Supply chain: why and how to switch from SAP APO to SAP IBP?

The adoption of SAP Integrated Business Planning is a key element in the modernization of the supply chain, particularly when combined with the intelligent ERP SAP S/4HANA. SAP IBP offers major advances in terms of collaboration, simulation and plan valorization

Nowadays supply chains get by new challenges : volatile demand, increasing globalization and the growing complexity of logistics chains. To meet these challenges, we need to set up an extended supply chain, where information can flow unhindered from end to end.

Many companies still work in silos, with teams focusing respectively on demand management, production, logistics, finance and so on. SAP Integrated Business Planning (SAP IBP) is a crucial tool to help supply chain players improve their processes by ensuring that they share information, to help align and converge the different plans: demand, production and finance.

This improved collaboration – both inside and outside the company – will lead to an increase in arbitration requests. SAP IBP makes it easy to create scenarios, so you can evaluate each hypothesis and make the best possible decision. This simulation aspect will help to align the various plans (demand, production and finance), resulting in improved customer satisfaction, company efficiency and sales.

The whole system is fully automated, to accelerate planning cycles and provide end-to-end supply chain visibility. A control tower makes it easy to escalate alerts and take them into account.

Modernize your supply chain with SAP IBP

Three key aspects of SAP IBP will be of interest to users of SAP Advanced Demand Planning & Supply Chain Optimization (SAP APO):

• The simulation aspect: it only takes a few minutes to create a simulation and share it with colleagues.
• The collaboration aspect : collaboration is made possible internally through SAP Jam, but also with external partners, via the SAP Ariba Supply Chain Collaboration portal.
• The valuation aspect : each plan can be valued, to simplify reconciliation with budget plans.

SAP APO users will also enjoy major technical benefits when switching to SAP IBP:

• Far more comprehensive coverage of business processes: S&OP, MPS, MRP, DRP, DDMRP… But also support for inventory optimization processes.
• A redesigned, more ergonomic and accessible user interface, based on SAP Fiori, but also on Microsoft Excel, well known to users. Note that the data is still managed by SAP IBP at all times.
• Significantly reduced calculation times thanks to the use of the SAP HANA in-memory database. Some calculations that used to take ten hours can now be carried out… in just ten minutes.
• End-to-end integration, from planning to execution. SAP IBP can interact with the intelligent ERP SAP S/4HANA, but also with offerings such as SAP S/4HANA, SAP Ariba or any other SAP or non-SAP solution.
• The presence of innovative technologies to meet new supply chain challenges: machine learning, demand sensing, advanced forecasting, etc.

When and how to migrate to SAP IBP?

There are several reasons why companies may want to migrate from SAP APO to SAP IBP These included: the desire to cover new processes, such as S&OP (Sales and Operations Planning); the wish to optimize an existing process, whose support by SAP APO no longer met the company’s expectations; a global IS transformation strategy aimed at switching from SAP APO+ECC to SAP IBP+S/4HANA.

It’s perfectly possible to switch over to SAP IBP gradually. This is all the more important as two processes supported by SAP APO are now also supported by the SAP S/4HANA ERP: detailed production scheduling (PP/DS – Production Planning / Detailled Scheduling) and confirmation of customer requests (aATP – Adanced Available to Promise).

If you’re not planning to switch to SAP S/4HANA intelligent ERP, you’ll need to retain SAP APO to cover these processes, or opt for an intermediate solution: SAP S/4HANA Manufacturing for Planning & Scheduling Digital Suppply Chain Edition.

TeamWork has developed a methodology to support organizations in their thinking process. It comprises four stages:

• An inventory of IS and business needs (current and target).
• A detailed explanation of the SAP roadmap, the new solutions available and their benefits.
• A more detailed IS analysis, with specific workshops to determine what SAP IBP can do for each process.
• Identification of priority processes, and implementation of the transition strategy and roadmap.

During this final stage, a POC is proposed, focusing on a specific business case or process. It allows you to discover the practical advantages of SAP IBP, and thus to be reassured while having a demonstrator that will help promote the project internally. Excluding POC, this transition study remains a short project, lasting – depending on the SAP APO scope covered by the organization – between one and three weeks.