© 2018 SAP SE or an SAP affiliate company. All rights reserved.
SAP Industry Paper – Digital Utilities | 2018 Edition
Digital Utilities
Inspire and Shape a Digital World that Reinvents
Power Generation, Transmission, Distribution,
and Retail
1/22
Message from Henry
Dear Customers and Partners,
“We envision the digital
energy network. It will
reflect new structures
of power generation,
transmission, distribution, and retail and
create new business
models and processes
in a competitive and
collaborative digital
economy.”
Henry Bailey
Global Vice President
Utilities Business Solutions
SAP SE
Ten billion people – that’s the global population projected by 2050. As billions of people
join the digital economy, some experts say the demand for electricity, natural gas, and
water will double or triple. They also predict the use of energy and water will grow while
vehicles and mass transit go electric. One thing is clear – the digital economy needs
clean, dependable, and affordable water and energy.
This should be a great outlook for energy and water suppliers, distributors, and
retailers. Yet, decarbonization, deregulation, and decentralization are disrupting the
century-old utilities hierarchy. We see a digital energy network emerging that reflects new
structures of distributed generation, water supply, transmission, distribution, and retail.
The digital energy network will foster new business models and processes. It will embrace
the prosumer and transform work in a competitive and collaborative digital economy.
The consequences are dramatic. Proven utilities business models based on trillions of
dollars’ worth of infrastructure collapse. New market entrants, such as Google, Amazon,
and Tesla, disrupt the value chain. Rapid technical and social innovation put new capital
investments at risk. Consumers, communities, and companies go off the grid with new
wind, solar, water, and storage technology.
The industry is currently balancing the efficient operations of its existing infrastructure with
the need to adapt to the volatile market environment. Leading utilities are reevaluating
their physical assets and customer relationships to:
• Reimagine business models to find new revenue and profit sources. This can be
achieved by offering innovative supply, load balancing, and smart home and business
energy services.
• Reimagine business processes and use of digital technology to optimize business
outcomes. This can be achieved by converging information and operational technologies
such as blockchain.
• Reimagine the role and structure of the workforce to support future business. This can be
achieved by incorporating wearable technology, 3D printers, and geospatial technologies.
Reimagining the utilities business will shape the digital energy network that overlays and
complements the power supply system. All participants – utilities, consumers, and new
nonutility players – will use digital innovation to anticipate real-time demand and supply,
operate self-healing grids, and innovate the customer experience.
Our vision is to help the world use energy and natural resources responsibly, finding ways
to serve all people reliably, sustainably, and affordably. This requires access to the digital
energy network for all participants. We will offer the digital foundation and the digital
gateways that will integrate the core solutions of each market participant to the digital
energy network.
This document offers our perspective on where the industry will go. It outlines how SAP
contributes to the evolution of the digital energy network. Thank you for your interest, and
I look forward to your thoughts and our journey together.
Henry Bailey
Global Vice President
Utilities Business Solutions
SAP SE
2/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
Table of Contents
4
Digital Utilities – Big Picture
5
The Future: The Utilities Industry Transitions into a Digital Energy Network
6
Reimagining: The Digital Economy Offers Infinite New Opportunities
7
Reimagine Business Models
8
Reimagine Business Processes
9
Reimagine Work
10
SAP Digital Transformation Framework: A Simple and Proven Approach to Value Creation
Through Digitalization
11
SAP Digital Transformation Framework
12
SAP Portfolio with SAP S/4HANA and the SAP Leonardo Digital Innovation System
14
How Does It All Come Together? – Predictive Maintenance
15
How Does It All Come Together? – Customer Engagement
16
From Your Current State to Digital
17
Transforming from Your Current State to Digital
18
SAP Digital Business Services
19
Comprehensive SAP Ecosystem
20
Why SAP?
21
SAP Is Committed to Innovation
22
Additional Resources
3/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
Digital Utilities – Big Picture
The digital economy is real and will continue to transform utilities.
TECHNOLOGY TRENDS CHANGE EVERYTHING
Digitalization has reached every aspect of today’s life, and it is here to stay.
Technologies such as in-memory computing, cloud, and enterprise mobility have
already started to make an impact on utility companies. Others such as the Internet
of Things (IoT), artificial intelligence (AI), machine learning, and blockchain provide
new and exciting opportunities. But, at the same time, they open the playing field for
companies that are not traditional utilities.
LEADERS ARE EMERGING QUICKLY FROM NOWHERE
The utilities industry boundaries are already blurred. Large players, such as Google,
Samsung, or Tesla, and millions of private consumers engage in sustainable and
smart energy generation and management. Startups promise a sustainable and
reliable power supply at reasonable costs. Key questions include:
• How to sustain and grow customer relationships with new digital services?
• Which market spaces are the most attractive for new disruptive competitors?
• Who are potential partners in the digital energy network?
EARLY ADOPTERS ARE WINNING
Companies that embrace the digital world and execute on their digital strategy are
growing shareholder and stakeholder value faster than their peers. The nature of the
digital energy network forces participants to synchronize and collaborate to deliver
stable, affordable, clean, convenient, and reliable electric energy. Key questions
include:
• Which business segments allow market leadership and competitive differentiation?
