Speed With Style - Why And How Customers Are Moving To S .

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Speed with Style - Why and How Customers areMoving to S/4HANA Fashion and VerticalBusinessASUG Session: 84561Ravi Prabhala, Global Head Consumer Industries DevelopmentPeter Akbar, Global Vice President & Chief Customer Officer Fashion7 May 2019

Legal DisclaimerThe information in this presentation is confidential and proprietary to SAP and may not be disclosed without the permissionof SAP. This presentation is not subject to your license agreement or any other service or subscription agreement with SAP.SAP has no obligation to pursue any course of business outlined in this document or any related presentation, or to developor release any functionality mentioned therein. This document, or any related presentation and SAP's strategy and possiblefuture developments, products and or platforms directions and functionality are all subject to change and may be changedby SAP at any time for any reason without notice. The information in this document is not a commitment, promise or legalobligation to deliver any material, code or functionality. This document is provided without a warranty of any kind, eitherexpress or implied, including but not limited to, the implied warranties of merchantability, fitness for a particular purpose, ornon-infringement. This document is for informational purposes and may not be incorporated into a contract. SAP assumesno responsibility for errors or omissions in this document, except if such damages were caused by SAP ́s willful misconductor gross negligence.All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differmaterially from expectations. Readers are cautioned not to place undue reliance on these forward- looking statements,which speak only as of their dates, and they should not be relied upon in making purchasing decisions. 2019 SAP SE or an SAP affiliate company. All rights reserved.2

AgendaThe Vertical Fashion Story at SAPFashion Customer UpdateFashion InfluenceFashion Roadmap Update 2019 SAP SE or an SAP affiliate company. All rights reserved.3

Retail and FashionA Strategic Industry208 of the 250 top retailers in the world run SAP:18 of the 20 top Fashion,18 of the 25Apparel and Footwear brands inthe worldfastest growing retailers in theworld13,400 Retailcustomers in 121countriesEnd-to-end fashionretail processes ona real-time reconfiguredbest practicesClear Industryroad map86% of the Brands/Retailers in the ForbesGlobal 2000 are SAP customers.Source: SAP Performance Benchmarking 2017. 2019 SAP SE or an SAP affiliate company. All rights reserved.4

Why does the Intelligent Enterprise matter?To help Drive Growth and ProfitabilityAI has Potential to double the industry growth rateby 2035 Source: Accenture Research 2018 SAP SE or an SAP affiliate company. All rights reserved. ǀ INTERNAL. and drive 60% increasein Profitability5

The Future of Vertical Business is NowThe Key DriversBusiness AgilityTransact Anyhow,AnywherePersonalized productsServe Customer by nameConsistency 2019 SAP SE or an SAP affiliate company. All rights reserved.Faster everythingSustainabilityCircular EconomyUser experienceMobility firstSmart BeaconsAdvanced analyticsDeep insightsIntelligent PlanningMachine Learning,Artificial intelligenceBuy, fulfill, return anywhereOn shelf availabilityCollaborative purchasing &manufacturingDigitization of storesInternet of ThingsVirtual RealityGlobal view ofconsumer,inventory, styles,sizes & segmentsNew businessmodels6

SAP’s Vertical Business Solutions Since 1996Innovation Accelerating with Leading Fashion Customers199620142017-2018Brands and Retail run separateBrands and Retail Run VerticalVertical Runs Simple!S/4HANA Fashion andVertical BusinessOne solution for allchannelsVertical ProcessesSimplified databasestructure on HANAMultiple Industry UsageIn parallel SAP Retailwas developedIn-Memory DatabaseSAP HANA350 customersworldwide130 customersworldwide50 Customersalready!First release SAP appareland footwear software forbrands and manufacturersCo-innovation with marketleaders created SAP FashionManagement Solution (FMS)S/4/HANA Fashion andVertical BusinessReleased 09/15/17 2019 SAP SE or an SAP affiliate company. All rights reserved.Flexible Supply Chain7

