With mySAP CRM installations becoming more stable, many companies are focusing on how better to take advantage of their investment in CRM software and data. One way to do this is with mySAP CRM Analytics, offered as part of mySAP CRM 2005. mySAP CRM Analytics is a group of tool sets that includes data mining and other mathematics-based analytical tools. These tool sets can help you uncover new business opportunities and improve how you target your customers.

As you can see in Figure 1, mySAP CRM provides data to SAP NetWeaver Business Intelligence (SAP BI), which processes the data and returns the analyses to mySAP CRM. This return of data from SAP BI to mySAP CRM is prevalent in many areas. It could be a simple feed of a target group generated by manual data analysis, or it could be the output of complex data mining algorithms run on millions of sales orders.

Figure 1

Integration points between SAP BI and mySAP CRM Click Here for larger image

Extractors in mySAP CRM Analytics transfer data into SAP BI for analysis. I will provide an overview of the extraction mechanism from mySAP CRM, a brief discussion about cross-application tools that directly support mySAP CRM business processes, and then a little detail about each of the available analytical tools.

mySAP CRM Extraction Mechanism

Many mySAP CRM business processes require real-time or near-real-time data transfer into or from other systems. For example, when you create a sales order in mySAP CRM, at the same time it must exist in mySAP ERP Central Component (ECC) or R/3. Imagine you are a global company with distribution centers worldwide. In this scenario, before you can assign an order a promised ship date, mySAP CRM must communicate with Advanced Planning and Optimization (APO) within SAP Supply Chain Management (SCM) to get global available-to-promise (ATP) information.

This communication between systems is handled by business documents (BDocs) that package the data as it “flows” between the systems. The dedicated software for each type of system mySAP CRM communicates with is called an adapter (e.g., BW Adapter). This is true for much of the data that flows from mySAP CRM to SAP BI. In addition to using the BW Adapter, data can flow out of mySAP CRM to SAP BI using generic extraction. This is the same generic extraction that you can use in any SAP source system.

A simplified version of the BW Adapter interface appears in Figure 2. mySAP CRM delivers an extraction mechanism to feed data into SAP BI from all mySAP CRM application areas. In most cases, the system stages this data to SAP BI (the delta queue) with exactly the data it saved in the mySAP CRM transaction at the time it processed it.

Figure 2

Most CRM DataSources use the same generic extraction process, although a few use BW Adapter to provide transaction data Click Here for larger image

Data Mining Workbench and APD

A few years ago, the mySAP CRM team at SAP led the initiative for the development of mySAP CRM-specific tools in SAP BI. These tools were the Data Mining Workbench and Analysis Process Designer (APD).

Data Mining Workbench is a tool that builds data mining models, which involve mathematical algorithms to analyze and discover information (trends and relationships) in mass quantities of data. Access Data Mining Workbench via transaction RSDMWB in SAP BI to create data mining models. Table 1 shows one use for each data mining algorithm. These applications just scratch the surface when it comes to mining data in mySAP CRM.

Data mining provides an object to store the settings needed to run the algorithms on specific sets of data. In many cases, execution requires preprocessing of the data from many sources to collect the data the model needs to run. Therefore, actual execution of the models takes place using APD.

APD manipulates data from various sources using predefined and custom transformations in support of a desired analysis task. The transformations can include executing the data mining tasks in Table 1 and many others. In addition, you can save the interim manipulations and the final result for future use. If this sounds a lot like the purpose of extraction, transformation, and loading (ETL) in SAP BI it should. When you use APD, for the most part you are using data cleansed and loaded by the SAP BI ETL process. Persistently stored output options include SAP BI master data, BI DataStore objects, CRM business partner attributes, CRM target groups, and CRM product proposals.

In addition to these cross-application tools, a group of SAP BI business content exists that you cannot pigeonhole into one mySAP CRM subarea. This includes SAP BI cross-scenario analyses content in the following areas of mySAP CRM:

• Installed base analysis

• Activity analysis

• Case management analysis

• Billing Engine analysis

• Interaction Center Workforce Management

• mySAP CRM Incentive and Commission Management

For more information about these areas, go to https://help.sap.com and follow menu path mySAP Business Suite>SAP CRM 5.0 Support Release 1>English>Analytics>BI Content>Cross-Scenario Analyses.

Available CRM Analytics

In the sections that follow I will explain the delivered tool sets specifically designed to support many of the subareas of mySAP CRM, including customer, product, sales, service, marketing, and channel analytics. In many cases the SAP-provided analysis content involves standard-delivered SAP BI content queries supported by delivered content providers and dependent ETL objects. In other cases, much more complex analytical applications are provided. Although you can define an analytical application as a simple SAP BI query, in this context I want to define it as a set of queries, specialized programs, or other tools packaged together that analyze a specific business issue. In some areas of mySAP CRM, these analytical applications are more prevalent than in others.

