Level 4: Advanced Level 5: Optimized

Detailed Dimensions (1/2)
If you are interested in the Digital Supply Chain Maturity Model

or additional services from SAP BTS, please contact the speakers

Detailed Dimensions (2/2)
If you are interested in the Digital Supply Chain Maturity Model

or additional services from SAP BTS, please contact the speakers

OVERVIEW: DIGITAL SCM SURVEY
From vision to preliminary results
Vision/Objectives Go-Life Regions Industries Your chance to

ENGAGE
 Industry-wide application of  Survey live now!  Participants from EMEA,  Participants from various  Receive a personalized
use cases discussed in North & South America & industries, e.g. Automotive, report about your results
phase 1 Asia Pacific High-tech, Machinery or  Get a performance
 Understand the maturity of Consumer goods benchmark for your
digital SCM trends in four industry
industries

MACHINERY INDUSTRY – PRELIMINARY RESULTS
Sample Customer Report
DIGITAL MATURITY OF CUSTOMER VS. INDUSTRY SUMMARY
Customer & Industry vs.

Customer's Maturity Level Industry's maturity level Vision
Customer & industry heavily
Digital Customer deviate from the ideal image of
5 digitalization HOW DO THE
4 RESULTS IN
Digital
Performance
3
Digital Supplier THE
Customer vs. Industry
Management 2 DIMENSIONS
1 Customer has already taken a LOOK LIKE IN
step towards digitalization in the DETAIL?
0
customer and production
dimension
Digital
Digital IT
Production
Customer needs to focus on
digitalization efforts in the
logistics and IT dimension due
Digital Logistics to weak results in comparison
with industry standards

SAMPLE CUSTOMER REPORT – SELECTED QUESTIONS OVERVIEW
Machinery Industry – Digital Production
1 How frequently do you run material requirements planning? 2 How do you monitor most of your supply chain assets and
50% 0% plan their maintenance?
40% Reactive maintenance
30% 24%
20% 35% Preventive maintenance
10%
0% Condition-based
Weekly On a daily Regularly, Regularly, Real-time maintenance
basis once a day many times a MRP 41% Predictive maintenance
day
3 For what purpose are you using 3D printing? 1 Material requirements planning
Customer’s maturity level: deficient
70% Next step: Assess opportunities to speed up MR planning cycles to
60%
50% have a more up-to-date picture of the demand and supply situation
40% Maintenance handling
30% 2
20% Customer’s maturity level: deficient
10% Next step: Analyse data from past incidents to prevent re-occurrence of
0% machine failure and improve downtimes
3 3D Printing
Customer’s maturity level: basic
Next step: Apply 3D printing techniques in product development &
production

AUTOMOTIVE INDUSTRY – PRELIMINARY RESULTS
Sample Customer Report
DIGITAL MATURITY OF CUSTOMER VS. INDUSTRY SUMMARY
Customer & Industry vs.

Customer's Maturity Level Industry's maturity level Vision
Customer & industry heavily
Digital Customer deviate from the ideal image of
5 digitalization HOW DO THE
4 RESULTS IN
Digital
Performance
3
Digital Supplier THE
Customer vs. Industry
Management 2 DIMENSIONS
1 Customer has already taken a LOOK LIKE IN
step towards digitalization in the DETAIL?
0
customer and production
dimension
Digital
Digital IT
Production
Customer needs to focus on
digitalization efforts in the
logistics and IT dimension due
Digital Logistics to weak results in comparison
with industry standards