The Starting Point: Historic World-Class SolutionsOriginally Businesses were Silos with Separate ervicesOrder anizationalStructureFinance toReportSupplyPlanningMRPProcure toPayAllocationRun(sales orders)SeasonsOptimizing Wholesale / ManufacturingWith SAP Apparel and Footwear (AFS)Retail was acustomerof SAPApparel ntManagement(Retail)RetailPricing reFinance toReportReplenishmentStore BackOfficeManagementAllocation(Stores)Retail VAS/ SeasonsRunning Merchandising / Store Distribution,with SAP Merchandizing for RetailConventional database onlyMRP Material requirements planningAFS and SAP Retail have supported fashion businesses since 1995/6 2019 SAP SE or an SAP affiliate company. All rights reserved.SAP HANA in-memory computing orconventional database8

SAP S/4HANA for Intelligent EnterprisesNEW VERTICAL REALITYA Historic Opportunity to Run One Simple S/4HANA Platform for All ChannelsS/4HANA Fashion and Vertical BusinessOne ERP for all channels fordramatic simplification e.g.Harmonized Processes on a Simplified S/4 Platformeliminate PO-SOs from retail towholesaleSingle Global Inventory to help reduce safetystock and retail stock-outs while increasingcustomer service, inventory turns andprofitabilityStandard solution on S/4HANAprovides ground breakingprocesses e.g. Advanced ATPand Supply Allocation (Arun) forall channels and industriesS/4 Fashion S/4HANA Fashion and Vertical BusinessS/4 Fashion is based on S/4HANA Retail MerchandisingFMS SAP Fashion Management solution (Suite on HANAproduct) 2019 SAP SE or an SAP affiliate company. All rights cingandMarkdownInventoryMerchandising Managementand ucture(Omni)One Set of Master Data for allchannels improves accuracy andspeed to marketFinancetoReportMRP andReplenishmentStore BackOfficeManagementHarmonized Processes on asimplified S/4HANA DB to reducesilos, simplify and run a globalvertical businessStrategic S/4 HANA platform withroadmap, influence channelsOrder toCashAdvancedATP / SupplyAssignment(Arun)Standard Tools to get ThereConversion from ERPInsightto Action* Note Fashion Manufacturing features are planned for S/4HANA 1809 releaseMRP Material requirements planningP2P Procure to pay9

Industry DynamicsSAP S/4HANARoad Map and Why SAP?Next StepsS/4HANABrings Data Model Simplification 2019 SAP SE or an SAP affiliate company. All rights reserved.10

Industry DynamicsRoad Map and Why SAP?SAP S/4HANANext StepsS/4 HANA Principle of OneData model simplificationsSIMPLE DATA MODELPRINCIPLE OF ONETHOUGHPUT INCREASE Only main tables remaining, no redundancies Only one valuation method (Material Ledger instead of 2(IM ML) Clear separation of master data from transactional data Reduction of memory footprintFlexible rebate management instead of cumbersome andexpensive redundancies* Actual Data Only Not displayed in lower part Profit CenterAccounting, Cost Based CO-PA, Reconciliation Ledger Only one Seasonal method, only one Value Added Servicesmethod 2019 SAP SE or an SAP affiliate company. All rights reserved.INSERT only on database level (MM-IM) nolocks for standard prices valuation11

SAP S/4HANA in Inventory Management - nventory inManagementwith aggregates and indicesSAP S/4HANAInventory Managementno indices 2019 SAP SE or an SAP affiliate company. All rights reserved.no aggregatesno redundancies12

SAP Delivering the Intelligent Enterprise for Vertical BusinessesHuman CapitalManagementExpedite time to benefit via Cloudand Model Company deploymentVertical BusinessRetail, Wholesale andManufacturing on S/4HANAGlobal Stock for All ChannelsCustomerActivityRepositoryDigital CoreSupply Chain tEnterpriseSuiteS/4 Fashion andVertical BusinessIntelligent TechnologiesAI/ML IoT AnalyticsInnovation PO PostponementSupply Demand OptimizationCollections ManagementProduct AllocationsFinancial Machine LearningCo-Pilot Chat/Voice Recogn.Innovation Vertical ProcessesARun for all channels, StockProtection/SegmentationSupply Chain via MRP Live andProduction PlanningDigitalPlatform 2019 SAP SE or an SAP affiliate company. All rights reserved.DataManagementSAP CloudPlatform13

