SAP Credit MGMT With CDA - 4-30-2013

SAP Credit Management with HighRadius
Credit Decision Accelerator

Presented by:
Vikram Gollakota
© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Agenda
• Company Overview
• Requirements GAP Analysis
• Demonstration
• GAP items Review
2
Company Overview
• Founded in 2006. Headquartered in Houston, Texas

• Trusted leader in Credit-to-Cash Solutions
• Nominated among fastest growing technology
companies in Houston 4 years in a row
• SAP Partner
• Three Lines of Business:
Solutions for SAP Cloud-based Cloud-based
Receivables Receivables Payments
Management OnDemand OnDemand
3
Partial List of Customers
4
GAP Analysis

GAP Analysis Summary
Modules Out of Box Minor Gap Major Gap
HighRadius Correspondence
Automation 8
HighRadius Credit Decision
Accelerator 25 13 1
SAP 15 4
Grand Total 48 13 5
Grand Total Out of Box

Major Gap SAP ACA
8% 31% 17%
Minor Gap
20%
Out of Box
73% CDA
52%
6
RM vs. Out Min Maj
S Acceler of or or
No. Process Category Requirement Example ator Box Gap Gap Gap Description
Need the ability to create a prospect and to Dealer development brings a
Credit Mgmt - convert a prospect to a new dealer and prospect to the attention of JDF
1 Account Mg Prospects maintain all data, analysis, and history. for consideration as a dealer CDA X
Dealer Development proposes a
Need the ability to allow for consolidation of merger or acquisition and JDF
Credit Mgmt - Relationshi multiple dealers for credit/financial analysis in must consolidate and create
2 Account Mg ps the event of M&A proforma financials SAP X
allow a user the ability to enter the dealer
Credit Mgmt - Number assigned and automatically update
3 Account Mg Deal/Proposal in system OOS
systematically retrieve dealer financial Solution would automatically
information (Balance Sheet, Income Statement) retrieve info from other sources
Credit Mgmt - from external sources (DFA, MFA) [information to pull into credit review
4 Account Mg Financials stored in Deere systems or JDF] documents CDA X
allow a user to enter & spread dealer group Currently not-DFA financials
financial information (Balance Sheet, Income spread in Moody's (MFA) - future
Credit Mgmt - Statement) [Detailed Financial Statements sent state - will likely be spread directly
5 Account Mg Financials in from Dealer] in system CDA X
R2 dealer may enter financial
statements in local currency but
JD Bank requires ability to view in
common currency, i.e. Euro or
USD; need outside source for
currencies not tracked by
Credit Mgmt - Corporate International
6 Account Mg Dashboard ability to manage multiple currencies Accounting CDA X
System will calculate key pre-
Credit Mgmt - systematically generate key ratios & reports for defined ratios based on financial
7 Account Mg Financials dealer groups information CDA X
allow a user to view/update/enter/store
Ownership Information (names of owners, Due to M&A, retirement, etc.,
Credit Mgmt - Relationshi power of attorney, trust) allow to do requested need ability to reflect ownership
8 Account Mg ps ownership changes changes SAP X
Maximum credit limit
used is not stored as
Need to view history to determine historical information.
Credit Mgmt - allow a user to view existing Dealer credit usage if credit limit is sufficient to Need to store this in a
9 Account Mg Credit Tab history (peaks by credit line) support high usage periods SAP X custom table.
7
Detailed Review of GAP Analysis

Demonstration

How does Credit Decision Accelerator work?

Requirements Classification
Count of
Requirement Category Requirements
Workflow 13
Customer / Credit Master 10
Correspondence 8
Characteristics 7
Financials 7
Attachments 5
Reporting 5
Credit Agency Ratings 3
Notes 2
Workflow 2
Integration 2
Scoring 1
Data Integration 1
Grand Total 66
11
Financials

