SAP Spend Performance Management FAQ

16 November 2012

Neil Bundy

Neil Bundy


Having worked with and implemented SAP Spend Performance Management (SPM) for nearly 2 years, I have had the opportunity to work with a number of different category managers, financial analysts, project managers and project sponsors as well as more technical stakeholders. Here, I have collated some of the most frequently asked questions that have come up.

What is SAP SPM?

SAP BusinessObjects Spend Performance Management is a strategic analytical reporting tool designed to aggregate spend data from multiple sources across an organisation into a single application. The application provides a large number of reportable metrics for invoice and purchase order spend, budgets, savings and sourcing contracts, and supplier risk metrics as well as allowing measurement towards strategic goals and KPIs set within the application.

It is a pre-built spend analytics solution with many pre-defined metrics that is built on SAP BW technology. SAP SPM combines and integrates spend information from SAP and non-SAP sources, as well as flat files, and other SAP technologies.

The application is accessed via a web-based interface and allows users to run pre-defined reports, set and measure performance against KPIs as well as provides a means for ad hoc analysis.

What do you get out of the box?

SAP SPM is very much aimed at rapid "as-is" implementation rather than extensive customisation.

  • A unique web-based user interface rendered in the Adobe Flash Player capable of displaying and creating new and existing reports and dashboards
  • An integration point for data cleansing and the classification of spend data
  • SAP BW data model, that can be installed as is, or extensively and completely customised based on requirements
  • About 140 reportable metrics
  • Approximately 130 pre-delivered reports as a starting point for analysis
  • Extractor starter kits for extracting data from SAP ECC and SAP SRM systems
  • A BusinessObjects Data Services license, limited for use with SPM. You can use Data Services to cleanse and classify your spend data before uploading this into SPM
  • Limited SAP BW license for installing SAP SPM as a separate installation if required.

Why buy SAP SPM when I have consultants who can make a spend
analysis solution in SAP BW?

SAP SPM is designed and built on industry best practices and contains a lot of pre-built analytics. It is a solution designed to be installed and used rather than extensively customised. This means that you could save significant time and effort scoping and designing a new application from scratch - after all much research and industry best practice has contributed to the application's development.

Another important reason why customers have purchased SAP SPM is due to low adoption of more traditional Bex reporting tools and reported much greater user adoption using the SAP SPM UI. All of these factors would have to be considered when creating your own bespoke application. As SAP SPM is based on SAP BW, you can extensively customise it to meet your requirements if needs be if you're worried about SAP SPM not meeting your businesses requirements.

How long does it take to implement SAP SPM?

Implementation time will depend upon a number of factors including, the number of SAP ERP systems you're intending to integrate, prior SAP SPM experience of your team, what proportion of of the predefined data model you plan to populate and of course how much customisation you're planning on doing.

Some customers have implemented SAP SPM for a single SAP ERP instance in as little as 3-4months with a small number of users. Under these circumstances you should be looking at a minimal number of users and have a team with prior SAP SPM experience under their belts.  If you're looking to integrate a dozen ERP systems, classify data, integrate a series of custom metrics, you could expect a team of 5 or more to be occupied for much more than a year and you should definitely consider breaking up your implementation into a phased approach.

A client I worked with last year went live with 9 countries with PO data, invoices and contracts data including some extensive customisations to account for some specific procurement processes in a complex landscape in 8 months.

What skills are required for a successful SAP SPM implementation?

Installing SAP SPM is not just a technical project, even if you do plan to implement it with minimal customisations. Although SAP SPM is based on SAP BW, it has many important technical and functional differences which will need to be factored in when choosing a suitable team. Ideally you will choose a team with prior experience of implementing SAP SPM as this will make a huge difference. Not only will you need an SAP BW consultant, a Basis consultant and an Enterprise Portal (EP) expert to configure your system and troubleshoot any problems, but critically, you will require business process skills to appropriately scope the requirements and understand exactly what data is being brought into the application. Additionally, if you want to integrate non-SAP sources you'll need to consider how you're going to get the data out of these other source systems.

