The Evidence for SAP Best Practices Claims

What This Article Covers

  • How SAP uses the Term “SAP Best Practices?”
  • The Evidence that SAP Software is Not in Fact Best Practice in many Areas.

Are best practices always in SAP software. 

Considering the SAP Best Practices Claims in Light of Their Actual Software R&D

I have worked in SAP APO since 2002 and never found anything in APO that did not exist in other vendors prior to SAP putting it into APO. Cost optimization, allocation, the statistical forecasting methods used by DP, in fact, everything in all the modules have been adopted by other vendors. However, if we broaden out the search for novel functionality to ERP, we can see that MRP and DRP were well established before SAP adopted them. There is nothing new in SAP BW either. In fact, SAP is one of the few vendors that partners with smaller software companies so they can specifically both co-opt their technology and build their own products from it. So SAP has copied its functionality from everywhere, however, I don’t think that is what SAP means when they refer to best practices.

Evidence That SAP Software Is Not Based on Best Practices

It’s clear that SAP primarily relied upon its customer base to justify best practice claims. Secondly, there are many areas of SAP that I am aware of that are simply not best practices. Here are some examples:

  1. SAP APO SPP uses DRP functionality in order to perform something called inventory balancing. However, DRP is no longer the best approach to performing this business process. The best practice is to use multi-echelon functionality. DRP plans all facilities as if they are independent of one another, which is a less accurate method of planning, and actually not an accurate reflection of reality. However, the problem is that SAP APO does not have it, while several best of breed vendors do.
  2. SAP APO DP has very few example of implementations using the characteristic based planning functionality. This is because it is so difficult to configure that it almost never is. It is also very weak in attribute forecasting. It is so infrequently used that one could question if DP is actually an attribute-based forecasting tool. I have used an application called Demand Works Smoothie that allows the entry of attributes into different columns in an import spreadsheet or database table. This allows for extremely easy to change attributes, something that is unheard of in SAP APO DP.
  3. SAP APO SNP only has one method by which to use service level to control stocking levels, which is dynamic safety stock. However, that is no longer the best practice. The best practice is to us inventory optimization, which SAP does not have, but best of breed vendors do have.
  4. BW has neither the ability to quickly make changes to the underlying data structures to support changes in the business nor the ability to provide best practice analytics. SAP would probably say that they have fixed this issue with the purchase of Business Objects. However, Business Objects also lacks best practices in this regard compared to competitors such as Tableau. Secondly, SAP claimed to have a best practice data warehouse back when they only owned BW. So if they already had all the data warehouse best practices, then why did they buy Business Objects again?
  5. PP/DS uses cost-based optimization and heuristics for developing the plan. However, neither one of these approaches is a best practice currently. Cost based optimization has failed to find success as an effective way of performing production planning and scheduling, and heuristics while better than purely manual methods are of low average effectiveness. Currently, the best practice in production planning and detailed scheduling is performing time or duration based optimization. However, SAP lacks this functionality. Other vendors have moved ahead of them, and SAP is offering old less effective technology to its clients and pretending it’s on the leading edge.

These are just a sampling. The areas in which SAP software does not have best practices just goes on and on.

Conclusion

SAP uses unsupported marketing concepts for business development in several major categories of their message to companies, but best practices might be the most effective. First of all the statement does not hold up against any analysis of SAP software, and second, it’s dangerous to assume that any software vendor is telling the truth regarding the idea that they have all the best ways of doing things already programmed into their business logic, so you don’t have to worry or question. Secondly, SAP is not clear as to what best practices are themselves and does not even take the time to keep the links on the topics updated.

References

http://help.sap.com/bp_dm604/BBlibrary/General/SAP_Best_Practices_overview_EN.pdf

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