• Which tasks are better allocated to a partner in the network?
• How do we develop and sustain the ability to adapt continuously to changing market
conditions?
Today, every business is a technology business.
Keys for utilities to win in the digital community include:
• Leading reinvention and digitalization of the business
• Digitalizing engagement with customers
• Partnering with other market participants to achieve economies of scale
Digital business models
are disruptive. The rules
have changed.
• Tokyo Electricity Company
(TEPCO), one of the world’s
largest utilities companies,
expects to deploy 27 million
residential smart meters within
its service territory by 2020.1
• CenterPoint Energy
implements an SAP HANA®–
based predictive maintenance
solution that supports the
strategy of integrating
information technology (IT)
with operational technology
(OT).2
• Google’s Nest is a line of
programmable, self-learning,
sensor-driven, Wi-Fi-enabled,
connected smart products that
promise energy efficiency,
comfort, and security for
people in their homes.3
• Tesla makes solar energy
available in the night with its
Powerwall product using
advanced battery technology.4
• Alliander, a large Dutch
power distribution company,
uses the SAP HANA business
data platform to analyze
1.5 billion grid sensor
measurements (expected
to grow by two magnitudes)
and forecast the required
asset substitutions or
maintenance at continuously
reduced time cycles.5
Access more information
on the latest technology
trends here:
4/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
The Future: Transition into a Digital Energy Network
THE DIGITAL ENERGY NETWORK
INDUSTRY 4.0
The digital energy network is the digital nerve system of
the next-generation energy infrastructure. It consists of
digital solutions from all market participants based on the
market rules and the established standard information
(exchange) model.
The digital age began in the middle of the 20th century.
The rapid development of digitalization has meanwhile led
to the definition of Industry 4.0 and the derivation from it of
the term Digitalization 4.0. The entire energy value chain
from energy generation to delivery and service is to be
networked with digital information and communication
systems.
TRANSFORMATION DRIVERS
The utilities industry value chain along supply,
transmission, distribution, and retail is transforming at
breakneck speed, driven by:
• Decarbonization: Invest in a low-carbon policy through
improved fossil-fuel generation efficiency, applied carbon
capture and storage (CCS) technology, and substitution
through CO2-free generation such as renewables or nuclear
• Deregulation: Recognize that market rules grant access
to new players and change the game for incumbents
• Decentralization: Take advantage of a power supply
that has turned into two-way power flow within distributed
networks of a mixed-generation portfolio, including
renewables
• Energy and water efficiency: Invest in energy and
water efficiency as an effective way to help reduce the
world’s consumption footprint and enable profitable new
business models
• Digitalization: Ensure that digital information within the
digital energy network uses the Internet of Things and
ubiquitous connectivity
The changes mentioned above and the unchanged
objective of ensuring a reliable, economical, sustainable,
and environmentally friendly energy supply require a
compromise in terms of:
• Prosumers: The freedom of citizens to produce and
consume their own energy supply
• Free market economy: Participation of companies in
the energy market adhering to the rules
NEW BUSINESS IMPERATIVES
The incumbent utilities companies and new players are
reimagining business models, business processes, and
job descriptions. They are enabled by transformation
drivers to achieve:
• Omnichannel retail to digitalized consumers
• Smart and efficient distribution
• Distributed energy resource balancing services
• Blockchain technology for the energy market
CYBERSECURITY
The real-time digital energy network is a potential target
for cyberattacks. Securing this system is one of the top
priorities.
>150%
Increase in worldwide
electricity demand according
to Energy Technology
Perspective 2010 in a
baseline scenario between
2007 and 20506
US$8 trillion
Total world energy storage
market by the year 20207
1 billion
Wind power
67%
Decision imperatives are:
• New business models
• IT for growth and
innovation
• Digital disruption and
security
This is according to a 2014
survey with utility CEOs.8
Currently the fastestgrowing source of electricity
production in the world.9
Of companies, including
utilities, say they have
had at least one security
compromise that led to
the loss of confidential
information or disruption
of operations in the past
year.10
5/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
Reimagining: The Digital Economy
Offers Infinite New Opportunities
In a connected world where every company is becoming
a technology company, smarter products and services
will refocus commerce on business outcomes and blur
industry lines.
6/22
Reimagine Business Models
Decentralization, deregulation, decarbonization, and digitalization disrupt established utilities industry
business models but don’t show a clear road to the future. We see utilities redefine their business
model and restructure the value chain. New value will come from smart alignment along the four main
business operations that reflect the volatile market situation.
OMNICHANNEL RETAIL TO DIGITALIZED
PROSUMERS
DISTRIBUTED ENERGY RESOURCE (DER)
BALANCING SERVICES
Consumers expect reliable and affordable energy supply
with maximum convenience. The emergence of
“prosumers” and increasing environmental and energy
awareness broaden the scope of customer interactions and
increase addressable consumer spend.
