Delivering profitable Projects and Manage Client Relationships in Advertising with SAP Commercial...

Delivering profitable Projects and Manage Client

Relationships in Advertising with SAP Commercial

Project Management

May 2014

SAP Point of View

Executive Summary

Profitable Projects are the Key to

Improving Firm’s Margins

Revenue and Margins are under pressure in the Advertising Industry.

Cost containment and margin improvement are a key priorities.

Business is evolving with new fee arrangements, increased client

sophistication, and the commoditization of services. Firms are faced

with managing a global workforce to deliver global services while

encountering more and more competition. New disruptive

technologies, such as social, mobile, Big Data, and cloud, are not just

changing the way you run your business, but also the services you

deliver to your clients. To improve project and overall firm margins, you

must produce reliable and accurate bids and deliver quality services,

globally, through repeatable processes.

Advertising Networks and Agencies can benefit from the advantages

and opportunities provided by SAP Commercial Project Management

and reinvent the way they sell and deliver their services with SAP as a

key enabler.

Resulting from a reduction in system breaks and data redundancies, a

single version of truth about resource utilization will lead to higher

accountability, better decision quality, increased agility, and ultimately

to grow project margins.

SAP can support Advertising Networks and Agencies in achieving

these benefits with a single, integrated, standard application on one

platform, which is:

• Integrated solution for the complete project lifecycle (bid phase,

planning phase, execution phase)

• Enhanced productivity of team members, less time spent searching

and more time spent on value-added tasks

• Increased visibility and transparency into cost drivers, productivity

and profitability of a project

• Better decision-making based on up-to-date and accurate

information

Executive Summary

©2014 SAP AG or an SAP affiliate company. All rights reserved. | 2

The Current Market Reality

Challenges for Commercial Project Management

in the 21st Century

Our Understanding

80% of Project Profitability is

Determined at the Bid Stage

Winning the business is paramount. However,

you need to win the business with bids that

are accurate so as to achieve the

projected margins.

Many projects are not profitable at the outset

due to:

• Failure to reuse previously successful bids

• Lack of transparency into actual project and

service profitability.

>50% of all Projects are not

Delivered as Planned

Once you win the business with an accurate bid,

you need to execute project according to the plan.

There are a number of areas where things can

and do go wrong:

• Time-consuming project analysis and progress

monitoring

• Limited proactive alerts

• Lack of visibility across all commercial aspects

of the project

• Deviations in costs, time, resources are detected

too late


Delivery Client Value Profitably with SAP Commercial

Project Management

Our Understanding

SAP Commercial Project Management helps Advertising Agencies maximize profitability

through the entire project lifecycle – from bid, to planning, executing, and monitor and

controlling – by producing reliable and accurate bids and delivering quality services, globally,

through repeatable processes.

• Increase employee productivity through

highly flexible workspaces that consolidate

data access across applications and systems

based on user role

• Enhance commercial project profitability

through improved insight, control, and

optimized process efficiency.

10% Increased win rate

• Reduce project risks through improved

transparency and data consistency

• Increase your customers’ satisfaction through

better quality and faster response times enabled

by enhanced process standardization

0.5% Increased profitability


Key Industry Metrics

SAP helps advertising agencies optimize their business processes through the SAP performance benchmarking

program. The following key performance indicators (KPIs) and best practices come from our benchmarking

database and show a strong correlation – the ability to better implement these best practices will improve the

resulting metrics. SAP’s solutions enable Advertising companies to do just that.

Source: SAP performance benchmarking

Disclaimer: https://valuemanagement.sap.com/disclaimer

Our Understanding


Best Practice Low Coverage High Coverage

Lower Sales FTE Cost (% of revenue) for organizations where

complex projects are managed effectively by seamlessly

integrating project and resource management capabilities

Lower Sales FTE Cost (% of revenue)

Higher Revenue Growth for organizations where cost and

profitability reports are generated to the level of product,

channel and client

Higher Revenue Growth (in %)

Lower SG&A Expenses for organizations where product,

channel and client profitability is reviewed on a regular basis

to develop strategies for improvement

Lower SG&A Expenses (% of spend)

More billable time spent for project management resources by

the top 25% of services companies as compared to average

services companies

More billable time (% of revenue)

Lower IT spend for organizations with a consolidated single

solution/platform landscape

IT Spend (% of revenue)

+40%

+56%

-29%

-12%

-24%

https://valuemanagement.sap.com/disclaimer

https://valuemanagement.sap.com/disclaimer

Maximize Profit Throughout the Project Lifecycle Using

SAP Commercial Project Management

The SAP Solution

Project financial

planning:

• Planning and forecasting of

quantities, costs, and

revenues

• Support for planning

resources, materials,

expenses/3rd party

• Flexible and user-friendly

user interfaces (e.g. Excel

front end)

Project issue and

change management:

• Recording and tracking of

project issues and

change requests

• Cost and revenue change

planning

• Integration with document

management capabilities

Project

workspace:

• Provide an integrated

view of the project

• Embedded analytics

• Enhanced project

management (status,

alerts, trends)

• Enhanced billing

scenarios


SAP CPM Project Financial Planning functionality simplifies process integration and

collaboration across departments in a non-disruptive manner.

