Global Value Chain (GVC)
Operating in Dynamic Markets
How profitable are your products across the entire value chain? How high are your overall material, manufacturing, and logistics costs? How are you affected by fluctuating commodity prices or exchange rates? How can you achieve transparency with regard to real transfer prices and inter-company profits? These are just some of the questions that central controlling, sales, or product and supply chain management units of international companies are finding increasingly difficult to answer.
For companies with global value chains to be successful, it is more important than ever to be able to show, plan, and optimize all the added value. This is the only way of capitalizing on the potential gains from the digital transformation, which amount to an annual figure in the region of 250 million euros for industrial sector in Europe alone.
The Solution: Global Value Chain
Our Global Value Chain solution is intended for international corporations from all industries, whether manufacturing, plant construction or the process industry. The SAP add-on solution enables you to display your group costing and profitability in detail. More specifically, you can display planned and actual costs per division, per product group, and per product across all production locations and systems without having to go through the laborious process of eliminating the intercompany profits manually. As a result, the solution not only provides you with a clear overview of your group costing and profitability, but also enables you to meet global statutory regulations and compliance requirements.
Benefits of Global Value Chain
- Present a global and detailed view of your group costing and profitability across any ERP and country borders
- Enjoy complete transparency (end-to-end) in relation to the costs of all products and product groups with options to create reports and drill down to any level of detail
- Work with a dynamically-created bill of materials that shows the entire global manufacturing process (global BOM)
- Collect and calculate your material, manufacturing, and logistics costs on all product levels
- Simulate the effects of currency fluctuations and other external factors on your profitability
- Improve your margins through faster decision-making, smarter purchasing strategies, or further optimization of your supply chain
- Analyze and plan the global transfer costs and identify audit-related deviations early enough to react accordingly
Global Value Chain will easily integrate in any SAP architecture landscape given the multiple options to use the system:
- Run GVC as SAP add-on on your existing SAP ERP or SAP BW (regular DB or HANA) server
- Run GVC on a side-car SAP ERP or SAP BW (regular DB or HANA) server
- Use GVC BW content to integrate with your existing SAP BW reporting landscape
- Extracts data from almost any SAP ERP via plug-in (ECC4.6C and beyond, Suite on HANA, S/4 HANA)
- Can import data from other non-SAP ERP or business systems via an external data interface
- Coming soon: modern web-based user interface with additional analytics
- Coming soon: native views to drive visual analytics with external tools like Lumira or Tableau
Needs and Engagement
- Almost each machine / product is uniquely customized at the factory resulting in final cost only known at the end of production
- Cost & profit planning done on “dummy” machines
- ERPs and CO-PA allowed for only single entity reporting and analysis not excluding intermediate profits
- No company wide profitability analysis for all products, segments and markets
Through the implementation and use of Global Value Chain our client now has the capability:
- To view a completely integrated view of its global value chain with planned and actual costs down to the last screw
- To analyze revenues and cost along almost unlimited number of attributes
- To Drill-down from company level aggregated date down to single items
- To run analytics based on the true global product hierarchy
- To distribute indirect costs (e.g. R&D, Marketing or IT) correctly based on real-world allocations splits across its products and services
(FISFG PMO & Governance)
F. Hoffmann-La Roche AG
EXA GVC is a unique solution, that enables companies to calculate consolidated product costs and profits along the entire global value chain, without losing track of the original underlying cost component split.
We use EXA’s GVC solution for multiple business functions and have found it very useful for all aspects of financial consolidation. Since implementing GVC, the accuracy of our cost and inventory calculation within group accounting has improved drastically. Considering that GVC works across ERP systems and across country boundaries, this is remarkable.
I personally think that EXA’s GVC solution is unmatched regarding its capabilities to create a truly global consolidated cost & profit footprint across the entire value chain. I firmly believe that it can be leveraged for various business functions such as accounting, controlling and logistics.
As for EXA, I think the company has demonstrated an impressive growth path, and in my role as Program and Project Manager at Roche, I am delighted to work with functional and technical team members from EXA. EXA consultants not only bring a very high level of expertise, but their quality consciousness and eagerness to deliver successfully is also noteworthy. This is once again being demonstrated in the current collaboration project, where Roche and EXA are working closely together.