How to choose your Business Planning & Consolidation solution: the FAQ

25 July 2017

Michal Galasinski

Michal Galasinski

EPM Consultant

Having decided to invest in a planning or consolidation solution, it can be confusing which one to implement. There are several options available within the SAP ecosphere, but what are the considerations you should be including in your decision-making process? There is no simple “right” or “wrong”; the choice you make needs to be tailored to your business needs.  From our experience of working with numerous customers in this area, here are the key areas to focus on.

1. What SAP planning and consolidation products available?

Traditionally in the Enterprise Performance Management (EPM) sphere, the go-to product was SAP Business Planning and Consolidation (BPC). This software has evolved, and today there are effectively three versions of BPC available:
  • SAP BPC Standard version
  • SAP BPC Embedded version
  • SAP S/4HANA Planning and Consolidation

2. How do the products differ?

The functionality between the versions is varied, however, the essential difference between these products is how they are integrated within the broader SAP environment.
 
To see how the three products are distinguished by their integration at each level we have split the components of BPC into three layers:
  1. the top, end-user accessible layer
  2. the middle “back-end” layer, in SAP Business Warehouse (BW)
  3. the bottom database layer3. What are the key elements for consideration?
To effectively decide which version you need, consider 4 different impact areas. These are:
  • Performance Management Processes
  • Data
  • Your IT Roadmap
  • Cost


Performance Management Processes

A. I need my data planning and consolidation data to be very detailed – what should I do?
The level of desired data granularity is one of the most significant elements to examine. One of the more significant features of an S/4HANA Planning and Consolidation solution is its integration with the S/4HANA universal ledger; therefore, any planning or data consolidation can effectively be performed at transaction level. However, with this greater data granularity inevitably comes a greater complexity in solution design and implementation, both due to the increased volume and increased dimensionality of the data in scope.
 
A crucial decision must be made early on: do you need a high-level, corporate plan/consolidation, or a solution that lets you drill right down to the transaction level detail?

B. Does what I am planning make a difference?
Absolutely. As mentioned above, S/4HANA Planning and Consolidation can integrate directly with the S/4 universal ledger. However, if you are investing in a solution to facilitate your headcount planning, a process that will need comparatively limited access to financial transactions, this additional layer of complexity is likely to be unnecessary. In this case, opting for a BPC standard or embedded solution, which are built separately in SAP BW, might be the better option.

C. How can I ensure I get the analytics I need?
Before making a choice, you will need to consider whether your EPM process has a need for complex and detailed analytics on top of your data. Because BPC Embedded and S/4 Planning and Consolidation are built using data objects in BW, there is greater flexibility in the solution design, leading to greater control over data availability for detailed analytics.  Additionally, it is easier to integrate with other warehoused data in BW.

D. What if I’m looking for something to facilitate my corporate planning and reporting?
If you need a solution for corporate planning or consolidation, with reporting requirements limited to variations on standard financial reports, then complex analytics might be overkill. As a reliable, finance-owned product, BPC Standard has stood the test of time. The excel front-end means your finance department has all the reports they need in a familiar document format.

Reviewing BPC suitability for the performance management process

Data

A. I’m struggling with the quality of my source data.  Does this make a difference?
You’re not the first and certainly won’t be the last! One key feature that distinguishes both BPC Embedded and S/4HANA Planning and Consolidation is their increased integration with other SAP systems; the former is embedded in BW, whereas S/4 Planning and Consolidation goes on step further and integrates right down to the S/4 universal ledger.
 
If your source data is of poor quality, implementing these solutions will only amplify these errors through to your plan, budget and financial reports. To maximise the capabilities of BPC Embedded and S/4 Planning and Consolidation good quality source data is a prerequisite.
 
NOTE: Achieving good quality data isn’t always easy. A large part of implementation costs will be attributed to data clean up and not the solution configuration. If there’s no appetite for this kind of investment, BPC Standard, with greater control over transformations and conversions during data loads, is a wiser choice.

