3709080 - Error connecting AO to BW system: "Missing required parameter: When using a concrete application server, SYSNR needs to be in the set of configuration parameters"

Error connecting AO to BW when starting the connection from the AO add-in. The error in the symptom can be seen in the AO trace files or when connection attempt is without SNC. When using SNC, the error may be masked by the "Couldn't establish safe connection to system XXX" message.

In the AO logs, the below entries can be seen:
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General .NET Exception [3588-1e5e-d9]:
Missing required parameter: When using a concrete application server, SYSNR needs to be in the set of configuration parameters.
   at SAP.Middleware.Connector.RfcDestination.CheckConfiguration()
   at SAP.Middleware.Connector.RfcDestinationManager.GetDestination(String destinationName)
   at Com.Sap.Cof.ConnectionService.BusinessWarehouse.BwConnection.Connect(IAuthentication authentication)
   at Com.Sap.Cof.ConnectionService.BusinessWarehouse.BwConnectionManager.ConnectInternal(IBwConnection connection, IBwSession session, IAuthentication authentication)
   at Com.Sap.Cof.ConnectionService.BusinessWarehouse.BwConnectionManager.Connect(IBwSession session, IAuthentication authentication)
   at com.sap.ip.bi.pioneer.core.Connections.BusinessWarehouse.CrBwConnection.Connect(String user, String password, String ticket, String ticketForMetaData)
   at com.sap.ip.bi.pioneer.core.Connections.Management.CrConnectionManager.LogonSapBw(IBwSystemInfo systemInfo, String user, String password, String ticket, String ticketForMetaData)
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KBA , BI-RA-AO-XLA , Excel Addin , Problem