Trends in SAP within the manufacturing industries

For the last ten years, SAP has been a valuable tool in helping manufacturing companies manage their full supply chain, from ordering to invoicing, from stock control to service delivery.

It represents a huge investment, however, both in terms of initial integration into a business and in terms of ongoing support.

Larger companies use SAP in-house, tending to favour a central team that works on a global scale. Smaller companies may choose to outsource the function to a specialised IT company in order to control costs.

Without doubt, SAP has helped businesses run better.

SAP HANA

As every industry submits to the digital age, so SAP is no different.

SAP Hana is the latest innovation created by the company to support its existing software, and represents the ability to extract data and analyse it at record speed.

One of its most well-known proponents is McLaren Honda, who say that SAP allows them to “challenge technological boundaries.”

Cost vs benefit

“What all companies have in common is trying to identify the opportunities and the cost benefit that HANA will bring them,” says a 25-year-long veteran of the industry and SAP Module Lead.

“Analytics tend to be much better developed in finance and sales reporting areas, and lagging a long way behind in supply chain. Most companies have invested in data warehousing but most of that is just from a financial reporting perspective, very little has gone down to supply chain metrics, that’s just not on their radar.”

“Every company has got their own ideas about what is important to them. Because SAP is a mature industry they will have evaluated it already. They’re asking: What is HANA going to do for me?”

“HANA has become much hyped elsewhere but not so much in the UK. It’s expensive. The licensing model and charges are based on the amount of data you’re processing and runtime and things like that, so it very quickly becomes an expensive solution. While it might look appealing, there are people that get put off by the price tag.

Improved analytics

However, it is a game-changer, as our source admits:

“HANA is a much more effective and a significantly quicker way of generating queries. You can access data much quicker. It does really change a lot of the BW space because BW in organisations is that classic idea of cubes, which is an incredibly labour intensive way of getting reports.”

“This allows companies to analyse their big data; the question that companies have to get to is what data is significant and what structured queries do they need to put together.  You still need some good old fashioned data modelling knowledge to get the most out of those types of tool. It is a leap forward but it is still a tool ¬– you still need to know what you’re doing.”

Security

Recent discussions on SAP have centred on cybersecurity.  According to recent research by the Ponemon Institute on behalf of Onapsis, more than half of companies surveyed (56%) believe it is likely their company would have a data breach due to insecure SAP applications.

Fifty-nine percent of respondents believe new technologies and trends such as cloud, mobile, big data and the Internet of Things increases the attack surface of their SAP applications.

“Many do not have the required expertise to quickly prevent, detect and respond to cyber-attacks – a problem which 60 percent of respondents say would be catastrophic or very serious and could lead to $4.5M average cost if systems are taken offline,” says the report.

“One of the big surprises in this study is this swell of silent breaches that are increasingly hitting organizations which are difficult to detect, and materially impact businesses and the overall economy,” said Dr. Larry Ponemon, chairman and founder, Ponemon Institute.

“Worryingly, while survey data indicates SAP breaches are expected to increase, there is no single group or job function most accountable. It appears that SAP cybersecurity is falling through the cracks between the SAP security teams and InfoSec teams, who need to step up to bridge the gap and make it a priority.”

Twenty years ago the internet was not a big player in business communications,” says our source. “It’s difficult to say whether the next 20 years are going to see the same rate of evolution.”

“To what extent HANA is going to take off only time will tell.”