Big Data Required Big Ideas

10/03/19 | Christoph Papenfuss

Big Data Required Big Ideas

SAP Profitability and Performance Management (SAP PaPM) was developed in response to a Big need.

Big Data and technology may be like the chicken and the egg: Which came first? Was it technology or the data it processes? Was it data or the technology required to process it? At this point, it doesn’t even matter. Big Data and technology are here to stay. And enterprise operations rely on both. That’s why SAP and NEXONTIS developed SAP Profitability and Performance Management (SAP PaPM).

A Little History

What we now know as SAP PaPM stemmed from a 2014 customer request: a large insurance company in South Korea wanted to evaluate the merits of SAP HANA's in-memory technology for analyzing and allocating their insurance contracts at the individual policy level. As part of their investigation of SAP Insurance Analyzer, they came into contact with Nexontis, a subsidiary of msg global solutions.

Nexontis developed an application of FS-PER, which enabled cost/profitability reporting at the levels of product, channel, and customer. That became the cornerstone of what we now know as SAP PaPM. Today, SAP PaPM functionality extends to planning, transfer pricing, IT costing, activity accounting, tax accounting, sustainability (greenhouse gas protocols), process mining, and cash flow projections.

Because SAP PaPM is built on SAP HANA’s in-memory platform (as opposed to older data-warehouse/data-replication technologies), it’s a high-speed calculation engine. It processes large volumes of data — from SAP and non-SAP applications, in the cloud or on-premise — to provide real-time insights generated by configurable business rules and flexible simulation parameters. That’s some pretty hefty functionality.

How Hefty?

One of our customers uses SAP PaPM to determine the performance and profitability of 120 million insurance contracts. That constitutes about six-and-a-half-billion data points per month, from more than 1,000 source systems, reporting more than 120 million profit-and-loss units and more than 450 KPIs, from more than 850 models.  

SAP PaPM can help any organization:

  • Build relevant profit and performance models at the levels of customer, product, or channel
  • Calculate massive volumes of data in seconds and perform what-if simulations to generate actionable insights
  • Make decisions confidently and test and review their impact before finalizing them
  • Align processes with profitability and performance by integrating calculated results into defined close activities, planning cycles, visualizations, and execution.

SAP PaPM comes with predefined business content, algorithms, and calculations logic for a variety of planning models, transfer pricing, risk management, solvency, cash flow, IFRS17 compliance, custom revenue allocations, costing, sustainability management, simulations, and more.

All That, Plus Convenience

Despite its comprehensive functionality, SAP PaPM requires very little IT support. Business users can do everything that needs to be done in the application, assigning roles, rights, and authorizations; creating logic, allocation rules, and workflow; and granting access to reports.

Think about it: Big Data. High speeds. Unprecedented detail. Comprehensive input, integration, and simulation capabilities; exhaustive calculation functions; flexible configurability; real-time reporting.

SAP PaPM is technology developed by end users for end users. It doesn’t get any better than that.

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Topics: Finance Transformation, Insurance, General Business Topics

Blog Author:Christoph Papenfuss

Christoph Papenfuss | Member of the Executive Board

Christoph Papenfuss serves as the Executive Vice President and Member of the Executive Board for the Americas Region. He is responsible for the team that brings the expertise of msg global solutions to its client companies and prospects.

Christoph brings to msg global over 20 years of experience in management consulting and software sales with a functional focus on Business Analytics, Big Data, Systems Implementations and IoT. The native of Munich, Germany, is well versed in the North American market, having moved to the San Francisco Bay Area in 1998 after graduating from the University of Passau in Germany.

After working in KPMG Consulting’s High Tech practice for over five years, Christoph joined Cognos, a developer of business analytics software where he built and managed the US West Coast professional services practice. After IBM acquired Cognos in 2008, Christoph moved back to Munich to establish and manage the IBM Cognos Innovation Center in Europe and the Middle East.

In 2015 Christoph joined OSIsoft, which furnishes real-time sensor data management to businesses worldwide, as the leader of the central European team. Besides managing and growing sales, Christoph was also instrumental in developing various key OEM and reselling agreements with companies such as SAP, Siemens and Kongsberg Maritime.

Christoph is married and the father of twin boys. Besides traveling and hiking with his family, he enjoys road bicycling, distance running and photography. View some of his photos at www.sftwins.com.