Human Capital Management

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1 UNIT 6 Human Capital Management Lesson 1 Organizational Management in HCM 244 Exercise 22: Create an Organizational Unit and a Position in Organizational 253 Management Lesson 2 HCM Master Data 259 Exercise 23: Create an Employee Master Data Record 265 Lesson 3 Integrating with Success Factors 270 UNIT OBJECTIVES Understand the usage of Organizational Management Explain the employee master data record Understand the integration with Success Factors Copyright. All rights reserved. 243

2 Unit 6 Lesson Organizational Management in HCM LESSON OBJECTIVES After completing this lesson, you will be able to: Understand the usage of Organizational Management Organizational Management Figure 115: Organizational Units in Management Accounting The operating concern is the highest reporting level for profitability and sales and marketing controlling, and the central organizational unit in Profitability Analysis (CO-PA) used to segment and structure the market. Controlling areas structure the internal accounting operations of an organization within Management Accounting. They represent closed units that are used to calculate costs. All internal allocations relate solely to objects that belong to the same controlling area. Company codes are independent accounting units within Financial Accounting. They represent the smallest organizational units for which an account group can be set up for the purposes of external reporting. The process of external reporting involves recording all relevant transactions 244 Copyright. All rights reserved.

3 Lesson: Organizational Management in HCM and generating all supporting documents for financial reports (such as balance sheets and profit and loss statements). Profit Centers are organizational units in accounting that reflect a management-oriented structure of the organization for the purpose of internal control. You can analyze operating results for profit centers using either the cost-of-sales or the period accounting approach. By calculating the fixed capital as well, you can use your profit centers as investment centers. Organizational Structure Figure 116: Organizational Structure The organizational structure represents the task-related, functional structure of your enterprise. The organizational structure differs from the administrative enterprise or personnel structure, whose elements are relevant to Payroll or Accounting. You can view your organizational structure with objects and reporting relationships to see various views of the organization. You create your organizational plan using organizational objects and positions. An organizational plan is a comprehensive and dynamic model of the structural and personnel environment in your enterprise. Map hierarchies within your organizational plan are as follows: The organizational structure of your enterprise The organizational structure shows the hierarchy that exists between the various organizational units in your enterprise. You create the organizational structure by creating and maintaining organizational units and relating them with one another. The individual positions and reporting structure (chain of command) A reporting structure depicts the line structure that exists in your enterprise. You create a reporting structure by creating and maintaining positions and relating these with one another. Copyright. All rights reserved. 245

4 Unit 6: Human Capital Management Object Types Organizational Units Figure 117: Object Types Organizational Units Organizational units describe the business units in your enterprise. Multiple organizational units and the relationships between them form the organizational structure. Organizational units can be classified generally (for example, by function or region) or specifically (for example, by project group). The way in which organizational units are classified depends on the company. Explain that organizational units are connected to one another through relationships. They form a network that illustrates the hierarchical structure of the enterprise. If you assign a cost center to one organizational unit at the top of others, this cost center can be valid for all the organizational units below. You must relate organizational units with one another in an organizational plan. The hierarchical interrelationships that exist among the organizational units represent the organizational structure of your enterprise. Organizational units can be linked to cost centers from accounting. The figure, Object Types Organizational Units, illustrates the executive board organizational unit as the superior object over two subordinate objects, HR and Finance. 246 Copyright. All rights reserved.

5 Lesson: Organizational Management in HCM Organizational Structure Jobs Figure 118: Organizational Structure Jobs Each job represents a unique classification of responsibilities in your organization. When you create a job, consider the specific tasks and requirements associated with it. Jobs are used in the following application components: Shift planning Personnel Cost Planning Personnel Development Hint: Make your job descriptions as general as possible and as specific as necessary. Copyright. All rights reserved. 247

6 Unit 6: Human Capital Management Organizational Structure Positions Figure 119: Organizational Structure Positions Explain that positions are specifications for jobs. You can use one job to create several positions. Positions are related to organizational units, whereas, jobs are not. All the information stored about a job, such as tasks and requirements, is inherited by all positions created from that job. After you create a job, you must specify the number of corresponding positions required in the organization. A position inherits the tasks of a job. However, you can define additional tasks that must be performed only by this position. Positions can be 100 percent filled, partially filled, or vacant. Positions, rather than jobs, are held by employees. One position may also be shared by a number of employees, each working less than full time. For example, two employees can hold 60 percent and 40 percent of a full-time position. 248 Copyright. All rights reserved.

7 Lesson: Organizational Management in HCM Object Types Cost Centers Figure 120: Object Types Cost Centers Cost centers can be linked to organizational units, and all subordinate organizational units can inherit the cost center assignment. Organizational units can have multiple cost center assignments or percentages. Additionally, you can change the cost center assignment at a lower level, such as position or person. Cost centers are maintained in Controlling and can be linked to either organizational units or positions. Cost center assignments are inherited along with the organizational unit structure. Copyright. All rights reserved. 249

8 Unit 6: Human Capital Management Organizational Structure Persons Figure 121: Organizational Structure Persons The term for an individual listed as an employee in Personnel Administration is person. Persons represent employees in your company. Persons hold positions in the organizational structure that is governed by Organizational Management. Infotypes for persons are maintained in Personnel Administration and linked to an organizational plan through their position assignment. Other defaults in Personnel Administration can be derived from Organizational Management data, such as the Employee Group/Subgroup infotype (1013). 250 Copyright. All rights reserved.

9 Lesson: Organizational Management in HCM Personnel Administration and Planning Figure 122: Personnel Administration and Planning The figure, Personnel Administration and Planning, is a summary of the relationships between a person and the other organizational objects. If Personnel Administration and Personnel Planning are integrated, you can enter the position in the Actions infotype (0000). This infotype must be added first. You cannot overwrite the job, organizational unit, or cost center fields. These fields define the relationships to the position. Default values can be configured for the personnel area, personnel subarea, business area, employee group, and employee subgroup fields. Copyright. All rights reserved. 251

10 Unit 6: Human Capital Management 252 Copyright. All rights reserved.

11 Unit 6 Exercise Create an Organizational Unit and a Position in Organizational Management Business Example As the responsible person for the structures in SAP Human Capital Management (HCM), you need to extend the organizational structure because there is a need for a new position. You will create a new organizational unit for the project department and a new position for a production worker in this department. In this exercise, when the values include ##, replace ## with the number your instructor assigned to you. This exercise use the cost center, PROD-##, created in the exercise, Create a Cost Center The data created in this exercise is required to create the employee master record in the next exercise. Create a New Organizational Unit for the Project Team Create a new organizational unit, PRD-## as a member of the organizational unit Training TS410. You need to log on to the backend system to create the organizational unit directly, because there is currently no SAP Fiori App available. 1. To create the organizational unit directly, log on to the backend system. 2. Change the validity date to the first day of the current year and change the time period for 24 months. 3. Search for the organizational unit, Training TS Create a new organizational unit, PRD-##, using the following information: Use the following information for the Details for the Organizational Unit: Field Value Organizational Unit 1 PRD-## Description Project Department ## Use the following information for the account assignment: Field Value Controlling Area A000 Copyright. All rights reserved. 253

12 Unit 6: Human Capital Management Field Master Cost Center Value PROD-## Create a New Position for the Production Worker Create a new position for an employee in the production area. 1. Create the new position POS-## (Production worker) in the new organizational unit Project Department ##. Mark the newly created organizational unit Project Department ##. 254 Copyright. All rights reserved.

13 Unit 6 Solution Create an Organizational Unit and a Position in Organizational Management Business Example As the responsible person for the structures in SAP Human Capital Management (HCM), you need to extend the organizational structure because there is a need for a new position. You will create a new organizational unit for the project department and a new position for a production worker in this department. In this exercise, when the values include ##, replace ## with the number your instructor assigned to you. This exercise use the cost center, PROD-##, created in the exercise, Create a Cost Center The data created in this exercise is required to create the employee master record in the next exercise. Create a New Organizational Unit for the Project Team Create a new organizational unit, PRD-## as a member of the organizational unit Training TS410. You need to log on to the backend system to create the organizational unit directly, because there is currently no SAP Fiori App available. 1. To create the organizational unit directly, log on to the backend system. a) On the SAP Logon, choose the entry T41 and log on to the backend system with your user. 2. Change the validity date to the first day of the current year and change the time period for 24 months. a) From the menu tree, choose Human Resources Organizational Management Organizational Plan Organization and Staffing Change. Alternatively, use transaction code PPOME. b) Change the validity date to the first day of the current year and change the time period for 24 months. 3. Search for the organizational unit, Training TS410. a) On the left side, choose Find by Organizational Unit. b) In the dialog box, in the With name field enter Training TS Create a new organizational unit, PRD-##, using the following information: Use the following information for the Details for the Organizational Unit: Copyright. All rights reserved. 255

14 Unit 6: Human Capital Management Field Organizational Unit 1 Value PRD-## Description Project Department ## Use the following information for the account assignment: Field Value Controlling Area Master Cost Center A000 PROD-## a) Right-click the Training TS410 organizational unit and choose Create. b) Choose New relationship Organizational Unit. c) In the Details for the Organizational Unit, enter the data provided in the first table. d) On the Account Assignment tab, enter the data provided in the second table. e) To reassign the controlling area, choose Reassign Controlling area and enter the controlling area A000 in the field. f) Save your entries. Create a New Position for the Production Worker Create a new position for an employee in the production area. 1. Create the new position POS-## (Production worker) in the new organizational unit Project Department ##. Mark the newly created organizational unit Project Department ##. a) Select the newly created Organizational Unit Production PRD-##. Create a new position and use the following data: Basic data: Field Value Short Key POS-## Short Description Production Worker ## Account assignment: Field Controlling Area Master Cost Center Value A000 PROD-## 256 Copyright. All rights reserved.

15 Lesson: Organizational Management in HCM b) Select the Organizational Unit Project Department ## and create a new assignment. Choose Create. In the dialog box, choose the position entry. On the Basic Data tab, enter the following data: Field Short Key Value POS-## Short Description Production Worker ## c) On the Account assignment tab, enter the following data: Field Controlling Area Master Cost Center Value A000 PROD-## d) Save the data. Copyright. All rights reserved. 257

16 Unit 6: Human Capital Management LESSON SUMMARY You should now be able to: Understand the usage of Organizational Management 258 Copyright. All rights reserved.

17 Unit 6 Lesson HCM Master Data LESSON OBJECTIVES After completing this lesson, you will be able to: Explain the employee master data record Employee Master Data Record Figure 123: From Vacancy to Hiring The e-recruitment component contains a range of powerful, flexible functions that you can use to implement an effective and largely automated recruitment strategy. You can use the e-recruitment component to recruit human resources at any time. You can increase the number of available candidates, and include them in the selection procedure for vacancies, by advertising for personnel (for example, by using job advertisements) or by receiving unsolicited applications. Copyright. All rights reserved. 259

18 Unit 6: Human Capital Management You can store information about candidates who are not suitable for a particular vacancy in the candidate pool for consideration for other or future vacancies. You can use the e-recruitment component to complete the entire recruitment process, from initial entry of applicant data to filling vacant positions. The SAP system supports you in identifying workforce requirements, creating job advertisements, screening applicants, and managing applicant correspondence. When you hire a candidate, you can transfer the candidate data recorded in e-recruitment to Personnel Administration as employee data. Line managers can use the Manager's Desktop to map their decisions on candidates and trigger further administration in the Human Resources (HR) department, efficiently and cost-effectively. Infotypes Figure 124: Infotypes Infotypes are logical groupings of data fields. All master data is stored on infotypes. Provide examples of infotypes and fields found. Personal information, such as last name, first name, and date of birth, is defined in data fields. Data fields are grouped into data groups or information units according to their content. In HR, these information units are called information types or infotypes for short. 260 Copyright. All rights reserved.

19 Lesson: HCM Master Data HR data is stored in groups that logically belong together according to content. For example, place of residence, street, and house number make up the address of an employee and are so stored (together with additional data) in the Addresses infotype. Infotypes have names and four-digit keys, for example, the Addresses infotype has the key Figure 125: Planned Working Time Infotype Copyright. All rights reserved. 261

20 Unit 6: Human Capital Management Employee Master Record Figure 126: Ways to Maintain an Employee Master Record Discuss the ways of processing infotype records. Employee data must be kept current. Data can be displayed, corrected, and supplemented. SAP Human Capital Management (HCM) stores the data of an employee in infotype records. Each infotype record has validity, which is a validity interval or a key date. Infotype records can be processed in the following ways: Single screen maintenance (individual infotype maintenance) You can call individual infotypes to maintain data for a particular subject or situation. You maintain one infotype at a time for a personnel number. Personnel actions You can use personnel actions if the subject or situation is more complex and you need to maintain more than one infotype. When you perform a personnel action, the system displays all the relevant infotypes for you to maintain, one after the other. Fast entry You can use fast entry to maintain an infotype for more than one personnel number simultaneously. 262 Copyright. All rights reserved.

21 Lesson: HCM Master Data Initial Entry Screen for Infotype Maintenance Figure 127: Initial Entry Screen for Infotype Maintenance Infotypes that are most frequently used are grouped together by subject matter and assigned to static menus. One infotype can be included in more than one menu. However, infotypes that are rarely used might not be included in any menus. To access a particular menu, choose the tab on the Maintain HR Master Data screen. The green ticks next to the menu list of infotypes indicate that these records already exist for the selected personnel number. Copyright. All rights reserved. 263

22 Unit 6: Human Capital Management Personnel File Figure 128: Personnel File The personnel file lists all the infotypes for which records have been created for a personnel number. The infotypes are displayed in ascending numerical order. If more than one record exists for an infotype, the records are displayed one after the other. The system then goes to the next infotype, after which it returns to the initial screen. You can scroll forward and backward within the personnel file. Show participants how to display an Employee Master Record by using the data and steps from the exercise, Display an Employee Master Record. 264 Copyright. All rights reserved.

23 Unit 6 Exercise Create an Employee Master Data Record Business Example You hired a new Project Engineer. Therefore, you need to create an employee master record. The new employee will be assigned to the vacant position of the Project Department. This exercise requires the position, POS-## and the organizational unit, PRD-##, created in the exercise, Create a New Employee Master Record for a Project Engineer. The employee master record created in this exercise is required in one or more subsequent exercises in this course. 1. Create a new employee master record using the old transaction, because there is no SAP Fiori app available. Log on to system T41 to create the master data record. HIRING a new employee for the position POS-## to be used in the project system later. The personal number will be given internally by the system. You will use the action HIRING to create the employee master record. Go to Personnel Actions (transaction code PA40) to create the employee master record. Use the following data to create the employee master record: Field Value Personnel number From Leave blank Today s date Select the HIRING Personnel Action and enter the following data: Field Value Personnel Area 1010 Employee Group 1 Employee subgroup Y1 On the Create Personal data tab, enter the following data: Field Value Title Last Name Own choice Own choice Copyright. All rights reserved. 265

24 Unit 6: Human Capital Management Field First Name Birth date Nationality Value Own choice Own choice German On the Create Organizational Assignment tab enter the following data: Field Value Payroll Area Position X0 Number for POS-## Delimit the vacancy for the proposed day. In the Create Addresses tab, enter any address data of your choice. Note: We will not add any entries on the Create Communication tab. Write down your personnel number. 266 Copyright. All rights reserved.

25 Unit 6 Solution Create an Employee Master Data Record Business Example You hired a new Project Engineer. Therefore, you need to create an employee master record. The new employee will be assigned to the vacant position of the Project Department. This exercise requires the position, POS-## and the organizational unit, PRD-##, created in the exercise, Create a New Employee Master Record for a Project Engineer. The employee master record created in this exercise is required in one or more subsequent exercises in this course. 1. Create a new employee master record using the old transaction, because there is no SAP Fiori app available. Log on to system T41 to create the master data record. HIRING a new employee for the position POS-## to be used in the project system later. The personal number will be given internally by the system. You will use the action HIRING to create the employee master record. Go to Personnel Actions (transaction code PA40) to create the employee master record. Use the following data to create the employee master record: Field Value Personnel number From Leave blank Today s date Select the HIRING Personnel Action and enter the following data: Field Value Personnel Area 1010 Employee Group 1 Employee subgroup Y1 On the Create Personal data tab, enter the following data: Field Value Title Last Name Own choice Own choice Copyright. All rights reserved. 267

26 Unit 6: Human Capital Management Field First Name Birth date Nationality Value Own choice Own choice German On the Create Organizational Assignment tab enter the following data: Field Value Payroll Area Position X0 Number for POS-## Delimit the vacancy for the proposed day. In the Create Addresses tab, enter any address data of your choice. Note: We will not add any entries on the Create Communication tab. Write down your personnel number. a) To create the employee master data record, choose Human Resources Personnel Management Administration HR Master Data Personnel Actions. Alternatively, use transaction code PA40. b) On the Data Screen Personnel Actions tab, leave the personnel number blank (the number will be given internally). In the field from enter today s date. For the action type HIRING, enter the data provided in the relevant table. No entry is required on the Create Actions tab. c) Execute and save the data. d) On the Create Personal Data tab, enter the data provided in the relevant table. e) Save your entries. f) On the Create Organizational Assignment tab, enter the data provided in the relevant table. g) Save your entries and delimit the vacancy for the proposed day. h) On the Create Addresses tab, enter any data of your own choice. i) Save your entries. We will not add any entries on the Create Communication tab. 268 Copyright. All rights reserved.

27 Lesson: HCM Master Data LESSON SUMMARY You should now be able to: Explain the employee master data record Copyright. All rights reserved. 269

28 Unit 6 Lesson Integrating with Success Factors LESSON OBJECTIVES After completing this lesson, you will be able to: Understand the integration with Success Factors Integration with SAP SuccessFactors Figure 129: Time Management Evaluating work performed by employees and determining employee availability are essential elements for a human resources system. This information is also relevant for other areas, such as controlling (how the employee spent their time) and logistics (determines employee availability for planning activities) and is a factor that influences enterprise-wide decisions. Time management allows you to display and record working times flexibly. Information on working times is used to calculate gross wages in payroll. There are various options available for recording time data, such as hours worked, vacation, off-site work or substitutions. Time recording options include the following: 270 Copyright. All rights reserved.

29 Lesson: Integrating with Success Factors Online data entry by the time administrator (for example, using the Time Manager's Workplace) Using front-end time recording systems (for example, Kronos) Using the Cross-Application Time Sheet (CATS) Using Employee Self-Service (ESS) applications Planned Working Time Time data is stored in special time infotypes, just like HR master data information. The planned working time infotype 0007 is the central time management infotype. It contains the times when the employee is scheduled to work according to the assigned work schedule. By defining the planned working time for your employees, you determine how long they must work on a daily basis. Payroll Designed for global business, SAP ERP HCM supports payroll functions and regulatory requirements. In general terms, payroll is concerned with calculating each employee's remuneration for the work performed. It encompasses a multitude of processes, such as the creation of payroll results and salary statements, bank transfers and payment to employees. Figure 130: Payroll Payroll includes a number of additional subsequent activities. Examples of these activities include the following: Copyright. All rights reserved. 271

30 Unit 6: Human Capital Management Transfer of payroll results to accounting (for example, expenses and liabilities) Data medium exchange (transfer of net pay amounts to financial institutions) Other evaluations, such as the payroll account and payroll journal The preparation of pay statements The calculation of payments to employees includes the following: Calculation of pay elements (gross amount) Statutory and voluntary deductions (country-specific, net amount) These payments and deductions are included in the payment calculation, using different wage types. The employee is usually paid by bank transfer or check and the payment amount is printed on a form for the employee. Employee Self-Service Explain that the concept of self-service is to reduce the paperwork load of the HR department so that they may focus on more strategic functions. Review the benefits of ESS. Enabling employees to maintain their own data and to have access to their own information increases employee satisfaction and accuracy of data. Using Employee Self-Service (ESS), employees maintain their own personal information and control many administrative transactions and other processes once handled by the HR staff. ESS streamlines approval processes for activities such as vacation requests and allows employees to check, for example, their vacation balance or benefits, thus reducing administrative costs. With ESS, employees can take responsibility for updating their own data. ESS empowers employees to view, create, and maintain their data any time, anywhere, via Web based technology. ESS has an intuitive, HTML-based user interface. ESS is an effective means to provide real-time access and data maintenance capabilities to the source or owner of the data, and to offload many of the data entry and related customer service activities that may typically be performed in a company s human resources, payroll, benefits, and travel departments. The following table provides an overview of the activities that employees complete using ESS: Table 3: ESS Activity Employee Self-Service Activity Submit travel expenses View the calendar Search the Who's Who Update personal information (such as address, marital status, and so on) Employee Self-Service Activity Enter work times Enroll in benefits Update banking information Enroll in a training course 272 Copyright. All rights reserved.

31 Lesson: Integrating with Success Factors ESS utilizes the same database as ERP. No dual maintenance or reconciliation is required. It takes full advantage of SAP system global capabilities, including country localization ESS: Highlights Extensive functionality beyond basic HR functionality, including travel management and purchasing Inherent integration between SAP system business scenarios, ESS, and Workflow Global availability of all functions Access from any platform at anytime from anywhere Easy to use Personalized Benefits of ESS include the following: Well-informed employee decisions Reduced administrative costs and shorter cycle times Accurate employee records Time and resources saved for strategic HR initiatives Manager Self-Service Manager Self-Service (MSS) consists of a set of easy-to-use tools, transactions, and reporting capabilities. MSS gives managers a single point of access to information and enables them to manage information efficiently, effectively, and proactively in one Web interface. It empowers managers to execute human capital and finance management strategies for budgeting, recruitment, compensation, and cost management, thus creating return on investment. MSS leverages human resources and financial back-end systems by making pertinent information available to managers throughout your enterprise. Self-service tools automate paper-based processes, such as requests for employee master data changes (for example, transfers and salary increases) or performance appraisals. The MSS solution integrates different systems and management information is consistent across the organization. Copyright. All rights reserved. 273

32 Unit 6: Human Capital Management Figure 131: Single Point of Access Managers can use MSS to do the following: Obtain information Recruit employees Perform compensation planning Control costs Manage budget and headcount planning Submit personnel data changes SAP ERP HCM allows you to manage employees with multiple assignments. In the standard system, you can track and manage all the employment relationships of an employee, in various countries. This is especially important for global enterprises. In SAP ERP HCM, global employees are managed by linking each employee's personnel assignments to the person. 274 Copyright. All rights reserved.

33 Lesson: Integrating with Success Factors HR Renewal Overview Figure 132: SAP ERP HCM Core Renovation SAP Business Client (BC), as of enhancement package 5, allows customers to implement employee self-services or manager self-services without using a portal. The look and feel of the SAP BC screens are similar to those displayed using a portal. SAP BC offers a unified environment for, and a single point of entry to, SAP applications. SAP BC is an environment that hosts SAP GUIs to provide a unified environment with a more efficient, intuitive, and complete user experience. Within SAP BC you can move seamlessly between Web Dynpro and SAP GUI transactions. For SAP GUI to run within the SAP BC, SAP GUI must be installed (as part of the SAP BC installation or separately). The benefits of SAP BC include the following: There is a single point of entry for SAP GUI applications and Web Dynpro applications. New Web Dynpro applications including POWER Lists improve functionality and usability. Desktop integration gives users the potential to leverage everything on the desktop. There is powerful search functionality including desktop search and external search engines. The smart client improves the performance of Web Dynpro applications. Minimal training effort due to familiar look and feel. The state-of-the-art UI more than matches the quality of the competition and it has distinctive SAP branding. Copyright. All rights reserved. 275

34 Unit 6: Human Capital Management SAP ERP HCM for core users such as HR professionals, employees, and managers has undergone a facelift. It has fresh interfaces based on new technologies plus updated screen layouts. HR Renewal delivers rich functionality using browser based screens. HR Renewal is available using SAP BC and the Enterprise Portal. For more information about HR Renewal and the Enterprise Portal, refer to SAP Note HR Renewal 1.0. Barriers between Personnel Administration (PA) and Organizational Management (OM) have been removed and you can work with Organization Units, Positions, or Employee objects using the same interfaces. HR Renewal roles enable fast access options to guide you to required functionality and processes. Accessibility is enabled using a lanes concept, which is the new access option for different specialists, such as HR Professionals, employees, and managers. HR Professional Role Landing Page Figure 133: HR Professional Role Landing Page HR Professional Lanes delivered with FP1 include the following: Actions Analytics Organization Tasks by priority Tasks by time Tasks by draft Discussions (Feeds/collaboration on an object) Search Processes 276 Copyright. All rights reserved.

35 Lesson: Integrating with Success Factors The HR Professional role is part of HR Renewal and has improved new functionality available with the new user interface. Role-specific start pages allow the user to easily access such things as important action items, frequently used applications, collaboration, and subscribed feeds. Selected PA and OM data is displayed to the HR Professional, allowing them to edit combined PA and OM data for single-step processes, for example, employee hiring, employee transfer, employee/ promotion, and organizational changes. Mass data change activities such as mass hiring is also available. A harmonized UI allows the HR Professional user to navigate and change employee data and organizational structures easily. The newly redefined navigation helps the users work more effectively and efficiently by allowing quick navigation with fewer clicks to the content. Information is organized, prioritized, and accessible to the user. Fast data entry aids such as cut, copy, paste, and user friendly capabilities such as, search and save as draft, provide better usability. The following are the high-level tasks involved in deploying HR Renewal and activating the landing page: 1. Install HR Renewal. HR Renewal complete functionality is delivered with ERP EhP7. 2. Activate business functions. 3. Activate OData services. 4. Maintain SAP Gateway OData Services (Configure ICF nodes). 5. Maintain Customizing settings. 6. Copy or build the composite role. The HR Professional landing page is a single point of access to employee and organizational data. A landing page is the initial page displayed when a role is accessed. The landing page provides access to vertical lanes showing high-level information or favorite content for a given subject area. When selected, a lane expands to display detail and give access to more functionality. An expanded lane can be condensed again by closing. HR Professional lanes include the following: Actions Analytics Organization Tasks by priority Tasks by time Tasks by draft Discussions (Feeds and collaboration) Search Processes Lanes can exist in multiple landing pages and the level of access to the data is controlled by the type of lane and by user authorizations. You can personalize the user interface, create Favorites, Copyright. All rights reserved. 277

36 Unit 6: Human Capital Management access recently used items, select which lanes you want to see, change the order of the lanes, and select a preferred background picture. HR Professional Role Actions Figure 134: HR Professional Role Actions Actions: The concept of Actions was available with FP1. The actions list contains many different activities, from viewing infotypes to creating objects and to mass processing. This is why there are multiple configuration techniques. Analytics: The analytics lane was available with FP1. As of FP1 the search is based on SAP Query. As of FP4 the Embedded Search model was added as an alternative search technology. Search: The search lane was available with FP1. Discussions: Discussions were available as of FP1. Processes: The processes lane was introduced to the HR Professional role with FP3. Organization: The organization lane was available with FP1. Tasks: The 3 tasks lanes available include tasks by priority, tasks by time, and tasks by draft. Mass Processing: Mass hiring functionality was delivered with FP3. The HR Professional can edit infotypes for the selected objects using the BizCard view, dataset view, or table view. Single infotype editing can be completed using a form called in the action menu. Employee data maintenance for one infotype at a time (single infotype) has different views and displays depending on the view selected or the tasks required. The table view of an infotype includes the following information: 278 Copyright. All rights reserved.

37 Lesson: Integrating with Success Factors A list of records in a table Key fields of the selected infotype displayed In-place editing options (editing on the screen) The dataset view of an infotype includes the following information: Extracts or blocks of records instead of a table Navigation to editing Multi-infotype scenarios include employee data maintenance that involves multiple infotypes. Before HR Renewal, this action was called a personal action in the backend and is now called a multi-infotype scenario. Multi-infotype scenarios are delivered from the actions lane and are based on HCM Processes and Forms. A multi-infotype scenario can represent a PA action or an OM action. The user processing information, whether an HR professional or a manager processing information for an employee, does not have to worry about different selections for single infotype changes, multi-infotype changes, or changing screens either with or without workflow. All information is available within the same application and the context-specific action menu provides the appropriate fields to be completed. An action completed using HR Renewal functionality is not the same as a classical PA action. Manager Self Service (MSS) Figure 135: Manager Role As a manager, the following lanes are available: Approvals This lane enables managers to access their inbox, which lists work items they are responsible for processing. Work Feeds This lane displays notifications pushed from the backend to the manager. A work feed notification can, for example, advise the manager of a missing employee time sheet. Copyright. All rights reserved. 279

38 Unit 6: Human Capital Management My Team This lane provides the manager with a view of information on their direct reports in the team. My Team Services The manager can start services applicable to the team from this lane. KPI Monitor This lane provides managers with an overview on the status of key performance indicators (KPIs) for their area of responsibility. My KPIs This lane provides managers with an overview of their favorite KPIs for their area of responsibility. My Reports This lane provides managers with a single point of entry to access required reports. In addition to the MSS lanes, as an employee, you also have access to ESS lanes. You can personalize your landing page by, for example, changing the order of lanes, their names, and the background image used. Employee Self Service (ESS) Figure 136: Employee Role 280 Copyright. All rights reserved.

39 Lesson: Integrating with Success Factors As a non-manager employee, the following lanes are available: Search: Provides a central search function My Information: Maintain your own infotypes My Learning: Manage your learning activities My Services: Provides access to ESS services Work Feeds: Provides notification of tasks or activities to be completed by the employee (for example, complete a self-assessment for a performance review) You can personalize your landing page by, for example, changing the order of lanes, their names, and the background image used. Learning Solution (LSO) Figure 137: Learner Role When the learning solution business function HCM_LSO_CI_4 is applied, the My Learning lane appears as part of the ESS role. Expanding the lane takes you to the Training Home page. The Training Home page allows you to do the following: Review your course bookings Search for courses View notifications about courses you need to take or retake Run a profile match-up to find gaps in your skills and competencies Copyright. All rights reserved. 281

40 Unit 6: Human Capital Management SAP SuccessFactors Overview Figure 138: SAP SuccessFactors Backed by SAP experience and global reach, SAP SuccessFactors (an SAP company) solutions benefit from SAP years of experience in HR systems. SAP SuccessFactors solutions are modular and support you as you transition to the Cloud at your pace. SuccessFactors offers a your cloud, your way adoption path. You can start anywhere; leverage your investments in on-premise solutions and easily deliver leading core HR, talent, and analytics solutions in the Cloud, or move all your HR processes to the Cloud immediately. Scenarios are supported with pre-delivered integrations developed and maintained by SAP to deliver the lowest total cost of ownership (TCO) possible. SuccessFactors products are very cost effective and typically take two to six months to implement. Software is updated four times a year, which means that you benefit from new features four times a year. 282 Copyright. All rights reserved.

41 Lesson: Integrating with Success Factors Figure 139: Modular Deployed at your Pace Employee Central Employee Central delivers a suite of applications for your most demanding business priorities. The next-generation core HR system (HRIS) is designed for the global enterprise workforce and delivered securely using the SAP SuccessFactors cloud. Employee Central is the central repository for all of your employee data and it is the foundation for all of the SAP SuccessFactors solutions. Employee Central is built using modern technology, so it is much more flexible and much easier to use than traditional applications. Features of Employee Central include the following: One global system of record: The SAP SuccessFactors platform is effective-dated across geographies, cost centers, legal entities, and employee types. Complete workforce data: Combined HR and talent data delivers a comprehensive employee profile. Powerful analytics: Correlate workforce data with financials, SAP CRM, and other data for actionable insights. Social collaboration: Optimize workforce productivity and accelerate innovation. Seamless integration: Connect with on-premise or cloud-based applications such as ERP, time and attendance, and benefits. Continuous innovation: Cloud-delivered enhancements are provided four times per year, with no additional cost or disruption. Copyright. All rights reserved. 283

42 Unit 6: Human Capital Management SAP Cloud Payroll Available for Employee Central Global payroll solution designed by SAP is available as a hosted option that comes integrated with Employee Central. For organizations that wish to manage payroll in-house using a cloud-based solution, Employee Central Payroll offers all the same features and benefits as on-premise payroll SAP solution and is delivered with the security, scale, and flexibility of the SAP ERP SuccessFactors cloud. Employee Central Payroll offers you the following: A proven solution: Based on the world's leading-edge payroll solution, it is currently used by thousands of organizations worldwide. Global reach: Employee Central Payroll is currently available for many countries. Choice: Available for customers who want the benefits and convenience of cloud delivery, but who also want the control of implementing and managing payroll in-house. Lower TCO: Realize the significant cost advantages of a cloud-based solution. Compliance: Employee Central Payroll delivers legal compliance and best practices. Dedicated specialists and country-specific product managers stay on top of all local statutes so you do not have to. Compensation Employee compensation is a huge expense, often the largest expense for many companies. With SAP SuccessFactors Compensation, you can allocate compensation funds effectively to retain your top performers and avoid overpaying underachievers. Beyond rewarding great performance, you can also optimize budgets, improve compliance, and reduce manual errors, all leading to better business execution and results. SAP SuccessFactors Compensation allows you to do the following: Manage compensation easily: Intuitive, configurable processes for base and variable pay have simple, accurate, and streamlined workflows. Eliminate manager bias: Performance-based calibration across the company improves fairness and retention. Increase insight with metrics: Dashboards and reports can be combined with other business data for total employee compensation analysis. Improve budget and regulatory compliance: Automated monitoring and built-in reports keep payouts in line with budgets and regulations. Assure data integrity: Automatically stored data saves time, reduces risk, and improves audit compliance. SAP Jam SAP Jam delivers social collaboration where you work, connecting customers, partners, and colleagues with information, applications, and processes to solve business-critical problems. It also facilitates driving results; all in your business applications, on your mobile device, or in SAP Jam. By adding collaboration to sales, HR, and other processes, you shorten sales cycles, increase customer, and employee engagement, and reduce training costs. You avoid disconnected silos of collaboration; instead, there is a single, secure social foundation across your entire business. SAP Jam enables you to do the following: 284 Copyright. All rights reserved.

43 Lesson: Integrating with Success Factors Connect: Improve communications and better connect employees across different geographies. Improve information sharing: Enable employees to find subject matter experts quickly and to share best practices. Drive decision making: Help teams tame project chaos, build consensus, and drive informed decisions. Collaborate externally: Strategize, communicate, and drive progress with customers, vendors, and partners. Social or blended learning: Reduce training costs with informal learning where experts can create content or video and can share expertise. Complement formal training with collaborative communities. Social onboarding: Improve time to contribution for new employees by connecting them with the people and content that they need to know. Collaborative performance and goal management: Create and share goals collectively for faster and better goal alignment and completion. Collaborative opportunity management: Bring all key participants together (sales, product management, service, partners, and others) in the opportunity process to reduce analysis and proposal development time. Keep key stakeholders updated in real time regarding opportunity progress. Learning SAP SuccessFactors Learning combines formal, social, and extended learning with unmatched content management, reporting, analytics, and mobile abilities. The result is learning that transforms the business and provides verifiable return on investment (ROI). SAP SuccessFactors Learning enables you to do the following: Manage learning more efficiently: Store learning activities in a single location to reduce costs and create greater visibility. Improve compliance reporting: Use the Learning Management System (LMS) to track, train, and automate required certification assignments. Blend formal and social for greater ROI: Accelerate performance and increase learning retention by using SAP Jam as part of learning processes. Extend learning easily: Train your partners and customers with an Extended Enterprise solution that includes e-commerce functions. Make administration more powerful and intuitive: Wizard-based processes and assignment profiles provide unparalleled automation for your administrators. Improve content delivery: Reduce costs, increase efficiency, and assure that e-learning exceeds business results with a unique icontent service. Performance and Goals SAP SuccessFactors Performance and Goals equips you with the in-depth employee performance information you need to retain, reward, and develop your best people. Its innovative Copyright. All rights reserved. 285

44 Unit 6: Human Capital Management capabilities and intuitive user experience ensure aligned, clear goals, and accurate objective talent assessments. SAP SuccessFactors Performance and Goals allows you to do the following: Align goals: Employees and managers can align individual goals with company business objectives. Deliver relevant formal reviews: Easy and engaging focal reviews. 360-degree assessments expand performance insight and improve employee engagement and retention. Calibrate performance: Intuitive, visual employee comparisons ensure objective and factbased assessment decisions. Support managers: Writing Assistant and Coaching Advisor help managers provide more meaningful feedback and coaching. Identify top talent: Compare and rate employees across the same dimensions to identify high performers and potential future leaders. Communicate continuously: With SAP SuccessFactors Mobile Touchbase, you can easily track issues and accelerate work on top-priority projects. