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Business IntelligenceA Look at SAP Business

Warehouse at Canadian National

Business IntelligenceA Look at SAP Business

Warehouse at Canadian National

March 29, 2006

Marco AltieriMarco AltieriSenior Project Manager, ITSenior Project Manager, IT

2March 29, 2006

Table of Contents

• Who is Canadian National (CN)?• What is Business Intelligence?• BI implementation at CN?• Reporting options in SAP?• When do you choose SAP Business Warehouse (BW)?• Who are the BW end-users?• What is required to implement a BW solution?• Case Study 1: Worker’s Compensation• Case Study 2: Mechanical Shop Productivity• Lessons Learned

3March 29, 2006

2004 Results in CDN $Annual Revenues

$6.55 billion

Operating Income$2.17 billion

Expenses$4.38 billion

Operating Ratio66.9%

Route-Miles of Track19,304

Employees22,470

System Cars (2003)93,699 car fleet1,912 locomotive fleet

“CN’s is the only rail network on the

continent to connect three

coasts - the Pacific, the Atlantic and the

Gulf of Mexico”

Introduction to CN

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What is Business Intelligence?

The data is out there but how do I find it?

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• Broad category of tools to gather, store, and disseminate decision-making information to business leaders

• ToolsØ Custom application programs or commercially

available software by Business Objects, Cognos, or SAP (Business Warehouse)

• GatherØ Extract data from multiple source systems in different

formatsØ Transform & standardize data

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• StoreØ Integrate enterprise-wide corporate data in a single

repository called a data warehouse (DW)Ø DW can contain enormous amounts of data Ø DW is the foundation of business intelligence

• DisseminateØ Provide easy access to the right data

• Canned reports via email• On-line queries

Ø Enable on-line analytical processing (OLAP); view multiple dimensions of the data (slice & dice)

7March 29, 2006

Why Business Intelligence?

• Business survivalØ Need information to make better strategic and

operational decisionsØ You can’t manage what you can’t measure !

• Regulatory complianceØ Accurate financial reporting is more critical

than ever as a result of the Sarbanes-Oxley Act

8March 29, 2006

CN’s 5 Guiding Principles?

• ServiceØ Deliver goods on time and undamaged

• Cost Control Ø Right management of all expenses

• Asset UtilizationØ An asset not in use is a liability

• Safety

• People

9March 29, 2006

BI Implementation at CN

Rail SAP R/3

Ad Hoc Query Business Objects

SAP BusinessWarehouse

Corporate Data Warehouse

CN Datacity(CorporateMeasures)

Ad Hoc Query (Business Explorer)

10March 29, 2006

Corporate Data Warehouse

• Custom built application and databases (Cobol and DB2)

• Business Objects tool used to build queries and analyze data

• Provides mainly rail operation measures

Ø Car velocity

• Corporate measures accessed via web front-end on CN intranet site (Datacity)

11March 29, 2006

Reporting Options in SAP

As flexibility increases, so do costs

• R/3 Standard Reports

• R/3 Report Generators

• Programmed Reports (ABAP)

• Business Warehouse

12March 29, 2006


Business Warehouse (BW)Ø SAP software solution (not an

R/3 module)Ø Consolidated view of enterprise

data Ø Optimized for reporting and

analysisØ Summarized copy of transaction

and non-transaction data Ø Data stored in multi-dimensional

tables called cubes

13March 29, 2006

SAP Business Warehouse

• Supports 16 different applications including:

ØFinance

ØMechanical Productivity

ØWork Related Injuries

ØTravel Management

• Approximately 500 users running over 20,000 queries per month

• Measures also found in CN Datacity

14March 29, 2006


• BW Advantages:

Ø Empowers end-usersü Can build ad-hoc queries with no

programmingü Can ‘slice and dice’ information using

various business criteria and ‘what-if’scenarios

Ø Provides high-quality information to meetcomplex reporting needsü Summarizes large amounts of data from

different sources in a single view

15March 29, 2006


• BW Advantages:

Ø Can analyze trends over several months or years

Ø Offloads ad-hoc and long running queries from production operational system to BI systemü Should improve overall performance of

operational systemü Reduces frequency of server capacity upgrades

Ø Can process large volumes of information quickly

16March 29, 2006


• BW Advantages:

Ø Can pull information from different R/3 modules or non-SAP sourceü Train schedule information from operations

system

Ø Reports easily deployed across organization via thewebü No need for BW software on user desktop

Ø Provides development aids via standard Business Contentü Templates for R/3 data extractors & cubes

17March 29, 2006

Given all the advantages in BW …

Does BW replace R/3 reporting?

Absolutely not !

Each tool satisfies very specific needs

18March 29, 2006


• BW DisadvantagesØ Most expensive to develop and maintainü Requires IT resources with BW skill setü Hardware infrastrucure to store several

years of dataØ Requires training of power usersØ Does not address real time reporting

needsü Available in 2006 with version 7.0

Ø May require ABAP programmingü To perform very complex calculationsü To pull additional R/3 data

19March 29, 2006

Distinction between R/3 and BW

• R/3 is an operational system optimized to post transactions as quickly as it can

• BW is an analytical tool optimized to readdata as quickly as it can

20March 29, 2006

When to Choose R/3 Reports …

• For operationaloperational needs

• When information is required by people:ü To carry on their day-to-day business

activitiesü In real-timeü At the detailed transaction levelü Frequently in the course of a day or week

21March 29, 2006

When to Choose BW Reports …

• For analyticalanalytical needs

• When information is required by managers: ü For decision-making that will impact the future of a

business ü To perform trend analysis on several months/years of

dataü To view aggregated information (with drill down

capabilities)ü Not needed daily

22March 29, 2006

When to Choose BW Reports …

• When R/3 reports time out

23March 29, 2006

Who are the BW Users?

Power Users

Report Viewers

Ø5% of users

ØFocus on Key Performance Indicators

Ø10% of users

ØBuild ad-hoc reports

ØPerform trend analysis & what-if scenarios

Ø85% of users

ØSimplified view of information

Executive Users

24March 29, 2006

Who are the BW Users?

Learning to navigate BW

reports is child’s play

25March 29, 2006

What is required for BW?

• Clear Requirements• BW Data Modeling• BW Configuration • ABAP Programming• BW Query Development• Security Analysis• Hardware • BW Software

26March 29, 2006


• Clear Requirementsü What are the key business questions that need to

be answered? ü What decisions will be made based on answers?ü How is information currently accessed (i.e MS

Access)?ü What are the various sources of information needed

(i.e. SAP, external)?ü Who is the audience for the reports? ü How often is data required (daily / weekly / monthly)ü What is data volume and retention period?

27March 29, 2006


• Data Modelling

Ø Store data in multi-dimensional tables called cubes

Ø Develop data model from scratch

Ø Can be very sophisticated to accomodate complexreporting needsü Summarized data with drill down to transaction

levelü Multiple data sources combined in one view

28March 29, 2006


Other

SAPBW Reports

Ad Hoc Query & Analysis

BW ODS

BW Cube

PM

External

HR

29March 29, 2006


• BW Configuration Ø Includes definition of data, cubes, and business

rulesØ Different from R/3 configurationØ Activation of business content

• ABAP ProgrammingØ Used when BW configuration cannot accomodate

requirements: ü Standard R/3 extractor does not include all

required dataü Very complex business rules or calculations

Ø Recommended as last resort

30March 29, 2006


• BW Query Development

Ø Build corporate or ad-hoc reports

Ø View reports via BEx or the Web

Ø BEx (Business Explorer)ü Excel front-end to BWü Requires desktop installation of SAP Business

Warehouse

Ø Web Templateü Simplifies deployment of reports across the

organizationü Requires a web browser only

31March 29, 2006


• Security AnalysisØ Different from R/3 Ø User access can be granted by:ü Info Area (functional grouping of cubes)ü Cubeü Report

Ø Security can even be restricted at field level (i.e. salary)

Ø Security by Info Area simplifies maintenance:ü Existing users continue to have access to new

reports or cubes developed within the same Info Area

32March 29, 2006


• HardwareØ Application server with multiple landscapes:Ø Sandbox for prototyping (production size)Ø DevelopmentØ User TestingØ Production

Ø Lots of disk space !!!

• BW SoftwareØ Requires licensing and supportØ Application software on host serverØ Desktop software for developers and end-users

33March 29, 2006

Case Study 1: Worker’s Compensation

• BackgroundØ Obligatory in CanadaØ Protects CN from legal action resulting from work-

related injuries or illnessØ No fault system regulated by Provincial Compensation

Boards (i.e. CSST)Ø Payments in Canada are approximately $35m / yearØ Every 3 years, CN must produce future liability of

compensation costs for accounting purposesØ Compensation costs on the rise in spite of fewer injuries

34March 29, 2006


• Context for Reporting:Ø Run custom R/3 reports (ABAP)Ø Manipulate excel files with downloaded R/3

information

• Limitations:Ø Complex and very time-consuming to produce

reports (3 days)Ø Unable to perform ‘what-if’ scenarios Ø Lack of drilldown capabilities Ø R/3 reports cannot handle sufficient volume of

information for trend analysis purposes

35March 29, 2006


• Limitations:Ø No tool to perform in-house valuations Ø No integration between expected payments and

the actual claim information (including administrative fees paid to the provinces)

36March 29, 2006


• AudienceØ Claim & Risk Managers across CanadaØ VP Finance and Accounting Managers

• Business RequirementsØ What are my WC costs by year of injury?Ø Why are my WC costs increasing when my injuries are

decreasing?Ø What injury type will cost me most?Ø What is my projected outlook for future costs?