SAMPLE CUSTOMER REPORT – SELECTED QUESTIONS OVERVIEW
Automotive Industry – Digital Customer
1 What are you doing to identify and predict long-term trends 2 What kind of information from the product lifecycle
regarding your customers' behavior / needs? (PL) do you store? (More than one answer possible)
1% Product identity
60%
50% 8% 14% Product info
40% 7%
Production history
30%
Supplier information
20% 16% 19%
10% Product modifications
0% Operational data (from the car)
No trendmining Trendmining Trend analysis Trendminig based Trendmining
activities activities planned based on internal, on external, based on IoT
20% 15%
Maintenance data
structured data unstructured data
No PL data is stored
2 How and where do you store all product lifecycle related data Trend Analysis
(product identity, modifications, production parameters etc.)? 1
Customer’s maturity level: standard
80% Next step: Extended the data basis by including external data (e.g. from
60% social media, web) or even sensor data from the car
40% 2 Digital Product History
20% Customer’s maturity level: standard - advanced
0% Next step: Establish a single source of truth for product history data and
Product history spread over Centralized digital product Decentralized digital product
different data sources history (e.g. on a cloud-based history, directly at the product
extended information by including maintenance and sensor data is
platform) (e.g. via RFID chip) applicable

AGENDA

FROM THEORY TO PRACTICE
The Digital Transformation
DIGITALIZATION BRINGS A NEW WAVE OF
OPPORTUNITIES & CHALLENGES
Gross World
Annual IoT 78% of employees
Product will reach
impact $4T to want to work for a
$90.0T with
$11 trillion in 2025.2 digital leader3
Digital Economy1
1) Seeking Alpha, Increasing Churn Rate In The S&P 500,

2) McKinsey, Unlocking the potential of the Internet of Things,
3) MIT Sloan Management Review, Is Your Business Ready for a Digital Future? McKinsey & Company,
© 2016 SAP SE or an SAP affiliate company. All rights reserved. Customer 59
A KEY TO SUCCESS?

DIGITAL TRANSFORMATION

WHAT IS DIGITAL TRANSFORMATION?
Digital Transformation is organizational change through the use of digital

technologies and innovative business models to improve business success
Innovation Digital Technology

Process of re-imagining a new Leveraging Digital technologies to
business model, a digitized product, deliver innovation
business process or work
Innovation and Digital Technology are both required to generate value

REIMAGINE YOUR BUSINESS MODELS
and transform your supply chain
People
Data
Businesses
Cloud
Things
 Use Cases & proven digital  Dedicated tools and  Identify new digital  Find the technology
success stories of companies approaches identify value services you can offer to enabler to implement your
 Be inspired for your digital drivers and inspire more your customers, using digital business model
transformation, e.g. using the detailed ideas for single tools such as business-
Digital Supply Chain Maturity business-model elements, model canvas
Model e.g. Design Thinking@BTS
Digital Transformation does not happen in silos!

Prevent potential myopia of disconnected departments by involving outside in expertise!
(e.g. Business Assessment for Digital Supply Chain Management)
FROM REIMAGINATION TO OPERATION
Digital transformation goes far beyond the MBA-trained mind
Reimagine Innovate Transform Operate
 Open-minded  Be unafraid to say no  Plan-build-run philosophy  Focused on operating

 Creative  Fail early, fail cheaply  On time and on budget expenses
 Desirability-focused  Leverage supporters  Rational thinking  Get-things-done attitude
 Avoidance of habits  Avoid too early decisions  Avoidance of failure  Continuous improvement
 Avoid disruption
The designer The innovator The transformer The operator

FINDING THE RIGHT DIRECTION
with selected methods and approaches
Design for Products and Services
 Desirability – Put the users to center stage
 Feasibility – build feasible, also think in future technologies
 Viability – A viable business model is part of the design!
Design for
Design for new
Organizational Change
Business Models
 Empathize
 Business Models need evolution
 Simplify
 Think in portfolios of busines models
 Humanize
 Reframe ecosystem and business
 Try.
model
Fail early. Fail often
Design for Competitive Advantage

 Create a design-focused culture that supports world-class
innovation
 Samsung: “Design expertise … the ultimate battleground for global
competition in the 21st century.”
 Institute policies and structures that embed design thinking in all
corporate functions
 Provide a framework for reevaluating products in the face of
dramatic technological change
 Design for near and for distant future

DESIGN THINKING AS TOOLSET FOR INNOVATION
Design
Challenge The Way:
Design Thinking end-to-end
Start: Goal:
Describe the problem Tangible result
For this:
Design Thinking
Toolkit
Important:
Timeboxing Example: Persona,
Spark creativity!
Customer Journey
DIGITAL INNOVATION & TRANSFORMATION WORKSHOP
Method - Key Steps
Specific Customer  Deep Understanding of