Fashion Article for Style/Color/SizeReturning Fashion to a standard architecture with SAP S/4 FashionAFS Material 1122AFS Material UPC 1SmallUPC 4MediumUPC 2MediumUPC 5LargeUPC 3LargeUPC 6Example S/4 Fashion Sales Order Structure with color in the generic article e.g. Style/ColorS/4 Fashion Sales Order HeaderItem Generic Article Style/ColorSub-Items Variant (material) SizesSchedule Line (confirmed qty/date)

SAP S/4HANA Fashion with SAP S/4HANA RetailFashion Processes for all sizes and colorsHMaster laningHProductAllocation(PAL)HAdvanced ATP (AATP) Backorder Processing (BOP) Supply Allocation (ARun)PlannedIndependentRequirementHPricingInsight To Action(ITA) Release checkRetailPromotionsShippingSeasons &Collections,Sales KitRetailMarkdownsBillingSizeConversion nMRPRetailAllocationReplenishent / VMIHSeasonalProcurementSymbolsS/4 Fashion Features (from lannedOrderProductionOrderRetail FeaturesStandard ERP FeaturesHSimplified and Harmonized Data & ProcessesHHarmonized Processes Enhanced in S/4HANAStyle/Colour/sizes/Segments Listing,Assortment& LayoutMerchandisingSales(O2C)Bill ofMaterialsInventory gGoodsReceiptInventoryMgmtHHWarehouseMgmt*Vertical processes need SAP S/4HANA Fashion and Vertical Business with SAP S/4HANA Merchandising for Retail

Fashionably Beautiful Screens with FioriThe new way to see, transact, analyze and gain insight from dataFiori Launchpadas single access point 2019 SAP SE or an SAP affiliate company. All rights reserved.17

The SAP Vertical Business Solution PortfolioAgility for the Customer based on a Stable CoreSAP C/4HANA Commerce SuiteSAP Interaction CenterSAP Cloud for CustomerSAP OmnichannelPOS by GKSAP HybrisEngagementCenterOmni Commerce Customer ExperienceSAPSAP CRMPromotionLoyaltyMgmnt forManagementRetail(PMR)SAP HybrisProfileSAP HybrisSAP HybrisMarketingLoyaltySAPMerchandisePlanningfor Retail (MPR)SAP AssortmentPlanningfor Retail (APR)SAP ProductLifecycleCostingSAP SCM /SAP IBPSAP SupplierCollaborationSAPAllocationMgmnt forRetail (AMR)SAP IntelligentProduct DesignSAP EventManagementSAP Forecasting &ReplenishmentSupply ChainSAP Digital Asset Managementby OpenTextSAP hybris ProductContent ManagementSAP mentSourcing & ManufacturingBrand & Merchandise PlanningSAP Master Data Governance& ConsolidationAriba /FieldglassSAP Product LifecyleManagement 3rd Party PLMMaster DataSAP CustomerActivity RepositorySAP Hybris MarketingData ManagementSAP Demand SignalManagementSAP BusinessIntelligenceQualtricsSAP Governance,Risk and ComplianceReal-Time Customer & Business InsightSAP S/4HANA Fashionand Vertical BusinessSAP Hybris BillingSuccessFactorsS/4HANA RetailSAPLeonardoSAP EnterprisePerformanceManagementSAP Business ProcessConsolidationCore Vertical Operations & Finance & HRPowered by SAP HANA 2019 SAP SE or an SAP affiliate company. All rights reserved.Now / Recent18

SAP CAR Customer Activity RepositoryOmnichannel Real-time Consumer Insight ner AppsPOSTLOGCustomer Activity RepositorySAP HANA Live Analytic ContentCustomerMasterSales OrderTightly IntegratedLoosely CoupledSAP Forecasting& ReplenishmentSAP HANA -in-memory computingS/4HANAProductMasterFiori / BOBJPOS DataTransfer andAudit (TLOG)Omni ChannelSales &MerchandiseAnalyticsInventoryVisibilityOrder Sourcing /ProductAvailabilityLocationClusteringPromotional OfferManagementUnifiedDemandForecastingOffer Repository(ARTS like format)Omnichannel Priceand PromotionOffer ExecutionSAP HybrisCommerce(incl.B2C/B2C)SAP HybrisMarketingSAPBW/4Inventory 2019 SAP SE or an SAP affiliate company. All rights reserved.19