Although the product is designed to be installed primarily as is, there are some very important aspects that will need careful consideration, especially if you choose to use the extractors that come with SAP SPM.
Additionally of course, you will need all the other project management, system integration testing, business acceptance testing and data reconciliation are important phases that the specialist can provide guidance and support as well as helping to show how the SPM solution can evolve and grow. You will also need to consider change management and how you educate and engage with your intended user community.

Avoid any of these skills at your peril. They are all essential for a successful implementation.

I want to integrate spend data from numerous SAP ERP systems.
How does SAP SPM handle data quality?

As SAP SPM is designed to extract data from a number of disparate SAP ERP systems and aggregate data together, this is a very important question. Unless your organisation has a single consolidated SAP ERP instance, universally implemented material and material categorisation and stringent master data management, its highly likely that data quality will impact upon your ability to report on spend data across your organisation effectively if you do not consider this.

SAP SPM is an integration point between data extraction and classification. Integrated into the web user interface is the Data Management tool. This is geared towards an operational user pulling data from a number of different sources. Data can then be exported and sent for data cleansing, enrichment and classification. Once the data has been cleansed and classified, then, through the same UI, data can be loaded back into SAP SPM and made available for reporting.

The data cleansing and classification process is not an integrated part of SAP SPM. Typically these processes are completed by an additional process. For example, you could use SAPs Data Enrichment and Classification technology or a third party tool or services. Alternatively you can choose to classify cleanse and enrich data within your organisation - using the SAP BusinessObjects Data Services license for example.

You will need to evaluate which method is best for your organisation. Do you already have any services from third party vendors that consolidate your supplier or categorisation data that you want exploit? Do you already have in-house skills? Will you be starting the process of cleansing and classifying data from a large number of sources for the very first time? Whatever your situation and whatever you choose, some validation and correction of your data classification will be required in order to satisfy your business requirements. Although this may seem time consuming, it is hugely beneficial and likely essential to make your implementation a success.

Can I run SAP SPM on In-Memory technologies like SAP HANA or
SAP Business Warehouse Accelerator (BWA)?

Yes. As SAP SPM is based on SAP BW, you can index your data on SAP BWA to significantly improve reporting performance.

SAP SPM has recently been certified on SAP BW on HANA by SAP. If SAP HANA isn't an option for your organisation just yet, you can install SAP SPM in your BW landscape now and handle a migration to SAP BW on HANA later.

That's not to say of course that you need either of these technologies to make your implementation successful, it can help improve user adoption. If you have the right skills in your team, you can make some informed decisions regarding performance and performance optimisation.

Can I use SAP SPM as an operational reporting tool?

Yes and no. SAP SPM is certainly not intended to be used as an operational reporting tool. The user interface is designed for reporting aggregated data and not for 'data dump' style analysis. Additionally, if you're doing a lot of cleansing and classification of data, and depending on how you choose to do this, then daily data loading into SPM may not be suitable. As SAP SPM stores line item data it is possible to consume this in another application. In a customer recently we built other reports using other SAP technologies to allow them to pull out large data volumes to meet their operational requirements.

Can I use SAP SPM on mobile devices?

Not without using a different user interface. SAP SPM's user interface is designed for use on a desktop or laptop computer, and is not optimised for touch input on a tablet or mobile device. Being an Adobe Flash application, you will also be unable to run this on Apple/iOS devices. If your requirements are to display data on your mobile device, you will need another technology to display the data contained within SAP SPM, such as BusinessObjects Explorer. Being based on SAP BW, all of your data can be made available to mobile devices if you use the right user interface technology. A customer I am working with at the moment is currently consuming their SAP SPM data through data through a bespoke iPad application.

I've tried to address the most frequent questions that I've been asked and will continue to add to this as I go along. Are there any further questions that could be shared here? What are your experiences of working with SAP Spend Performance Management?

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Neil Bundy

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