Solution Capabilities Benefits

• Planning and forecasting of quantities, costs

and revenues through the complete project

lifecycle (bid stage, base line planning,

execution)

High-level estimates in bid stage based on

bid structure

Detailed baseline cost and revenue plans

(optionally based on execution structure in

ERP PS)

Forecasting and ETC processes during

project execution

• Support for planning resources, materials,

expenses and 3rd party

• Flexible and user-friendly user interfaces (e.g.

support of Excel frontend)

• Integrated solution for the complete project

lifecycle (bid phase, planning phase, execution

phase) allows a consistent planning with

progressing level of detail, leading to

Increased accuracy of bid estimates

Increased traceability of bid estimates and

baseline plans in comparison with actuals

And finally, increased project profitability

• Increased visibility and transparency into cost

drivers, productivity and profitability of a project

• Increase operational efficiency and agility

• Operate a modern IT platform with higher value

and lower TCO

Project Financial Planning Benefits and Solution Scope

The SAP Solution


SAP CPM Project Workspace provides an integrated view across systems and applications in

order to support the user to complete his tasks.

Project Workspace Benefits and Solution Scope

The SAP Solution

Solution Capabilities Benefits

• Comprehensive and bundled view on existing

business objects that includes Opportunities,

Orders and Projects via new master project

veiw (object)

• Configurable views and reports on project

data dependent on user role and project stage

• Pre-delivered content like project overview,

project commercials, issue and change

management and financial planning

• Enhanced Project Contract Management

(Rate Card, Billing Plan Manager)

• New functionality (e.g. Status Management,

Roles & Responsibilities)

• Native integration with document

management solutions providing a complete

view of unstructured and structured data

• Better decision-making based on up-to-date

and accurate information

• Enhanced productivity of team members, less

time spent searching and more time spent on

value-added tasks

• Improved user experience, unified across all

aspects of handling projects

• Enhanced transparency about project status

allows tighter monitoring and control to reduce

project risks

• Support for critical activities, like WIP

management, ETC, Purchasing, and Resource

Staffing


Customer Example: Top Tier Professional Services Firm

Leverages SAP Commercial Project Management Across

Divisions

The SAP Solution

This professional services firm’s objective is to have a standard solution for the

entire opportunity-to-cash process that supports all divisions and service lines

across the globe.

Reasons why SAP Commercial Project Management

was selected: • Standard Solution

• Flexible and extensible to meet each company’s unique

requirements, including different divisions and service

lines

• Integrates well with SAP back-end order management

and pricing, as well as resource scheduling tool

• Great usability (employees favor the Excel user

interface for planning)

SAP Commercial Project Management means: • Improved offer win rates

• Increased bid reliability and accuracy

• Increased project profitability

• Reduced project failure


SAP Innovations Support the Entire Project Lifecycle

Monitor & Control Execute Plan Bid

Collaborate on

successful bids using

historical project

data and deep client

insights

Deploy a globally

integrated service

delivery platform to

achieve operational

excellence

Utilize a highly secure

mobile platform that

allows you to monitor

and execute projects

anytime, anywhere,

using any device

Embedded real-time

analytics, including

resource utilization,

WIP and receivables,

and project

profitability

Take advantage of

the ultimate platform

for innovating new

service lines and

improving

operational efficiency

BIG DATA/

ANALYTICS

MOBILE CLOUD

DATABASE &

TECHNOLOGY

APPLICATIONS

The SAP Solution


Why SAP?

SAP’s vision is to help the world run better and improve people’s lives. Our

mission is to help every customer become a best-run business.

We are the market leader in enterprise application software, with more than

253,000 customers across 180 countries. Our solutions and services are

today’s business enablers, and we continuously co-innovate with customers

to help them address the needs of tomorrow.

Our media solution portfolio provides: • A comprehensive, end-to-end solution on a modern architecture

• Deep industry experience and customer base • Excellent customer references with tangible results • Platform for the 21st century: Innovations to support your business model

today and in the future

Our inspiration: “We remain focused on the success of our

customers – they are at the heart of our ambitions. The passion of

SAP employees has brought amazing momentum…our best-ever

financial results…are testament to our strategic direction, our

customer orientation, and our world-class employees.”

Bill McDermott, CEO, SAP

Why SAP?


More than 8,400 media companies in 89 countries are

innovating with SAP solutions.

100% of the advertising companies in the Forbes

Global 2000 are SAP customers.

Summary & Next Steps

Your Transformation Starts Now

The potential to increase project professionals’ productivity and improve project profitability with

SAP Commercial Project Management is enormous. Our solution can increase reliability of bids,

improve tracking of actuals against plan, and help you forecast effectively. It can increase

transparency and control of project issues and changes and improve visibility to cost drivers,

productivity, and profitability of projects

Experience the solution yourself at the next

local SAP event. Visit the SAP

global events calendar.

Contact your account team

to schedule a meeting.

Engage with SAP in Design

thinking workshops.

Initiate the benchmarking process

with a free value

assessment at

valuemanagement.sap.com/


Next Steps

www.sap.com/contactsap

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and may not be disclosed without the permission of SAP. This presentation

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develop or release any functionality mentioned therein. This document, or

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developments, products and or platforms directions and functionality are all

subject to change and may be changed by SAP at any time for any reason

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estimated costs and benefits of the predicted delivery project. These

materials may be based upon information provided by you, information

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These materials present illustrations of potential performance and cost

savings, and do not guaranty future results, performance or cost savings.

SAP assumes no responsibility for errors or omissions in this document,

except if such damages were caused by SAP´s willful misconduct or gross

negligence.

All forward-looking statements are subject to various risks and uncertainties

that could cause actual results to differ materially from expectations.

Readers are cautioned not to place undue reliance on these forward-looking

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relied upon in making purchasing decisions.

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Delivering profitable Projects and Manage Client Relationships in Advertising with SAP Commercial...

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