Definition Targeted Customer
Empathy
 Prototype, Test,
Feedback Design Challenge
 Sales Pitch
 IoT device
Pilot Improvement Ideation Experience
Opportunities Threats Requirements
 Ideas using
digital tech.
Digital Economy New Model design

Idea Sketch
Overview Hypothesis
Ecosystem Context Discovery  Digital Business  Customer Pains/Gains

Model Patterns
Business Value
Model Proposition  Pain relievers/
Digital Capacity Assessment  Best Practices Gain Creators
 Digital Constraints Customer & Value

GLOBALLY PROVEN METHODS
SAP BTS Innovation Business Modeling Canvas

Management Framework
CUSTOMER
JOURNEY
ACTIO
ET TOUCHPOI
MINDS
MINDS NS
NTS
TOUCHPOI
ET
NS
ACTIO
NTS
Technology Radar for IoT Business Model Pattern Library IoT Sensor & Demo Cloud
• 55+7 business model patterns

THINK & ACT
LIKE A STARTUP
Mindset Change & Organizational Change
 Agility  Digital Transformation Programs

 Customer validation  Innovation Labs Approach:
(internal & external) prototypes / speed boat projects &
intrapreneurship
 Data-driven approach
 2-speed IT
 Digital natives
(keep lights on + innovation)
© 2015 SAP SE or an SAP affiliate company. All rights reserved. 70
A GOOD PROTOTYPE IS A MINIMUM VIABLE PRODUCT
What is an MVP?* Benefits
 Risk reduction through solution

validation in regards to end user
desirability, business viability &
technical feasibility
 Tangible result that clearly show-

cases the desired solution and is
easy to share with customers &
across organization
 Small time investment from few

weeks to few months (depending
on project requirements)
© 2016 SAP SE or an SAP affiliate company. All rights reserved. * Spotify, Henrik Kniberg, “How Spotify builds products” Public 71
SAP INTERNET OF THINGS SIMULATOR
Pilot Demo Bundle of Software & Hardware for IoT

SAP IOT SIMULATOR
Project Approach
Project Vision & Iterative

Organization & Setup Solution Finding Execution
Short time frame: Design Thinking: SAP HANA Cloud Platform (HCP)
 1,5 months of not full time work  to define key customers’ pains & & HCP IoT Services:
 Frontend: beautiful UIs based on
before Hannover Messe 2016 gains in focus, target solution key
features, high level biz models award-winning SAP Fiori
 Many MVPs can be built within  Backend:
ca. 30 days High fidelity prototypes  data storage & analytics
Diverse mixed teams of  with interactive mockups  big data integration (VORA /
 SAP (in this case: 2 business (showcasing key user flow) Hadoop)
consultants & 3 core developers)  made with SAP Fiori powerpoint  security & scale
design library (making UI design  application development
 Customers (in this case SAP
accessible to non-designers) environment & management
marketing & sales colleagues)  IoT Services (device &
 and preferably customer’s  make long function specification message management)
customers documents redundant

SAP INTERNET OF THINGS SIMULATOR:
Get up and running in 5 easy steps
1) Get the App 3) Launch the App 5) Start IoT Simulation

With only 2 clicks
Search for: SAP IoT Simulator

IoT Simulator
2) Get the Device 4) Turn on the Device
Contact your SAP Services

Sales representative or
[email protected]

START THE DIGITAL TRANSFORMATION
by assessing your own Digital Supply Chain Maturity
TAKE ONE STEP FORWARD
Digital Supply Chain Maturity Assessment
Participate in the maturity

assessment
IS YOUR
SUPPLY CHAIN
Identify SCM potentials for
PREPARED FOR THE improvement
DIGITAL FUTURE?
Define your roadmap towards
the digital SC

APPLICATION OF RESULTS
Digital SCM use case portfolio for specific customer
# Digital SCM use cases

9b 9a 12
High
1a Selling pattern analysis (5; 5)

1b Customer buying behavior analysis (5; 5)
10b 11 1a 2 Trendmining (3; 2)