• Consumer information about personal preferences,
lifestyle, location, sentiment, or consumption behavior
gleaned from smart meters and consumer or owned
devices create new business potential.
• Customers are willing to invest in energy efficiency and
in renewables generation that require new infrastructure
and services.
• E-mobility, such as electric cars, offers a broad range of
business opportunities to engage customers that are
today captured primarily by the vehicle manufacturers
• Smart and efficient distribution
The intermittent character of DER generates business
opportunities around balancing services in the energy
system – either by storing cheap and releasing expensive
energy or by influencing the demand side to shift
consumption and save energy.
• Virtual power plants will connect and centrally manage
decentralized energy production.
• Real-time processing and predicting of generation and
consumption data is required.
• Power storage technologies such as pumped hydro,
power to gas, batteries, thermal, flywheel, and
compressed air are included.
BLOCKCHAIN TECHNOLOGY FOR THE ENERGY
MARKET
The number of DER energy sources (prosumer), the
increasing number of measurement points (for example,
due to e-mobility or energy storage), the number of market
participants, and the emergence of transactive energy are
reasons for considering the use of blockchain technology
to manage and settle transactions.
• Peer-to-peer energy trading
• Large-scale solar and wind farms that are being built by
utilities to help regions meet renewables mandates
• Generators that integrate and process real-time sensor,
market, and weather data to operate profitably
• Predictive analytics as a key enabler to maximize the use
of centralized and decentralized assets
Decentralized, renewable energy still needs powerful grids
to deliver electricity. Whether transmission and distribution
are paid by the energy (KWh) or load (KW), excellence in
grid building, operations, and maintenance is key for
profitability.
• Intermittent and decentralized power production requires
the ability to predict and handle power in-feed with
bidirectional power flow.
• Evaluation of energy data helps to predict grid loads and
anticipate bottlenecks that strain the grid. This allows for
the optimization of grid investments.
• Real-time processing of load data enables the integration
with demand and supply balancing services to optimize
grid utilization.
• As with power plant operations, new capabilities in
predictive maintenance and self-healing concepts help
to further reduce operational costs.
NEW GENERATION
Global renewable power generation
is expected to grow from 5,000
TWh in 2013 to 7,000 TWh in 2019
(all fuels: 24,000 TWh).11
BETTER FLEXIBILITY
Utilities can increase revenue by
15% or more by increasing the
flexibility of their assets and offering
new types of services.12
7/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
Reimagine Business Processes
The traditional energy value chain is transforming at breakneck speed, driven by massive structural
changes, new technologies, highly interactive devices, and real-time processes enabled by the digital
energy network.
ENERGY SUPPLY OPTIMIZATION
Supply-Side Coordination
Storage and Flexibility Services
Distributed generation of volatile renewable energy requires
sophisticated, digital, supply-side coordination that collects,
analyzes, and distributes information in real time to market
participants for the sake of better decision-making.
Sensors and meters attached to power-consumption or
power-generation devices and the industrial consumers’
overall operations plan deliver input to calculate and offer
demand increase and reduction capacity. This capacity can
be managed automatically and is sold to grid operators
who need to stabilize their grid.
Distribution
Renewable energy from wind parks and solar farms feeds
back into the distribution grid that was designed for oneway operation. This strains the infrastructure and requires
predictive maintenance to avoid outages.
Sourcing and Trading
Structured portfolios of aggregated, expected energy
demand are optimally mapped to planned generation and
standard energy wholesale products, sourced through own
or cloud-based trading systems.
METERING
Meter Point Operation
Meter data is not just needed for billing purposes –
it is analyzed in real time to forecast and balance load,
optimize demand response, monitor and improve energy
efficiency and reliability, and optimize energy portfolio
profitability.
OPERATIONAL EFFICIENCY
Smart Asset Operations and Maintenance for
Generation and Wholesale Distribution
Smart asset operations and maintenance are key drivers
for cost-efficient, compliant, and safe power generation, in
particular in highly distributed environments. Based on
sensor data, predictive analytics with SAP S/4HANA®
enables smarter asset management with a fully digital
allocation of spare parts, work, and logistics services
delivered by digital business networks.
CUSTOMER ENGAGEMENT AND BILLING
Sales
Digital information about consumer behavior, preferences,
and needs creates a new world of sales opportunities.
Regardless of the business model, sales needs a digital,
360-degree view of the consumer and the market.
Transmission
Significant investments have to be done to adapt the
transmission network from the as-is fossil or nuclear-fueled
plant locations to the new renewables plant locations.
Simulation to predict load patterns, financial and technical
modeling, and real-time control optimizes grid utilization
and avoids building oversized transmission assets.
Services
Innovative service offerings and processes can have a
game-changing impact on customer relationships and the
top and bottom line. All service processes will be digitally
connected to the workforce, suppliers, customers, and
assets for more efficiency and customer value.
8%–14%
Convergent billing and invoicing
that unifies billing for any kind of
commodities and services14
Sourcing savings with integrated
strategic sourcing and a supplier
management solution13
8/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
Reimagine Work
The fundamental transformation from a telco to a digital services provider profoundly changes what
people do and how they do it and how they learn, interact, and grow.