Credit Dashboard: Financials
Ability to capture unlimited P&L, Balance

Sheet & Cash Flow statements

Credit Dashboard: Financials in Multiple Currencies

Side-by-side display of the last three financial

reports. For public companies data is automatically
updated from Yahoo Finance

Summary of Key Attachment of the

Financial Information Financials

Yahoo Finance Data

Characteristics

Credit Dashboard: Characteristics
Characteristics are various performance indicators of

the customer. The ‘Dashlets’ can be customized to
add new fields

Credit Agency Ratings

Credit Dashboard: Credit Reports
History is
retained for
trend analysis
and credit
scoring
All the Credit Bureau data is

Credit data automatically pulled captured versus standard SAP
from Credit Bureau without fields such as Credit Limit, Risk
requiring any additional Category etc
integration efforts

Scoring

Scoring Model
Financial
Informat
ion
Characteri
stics Credit Decision
3rd Party
Assessm Chec
ent k
Rules
Credit
Check
Credit Limit
Scori Scori
ng ng
Mod Mod
el el
Scoring Scoring
Engine Engine
Credit Score Map Risk Class

Scoring Model Overview
• Credit Score and Credit Limit are computed using

HR CDA’s Scoring Engine
• Scoring Engine allows definition of complex
mathematical formulae using simple structures
like Factor Tables and Assignment Tables
• A Factor Table is a tool to capture weighted
summation:
– Z = aX + bY
• An Assignment Table is a tool to capture
conditional assignment:
– IF ‘Customer Since’ > 10 years THEN ‘5’
Risk Score – An Example
Risk Score = Financial Score
+ Payment Index
+ Business Score
+ Rating Agency Assessment

Business Score

Financial Score

Credit Limit – An Example
Credit Limit = 0% of Tangible Net Worth If Risk Score is 0
15% of Tangible Net Worth If Risk Score is between 0 and 20

Credit Scoring
Credit Score compute task.
Ability to score
customer ad-hoc as
well as in Mass

System Credit Limit Calculation
Credit Limit compute task.
Ability to compute
recommended
credit limit ad-hoc
as well as in Mass

Workflow

Workflow Categories / Requirements
systematically identify indicators/warnings and present to user (ex: guarantor
13Credit Mgmt - Account Mg Workflow strength, equity percent, senior lien position)
16Credit Mgmt - Account Mg Workflow Ability to track and manage credit conditions
17Credit Mgmt - Account Mg Workflow Ability to track and manage credit enhancements
provide systematic & manual workflow, work queue, email notifications & routing
capabilities
(ex. Due Diligence workflow, Collateral Perfection, Analysis/Underwriting, Inventory
19Credit Mgmt - Account Mg Workflow Inspection, Account Management - see workflow tab)
allow a user & systematic setting of predefined statuses (analyst assigned, in process,
24Credit Mgmt - Account Mg Workflow routing for approval, approved) for analysis
37Credit Workflow Workflow allow a user & systematically route credit authorization for review
38Credit Workflow Workflow systematcially route credit authorization per predefined approval authorities
39Credit Workflow Workflow systematically capture the approval, comments, decision, notes
40Credit Workflow Workflow systematically track approvals & notifications

Systematically update credit limits, approval conditions (all parameters related to
45Credit Workflow Workflow approval)
Systematically initiate existing dealer process (inventory inspection date, next review
48Credit Workflow Workflow date, credit limits, int rates)
systematic routing of valuation exceptions for approval

51Credit Workflow Workflow
systematically monitor the credit policy measurements and requirements - identify
exceptions (stale financial submissions, missing DFA, consecutive losses, review
69Portfolio Risk, Rel, & Doc Mgmt Workflow frequency, etc)
Extend workflow capability to JDF employees (Asset Protection, Legal, Retail, Asset
80Dealer Termination Workflow Mgmt)
32
Workflows: Periodic Credit Review

Credit Dashboard: Workflow: Periodic Credit Review
Customer automatically added to Credit Analyst

Worklist for periodic review based on the
“Periodic Review Date”

Ability to perform context sensitive Workflow Actions and Tasks

with one click of a button. The available options will change based
on the ‘Workflow Type’ such as ‘Credit Review’, ‘New Customer’ etc

Real-time
request and
update of
Credit Data
from Credit
Bureau into
SAP

Ability to
manually create
customer
financials if
provided in a
non-standard
format. Key Figures are
automatically
updated
Credit Score compute task.
Ability to score
customer ad-hoc as
well as in Mass

Credit Dashboard: Workflow: Credit Review
Credit Limit compute task.
Ability to compute
recommended
credit limit ad-hoc
as well as in Mass

Request for an
increase in limit

Automatic notes are

added to support
the credit limit
request decision.


