Financial and operational planning processes in SAP BPC have unofficially come full circle since I first started using the software 11 years ago. At the time, our corporate accountants could key annual budget information into the SAP ERP 5.0 transaction codes so that they could run comparative reports while they closed the books during month-end. Additionally, the budget was originally created and forecasts were subsequently updated, using a BW-based planning product called SEM-BPS. This used ALV grid layouts in SAP GUI for users to key in data and macro-like buttons to run calculations on the data.
Well, eleven years later, and seven years after the first NetWeaver version of BPC, I find myself embarking on the same journey I did back in 2005 – I’m essentially a business user trying to enable a planning process using a primarily IT-managed software solution. Over the next few weeks and months, we’ll start to introduce the BPC Embedded Model Type (“BPC Embedded”) and BPC Optimized for S/4 HANA Finance (“BPC Optimized”), which are the latest additions to the SAP BPC family. These new solutions are essentially based on the functionality that was deployed back in SEM-BPS (and its successor BW Integrated Planning, or BW-IP for short).
Explaining the Nuances of Standard and Embedded
It’s easier to explain BPC Embedded by using the BW terminology that came along with SEM-BPS. I can then relate that to what I have seen in my years of implementing the traditional BPC Standard, which is the product that we’ve all come to know and finance users have come to love (for the most part). In SEM-BPS (and is the same in BPC Embedded), you first start with creating BW InfoObjects, which you may commonly call BW Characteristics. These Characteristics may be standard delivered content that SAP supplies when you install BW, such as 0GL_ACCOUNT, 0COMPANY, 0PROFIT_CTR, etc., or you can create custom Characteristics based on your own needs. When you create a Dimension in the BPC Standard front-end, behind the scenes the system creates a BW Characteristic for you and gives it a unique technical name.
Next, in order to store some transactional data, you must build an InfoProvider, the primary example of which is an InfoCube (another example would be a Data Store Object or DSO), during which time you assign InfoObjects to that InfoCube. Sound familiar? It should, because when you create a Model in BPC Standard, it creates that InfoCube for you behind the scenes, as well.
So far, so good – the process for build is fairly similar between BPC Standard and BPC Embedded, but where you do this work is quite different. Keep in mind that when you’re doing this development for BPC Embedded, you’re doing it in the SAP GUI screens of BW – primarily transaction RSA1. Building Characteristics and InfoCubes in BW, along with all the other objects that are required as part of the overall solution, is one of the reasons why BPC Embedded, like its SEM-BPS predecessor, is more likely to be ultimately owned by the IT function. SAP has enabled the BPC Standard HTML5 interface to work for BPC Embedded so that finance users can maintain members of the Characteristics. They have also recently added the ability to manage hierarchies from this web interface, but the initial creation of the Characteristics and InfoCube must be done in BW.
The Factor of Data Duplication
As mentioned above, there are several other objects which must be built to enable a finance user to get data into and manage their planning process using a BPC Embedded Model. This will be covered in more detail in future blog posts. At this point, you may be asking yourself why would anyone want to go with BPC Embedded over BPC Standard? One of the primary reasons that SAP points to is that data is replicated unnecessarily when using BPC Standard. Think about how we get Actual data into BPC Standard – for transactional data, we typically take ERP GL data and load it once into a BW InfoCube (aka staging cube), then use BPC data manager packages to load that data a second time into the BPC Standard Model. Similarly, BPC dimension members and hierarchies are loaded from BW master data objects (Characteristics!) after they have been sourced from SAP ERP. So, essentially, the Embedded Model type allows for the use of those BW InfoCubes and Characteristics directly without having to load the data twice. This saves time and storage space, especially for large customers.
Reviewing Additional Key Differentiators
Before we wrap up this initial blog post, let’s cover a few additional key points about these new wave—yet old school—products:
- The first key point is that in order to use either BPC Embedded or BPC Optimized, the customer must be using HANA as the underlying database. When it comes to BPC, if you’re not using HANA, your only option is to implement BPC Standard.
- The second key point is that for a customer to implement BPC Optimized, it must migrate its existing SAP ERP system to or be a fresh install of S/4 HANA. If a customer isn’t interested in taking this plunge just yet (as many aren’t), then Optimized is not an option.
- The third key point is that while it often gets referred to as an Embedded Model type, it is really an Embedded BPC Environment. This means it’s really a segregation at the highest level in BPC – you can have an Embedded BPC Environment on the same BW system as a Standard BPC Environment; however, you cannot have an Embedded Model inside of a Standard Environment.
- Lastly, you may have noticed that we didn’t really cover any functionality of BPC Optimized. That’s because BPC Optimized is very similar to a Rapid Deployment Solution, whereby it contains standard content that is delivered as part of S/4HANA Finance. This standard content is based on BPC Embedded – it comes with Characteristics, InfoCubes, and all the various other pieces and parts that users would need to replace the “old” SAP ERP planning screens that I first mentioned at the beginning of this blog post.
To learn more about BPC and how it can transform your finance department, read our white paper on achieving a faster financial close.