Every substantial business transformation automates
manual tasks, enriches jobs, and drives efficiency.
Flexible business-to-people relationships: Utilities are
high-tech companies that operate large-scale technical
and digital assets. The transformation to the digital energy
network creates hundreds of millions of new people
interactions – between consumers and service teams,
between the core and the extended workforce, and with the
public over social and broadcasting networks. Real-time
digital information on the right devices is critical to advance
the business agenda through interaction between people.
Digital business processes replace manual transaction
work in procurement, inventory management, invoicing,
and payment processing. Digital processes have access to
real-time analytics to support rule-based decision-making.
The right information at the right time on the right
device: Shop-floor processes are supported or controlled
by predictive and self-learning systems that interact with
machines and business processes.
Predictive analytics and machine-learning accelerate
the delegation of business processes and decisions from
people to machines. People who need the knowledge have
digital access on demand and in real time, regardless of
whether they are part of the core or the extended workforce.
Interactive technologies reflect the transition of people’s
roles from transaction workers to exception workers who
engage when the digital rulebook needs human creativity
and ingenuity.
People continue to be key assets in
the digital energy network. Their roles
will change, but their value to each
segment in the network will grow.
Alberta Electric System (AESO)
realized 27% savings in learning
management by deploying an
integrated suite of workforce
solutions.15
Many utilities will lose half of their
current workforce to retirement in
the next 5 to 10 years.16
9/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
SAP® Digital Transformation
Framework: A Simple and Proven
Approach to Value Creation
Through Digitalization
Every company across all industries requires a simple digital
approach to build a pragmatic and executable vision on its
digital strategy.
10/22
SAP Digital Transformation Framework
Every service provider needs to think about digitalization across five key pillars.
SAP understands the five pillars of digitalization, and we also
understand that the continuously changing requirements pose
big challenges for businesses. The method of reimagining
business models, business processes, and work helps develop
the digitalization road map.
The digital business framework will help utilities create:
• A smarter and engaged workforce across all employees
and contractors
• Spend management to accelerate growth and innovation
• Full and safe utilization of assets leveraging the
Internet of Things and the supply chain to drive
real-time insights and enable new business models
• Outcome-based customer and stakeholder
engagement across all physical and digital channels
• Real-time business transactions and analytics connected
on a digital core so everything is smarter, faster, and
simpler
We have designed the SAP® Digital Transformation
Framework methodology to support utilities in developing
and executing on their digital enterprise strategy to become
digital transformers that fully leverage and contribute to the
digital energy network.
Utilities must transform to grow profits and reduce costs by
simplifying their operations. The value of the digital economy
is based on how to serve the consumer or prosumer.
Value creation often comes from edge solutions that are
based on and coordinated by digital core solutions. It is the
framework for innovation and business process optimization,
connecting the workforce, suppliers, customers, assets, and
the supply network.
GET STARTED TODAY
It isn’t necessary to implement this digital business
framework all at once, or even to start with SAP S/4HANA.
Companies can start with the pillar that creates the most
value for their given situations, and add others when they
are ready.
11/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
SAP Portfolio with SAP S/4HANA and SAP Leonardo
Digital Innovation System
SAP has innovated its portfolio to provide both for a stable digital core as well as flexible line-ofbusiness (LoB) extensions.
In the digital economy, simplification and business innovation matter more than ever. To achieve this effectively, it’s important to
cover the end-to-end digital transformation journey, ranging from planning a digital innovation road map and implementation plan
with proven best practices to the ability to run all deployment options and ultimately optimize for continuous innovation with a focus
on outcomes.