AgendaThe Vertical Fashion Story at SAPFashion Customer UpdateFashion InfluenceFashion Roadmap Update 2019 SAP SE or an SAP affiliate company. All rights reserved.20

SAP S/4HANA Fashion and Vertical BusinessCustomers are Starting with S/4 Finance and/or S/4 A 1709S/4HANA 1709S/4HANA 1709S/4HANA 1809S/4HANA 1809S/4HANA 1809FPS0 Sept 2017FPS01 Jan 2018FPS02 Sept 2018FPS0 Sept 2018FPS01 Jan 2019FPS02 Sept 2019SAPS/4HANAFinanceRetailBasis inS/4HANAS/4HANA Fashionand VerticalBusinessWholesaleS/4HANA Fashionand VerticalBusinessWholesaleEnhancementsS/4HANA Fashionand VerticalBusinessManufacturingEnhancementsS/4HANA Fashionand VerticalBusinessS/4HANA Fashionand VerticalBusinessS/4HANA Fashionand VerticalBusinessEnhancements andcustomer influenceEnhancements andcustomer influenceERP-S/4HANAConversion ToolsERP-S/4HANAConversion ToolsERP-S/4HANAConversion ToolsERP-S/4HANAConversion ToolsERP-S/4HANAConversion Tools201520162017 2019 SAP SE or an SAP affiliate company. All rights reserved.Flexible PurchasingCommitments - FPSSupply DemandOptimization - SDOCollections ManagementInbound for Outbound IFO (cross docking)Advanced ReturnsERP-S/4HANAConversion ToolsStart S/4 FashionGo-Live on S/4 Fashion20182019Note dates and content may change27

Paths to S/4 FashionMigrate from AFS, Convert from FMS with the SAP Model CompanyFutureDirectionData Migration PackageV2.1 AFS to S/4 FashionAvailable Now (Project Basis)RTC Planned 2019SAP Model Company for FashionSAP AFS 6.0 incl. BusinessSuite FinancialsAnyDBData Transfer andMigration Tool(DTMT)AFS-FMS MigrationAvailable NowFinance,on-premise editionSAP FMS 1.0-1.6 / 2.XSAP NetWeaver 7.xSAP HANAFMS-S/4 FashionConversionFrom FMS 1.0(EhP7 SP04)SAP S/4HANA on-premise edition 1709and 1809 and beyondSAP S/4HANA Fashion*SAP S/4HANA Enterprise ManagementAvailable NowSAP HANAAvailable NowFMS with S/4 FinanceSAP S/4HANAMigration CockpitLegacy-S/4 FashionSAP FMS 1.0-1.6 / FMS 2.Xincl. Business Suite on HANAFinancialsConversion TechnicalProcedure based onSoftware UpdateManager (SUM) withits Database MigrationOption (DMO) 2019 SAP SE or an SAP affiliate company. All rights reserved.SAP NetWeaver 7.xSAP HANAAvailable NowNotes*S/4 Fashion SAP S/4HANA Fashion and Vertical BusinessAFS to S/4 Fashion (or AFS to FMS) are migration projectsFMS to S/4 Fashion is a conversion projectSoH (business) Suite on HANAFMS with SoH FinancialsVertical processes need S/4 Fashion and S/4HANA merchandising for retailPlanned dates and planned content subject to changeNote dates and content may change28

SAP Runway with SAP Leonardo and SCPIncreasing Sales, Brand Strength and Efficiency through disruptive digital technologies 2019 SAP SE or an SAP affiliate company. All rights reserved.29

SAP Runway: Increase Margins and Reduce Waste by Understanding What’s Loved in Real-TimeSAP Runway AppSAP Runway LeaderboardFashion LeaderboardFall 2019 – TOP TEN LOOKS 2019 SAP SE or an SAP affiliate company. All rights reserved.30

