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Hello again,

now that we are past the launch mile stone at SAPPHIRE NOW Madrid, I'd like to continue this blog series with a bit more detail on the design principles of SAP Financials OnDemand that enable the solution to deliver insight and openness "by design" (pun intended).

Let's start with the topic of insight by design. How is it done? The following image might help to illustrate the concept.

The fundamental idea of SAP Financials OnDemand is based on the concept of making information relevant to each business consumer, by bringing information to them in context of their business objectives or KPI's, and then allowing them to take instant action on the insights they have obtained. This is made possible by a central journal powered by SAP HANA technology. This journal acts as repository of all journal entries which are enriched and tagged with all relevant attributes to enable flexible and instant data aggregation into a single source of truth. SAP Financials OnDemand goes beyond typical core financial management systems in that it allows an end-to-end view by including basic order and purchase management capabilities. On the other hand, SAP Financials OnDemand is also a "classical" financial management system optimized for the CFO by providing financial accounting, management accounting and financial performance management and even project management in a single solution. What are the benefits of this people-centric design, based on a single source of truth? CFO's don't need to establish a separate data warehouse for financial data. Information is instantly available, allowing multi-dimensional reporting along transaction tags based on common master data. This a key benefit for financial departments who often employ dedicated teams just for financial reconciliations. These resources can now be freed up to deliver relevant and KPI-specific information into the hands of the business consumer, in their specific context, in real time.

Another important aspect of SAP Financials OnDemand is openness by design. The following image illustrates the concept:

The analogy we are using here is that of a power plug multi-socket. The fundamental functions of SAP Financials OnDemand such as General Ledger (GL), Accounts Receivable (AR), Accounts Payable (AP), Financial Accounting (FA), Management Accounting, Financial Performance Management, Cash and Asset Management, Financial Closing as well as Reporting and Analytics are all extensible through open interfaces. This open architecture of SAP Financials OnDemand was inherited from SAP Business ByDesign which was architected around the concept of flexible deployment units and integration scenarios. In contrast to SAP Business ByDesign, the sub-ledgers of SAP Financials OnDemand are not "fed" by the other deployment units of an integral suite, but can be fed from remote components providing functionalities such as Order to Cash (OTC), Procure to Pay (PTP), Customer Relationship Management (CRM), Human Capital Management with Employee Central (EC), Supplier Relationship Management with Ariba or any other system by using Integration on demand. In this way, SAP Financials OnDemand forms a fiancial core for "Best Of" suite components that some analysts call this capability an "Administrative ERP". Through the use of open integration interfaces that can be wrapped in Web Services and can use multiple transport layers for communication including SAP HANA Cloud integration or partner solutions, SAP Financials OnDemand can be easily integrated within the SAP Portfolio, both to on premise and cloud solutions. In terms of integration to 3rd party solutions, SAP will deliver the interface specifications and integration content to partners who can then apply their solution expertise to deliver certified adapters to any interesting 3rd party component.

Using these 2 key principles (1) insight by design and (2) openness by design SAP can deliver a modern financials solution for the cloud that is not only optimized for the CFO, but can be tailored to the business consumer in an increasingly mobile workforce who demand the ability to go from insight to action in real real time.

For a less technical view of how this might empower the business consumer, I have included a 6 minute interview from SAPPHIRE NOW

As always, I look forward to your questions and comments

CHHO, Walldorf, 21 November 2012