Workflows: Credit Limit Approval

Workflow - Configuration
Configurable
workflow to enable
quick business
requirement

Credit Dashboard: Workflow: Credit Limit Approval
Credit Limit Approval - Analyst
Credit Limit Request

Approved – Ability
to capture notes at
an approval level

Credit Dashboard: Workflow: Credit Limit Approval
Credit Limit Tab – show approved amount.
Credit Limit is updated in the system

directly after the DOA is put in effect.

Workflows: Collateral Expiration
Workflow

Collateral Expiring Workflow
Collateral workflow that will trigger

into the worklist of the “Credit
Managed by” based on business rules
like “X days before the expiration,
show it in the workflow”

Collateral Expiring Workflow
Workflow specific tasks to let you

handle the “expiring collateral”

Workflows: Business Opportunity Review
(Prospect)

Credit Dashboard: Workflow: Business Opportunity / Prospect
Action provides ability for a credit

analyst to create a business
opportunity

The Business Opportunity workflow is

triggered once the opportunity
account is entered in the system.

Ability to perform Business Opportunity Workflow Actions and Tasks in

order to complete review. These include pulling financials and rating
reports, computing credit score and limit, setting limit and sending the
prospect through approval process

Notes and Attachments

Credit Dashboard: Notes
Centralized
Notes
Management
capability

Credit Dashboard: Document Attachments
Ability to classify and

attachment all
documents related to
the customer

Customer Credit Master Data

Credit Worklist
Configurable ‘Dashlets’ that summarize all the

key information for a customer that the credit
analyst can see in a single page

Credit Dashboard: Credit Information
Summary of Credit Exposure

Credit Limit across Details from SAP
all available credit SD & FICO
Detailed break-up of
segments modules
the Credit Limit data

Credit Dashboard: Securities & Insurance
Leveraged standard FSCM

Credit ‘Information Types’
Ability to capture Letter of Credit, Personal Guarantee,

Insurance etc. Based on the validity dates these values
automatically increase the ‘Available Credit’ to the customer

Credit Dashboard: Customer Relationships
Display of Customer’s affiliated

companies and their credit
exposure data
Leverage standard FSCM Credit Business

Partner Relationship Categories to ‘tie’
Customer to affiliates

Correspondence

Correspondence Categories / Requirements
Process Category Requirement
have systematic ability to send system generated
Credit Mgmt. - Account communication of Dealer credit capacity (when system
Mg Correspondence updates credit limit)
Systematically generated documentation – (approval

Credit Workflow Correspondence letter/notification, Guar, Loan Docs)
allow a user the ability to edit documentation (approval
Credit Workflow Correspondence letter/notificaiton, Guar, Loan Docs) online
allow a user the ability to notify external stakeholder of
Credit Workflow Correspondence approvals via email in the system
generate ,populate & store standard legal documentation
Portfolio Risk, Rel, & Doc templates & workflow (promissory notes, guarantees,
Mgmt Correspondence security agreement, etc)
systematic & user notification to retail and revolving

Dealer Termination Correspondence systems to close out/restrict retail and revolving financing
Generate Documents (Buy Back, Transfer, Termination
Dealer Termination Correspondence Letter from JDF to Dealer)
63
Correspondence Automation from Credit Dashboard

Correspondence Automation
For Credit Management,

select Package Type =
Credit Correspondence.

Hit Display Button to display

Package Details - Available
Smartforms & Documents.

Verify documents selected

in the package.

For adding more SMARTFORMS or

documents, select the required forms and
documents & hit the arrow.

Select the appropriate

mode of correspondence

Hit ‘SEND’ button to

send correspondence

Letter Setup

Correspondence Automation: Letter Setup
Click on create button

Click here to populate your

Header Data

Use these fields to populate

your letter

Click here to maintain

Company Logo

Use this field to

upload a new logo

Click here to populate

Date

Use these fields to

populate your letter

Populate Paragraph1

Use these fields to

populate tables

Maintain Signature
Details

Maintain Footer details

Click on the ‘Preview’

button to view the
letter template
created.

