The main benefit of an integrated solution is better information to support crucial business decisions. Simply obtaining information may improve the way your business operates. For example, if your employees know that their Internet browsing activity is tracked, the quality of the sites they visit will improve. The same applies to your business system. In this chapter, we will see the key aspects of a reporting strategy. As part of that, we will touch upon all of the features in the SAP Business ONE application that are relevant for reporting. In the process, the following areas will be covered:
- Reporting architecture and its forward-looking vision – How does it fit in? I will explain the key role reporting plays within your SAP solution.
- Real-time reporting – The information in SAP is real time. What does this mean for your reporting strategy? We will look at how information can be categorized in SAP.
- BI – What is BI? We will look at the core aspect of what BI means for your reporting strategy.
- The difference between data and information – Let’s not forget that we are seeking information. Data is not equal to information in this sense.
- UDFs – We will take a thorough look at UDFs. UDFs are key aspects of every SAP implementation, and you will be able to understand their purpose and create your own.
- Reporting strategy – How can you apply the concepts in this chapter to your own project? I will help you understand the key aspects of a successful reporting strategy for your business.
Reporting architecture
What is reporting? Reporting is the analysis or slicing and dicing of business data to identify key performance indicators. These key indicators are used to navigate your business through the ever-changing challenges it encounters during operation.
The true value of a system, such as SAP Business ONE, can be evaluated when it comes to reporting against the data that was collected during its operation. Remember the settings we discussed in the Financials section, such as the Chart of Accounts settings? This was the financial skeleton that we established, which will eventually hold all of the financial data. This system has to comply with the local legal requirements and it uses the so-called double-entry bookkeeping system. In this system, each transaction is represented by a monetary value associated with a credit and a debit that are of equal value.
The accounting skeleton collects all of the relevant data based on the transactions entered in the system with the underlying G/L Account Determination settings. Consequently, all transactions will be documented in the Chart of Accounts as per our settings in the “G/L Determination Settings”.
This is the first crucial aspect to understand when it comes to reporting. SAP Business ONE provides a reporting system based on double-entry bookkeeping accounts, plus the system settings that help us collect key performance data about the business.
Reporting requires a forward-looking vision
The art of reporting lies in a forward-looking vision that prepares the system with additional fields and parameters to collect relevant data as we operate our business. For example, we may sell lemonade as a part of the business. However, it may be a good idea to categorize the type of lemonade we sell to later analyze which type of product had the best sales. In addition, we may categorize the location where we sold the final product. To further apply our case study, we may also want to run a report on a per-salesperson basis to gain information about the salespeople’s performance. It is often quickly decided who the best customers are. Business owners commonly take pride in knowing this. However, it is a good idea to include all of the available information and analyze the data. For example, who may look like a good customer because of the fact that they are responsible for most of our workload, may not lead to most of the businesses’ profit.
A customer may return products often, or complain about them. This may cost the business excessive time and money. Let’s consider the infamous 80-20 rule as an inspiration. This rule basically claims that 80% of the customers are responsible for 20% of the profit and 20% of the customers are responsible for 80% of the profit. Understanding the 20% that drive our business and collecting the right information so that we can learn more about them and improve our services is the challenge at hand. It is an interesting fact that in order to design an efficient reporting system against past data, we need to have a forward-looking vision that enables us to define the data collection framework in the system.
Real-time reporting
The SAP Business ONE solution has an integrated financial skeleton and a Business Indicator Architecture which will be the basis for our reporting. All of the business information is collected in a single system without the need for synchronization or re-entering.
In today’s digital age, it is easy to collect too much information. This often leads to data graves with information that cannot be used. It is therefore important to collect the right information for analysis.
The SAP Business ONE system provides reporting tools that collect the right information for the following areas:
- Financial reporting based on legal requirements
- Business management reporting
- Compliance requirements
What is BI—business intelligence?
An ad hoc definition of business intelligence is “the aggregation of data from different sources and presentation of this data in an integrated format to provide new information.”
It is a fact of today’s business world that the amount of data collected exceeds the information which will be extracted from this data. However, modern tools (such as Crystal Reports) provide sophisticated means to access the data, process it, and present it in a desired format.
Business intelligence comprises the process of using tools (such as Crystal Reports) and automating the reporting process.
The difference between data and information
Let’s focus a bit more on data and information. Data is not information. What does this mean? Let me explain this with relation to the SAP Business ONE system. Only entering sales orders and collecting data in the SAP system will not provide all of the information we need to make informed decisions about our business. We need to think ahead and design the information framework that will collect data based on the way we want to run the business. Let me give you an example which will make this concept clearer. For example, as part of the Lemonade Stand Inc case study, we may want to collect information about the following areas:
- Best salesperson
- Sales per street
- Returning customers
- Most sold lemonade flavor
- Orders with special instructions
Therefore, by using a forward-thinking SAP configuration, we can make sure that all of the relevant information will be automatically collected.
In SAP Business ONE, this essentially means that we add fields in the relevant forms that allow us to specify the required information. For example, we may add a so-called user-defined field to most of the SAP forms.
User-defined fields
User-defined fields (or UDFs) are a simple way to add custom fields to the SAP Business ONE forms. For example, we may want to collect specific information that is not presently accounted for in SAP. It is then possible to easily add a custom field which will allow us to collect the designated information. It is a simple feature that has a great value. In most systems, we need to write a custom program to modify an existing form. I have worked with many accounting and business management solutions, and during the years it has become clear that there is great risk in programmatically changing an ERP system. It basically renders the system non-compliant to any updated or maintenance patches released. Therefore, I recommend the use of programming to implement custom features with caution. The SAP way of using UDFs for simple form adjustments is a good feature because it allows us to make changes without programming. Therefore, the system is still release-ready. This means SAP will continue to support it.