SAP Runway: Invite your Customers to the Show – Wherever They AreRecognize the StyleSAP Leonardo IoT:- Bluetooth Beacons on outfits- Machine Learning of outfits with cameraLove and Like in Realtime WorldwideRealtime LeaderboardSAP iOS SDK- Record loves and likes, see outfit details- Product catalog with KITSAP Cloud Platform SCP MLSee most loved/liked styles in real-timeFashion LeaderboardFall 2019 – TOP TEN LOOKSBluetooth BeaconML Visual RecognitionCustomer 1Bluetooth BeaconCustomer 2ML Visual RecognitionBluetooth Beacon 2019 SAP SE or an SAP affiliate company. All rights reserved.ML Visual RecognitionCustomer N31

Fashion InnovationSAP Runway: A New Experience for Fashion Designers and their FansSAP Runway Created ‘Runway by SAP’ prototype app on SCP withmulti-tenant/ multi-designer/ multi-show plus SAPLeonardo ML and IoT Beacons to recognize outfits oncomplex runways Successful launch at Christian Siriano show NYFWFeb 9th 2019 where fans voted in real-time on outfitsPress: Links WWD and BBC Designers improve margins and reduce waste by:Not waiting until goods are already made and in storeMake more of what’s loved in the appMake Less of what’s ignored in the appCreating a unique experience with their consumers Download the app and vote now!Apple App Store: search for ‘Runway by SAP’Or point your iphone camera at this QR code(Android based on customer demand)Cloud 2019 SAP SE or an SAP affiliate company. All rights reserved.32

AgendaThe Vertical Fashion Story at SAPFashion Customer UpdateFashion InfluenceFashion Roadmap Update 2019 SAP SE or an SAP affiliate company. All rights reserved.33

INTELLIGENTFASHIONMOVESFASTERSAP Fashion Council Spring 201913-14 March at adidas World of SportsHerzogenaurach, Germany25 Fashion Customers, C levelInvitation Only, Meets 2X per yearGoals: Understand SAPs Fashion and Vertical Business RoadmapStrategic Influence, Education and Networking

S/4HANA Cloud for Intelligent Product DesignS/4HANA cloud for Intelligent Product Design helps to accelerate product innovation with instant collaboration,requirement driven product development, and actionable live insights across the extended enterpriseSystems Engineer CockpitRequirement Driven Engineering CollaborationEmbedded SWCollaborative Documents & 3D Visual DesignRequirements ManagementSimple Task/Worklist ManagementFunctional Structure ManagementChange Management IntegrationWhere Used AnalysisCompatibility ManagementTest ValidationIOT d ServicesECCSAP NetWeaverSCP ServicesSAP Cloud PlatformSAP HANAIoT/AINSAP Ariba

Apparel Footwear and Fashion (AFF) ASUG SIG User Group14 Years of Customer Influence on FashionASUG AFF Special Interest Group Meets in Orlando and Customer Sites with over 100 attendees2015St. Louis, MO2016ASUG Fall AFF Webinars2017Burlington, VT2018Portland, ORAFF SIG at SAPPIRE5-7 May 2019, Orlando, FLAFF SIG Fall Meeting at Wolverine World WideOctober 2019, Rockford, MI 2019 SAP SE or an SAP affiliate company. All rights reserved.36

AgendaThe Vertical Fashion Story at SAPFashion Customer UpdateFashion InfluenceFashion Roadmap Update 2019 SAP SE or an SAP affiliate company. All rights reserved.37

SAP S/4HANA On Premise Retail, Fashion and Vertical Business2017 – Recent innovations1Retail and Fashion Foundation Merchandise management – Master data Enhance material/article harmonization Merchandise management - In-StoreMerchandising Transfer Products app Enhanced distribution scenarios for genericarticle and site masterFiori app enhancements for Order Products Lookup Retail ProductsMerchandise management – Logistics Structured articles with full products– Master data maintenance– Support in logistical processes2018 – Planned innovations1,

and footwear software for brands and manufacturers 1996 Brands and Retail run separate 350 customers . POS Outbound Merchandising Site Master Listing, Assortment & Layout . POS by GK SAP Interaction Center SAP Cloud for Customer SAP Hybris Engagement