ENERGY SUPPLY OPTIMIZATION
DIGITAL ASSET MANAGEMENT
METERING
CUSTOMER ENGAGEMENT AND COMMERCE
• Predictive maintenance and service
• Asset intelligent network
• Mobile asset management
• Meter lifecycle management
• Marketing
• Scheduling and load management
• Asset information collaboration
• Meter data management and operations
• Sales
• Environment, health, and safety
• Meter administration and operations
• Meter to cash for energy and water
• Asset operations and maintenance
• Energy data management
• Nonenergy billing
• Sustainability
• Sustainability performance management
• Order and contract management
SAP S/4HANA Enterprise Management
Digital core1
• Time recording
• Accounting and closing operations
• Operational purchasing
• Core accounting
• Collaborative sourcing and contract management
• Cost management and profitability analysis
• Invoice and payables management
• Supplier management
• Procurement analytics
• Bill to cash
• Financial planning and analysis
• Accounting and financial close
• Treasury management
• Receivables management
• Invoice management and accounts payable
Extensions2
• Bill to cash for energy and water
• Core human resources and payroll
• Bill to cash for energy services
• Talent management
• Business network
• Omnichannel commerce and subscription billing
• Time and attendance
management
• Human capital analytics
• Guided end-user buying
• Supplier collaboration
• External workforce management
• Resume matching
Digital innovation
SAP Leonardo3
• Cash application
• Job matching
BILLING AND REVENUE MANAGEMENT
1
• Governance, risk, and compliance
SAP Cloud Platform
• Maintenance management
Customize applications | Integrate applications, data, and processes | Build new applications
Extensions2
• Fuel management
Digital core (inner lane): Core solution capabilities
delivered as part of SAP S/4HANA Enterprise
Management
HUMAN RESOURCES
1
Digital core (outer lane): Solution capabilities
that are also part of SAP S/4HANA Enterprise
Management but added or purchased as needed
FINANCE
2
PROCUREMENT EXCELLENCE
Extensions: Cloud-based (LoB) solution extensions
that are fully integrated with SAP S/4HANA Enterprise
Management but added or purchased as needed
3
SAP Leonardo: Solution capabilities that are
powered by SAP Leonardo and included in the
SAP Leonardo system; how to add or purchase
them is not shown on this diagram
Learn more about SAP solutions today, and
discover planned innovations by accessing
the SAP road map for utilities here:
12/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
Distributed
energy
resource
operations
Smart and
efficient
distribution
Demand and
supply
balancing
services
Omnichannel
retail to
digitalized
consumers
Typical business
benefits*
Utilities digitalize themselves to manage their assets and serve their customer better than ever before by:
1. Engaging employees better and optimizing asset operations
Energy Supply Optimization
Digital Asset Management
Customer Engagement
and Commerce
Metering
Billing and Revenue
Management
Finance
Procurement Excellence
• Monitor asset operations and
maintenance in real time
• Replace manual transaction work
with digital business processes
• Provide bidirectional, precise, and
timely information to and from
prosumer operations
• Deliver a single, real-time,
consolidated view of customer
consumption information
• Identify profitable service lines and
customers by offering real-time
reporting
• Find and contract talent with
specific noncore skills to deliver
new services to support new
business models
• Support real-time revenue
recognition, profitability analysis,
cash allocation, and working
capital analysis
• Enable economies of scale and
flexible ordering with strategic and
agile global supplier network
management
• Manage scheduling and load
instantly and accurately
• Forecast energy demand and
supply with greater accuracy
• Track grid loads and asset
network performance
• Support predictive analysis of
asset health
• Increase the accuracy of meter
lifecycle management
• Manage and report smart-meter
rollouts in real time
• Provide customers with
omnichannel access
• Store and analyze structured and
unstructured customer data in real
time
• Run instant and accurate billing
• Enable easier analysis of all
offered services
• Procure and manage contingent
labor and services to optimize
delivery across regions
• Predefine reports
• Configure reporting tools for
nonenergy products and services
• Innovate procurement strategies
for specialized service parts, such
as 3D printing
• Provide programs for efficient
demand management and energy
trading
• Access available prosumer energy
instantly while balancing grid
loads
• Enable instant bidirectional meter
communications
• Personalize customer contracts for
energy and nonenergy services
• Deliver a single source for realtime updates that are immediately
visible to all parties across all
channels
• Identify, forecast, and address skill
gaps
• Empower employees to make
decisions in real time
• Provide a single source of truth
• Analyze profitability across
multiple dimensions such as
customers, projects, and plants
• Integrate the contingent workforce
efficiently
• Bundle third-party services
• Monitor distributed generation
loads and access to prosumer
energy
• Gain real-time insights to ensure
environmental health and safety
compliance
• Analyze and provide timely and
accurate information about energy
usage and production
• Detect fraud in real time
• Offer more customer self-services
in an omnichannel environment
• Present relevant and personalized
recommendations
• Provide all end customers with
relevant processes across all
channels
• Support omnichannel commerce
and subscription billing
• Onboard and train employees
quickly and seamlessly
• Identify and secure talent for
prosumer engagement
• See profit margins in real time for
new-product and service offers
• Support inventory and warehouse
management for new energyrelated products
• Greater read accuracy
• More demand management programs
• Enhanced customer service
• Higher user productivity
• Better understanding of customers
• Greater profitability
• Improved customer satisfaction
• More-effective self-services
• Optimized use of fuel
• Lower fuel costs
SAP Cloud Platform
Energy Supply Optimization
• Increased return on assets
• Greater operational efficiency
Machine learning
Analytics
Analytics services
Digital Asset Management
User experience services
Metering
• Mobile asset management
• Asset information collaboration
• Meter lifecycle management
• Meter data management and operations
• Marketing
• Sales
• Bill to cash for energy and water
• Bill to cash for energy services
• Omnichannel commerce and
subscription billing
• Sustainability performance
management
• Environment, health, and safety
• Asset operations and maintenance
• Meter administration and operations
• Energy data management
• Meter to cash for energy and water
• Nonenergy billing
• Bill to cash
Extensions
SAP HANA
|
Human Resources
SAP Cloud Platform
*Benefits are based on early adopters of SAP S/4HANA or conservative outside-in benefits due to moving from a traditional enterprise resource planning system to enhanced capabilities of SAP S/4HANA, as well as line-of-business and cloud solutions.
