Numerous discussions with customers have repeatedly shown that many SAP users are convinced that Integrated Business Planning - IBP for short - is only available in a double pack with S/4HANA. But this is comparable to an "urban legend", because IBP can be integrated into a classic ECC system just as well as into S/4HANA.
Cloud tenant guarantees flexibility
Why is that? The answer is very simple. Unlike APO, IBP provides the user with a cloud tenant - a client in the cloud. This "client" doesn't care which system it is connected to, as long as the appropriate interfaces are available. In IBP's case, the license includes all the parts needed to communicate with other systems. For example, the solution includes the CPI-DS interface and SDI for order-based integration, as well as the ERP add-on for the core system. This means that no matter which and how many systems are connected, there are no extra costs. For this reason, billing is not based on the number of connected systems, but on other criteria - such as the company's turnover or the number of modules it requires.
This means that users who initially integrate IBP into their ECC system simply take their license with them when they later switch to S/4HANA - at no extra cost. Figuratively speaking, the plug is pulled out of the old system and plugged into the new one - done. From now on, the cloud tenant communicates with the new system.
APO is not a prerequisite
Are there any software requirements for the IBP implementation? Is perhaps a previous SAP Advanced Planning and Optimization (APO) installation necessary from which to switch to IBP? Despite a certain plausibility, the assumption is not correct. Experience has shown that APO is generally used by very large companies with several locations or companies. For small to medium-sized customers, on the other hand, the planning solution was usually too powerful, too complex to maintain and therefore often too expensive. Planning solutions that combine external forecasting tools and Excel are often found here. The emerging attractiveness of IBP for small and medium-sized companies lies primarily in the cloud aspect, as there is no need for cost-intensive maintenance. This means that expensive, long-term capital expenditure (CAPEX) can be avoided, as only operational costs (OPEX) are incurred for IT resources provided by a cloud.
For users who are already using APO, the reasons for switching are different. Firstly, SAP has discontinued support for SAP SCM APO and secondly, there are no longer any significant functional updates. In addition, IBP comes with many new functions that make it much easier for companies to produce economically. The keywords here are Improved simulation options with what-if scenarios, more precise evaluation options with analyses and dashboards, new forecasting methods with demand-sensing and machine learning algorithms, simplified collaborative planning and better performance thanks to optimization for HANA.
CHANGEOVER: A PRACTICAL SCENARIO
If the integration already works in ECC, how should you proceed? What is the situation for users with and without APO? The easiest way to IBP is for users who do not yet have APO. Implementation on the proverbial "greenfield site" is associated with the least effort, as IBP provides all the tools to either pull the required data from the ERP system or access it from third-party tools until IBP goes live.
The changeover is somewhat more complex if APO is already in use - even if the solution comes from SAP. This is mainly due to the fact that APO has numerous modules that IBP does not fully cover. This is because the PP/DS and gATP modules are not migrated from APO to IBP but to the S/4HANA core. A gradual replacement is therefore recommended. One use case, for example, is to first replace sales planning (APO DP) with IBP for Demand, followed by IBP for Response & Supply for SNP. During the transition phase, it must then be ensured that the APO module PP/DS is supplied with forecasts via IBP; gATP can initially continue to run in parallel. APO will not be switched off completely until the switch to S/4HANA.
IBP can be integrated into a classic ECC system as well as into S/4HANA. For example, the solution includes the CPI-DS interface and SDI for order-based integration as well as the ERP add-on for the core system.