10a 1b
3 Digital product history (4; 4)
4 Real-time geo-located shipping (3; 2)
8 5a Augmented reality for warehousing (1; 1)
6 3
5a 5b Augmented reality for service operations (4; 1)
6 Automated commissioning & packing (4; 2)
7a
Value
4 7a Additive manufacturing for plastic parts (3; 2)

7b
2
7b Additive manufacturing for metal parts (3; 1)
8 Intelligent product (4; 2)
9a High volume equipment reliability analysis for
preventive maintenance (6; 5)
9b High volume equipment reliability analysis for
predicting product quality (6; 2)
10a Business network for commodity parts (5; 5)
5b
10b Business network for engineered parts (5; 1)
11 Flexible on-demand business IT (5; 3)
Low
12 Supply chain control tower (6; 5)
Vision Maturity Reality

DEVELOP YOUR ROADMAP TOWARDS THE DIGITAL SUPPLY CHAIN
Assess the digital maturity close the gap

Digital Customer your company
5
of your Supply Chain become a champion your industry
4
ILLUSTRATIVE
 Discover the current state of your Supply Chain
3
 Get inspired by realistic industry Use Cases Digital Performance
Digital Production
Measurement
 Learn about the digital maturity of your competition 2
0
Develop your roadmap for
your digital Supply Chain
 Identify Use Cases relevant for your company

Digital IT & Technology Digital Supply
 Develop a plan to close the gap to competition and
become a digital supply chain leader in your area
 Select the partners and tools to enable your roadmap
 Execute your strategy towards a digital supply chain Digital Logistics

START TODAY BY
COMPLETING THE
DIGITAL SUPPLY CHAIN
MATURITY ASSESSMENT
THANK YOU
CONTACT INFORMATION:
Dr. Jörg Wilke

Business Transformation Services
Head of CSCO Advisory Europe
[email protected]
+49 151 16809833
Roland Deuker
Business Transformation Services
[email protected]
+49 151 67834618
@RolDeu
© 2016 SAP SE or an SAP affiliate company. All rights reserved.

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WEGE ZUR DIGITALEN SUPPLY CHAIN

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 2

1 BTS / FIR Studie “Digitale Supply Chain” – Überblick

2 Digitale SCM Use Cases und Praxisbeispiele

3 Online Survey und erste Ergebnisse

4 Methodischer Ansatz: Wege in die Digitale Supply Chain

5 Fragen und Antworten / Wie geht es weiter?

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 3

First research work Applying operations Exploring principles of Using digital

1950 1960 1970 1980 1990 2000 2010 2020

Mobility Omnichannel Commerce

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 5

 Step 2 - Current situation:

 Step 3 - Transition path:

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 6

 Duration: 1-2h per interview

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 8

Use Case Library with ~140 digital use cases

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 10

Supply chain visibility

1 BTS / FIR Studie “Digitale Supply Chain” – Überblick

2 Digitale SCM Use Cases und Praxisbeispiele

3 Online Survey und erste Ergebnisse

4 Methodischer Ansatz: Wege in die Digitale Supply Chain

5 Fragen und Antworten / Wie geht es weiter?

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 12

 Use Cases & proven digital

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 13

Supply Chain Control Tower

Mobile Talent Development

Digital IT & Technology

 Predictive Quality  Selling Pattern & Customers

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 14

Digital Product History Predictive

SC visibility Process standardization Process standardization and

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 15

Customer Project Example 1

Supplier information and

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 17

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 18

Customers buy Insurances Parts Value-added Services

What makes New Business Model &

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 19

MRO service Availability Inventory levels Actions:

 What to do and when?  Which parts and/or

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 20

Customer Project Example 2

Customer Project Example 3

Experts foresee How do you monitor most of 35%

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 24

Customer Project Example 4

Customer Project Example 5

SC visibility SC visibility New business models and

Customer Project Example 6

The customer behavior with regards to configurable products is hard to predict.

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 29

Solution: Statistical model for analysis of demand for configurable products

© 2016 SAP SE or an SAP affiliate company. All rights reserved. Public 30