Consider the procurement process. Everything about that process is housed within an enterprise ERP system such as authorized vendors, what can be bought, who is allowed to make purchases and of what size. If blockchain is used to manage procurement across enterprises, all of that procurement logic and information has to be rebuilt in the blockchain which slows the development considerably. A much easier approach with faster time to value is to plug the blockchain into the ERP system and make use of the company’s existing business logic, data and process controls. In addition, if the ERP and blockchain platform are not integrated, there is a continued resource investment to keep the two aligned. The likelihood of introducing error increases, creating synchronization challenges and heightening business risk.
In many companies today, the view of processes is limited to within the organization’s boundaries. For example, the procure-to-pay process is seen as “end-to-end” with the elements of the process outside of the enterprise’s control being taken for granted. But, with blockchain integrating enterprises, the new scope of a procure-to-pay process spans multiple entity boundaries and it begins and ends in ERP systems. A truly seamless, end-to-end multi-company process begins within one company’s ERP system, moves through the blockchain and ends in other companies’ ERP systems.
SAP Integrated Business Planning (IBP)
Advanced planning and scheduling, for which many companies use SAP IBP (and APO), is dependent on its underlying data to build an accurate forecast. The accuracy of the SAP IBP forecast is a function of the accuracy of the information about the inventory in its supply chain.
Despite the digital infrastructure within the company, most companies have only limited visibility and insight into where all their products are at any given moment. Analog gaps exist between systems within enterprises and across enterprise boundaries. However, the opportunity that blockchain presents for planning and scheduling is tremendous if the end-to-end process is expanded. Blockchain solutions are extremely disciplined in how they handle assets and are able to greatly reduce inventory inaccuracies. When an asset management blockchain is integrated into SAP IBP, the company gains a more accurate picture of inventory throughout the extended supply chain and, therefore, receives a more accurate forecast to drive its own production.