TEC senior ERP analyst Ted Rohm takes a close look at SAP Business Suite on HANA one year after its debut. His report delves into the improvements SAP has been able to achieve by taking advantage of the HANA platform, and explores why SAP ERP powered by HANA is picking up so much momentum.
SAP Business Suite powered by SAP HANA was publicly launched a little over a year ago. The messaging around SAP Business Suite on HANA (SoH) is that organizations can realize smarter business innovations, faster business processes, and have simpler business interactions. In general with software vendors, messaging is all well and good, but often the hype doesn’t quite match what is delivered by the vendor. However, with SAP Business Suite powered by HANA, SAP is not only delivering on the messaging but is in ways exceeding even its own expectations.
In this report, we’ll dig into the improvements SAP has been able to achieve by taking advantage of the HANA platform, and explore why SAP ERP powered by HANA is picking up so much momentum. Salient points regarding SoH are that 1) HANA is more than just an in-memory database, it’s a next generation platform that goes beyond classical database management systems; 2) thanks to HANA, SAP has been able to fundamentally rethink and optimize core transactions and processes within the Business Suite; and 3) the combination of Fiori on the front-end and HANA on the back-end is enabling a whole new user experience for the Business Suite. These improvements, along with the overall adoption in the marketplace (both customers and partners), should convince organizations currently using the SAP Business Suite (or looking at moving onto SAP) to take a serious look at SAP Business Suite on HANA (SoH).
HANA—More Than Just a Screaming Fast In-memory Database
The HANA critics (and competition) might lead one to believe that HANA is nothing more than an in-memory database, with the argument that the benefits of HANA are really limited to performance improvements that can be done with any in-memory database/hardware solution. But HANA’s architecture offers much more than that—it enables hybrid transactional and analytical processing within a single database. Combining OLTP (online transaction processing) and OLAP (online analytical processing) into a single data store within HANA enables what SAP defines as a hybrid transactional and analytical (HTAP) platform, and is a true differentiating factor for HANA.
A major benefit of the HTAP platform is that it can store data in columns, making it an ideal choice for processing large amounts of data, much like an OLAP data store but without the need for the aggregates or indices like in a traditional OLAP data store. Because of HANA, SAP is able to not only improve Business Suite components’ performance dramatically, but also to operate multiple Business Suite components (such as ERP and SCM). Total cost of ownership benefits of SoH reported by SAP include reduced server costs (by 20–30%), reduced storage costs (by 30–60%), reduced SAP system landscapes, and reduced cost of business intelligence/reporting (by 20–30%), which all lead to reduced operating costs and more importantly increased user satisfaction.
Beyond the benefits of the HTAP platform, SAP HANA also includes a search engine, text analysis, a prediction engine, and other advanced capabilities. These engines have traditionally been deployed on satellite systems, requiring data replication and transfer mechanisms and therefore increasing complexity and creating additional costs. SAP Business Suite powered by HANA combines these capabilities into the one platform.
The integrated search engine with text analysis enables a paradigm shift on the front end. SAP sees that “search is the paradigm for information retrieval that has won the Web. All leading offerings operate on a combination of search and social, whereas traditional navigational approaches have fallen far behind.”1 The power of HANA allows interface designers and developers to create exciting new user experience based on this paradigm. The section below on the new SAP app collection leveraging Fiori shows how SAP is taking advantage of the front-end paradigm shift.
SAP Business Suite on HANA Process Improvements
The SAP Business Suite on HANA is not just a simple port of the code into SAP HANA. As SAP points out, “a simple port would have given measurable run-time improvements, but would not properly leverage the SAP HANA database architecture.”1 SAP has poured a significant amount of resources into optimizing core transactions and overall business processes. SAP analyzed the most frequently used transactions and has, to date, optimized 800 out of the 2000 most frequently used transactions.
One great example of these optimizations is the optimization of the Incomplete Sales Document Report, transaction RVAUFERR. The SAP HANA optimized version runs 1,290 times faster than the classical report. (The specific observed performance depends on configuration, data volumes, and data constellation.) In sales and distribution (SD), the classical rebates process uses the database table VBOX, a materialized index table that stores redundant data and conditions. In extreme cases, SAP customers have VBOX table sizes in the terabyte range to store billions of records. With SAP HANA, the use of VBOX and supporting table indexes can be eliminated, because in HANA, every attribute of the database tables can be accessed incredibly fast without the need for additional indexes.
A graphical example of how major business processes have been optimized on HANA is shown below. This example shows demand and supply planning for the manufacturing process. Because of HANA, a significant number of transactions in the process have become obsolete and the remaining transactions run faster by upwards of a factor of 10. The resulting expected benefits include a 50% reduction in general ledger (GL) posting corrections, 60% reduction in time to reconcile revenue issues, and a 70% reduction in the time to resolve allocations.
Figure 1: Business process improvements enabled via SoH
1 Fundamentals of SAP Business Suite powered by SAP HANA. SAP Fact Book. 2014.