- People for managing the system
- AIF error handling team
The 4 key components of the chain are below and all these steps should be executed in sequence. Any overlap may result in huge regret cost
Explanation of the Steps:
- Transform – In this phase the core of SAP Central Finance is built. Focus should be on replicating data from source systems with excellent quality of data. As in this phase Initial Load (with some amount of month’s data) will be run so that data should be usable for the organization in future. This data forms the foundation of the whole value chain. Some key activities in this phase may be:
- Identifying source systems
- Working on System connectivity
- Working on Master Data Strategy
- Working on future consolidation requirements
End state of this phase should be robust foundation to next. Processes, people and technology should be in place, Data strategy should be in execution and team should be aligned for resolving the AIF replication defects and also any new acquisition or landscape changes should be accommodated.
- Sustain – This phase is less of an execution and more of a planning to next. Here the real time replication should be happening from the source systems. Resolving the errors is operational focus. Strategic focus should be on working on dashboards to do the root cause analysis of the major defects. 80-20 rule can be of benefit here. Process mining can also be used if needed on the source systems to determine the root cause of errors and working on permanent fix.
Please note that till this phase SAP Central Finance will not delivery any value except getting the common view of data which can be used for reporting purposes. Cost will be higher and the value is almost zero till this phase.
- Run – In this phase the value delivery starts. When the data in the Central Finance system is sustainable then we should start implementing the processes on the CFIN and centralize the operations. We can implement
- Central Payments
- Central Credit Management
- Central Financial Close
- Standard Reconciliation approach
- Harmonize bank connectivity due to Central Payments
- Connect the satellite applications to the Central Finance System
- Implement Group Reporting or other consolidation tool
- Implement SAP Analytics cloud or any other planning tool
With this the major operations will be centralized. It is also important to consider the changes which need to happen in security roles & authorization like when payments are centralized the payment transaction should not be available to users in source systems and should be only be given in CFIN system. There will be lot of similar changes in security/authorization area
- Innovate – In this phase the focus should be on the sustainability of the centralized operations and stabilize the processes which have been changed/redesigned or newly added including the tools and applications. In addition to the same the organization can start their digital journey with the introduction of:
- Robotics Process Automation (RPA)
- Machine Learning
- Artificial Intelligence
- Process Simplification and continuous improvement
Execution of one and Planning of next phase can happen in parallel but parallel execution of the phases should be avoided.
Please note that the content is based on author’s experience with several Central Finance implementations and transformations. There is no good or bad practice and it all depends on organizational plans and goals for their digital journey.