Collaboration services
• Cash application
•
•
•
•
• Governance, risk, and compliance
Core human resources and payroll
Talent management
Time and attendance management
Human capital analytics
Procurement Excellence
Finance
• Resume matching
• Job matching
•
•
•
•
•
• Time recording
• Order and contract management
Big Data
Security services
Billing and Revenue Management
• Fuel management
• Scheduling and load management
• Sustainability
• Maintenance management
Blockchain
Mobile services
Customer Engagement and Commerce
• Procurement function cost:
-15%–20%
• Worker acquisition time: -30%–40%
• Days payables outstanding on targeted
spend: -2–5 days
• Days to close annual books: -40–50
• Budgeting and forecasting cost:
-25%–50%
• Audit cost: -20%–40%
• Lower time and attendance cost
• HR full-time equivalents: -44%
Data intelligence
• Predictive maintenance and service
• Asset intelligent network
Digital core
SAP S/4HANA
Human Resources
• Deliver safe, reliable, and
sustainable energy
• Monitor operation costs and
supplies in real time
Internet of Things
Digital innovation
SAP Leonardo
2. Innovating the digital energy network and rethinking customer interactions
•
•
•
•
Supplier collaboration
Business network
Guided end-user buying
External workforce management
•
•
•
•
•
Operational purchasing
Collaborative sourcing and contract mgmt.
Invoice and payables management
Supplier management
Procurement analytics
Financial planning and analysis
Accounting and financial close
Treasury management
Receivables management
Invoice management and accounts payable
• Accounting and closing operations
• Core accounting
• Cost management and profitability
analysis
Studio SAP | 49197enUS (18/03) © 2018 SAP SE or an SAP affiliate company. All rights reserved.
They pursue four
key initiatives that
require
new business
capabilities along
the value chain.
How Does It All Come Together? – Predictive Maintenance
Each of the five digital business pillars delivers individual business value, but next-generation business
processes will span multiple pillars to drive efficiency internally or across the business network, connect
to devices, and improve asset health and performance.
USE SENSOR AND METER DATA TO PROACTIVELY MAINTAIN ASSETS
Determine
asset health
index
Determine
root cause
of failure
Collect sensor
and meter data
Supplier collaboration
and business networks
Decide on
best measure
Create
work order
Order
(spare) parts
Predict failure
Evaluate
proactive
measures
Maintain
asset
Customer experience
and omnichannel
Assets and the
Internet of Things
Digital core
Time
Real-time predictive analytics yield tangible business
benefits:
• Higher return on assets
• Faster recovery time from failure
• Higher productivity and safer work
• New service revenue streams
• Competitive service-level agreements
• Higher customer satisfaction
The digital work order dispatches the service crew and
provides additional geospatial and device information
to ensure that the right activities are conducted at the
right time by qualified people with the right spare parts
and tools.
Every outage and failure that can be prevented or
proactively managed minimizes cost and maximizes
asset availability and customer satisfaction.
The digital energy network enables even more innovative
asset management scenarios where equipment:
• Monitors its own health
• Reaches out to system experts to devise a recovery plan
• Devises work-arounds
• Sources, orders, and schedules the service experts
• Gets 3D-printed service and spare parts
• Updates its production schedule
Imagine that sensor data is continuously collected and
analyzed in real time to determine and monitor asset status
and health. This information is also fed into advanced
analytics models that can predict impending failures early
enough to avoid damages and outages. To evaluate the
proactive measures, the system needs to determine
potential root causes for an expected failure. This supports
the decision for the best actions, including ordering the
right spare parts, assigning the right experts, and devising
a cost-effective schedule.
14/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
How Does It All Come Together? – Customer Engagement
Each of the five digital business pillars delivers individual business value, but next-generation business
processes will span multiple pillars to drive efficiency internally or across the business network, connect
to devices, and improve asset health and performance.
USE CUSTOMER DATA TO OFFER NEW SERVICES AND INCREASE REVENUE
Financial
management
Energy market
trading
Shared energy
economy
Optimized
consumption
Outage
management
Digital
prosumer
E-mobility
management
Supplier collaboration
and business networks
Customer experience
and omnichannel
Assets and the
Internet of Things
Virtual energy
storage
Energy portfolio
dispatch
Microgrid
management
Loyalty
management
Smart home
management
Maintain
asset
Real-time customer analytics yield tangible business benefits:
• Higher customer satisfaction
• Better response for potential high-bill scenarios
• Higher profits with smarter services
• New revenue streams with e-mobility and energy storage
• Competitive service-level agreements for smart homes
• Collaboration as an energy provider
Digital core
If the prosumer accepts the offer, the utility leverages its
network to collaborate with partners to install the smart
home devices. The utility also provides an option to
contribute electricity to the grid through home-based
solar power installations and other renewable sources,
depending on feasibility.
The utility continuously monitors the prosumer’s
consumption behavior and creates personalized analytics,
which the prosumer can access using various channels.
This allows customers to receive a consolidated bill,
including the energy consumed or contributed and smart
home services.
The digital utility now has the opportunity to use one or
more communication channels to engage with prosumers
to identify concerns about high energy bills and other
issues. With smart meters, a prosumer can see consumption behavior throughout the day to make better decisions
in real time.
