COST PLANNING, BUDGETING & REPORTING WITH SAP BPC · PDF fileCOST PLANNING, BUDGETING &...
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COST PLANNING, BUDGETING & REPORTING WITH SAP BPC ON HANA Speakers : Onnik Istepanyan, Program Head Adam Salem, Project Manager
Transcript of COST PLANNING, BUDGETING & REPORTING WITH SAP BPC · PDF fileCOST PLANNING, BUDGETING &...
COST PLANNING, BUDGETING & REPORTING WITH SAP BPC ON HANA
Speakers:
Onnik Istepanyan, Program Head
Adam Salem, Project Manager
AGENDA
1. PMI – THE COMPANY
2. THE PROGRAM BRIEF
3. ACHIEVEMENTS WITH SAP BPC 10.1 ON HANA
4. LEARNINGS
5. IN SUMMARY
1. PMI - THE COMPANY
Philip Morris International Inc.
(PMI), which spun-off from Altria
Group in March 2008, is a U.S.
corporation with its headquarters
in New York and operations center
in Lausanne, Switzerland
PMI OVERVIEW
Philip Morris International Inc.
(PMI), which spun-off from Altria
Group in March 2008, is a U.S.
corporation with its headquarters
in New York and operations center
in Lausanne, Switzerland
The leading international tobacco company with products sold in more than 180 countries and six of the top 15 global brands
PMI OVERVIEW
Philip Morris International Inc.
(PMI), which spun-off from Altria
Group in March 2008, is a U.S.
corporation with its headquarters
in New York and operations center
in Lausanne, Switzerland
The leadinginternational tobaccocompany with products sold in more than 180 countries and seven of the top 15 global brands
In 2015, an estimated 15.6% share of the total international cigarette market outside the United States, or 28.7% excluding China and the United States
PMI OVERVIEW
PMI’S CIGARETTE BRAND PORTFOLIO
Note: Pack designs are for illustrative purposes only
Mid-Price
Premium &
Above
Local HeritageInternational
Low-Price
THE WORLD OF PMI IS CHANGING – RRP’S: OUR NEW PRODUCT PLATFORMS
With or without
tobacco
With or without
electronics
Burning tobacco generates many
harmful or potentially harmful
components “HPHC’s”
Heat tobacco rather than burn
it to significantly reduce level
of HPHC’s
Our research is based on
state of the art
methodologies inspired by
pharmaceutical industry
best practices
A range of products to
address all consumer
preferences
Eliminating combustion is
the most promising path
to risk reduction for
smokers who don’t quit
Significant investment in
risk-reduction
substantiation
Platform 1
iQOS
Platform 2
Platform 3
Platform 4
Heated Tobacco Products
Nicotine-Containing Products
Note: Reduced-Risk Products ("RRPs") is the term the company uses to refer to products with the potential to reduce individual risk and population harm in comparison to smoking cigarettes. The products depicted are subject
to ongoing development and therefore the visuals are illustrative and do not necessarily represent the latest stages of product development
2. THE PROGRAM BRIEF
TOP FIVE PROBLEMS FACED IN COSTING
• Excel was the main tool for SVC budgeting, reporting and variance analysis
• Huge amount of data used for SVC budgeting, informal and requiring manual controls
• Deviations allocated by volume to SKU, losing the link to business drivers
• Impossibility to ensure that changing business assumptions were reflected in budgeting
• The Excel costing model was simplistic and missing key information
PROGRAM GOALS
• Standardize and Optimize the existing processes and systems portfolio for SVC budgeting & reporting
• Enable Actual costing by SKU with Material Ledger implementation in our SAP ECC
• Simplify reporting and variance analysis
• Enable costing simulations and forward looking scenario analysis
• Develop a tool which facilitates the life of all involved parties
SOLUTION OVERVIEW
BUDGETING
MANAGEMENT REPORTING
SAP BPC (10.1)
BW / HANA
Our program is composed of 2 projects
• GSVC project focusing on building a standard solution across
PMI for Budgeting and Management Reporting
• Actual Costing project focusing on deploying in our 4 regional
SAP systems a standard solution (Material Ledger) to enable
Management Reporting
ECC LA
ERP
ECC WE
ERP
ECC EE
ERP
ECC AP
ERP
Regional SAP Systems
THE JOURNEY
Future
requirements
gathering and
To Be process
validations
Q1, 2013
GSVC
Budgeting
module Design
Q3, Q4 2013
AS IS process
mapping
Q1-Q3, 2012
Costing methodology
review Q4, 2012
Go-Live Pilot for
Budgeting
Module BPC 10
Q2, 2014
Worldwide
Go-Live of
Budgeting
module with
migration to
BPC 10.1
Q2, 2015
Actual
Reporting
Design
Q1, 2016
Variance
Analysis
module Design
Q2, 2016
Go-Live Actual
Reporting &
Variance
Analysis
modules
worldwide
Q4, 2016
In parallel as of Q1 2015, we have deployed in our 4 Regional SAP ECC, Material Ledger module in a
standardize manner (25 Affiliates), planned to be finalized in Q4, 2016
Today
3. ACHIEVEMENTS WITH SAP BPC 10.1 ON HANA
KEY IMPROVEMENTS
ONE SOURCE OF TRUTH
COST VISIBILITY
INTEGRATION
&
AUTOMATION
PROCESS
CONTROLVARIANCE
BY DRIVER
DEMO ON BUDGETING MODULE
ACHIEVED RESULTS
• GSVC is now used in 42 Production Centers worldwide
• Around 7’000 SKU were successfully budgeted between August to November 2015
• Several millions of calculations steps are effectively processed during budgeting
• Budget cycle can now be performed in 2 months instead of 6 month previously
• The new solution allows to update most of our assumptions centrally and simulates budget assumption
changes very promptly (i.e. price, currency change….)
FEED BACKS GATHERED VIA A SURVEY ISSUED AFTER THE BUDGETING PROCESS
DATA
INTEGRATION CALCULATION
AUTOMATION ONE
SOURCE OF
TRUTH
SEGREGATION
OF DUTY
ASSUMPTION
VALIDATION
BASE FOR
VARIANCE
ANALYSIS
PROCESS
CONTROLS
Benefits Expressed
by our Affiliates
4. LEARNING’S
KEY LEARNING
• This is a Business Transformation project and Change management is key
• Once end users will understand benefits of the solution/process, they will have a growing appetite for changes
• Have the right partner when you start a transformation project journey with a new solution
• Migration between new SAP versions can be challenging (BPC 10.0 vs 10.1, no migration path existed when we did this exercise)
• Never under estimate :
• Data Modeling with a new solution
• Technical challenges and effort for Functional Design Phase
• Follow SAP guidelines/Best Practices for Modelling, Data integration/Staging, Security and Reporting
5. IN SUMMARY
DIGITALIZATION – WHAT ARE THE IMPACTS TO PMI ?
• We started the Finance Transformation journey by being the first team using SAP HANA technology in PMI
• Without having SAP BCP 10.1 on HANA our achievements would have been difficult
• Digitization has a strong impact on how we act and interact and work together on costing processes
• We are moving from Excel/standalone files to collaborative business communities/functions
• We brought together transactional records and analytics onto one platform
THANK YOU
Speakers:
Onnik Istepanyan
Head of Operations Finance Projects at Philip Morris International
Email: [email protected]
Adam Salem
Project Manager Operations Finance at Philip Morris International
Email: [email protected]
