Building an Automotive Value Chain with SAP S/4HANA

Automotive

Through this post, we are going to take a deep dive along the automotive chain and understand where we can improve the value chain in India with SAP S/4HANA.

Product Innovation

Current challenges

  • Low brand equity and stagnation due to time-lag in selecting and bringing novel concepts to the Indian market or unsuccessful vehicle and product initiatives.  
  • High downstream costs leading to surging market prices
  • Ineffective collaboration leading to complex configurations
  • Lack of visibility between the plant floor and management leading to information loss along the end-to-end process

Capabilities of SAP S/4HANA

  • Sustainable innovation and development, increasing reuse
  • Investing in projects that show promise
  • Context-sensitive analytics, transparency and complete knowledge of downstream costs leading to increased profit
  • Intuitive, user-friendly, customizable user interface with enhanced analytics capabilities and simulation for efficient user experience
  • Vehicle components, the vehicle, and the ecosystem will reach markets with a compatibility assurance

Benefits with SAP S/4HANA

  • With faster time to market and fewer project cost overruns, there is increased revenue from new products
  • Accelerated product development reducing manufacturing cost
  • Improved margins due to personalized made-to-order product development
  • Reduced manual rework in manufacturing allows target costs to meet real customer needs

Operations and logistics

Challenges

  • Ineffective planning leading to drawn-out production runs in the Indian landscape
  • Complex analysis of planning situations with difficulty in changing focus and scope of quality management
  • Problems with maintaining end-to-end quality due to interrupted material flow resulting in inefficient operations
  • Managing “lot size of one” is a high-cost endeavour due to poor logistics and operations.

Capabilities of SAP S/4HANA

  • With zero requirements of run coordination between finite and infinite planning, SAP S/4HANA offers a single run supporting both detailed scheduling and MRP.
  • Harmonizing requirements to the production schedule together with the supplier ‒ for example, ensures an optimal inventory
  • Using production planning and detailed scheduling in SAP S/4HANA to create constraint-based planning (capacity and resource) generates a precise production plan using various metrics
  • Integrated and simplified solutions deliver streamlined quality management capabilities
  • Efficient integration between engineering and manufacturing helps change impact analysis and change record apps

Benefits with SAP S/4HANA

  • Faster manufacturing cycle time due to improved manufacturing planning function efficiency leading to reduced total manufacturing costs.
  • Improved and increased on-time delivery performance
  • Less revenue loss due to fulfilment issues, quality, and compliance issues
  • Sustainable development with reduced scrap and rework
  • Streamlined, efficient hand-over process enables new revenue potential through personalized products and/or new business models

Supply Chain

Challenges

  • Archaic and inefficient planning failing to include evolving, real-time demands of the Indian landscape in the planning run
  • Lack of control over materials and visibility across the network
  • Lack of real-time monitoring and batch-based processes leading to poor on-time delivery performance
  • A single platform to manage an increasingly complex, multimodal, global transportation needs
  • No track and trace capabilities leading to lack of end-to-end visibility

Capabilities of SAP S/4HANA

  • Managing omnichannel demands through the real-time order management platform
  • Real-time visibility of order changes in demand without waiting for time-consuming batch runs
  • Integration of various parts of the supply chain prioritizes orders
  • All warehousing operations from optimization, automation, and labour management are on a single platform enabled with the SAP Extended Warehouse Management (SAP EWM) application embedded in SAP S/4HANA
  • Basic and advanced shipping functionality and real-time analytics are available on a single platform.
  • Real-time tracking helps identify and address issues in-transit through collaboration with partners

Benefits

  • Accurate forecasts from SAP S/4HANA reduce the cost of demand planning and forecasting. This, in turn, provides a better lead time for order fulfilment.
  • Increased inventory accuracy leading to reduced warehouse operating cost
  • Landscape simplification lowers TCO
  • With effective transportation management, total logistics cost is lowered.

Marketing and sales

Challenges

  • Lack of visibility into the order management process increases the risk of delayed delivery and slow resolution of order fulfilment issues
  • Hard to monitor performance due to lack of immediate transparency in order-to-cash process performance
  • Complex user interfaces challenge casual users leading to lengthy up-skilling
  • Selling low-availability products gets tedious with complex user-interface leading to complicated rebate processing

Capabilities of SAP S/4HANA

  • New sales order fulfilment monitor for the Indian landscape providing a prioritized list with key characteristics of outstanding sales orders based on real-time information
  • Relevant insights and collaboration features by SAP S/4HANA helps internal sales professionals and management. This helps identify performance trends with a flexible analytics framework.
  • Real-time transactional data monitors order-to-cash process performance and delivers predefined performance key performance indicator (KPI) overviews
  • New strategies for back-order processing with support for high volume and confirmation of business priority is made possible through advanced ATP

Benefits

  • Increased on-time delivery performance with improved order management and productivity of FTEs
  • Sales and sales training costs are reduced
  • Increased performance efficiency reducing revenue loss by faster onboarding through higher sales transactions
  • Greater sales quotation productivity reducing order-to-cash costs
  • Reducing sales order lead times with intuitive, intelligent demand classification of back orders leading to fewer overpayments of sales rebate
  • Increased productivity of rebates receivables and claims processing FTEs

Mobility and Transportation

Challenges

  • New business and monetization models within the Indian landscape require support  
  • Complicated billing systems to combine invoices from different sources on a single invoice
  • Inaccurate billing and dissatisfied customers due to the inefficient collection of high-volume usage across service platforms with new business models
  • Mobility service solutions require Big Data from connected vehicles to function
  • Creation of an open industry business network necessitates a close integration between cross-industry players in the ecosystem

Capabilities of SAP S/4HANA

  • Generate a single invoice from SAP S/4HANA that combines goods, services, and external data
  • Streamlined operations supporting a high volume of subscriptions and usage with a scalable, service-agnostic billing engine
  • Enabling internal business processes with a feedback loop
  • Connecting digital products in the field with available vehicle networks
  • Providing support for products and performance-based services
  • Monitoring remote conditions and performance with support for predictive services

Benefits

  • Digital product offerings extends traditional business models
  • Increased customer satisfaction leading to increased revenue due to new services
  • Lower operating costs leading to reduced revenue loss

Get in touch with itelligence, an SAP Platinum Partner, for a free expert consultation on SAP S/4HANA.

 

Similar posts

Read more
SAP Trends
Read more
Read more
Read more
Read more
Read more

Contact Us
Contact Us

Have questions? Please contact us.