The utility can now easily provide even more services to
improve prosumer engagement and satisfaction.
The utility now offers benchmarking services at no cost
and asks the prosumer for permission to evaluate the
metering and consumption-related information using Big
Data analytics.
The digital energy network enables even more innovative
prosumer management scenarios in which prosumers
monitor their own consumption, reach out to experts to
devise an energy plan, and become “digital prosumers”
with personal solar panels, battery storage, e-mobility,
and smart home management.
If the prosumer exceeds consumption targets, the utility
offers smart home products and services with a profitability
analysis to create a customized offer for dispatching
energy.
15/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
From Your Current State to Digital
The journey to becoming a digital service provider begins
with planning a digital transformation road map.
16/22
Transforming from Your Current State to Digital
In the digital economy, simplification and business innovation matter more than ever. To achieve this effectively, it’s important
to cover the entire digital transformation journey. This ranges from planning a digital innovation road map and implementation
plan with proven best practices to the ability to run all deployment options and ultimately optimize for continuous innovation
with a focus on outcomes.
The digital transformation journey
Plan
Build and launch
Run
Optimize
well to manage
expectations
with proven best
practices
all deployment
models
for continuous
innovation
Simplify and innovate
 Reimagined business
models, business
processes, and work
Standardize and innovate
 Model-company approach
to accelerate adoption with
model industry solutions
 SAP Digital Transformation
Framework as a guide for
digital transformation
 SAP Design Thinking
methodology and rapid
tangible prototypes
 Value-based innovation
road maps
 Coengineered industry
innovations delivered with
agility
Run with one global support
 One global, consistent
experience
 Comprehensive support –
on premise, in the cloud, or
a hybrid
Optimize to realize value
 Continuously captured and
realized benefits of digital
transformation
To move forward with speed and agility, it helps to focus on live digital data, instead of Big Data, and combine solution
know-how and industry-specific process expertise with data analytics so that the right digital reference architecture is
defined and delivered. In that context, a model-company approach can enable airlines to transition from their current state
to digital.
Model companies represent the ideal form of standardization for a specific line of business or industry. They are built
on existing SAP solutions using best-practice content, rapid prototyping solution packages, and additional content from
customer projects. They provide a comprehensive baseline for rapid customer-specific prototypes, cloud demos, and
quick-start implementations.
Model-Company Approach
End-to-end solution
Internet
of Things
End-to-end business process
People
Innovation
Business
networks
Differentiation
Social
networks
Best practice
Devices
SAP products
Model company
Big Data
17/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
SAP Digital Business Services
Enabling your success in digital transformation
SAP has a broad range of services to cover the digital
transformation journey, ranging from consulting on a digital
innovation road map and implementation plan with proven
best practices to the ability to run all deployment options
and ultimately optimize for continuous innovation. We
provide both choice and value within our service offerings,
allowing you to tailor the proper approach based on your
specific company expectations and industry requirements.
•
•
•
•
•
•
•
•
25,000 professionals in 70 countries
Customers in 130 countries
Outcomes delivered as one team in one contract
Projects connected in real time to a global network of
support functions through SAP Mission Control Center
SAP MaxAttention™ and SAP ActiveEmbedded services
to safeguard the investment
Consistent experience – on premise, in the cloud,
or a hybrid
Standardized adoption of processes and tools
Streamlined onboarding and ramp-up of stakeholders
From proposing a comprehensive digitalization proposal to realizing and running it, SAP delivers on the digital transformation
promise to its customers on time, within budget, and on value.
Value delivery from SAP is possible due to our many unique, differentiating assets:
SAP Transformation
Navigator tool
Expert
organization
Exhaustive service
portfolio
Global reach
SAP Model Company
service
Partner
ecosystem
SAP Activate
methodology
Industry
expertise
SAP Solution
Manager
Focus on business
outcome
SAP Mission
Control Center
Co-innovation
SAP Digital Business Services deliver digital innovation with simplification and accelerated implementation, which is key
to adoption and value realization. Continuous improvement is supported through the ongoing assessment of real-life data
insights and joint governance with customers.
Value delivery from SAP focuses on the following deliverables:
Digital Business Foundation
Business Insights
Continuous Improvement
Run better:
Operate
Use better:
Harvest
Corporate
Strategy
Extend use:
Invest
Build new:
Innovate
• Digital business model
• Digital boardroom
• Joint value governance
• Flexible, scalable enterprise architecture
• Predictive customer insights
• Sustainable engagement model
• Platform for the digital future
• Value realization dashboard
• Innovation without disruption
• People and culture transformation
• Agile decision-making and
execution support
• Simplification
18/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
Comprehensive SAP Ecosystem
Orchestrating the world to deliver faster value
Our comprehensive ecosystem for the utilities industry offers:
• Integration into a wide range of business services
(suppliers, banks, key vendors, travel, and more)
• Open architecture, with a choice of hardware and
software
• Complementary and innovative third-party solutions
• Reach – partners to serve your business of any size
anywhere in the world
• A forum for influence and knowledge
• A large pool of industry experts with broad and deep
skill sets
Business network
• 1.9 million suppliers
• 200 major travel partners (air, hotel, and car)
• 50,000 service and contingent labor providers
Influence forums and
education
Implementation services
• 32 user groups across all regions
• 300+ services partners focused on
utilities
• 40+ industry councils
• 3,200 services partners overall
• SAP community with more than
24 million unique visitors per year
• Delivering utilities-specific solutions
and services
• 1,800 members of the SAP
University Alliances program
Driving
customer
value
Innovation
Platform and infrastructure
• 1,900+ OEM partners to extend
SAP solutions
• 1,400 cloud partners overall
• 30+ partners focused on utilities
platforms
• 2,000 startups developing
SAP HANA applications
Channel and SMEs
• 860+ channel partners focused
on utilities
• 4,800 overall channel partners
19/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
Why SAP?
