The 2nd SAP India Analyst Forum hosted in August in SAP Labs, Bangalore had sessions on new products launched, future road map, innovation agenda and collaboration/co-innovation with partners. SAP was keen to highlight the benefits of in-memory database HANA, where due to the speed, business problems that could not be solved before or new applications are now conceptualized, designed and solved using HANA. In situations where speed is required for business decisions and where large amount of unstructured data is generated in today's world of connected machines, in-memory databases offer a solution using real time massively parallel processing.
How can Manufacturing leverage HANA?
Real-time status and insight made possible by SAP HANA is helping manufacturing sector to work both "smarter and faster". We have talked about how manufacturers are embracing HANA in previous documents (SAP HANA Moves into the Manufacturing Industry Suite IDC Manufacturing Insights,, August 2013). Suite on HANA offers core functionality where analytical processes are directly embedded into transactional systems like ERP offering real time analysis and reporting leading to faster decision making. The following are specific business cases where SAP HANA has been implemented in India and business impact seen:
- Automating the milk supply chain
Aavin is a cooperative milk producers union where SAP HANA has been implemented to improve visibility into both the supply and demand side of the business. The average milk procurement in 2012-13 was 2.7 million liters per day. Anticipating the supply is critical for the business to be profitable. By having a better understanding of the constituents of the milk, especially the fat content, different products can be manufactured. However it is critical to get this data as early as possible to allow for production and distribution planning.
SAP piloted a cloud based application with the data and analytics technology driven by HANA. The application works with mobile Point of Sale devices to measure the quantity of milk and fat content at the cooperatives' collection points. The information from individual producers will be keyed in through these devices and the data stored in a centralized SAP HANA server. The cooperative now has real-time visibility on the procurement to plan its production and distribution. The entire milk procurement process is captured at-source resulting in transparency and facilitating faster electronic payment to farmers in their bank accounts.
- Inventory reduction in consumer durables
Usha International is a leading consumer durable company manufacturing products such as sewing machines and ceiling fans. As part of its business transformation, Usha wanted greater visibility across the countrywide enterprise, optimized operations in key business areas like sales/supply chain and improvement in performance of its analytics environment. With its data warehouse (SAP NetWeaver BW) growing 20% annually, the company had the option to either add new storage hardware or go for HANA.
50% reduction in inventory levels was achieved after implementing SAP HANA. From the business side where quick market-driven calls need to be taken, it led to complex runtime data analysis, faster decisions and ability to prototype different business scenarios for building a more demand-driven supply chain. All this led to better control of the supply chain, inventory reduction, elimination of obsolete inventory in some cases resulting in better cash flow and lower inventory holding costs.
- Short lead time material planning
Avon Cycles produces a wide range of bicycles for the global market. It had to manage a huge volume of bought out components, given its wide product portfolio in terms of models, sizes in each model and colour combinations. With cycles getting commoditized and given a flat to shrinking market in India where cycling is not a popular sport due to infrastructure issues, forecasting of sales becomes challenging, with very short lead times for material requirement planning. Avon selected HANA to transform to real-time planning and monitoring of order fulfillment scenarios.
- Faster order fill rate for large volume ERP
Asian Paints is India's largest paint company in terms of revenue. It was one of the global 8 firms where SAP HANA was piloted. With centralized order management, thousands of SKUs and short delivery time, complex rule computations over a million sales order line items had to be done in real time for cross selling. Significant employee productivity, performance improvement in query response times, data compression and data load time were noticed post HANA implementation.
While HANA demonstrates clear process improvements, there does appear to be some inertia for adoption amongst the local manufacturing companies. To overcome this, a two pronged approach is required from both SAP and the users.
● First, SAP needs to focus on getting closer to the business users to identify where HANA capabilities can make a real impact on the business, such as with Aavin, where technology deployed in the field is feeding directly into the production and distribution planning systems.
● Second, it is up to manufacturing firms and their implementation partners to collaborate with SAP and identify the right use cases for their implementation.
● SAP HANA Moves into the Manufacturing Industry Suite (IDC Manufacturing Insights,
● Perspective: SAP's Manufacturing Strategy in Asia (IDC Manufacturing Insights, , February 2012)
● Highlights from SAP TechEd 2012: SAP's Big Move to SAP HANA (IDC Insights, IDC #238258)