Siemens Energy: Using continuous accounting principles to optimize enterprise performance management on group and local levels
A flexible financial reporting and planning landscape
Siemens Energy AG is committed to meeting increased energy demand while supporting efforts to reduce greenhouse gas emissions. To realize strategic potential, it overhauled entity and group close reporting using the SAP Cloud ERP Private, group reporting add-on and the SAP Analytics Cloud solution. This move accelerated financial consolidation and close processes while enabling more agile business steering.
| Industry | Region | Company Size |
| Oil, gas, and energy | Munich, Germany | 101,100+ employees |
Project Manager (IT), Siemens Energy AG
Boosting enterprise performance management with consolidated planning data
Siemens Energy AG operates across the energy landscape in both conventional and renewable power, grid technology, storage, and electrifying, complex industrial processes. Located in 90 countries, its broad product portfolio allows it to meet the increasing demand for energy while supporting efforts to reduce greenhouse gas emissions.
The company is well positioned to shape the energy transition toward decarbonized energy technologies and promptly react to customer needs worldwide. With research and development fundamental to its success, Siemens Energy invests around €1.2 billion in R&D activities each year and is committed to making energy reliable, affordable, and more sustainable. It focuses on addressing the challenges posed by the market-defining megatrends: growing electricity demand, decarbonization, digitalization, and decentralization.
When Siemens Energy was spun out of Siemens AG in 2020, it inherited a highly customized instance of strategic enterprise management software that no longer suited its requirements in enterprise performance management (EPM). With the new energy business fast outgrowing this legacy solution for internal and external enterprise reporting and group consolidation, Siemens Energy sought a new approach that would integrate with advanced ERP capabilities.
Rethinking the financial close-to-disclose process
To simplify group consolidation, corporate reporting, and planning based on high-quality data, Siemens Energy set about creating its next-generation EPM architecture, known as EPM+, with the SAP EPM solution. A combination of proven and innovative components—including the SAP Cloud ERP Private, group reporting add-on; SAP Analytics Cloud solution; and SAP Business Technology Platform—sit at the core of this landscape. It also features the SAP BW/4HANA solution, as well as SAP Analysis software for Microsoft Office, and the SAP Disclosure Management application to support external legal entity reporting.
Because Siemens Energy was departing from a highly customized legacy environment, the company’s approach for the implementation was to prioritize the use of standard functionalities wherever possible for strong governance and process simplification.
As shown in the diagram, Siemens Energy configured the environment with consolidation activities performed in SAP Cloud ERP Private, group reporting. Data is collected from SAP S/4HANA or its remaining legacy ERP solutions through the SAP Group Reporting Data Collection solution. Actuals are consolidated for International Financial Reporting Standards and German Commercial Code (Handelsgesetzbuch) datasets. Operations reporting has live access to the group reporting add-on.
SAP Analytics Cloud for planning is configured for financial planning, encompassing data collection and the processing of forecast and budget data, as well as for special-items reporting. Meanwhile, SAP BW/4HANA provides the source for legal and management reporting on group reporting figures as well as the framework for comparable data generation. SAP Analytics Cloud also provides dashboarding and self-service reporting and supports function reporting.
Adopting continuous accounting methodology using trusted granular data
With SAP EPM serving as the basis of the company’s EPM+ architecture, Siemens Energy successfully transformed its EPM architecture without missing a beat. In doing so, it created an efficient, flexible, and future-ready EPM framework while reducing IT costs. The solution draws on a common database with high-quality, harmonized, and validated data for different reporting purposes, improving data accuracy and company-wide accessibility.
As part of the project, Siemens Energy simplified its group reporting environment by aligning its processes to standard functionality, providing users with a more modern and intuitive experience. The project also presented the opportunity to identify redundancy and eliminate customizations in its group consolidation systems that were brought over during the spin-off from Siemens AG. This has allowed the company to combine internal and external reporting and speed up group consolidation reporting.
Kai Fischer, EPM+ project manager (business) at Siemens Energy, comments, “By simplifying and harmonizing our group reporting landscape, we created one unified source of accurate and up-to-date data that is accessible to everyone in the company. This includes aggregated account order information with a reporting line, enabling users to see detailed accounts within the orders. This is something that was not possible in the old landscape.”
In terms of functionality and usability, there’s greater flexibility for ad hoc adjustments, and the modern user interface has simplified access to strong analytical capabilities, including validation result analysis and group data analysis. Reporting items for the corporate account and reporting position are now integrated in one data model. There’s also improved functionality for exporting Microsoft Excel data.
Bettina Feyrer, EPM+ project manager (business) at Siemens Energy, adds, “The new environment is more flexible and there’s less complexity, especially in the reporting environment for group consolidation. It’s now easier to identify errors and gaps because everything is connected. And with the same master data in each reporting tool, we need to make changes only once. When our companies have moved to SAP S/4HANA, we expect to see a significant improvement in data quality.”
Project Manager (IT), Siemens Energy AG
Maximizing value from a fit-to-standard approach
Building on this established EPM foundation, Siemens Energy aims to further enhance efficiency and accelerate the overall financial close process.
The company also expects to see additional benefits in group reporting in the near future, as more of its entities move from legacy ERP solutions to SAP S/4HANA and the group reporting close process becomes far more integrated. With fewer interfaces and fewer manual fixes, the company expects to see a smoother, faster closing on one harmonized foundation. Likewise, the company is looking to take advantage of integrating SAP S/4HANA with other advanced technologies from SAP to propel innovation.
In the meantime, another work in progress involves replacing its system for providing additional disclosure data by automating forms within SAP Group Reporting Data Collection.
Elsewhere, the company is exploring potential financial and functional benefits from migrating data housed in its data warehouse on SAP BW/4HANA to the SAP Business Data Cloud solution.
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