SAP software enables the digital energy network with a digital
core, business networks, supply chains, and the Internet of
Things.
20/22
SAP Is Committed to Innovation
Vision
Global
presence
and
relevance
• 82,400 employees
representing
130 nationalities
• 335,000 customers
• SAP operates in
190 countries
Help the world run better and improve people’s lives
Mission
Help our customers run at their best
Strategy
Become the cloud company powered by SAP HANA
Industry
and line-ofbusiness
focus
• Solutions for
25 industries and
12 LoBs
• 98% of top valued
brands are our
customers
• 74% of the world’s
transaction revenue
touches an SAP
system
Digital
economy
ready
• 120 million business
cloud users
• 1.9 million connected
businesses
• More than $800 billion
in B2B commerce
• Over 99% of mobile
devices connected
with messaging from
SAP
Innovation
leader
• 2011: SAP HANA
launched
• 2012: SAP Cloud
portfolio launched
• 2014: SAP business
networks are the
largest marketplace in
the world
• 2015: SAP Cloud
Platform launched
Digital utilities
enabled by
SAP software
• Utility solutions since
1988 for electric, gas,
and water
• 88% of utilities in the
Forbes Global 2000
are SAP customers –
more than 4,200 in total
• More than 740 utilities
managing more than
3 billion invoices
• 2015: SAP S/4HANA
as the next-generation
business suite
Source: Internal SAP data
PREDICTING CUSTOMERS IN HOUSTON
FIRE AND RESCUE
EARLY FLOOD DETECTION IN INDIA
With CRM data running on the SAP HANA
business data platform, CenterPoint Energy is
able to analyze customer data more than 1,000x
faster from different sources (examples: smart
meters, bill history, weather data, and so on) to
accurately predict in real time why customers are
calling and automatically route the calls to the
proper agent or self-service process to significantly
reduce costs.
New South Wales now has a comprehensive
view of fire and disaster risk to protect 7 million
residents. More than 30 years of experience
available in real time in the SAP HANA business
data platform ensures the right people are
addressing emergencies at the right time.
With the SAP HANA business data platform
and SAP Predictive Analytics software, water
levels can be monitored in real time to alert
the population about the floods and ultimately
save lives.
21/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
Additional Resources
Outlined below is additional external research that was used as supporting material for this white paper.
1. “Smart Meters Japan: TEPCO to
Deploy 27m by 2020 Olympic Games,”
Metering and Smart Energy
International, February 26, 2015.
2. “Accenture and SAP Chosen by
CenterPoint Energy to Develop Asset
Analytics Solution to Take Advantage
of the Internet of Things,” Accenture
news release, March 16, 2015.
3. Nest Web site.
4. Tesla Motors Web site.
5. “Smart, Flexible Energy Supply for a
Sustainable Society,” SAP customer
journey, SAP SE, 2014.
6. “Energy Technology Perspectives:
2010,” International Energy Agency.
7. “Energy Storage Market to Hit $50
Billion by 2020 (Lux Research),”
CleanTechnica, August 26, 2014.
8. Jill Feblowitz, IDC, “Getting to Digital
Transformation,” SAP Utilities
Conference 2015, Berlin (presentation
available upon request).
11. “Global Renewable Energy Market –
Trends and Projections,” International
Energy Agency, 2013.
12. “How Electricity Generators Can Jolt
Profits Back to Life,” Forbes,
November 14, 2014.
13. SAP benchmarking
14. SAP software for use in sales,
SAP Web site.
15. “AESO: Aligning HR and Business
Strategy with SAP SuccessFactors
Solutions,” SAP business
transformation study, 2015.
16. “The Disappearing Utility Workforce,”
Electric Energy Online, March/April
2006.
Note: All sources cited as “SAP” or
“SAP benchmarking” are based on our
research with customers through our
benchmarking program and other
direct interactions with customers.
Note: Some images are used under
license from Shutterstock.com.
9. Wind Energy Foundation Web page.
10. “Critical Infrastructure: Security
Preparedness and Maturity,”
Unisys and the Ponemon Institute,
July 2014.
22/22
© 2018 SAP SE or an SAP affiliate company. All rights reserved.
www.sap.com/contactsap
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