Enter Customer and

Company Code and Hit
Enter.

Print Preview.

GAP Review

GAP Review - Minor
Minor Gap
Dashboard 1
Generate standard financial reports (cash flow, common size balance sheet, ratio reports) - create dealer dashboards &
systematically populate 1
Dashboard - Characteristics 4
allow a user the ability to view historical settlement information 1
allow a user the ability to view incentive management information 1
have systematic way to generate collateral table and structure rating (loss estimate) - based on potential loss 1
systematically calculate & store the following data by month - Model Risk Rating, Equity-Adjusted, Interest Coverage, Used
Inventory to Adj Equity, Turf Flag, Working Capital to Cost of Sales, Used Inventory Turn, Years in Business, Parts & Service
Absorption, All R12 Past Due to Settlements, Net Operating Return on Sales, R12 Sold to Settlements 1
Dashboard - General 1
systematically create the credit authorization & executive summary (including: financials, guarantors, inventory, org structure,
recommendations, conditions of recommendations, credit line needs/structure, risk rating rationale, shareholder
subordination) 1
Reporting 1
systematically track & archive the approvals for query 1
Workflow 6
Ability to track and manage credit conditions 1
provide systematic & manual workflow, work queue, email notifications & routing capabilities
(ex. Due Diligence workflow, Collateral Perfection, Analysis/Underwriting, Inventory Inspection, Account Management - see
workflow tab) 1
systematic routing of valuation exceptions for approval
1
Systematically initiate existing dealer process (inventory inspection date, next review date, credit limits, int rates) 1
systematically monitor the credit policy measurements and requirements - identify exceptions (stale financial submissions,
missing DFA, consecutive losses, review frequency, etc) 1
Systematically update credit limits, approval conditions (all parameters related to approval) 1
Grand Total 13
87
Example Minor GAP
88
Example Minor GAP
89
GAP Review - Major
Major
Row Labels Gap
Dashboard - Characteristics 1
allow a user & systematically establish/view/modify inventory inspection scope
and frequency 1
Dashboard - Credit Tab 1
allow a user to view existing Dealer credit usage history (peaks by credit line) 1
Dashboard - Relationships 1
have systematic ability to manage ownership structure that includes multiple
dealer credit limits (new A&T, new C&F, used, rental, etc).- both levels have
credit limits - manage limits at the dealer level and parent level. 1
Integration 2
allow a user the ability to view/locate and aggregate exposure (what the
dealers owes, retail recourse, revolving) 1
have systematic ability to integrate with loan accounting / receivables system
to generate and view Dealer Inventory to determine the turn (Aging Report) 1
Grand Total 5
90
91
Global Accounts

Group Accounts

Group Review


SAP Credit MGMT With CDA - 4-30-2013

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

SAP Credit MGMT With CDA - 4-30-2013

Uploaded by

Copyright:

Available Formats

SAP Credit Management with HighRadius

Credit Decision Accelerator

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

• Founded in 2006. Headquartered in Houston, Texas

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Grand Total Out of Box

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Ability to capture unlimited P&L, Balance

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Side-by-side display of the last three financial

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Summary of Key Attachment of the

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Yahoo Finance Data

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Characteristics are various performance indicators of

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

All the Credit Bureau data is

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Credit Score Map Risk Class

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

• Credit Score and Credit Limit are computed using

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Credit Score compute task.

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Credit Limit compute task.

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

40Credit Workflow Workflow systematically track approvals & notifications

systematic routing of valuation exceptions for approval

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Customer automatically added to Credit Analyst

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Ability to perform context sensitive Workflow Actions and Tasks

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Credit Score compute task.

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Credit Limit compute task.

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Automatic notes are

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Credit Limit Approval - Analyst

Credit Limit Request

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential

Credit Limit Tab – show approved amount.

Credit Limit is updated in the system

© 2013 HighRadius Corporation. All rights reserved. Privileged & Confidential