37March 29, 2006

Case Study 1: BI Solution

Other

SAP R/3

Actual Payments Cube

Claims & Payments

Actuarial Factors

Employee Health & Safety

Future Payments Cube

38March 29, 2006

Case Study 1: WC Cube

‘03 ‘04 ‘05

Compensation Costs

Ontario

Quebec

Concussion

Sprain

Burn

BC

Injury Type

Report:View Compensation Costs for Quebec according to Injury Type for 2003 to 2005

Event

39March 29, 2006

Case Study 1: BI Benefits

• Improved productivity for claim managers Ø Reports available in seconds compared to daysØ View data from different criteria

• Ability to analyze compensation costs over several years to identify injury trends trends

• Ability to drill down on individual cases to focus on high-cost generatorsØ Better allocation of time for claim managersØ Anticipate $10 million savings

40March 29, 2006


• Ability to run in-house valuation for future costsØ Savings of $100,000 per year

• Cleanup of source dataØ BW catalyst for initiative

41March 29, 2006

Case Study 2: Shop Productivity

• Background

Ø American Association of Railroads (AAR) provides standards for maintenance activities on rail cars:

üCar inspections

üWheel Change

Ø Management was looking for ways to measure productivity of maintenance workers across Canada

42March 29, 2006

Case Study 1: Shop Productivity

• Context for Reporting:Ø Developed ABAP programs in SAP R/3 to match

standards with time reported by employee

• Limitations:Ø Run-time performance of reports was very slow

(over 45 minutes to run report for 1 shop for 1 month)

Ø Not able to run more than 6 months (time-out)Ø Not able to run comparison reports between

different shops Ø Measures inconsistent depending on who ran

report (R/3 security constraint)

43March 29, 2006

Case Study 2: BI Solution

SAP R/3

SAP R/3

Mechanical Productivity Cube

Mechanical Work Orders

Employee Time Reporting

Plant Maintenance

Human Resources

44March 29, 2006


• Increased visibility of measures improved productivity of all shops across CanadaØ 1 shop went from 30% to 80% productivity in a few

monthsØ No need to replace maintenance workers who left

by attrition

• Significantly improved run-time of reports from 45 minutes to under 10 seconds

• Can run measures with over 1 year data to identify trends

45March 29, 2006


• Retired old R/3 programs (strain on operational system)

• Measures produced are consistent regardless of who runs report (no security constraint)

• Reports easily accessed via Datacity with a browser

46March 29, 2006

Lessons Learned

• Get clear requirements from the businessØ Identify key questions to be answered

• Get early commitment from the business for testingØ Identify power user and report viewerØ Schedule test period

• Plan and budget for user training:Ø Power users (2 days)Ø Report Viewers (1/2 day)

• Run a pilot before full deployment

47March 29, 2006

Lessons Learned

• Use the web for deployment of reports to viewers

• Plan time to prototype application Ø Early validation of requirements by the businessØ Speeds up delivery by minimizing transports

• Make sure you have a solid data model & architecture

• Use Operational data stores (ODS) to store transactions in their raw formØ Reduces impact of future cube reloads

48March 29, 2006

Lessons Learned

• Pull any R/3 field that may be required in the futureØ Minimizes risk of cube reloads

• Apply security by Info-AreaØ Simplifies maintenance

• Assess hardware requirements earlyØ Vendors can help to identify requirements for main

memory, disk space and CPU

• Allow sufficient time for initial data loadsØ Can range from a few hours to 3 weeks

49March 29, 2006

Lessons Learned

• Minimize ABAP codingØ ABAP programmers tend to quickly adopt ABAP

• Use Process Chains for:Ø Alerts: Email or pager notification of problemsØ To schedule dependencies between nightly jobs

• Ensure your development team is comprised of at least 1 internal resourceØ Improves support of implemented solution

50March 29, 2006

Thank You

How to contact me: [email protected]

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