Customer Analytics

Customer analytics gives you insight about customers’ buying behavior and satisfaction, as well as their loyalty and churn behavior. Furthermore, you can use customer analytics to determine a
customer’s value to your company. With customer analytics, SAP provides analysis tools and reports (queries) targeted at analyzing your customers. These can help answer questions such as:

• Who are my customers?

• On average, for how long do we retain a specific customer?

• What is our turnover of customers from period to period?

Some of the content in customer analytics contains simple queries that list customers and their information. Other content is much more sophisticated. For example, one section of customer analytics leverages stored results from Data Mining Workbench to look at the migration of customers from one grouping to another over time. An example of this migration analysis content includes reports and charts showing ABC analysis over time. In a simplified example, this content would answer the question: How successful was our recent promotion in turning B customers into A customers?

An analytical application called customer lifetime value analysis (CLTV) brings together information from many sources to determine how much the average customer spends over his lifetime as your customer. This lifetime is divided into industry-defined lifetime periods (e.g., 12 months/period for the auto industry). It also produces reports that show profit/loss and how many customers churn during any specific lifetime period.

Customer analytics would not be complete without discussing Survey Suite, a tool you can use to survey your business partners. You could have a marketing campaign with a link to Trade Promotion Management using Survey Suite and customer segmentation. With Survey Suite, you design custom surveys (without using coding), link them to an email campaign, and then send the survey results to SAP BI for analysis. For example, a computer distributor could send a promotion to customers who plan on buying more than 1,000 computers within the next three months.

Product Analytics

Product analytics provide you with the processes for cross-selling and competitor analyses. They offer valuable information about the interdependencies between your products and competitors’ products.

Although it may seem that you would need a simple set of business content to support product analytics, the volume of information and the complexity of relationships among product purchases creates analysis complexity. To solve these complex issues, you need data mining. You apply the association analysis data-mining model to sales data to generate product relationships (associations). In my closed-loop SAP BI to mySAP CRM scenario, the system sends the data mining results back to mySAP CRM as product proposals.

Sales and Service Analytics

Sales and Service analytics provide reports to monitor, control, and measure sales and service activities. In these areas, SAP BI supports mySAP CRM with delivered SAP BI content in the form of InfoProviders, queries, and ETL components for each subarea in Sales and Service.

Delivered DataSources from mySAP CRM feed the InfoCubes and ODS objects with linked queries. As with other areas of mySAP CRM, Sales and Service uses an SAP BI application called Integrated Planning, (or the older BPS planning), in addition to simple queries. I will discuss planning in the “Marketing Analytics” section, but the concepts also would apply in Sales planning.

Marketing Analytics

Marketing analytics provide information to help you create and optimize marketing campaigns. In this area, SAP BI, mySAP CRM, and ECC have a lot of intricate content, not just basic InfoCube or ODS content. Compared to a simple set of SAP BI queries, this content is much more involved. Two examples are recency, frequency, monetary (RFM) and CLTV, which I discuss below.

Many marketing campaigns lack measurements of success (e.g., cost for the campaign, revenue generated by the campaign, and the proportion of targeted versus responding customers). With mySAP CRM, SAP BI, and ECC you can perform scientific success analysis. Table 2 provides an overview of the steps involved in marketing analytics.

In addition to capturing cost, SAP BI supplies many other analytical tools to support marketing. These include decision trees, clustering, scoring, and ABC analysis to help you create target groups. Additionally, SAP BI offers RFM analysis. This specialized analysis tool uses APD to provide the following information about customer purchases:

• How recently they occurred (R)

• How frequently they occur (F)

• How much profit (monetary value) they generate (M)

The RFM model is a common rating to determine a value for purchased mailing lists. Although it may not work for all industries, many use it as an additional classification for customers. The result of the RFM model is a rating level for each customer in each category. For example, the RFM rating for your most recent, frequent big spenders could be 1,1,1, where 1 is the best rating for each R, F, and M category.

You select the rating scale for the RFM model to create grouping codes for your customers. You do not need the same scale for each category. For example, you could have 4 as the highest rating
for R segments, but 3 as the highest rating for F segments, and 2 as the highest rating for M segments, so your best customer would be 4, 3, 2.

mySAP CRM Segment Builder with SAP is another tool you can use with Marketing Analytics. Segment Builder is a mySAP CRM tool you use to create marketing target groups. Using a drag-and-drop GUI, you can drag attributes like “region” and “hobbies” with the desired values into a target group for a marketing campaign. For example, you could target boat owners who live in California. The data to support this selection process can come from within the business partner data in mySAP CRM or from SAP BI. This is significant because it means that without knowing it, a marketing person can access queries and InfoProviders indirectly in SAP BI.