B. I’m confident about the quality of my data, but it is across multiple sources.
BPC solutions that are dependent on data from various unintegrated sources (often encountered in the requirements for HR planning and industry-specific planning solutions), will experience limited benefits of full universal ledger integration.  Now is the time to consider your future IT roadmap and ask the question “will additional implementation complexity bring with it benefits?”.

C. What about data volumes?
The most disruptive change that has been introduced with HANA database technology is the immense increase in aggregation and calculation speeds and subsequently increased HANA integration amongst some of the BPC offerings.  If you are working with large data sets, S/4HANA Planning and Consolidation or BPC Embedded for less finance-dependent solutions, should be considered over BPC Standard.

Reviewing BPC suitability from a data perspective

IT Architecture

A. SAP BPC sounds great; however we don’t have an SAP landscape. 
Your existing and future IT architecture needs to play a role in determining which version of BPC is right for you. Most significantly, BPC integrates well with other SAP software, most prominently SAP BW and S/4HANA. If you do not have an SAP BW installation, and are not likely to embark on a wider roadmap of S/4HANA the choice is straightforward: BPC Standard is available as a SQL server installation.

B. We want a planning solution for our warehoused data – is BPC Standard the way to go?
With the introduction of BPC Embedded, which fully integrates with SAP BW, there are now two options to consider in this situation. There are two reasons to choose BPC Embedded over BPC Standard.
  • Extensive BW User. If you are already using integrated planning extensively in your BW environment, or if you are performing extensive reporting and analytics on top of a variety of other BW data, using BPC Embedded to integrate BPC into your BW environment will make it much easier to consolidate your IP and BPC functionality, or to include BPC data in to your dashboards.
  • Imminent move to S/4HANA. If S/4 is on your near-future roadmap, but you need to invest in a planning solution now, it is wise to choose BPC Embedded.  This will be easier and cheaper to migrate to an S/4HANA Planning and Consolidation in the future.

C. How does this fit into our larger IT architecture?
The wider design of your IT architecture needs to be factored in – for instance, how you manage system risk, availability and dependencies? To lower the impact of system downtime and/or unforeseen problems, you may consider data loads and interfaces between BPC and BW are a small price to pay for a more distributed architecture. In this case, BPC Standard becomes an attractive choice. But, you do lose the benefits of integration and HANA technology, so it is important to balance this decision with your process and data needs as discussed above.

 

Reviewing BPC compatibility with your IT architecture

Cost

Which solution provides the best return on investment? 
This question can’t be answered in isolation of the wider SAP strategy and expectations of your organisation. If there are plans towards S/4HANA in the medium-term future, BPC implementation costs aren’t likely to be significant in comparison to the direct and indirect costs of S/4HANA as part of a finance transformation program.
 
An immediate BPC upgrade to BPC 10.1 Standard, in the lift and shift style, is not likely to be cost effective in the above scenario, however, it may provide the relevant immediate benefits that make it a worthwhile stopgap. A review of your long-term organisational goals is critical to understanding the ultimate costs of a planning and consolidation implementation, and how this should influence your choice of software.
Reviewing the cost effectiveness of BPC
 

One size does not fit all

The choice is not a simple one.  However by answering the questions above and closely evaluating your business needs, and future IT roadmap, you should be able to make a well informed decision that provides the business what it needs, within the allocated budget.  Still confused?  Drop us a line today and speak with one of our EPM specialists.

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About the author

Michal Galasinski

EPM Consultant
I am fascinated in how technology is changing the way companies operate.  As part of Bluefin's Enterprise Performance Management (EPM) Centre of Excellence,  I help global organisations use the latest SAP technology to develop their strategic processes and gain insight into complex data. I thoroughly enjoy approaching this task creatively and collaboratively, enabling clients to think differently about planning and performance management.

Since joining Bluefin, I have been engaged in multiple EPM projects across a variety of industries. I have worked in the delivery of global, customised BPC solutions to develop corporate analytics and meet management and statutory reporting requirements.

When I am not doing this, I enjoy reading, playing football, and going to concerts.

Bluefin and SAP S/4HANA - welcome to the one horse race