Planning is another marketing analytics tool you can use with mySAP CRM and SAP BI. Even if you cannot apply this concept with your marketing team right away, most companies use Sales or Service planning. This section applies almost entirely to these areas as well as others in mySAP CRM, such as call center planning or opportunity planning.

This process involves SAP BI databases called InfoCubes as the storage container, Microsoft Excel or Web- based input screens, and planning functions (similar to macros in Excel) to maintain data. SAP BI planning can eliminate planning based on exchanging Excel-based spreadsheets. Planning in mySAP CRM is really planning in SAP BI with or without tight integration. (Tight integration involves embedding SAP BI planning screens inside mySAP CRM transactions.)

Planning in SAP BI is in transition. Originally SAP’s dedicated planning tool, Business Planning and Simulation (BPS) was a component of SAP’s Strategic Enterprise Management (SEM). SEM-BPS still is a fully featured product for performing all types of planning, including special planning functions to support Financial Accounting (FI) planning requirements.

SAP noticed, however, that many companies needed planning for many areas besides FI, such as planning for mySAP CRM. SAP did not want to force companies into SEM when all they needed was Sales and Marketing planning. As a result, SAP created BW-BPS, which is basically SEM-BPS without a few dedicated, sophisticated FI functions. mySAP CRM integrates very tightly with SEM- or BW-BPS. This integration allows you to seamlessly enter planning information in SAP BI through mySAP CRM screens.

SAP offers a new planning tool, SAP BI Integrated Planning, with SAP NetWeaver 2004s. The advantage of this tool over SEM- or BW-BPS is that it is much more tightly integrated with existing SAP BI front-end tools, including Business Explorer (BEx) Analyzer, Web Application Designer (Web AD), and BEx Query Designer. The disadvantage is that this is so new that the integration with mySAP CRM is not yet complete.

This might require that you use both the newer SAP BI Integrated Planning for some planning areas in your company and the older BPS planning for areas where you need tight mySAP CRM integration, at least temporarily. For example, if you were just doing Sales planning, I would stick to the new SAP BI Integrated Planning, as tight integration is not an advantage. For Marketing planning, however, until improvements are ready, I would use the older BPS planning. Table 3 summarizes these planning options for mySAP CRM.

BW-BPS provides tight integration in Marketing Planner. Not only do you have the ability to nest BPS planning inside of mySAP CRM, the system also automatically creates master data for the new campaign in SAP BI and saves the campaign in mySAP CRM.

A special version of Marketing planning involves trade promotions planning to determine the increased sales (uplift) when you offer “buy 2 get 1 free.” This is called Trade Promotion Management in mySAP CRM. The type of planning enables you to assign uplift volume (which you can transfer to APO) and generate condition records (for discounts) that you can use in mySAP CRM Sales or in ECC. The conditions tag the invoice/order to a promotion, then the system transfers that tag to CO-PA and into SAP BI. You analyze this information to determine the effectiveness of the promotion.

Channel Analytics

Channel analytics provides information about how you sold an item. Which channel did you use — Interaction Center (IC), Internet, a partner, or direct sales? Channel analytics answers the questions “How effective was this channel?” and “What can you do to make it more effective?” For example, you can create a useful channel analytics report that shows sales broken down by channel to see how much of your business comes over the Web as opposed to direct person-to-person (field) sales.

While you might expect SAP BI content to support the question “Which channel had more sales?” SAP provides much more specific SAP BI channel analytics content. For example, for the Web channel, SAP provides content that not only tells you how many hits a given Web page received, but also how many people put product X into their Web shopping basket and did not purchase it. For IC, SAP provides queries about the number of calls each operator processed, as well as the sales made by each operator. This is a critical connection, as the number of calls per day might be one factor for success, while calls without sales might be unimportant.

Ned Falk

Ned Falk is a senior education consultant at SAP. In prior positions, he implemented many ERP solutions, including SAP R/3. While at SAP, he initially focused on logistics. Now he focuses on SAP HANA, SAP BW (formerly SAP NetWeaver BW), SAP CRM, and the integration of SAP BW and SAP BusinessObjects tools. You can meet him in person when he teaches SAP HANA, SAP BW, or SAP CRM classes from the Atlanta SAP office, or in a virtual training class over the web. If you need an SAP education plan for SAP HANA, SAP BW, BusinessObjects, or SAP CRM, you may contact Ned via email.

You may contact the author at ned.falk@sap.com.

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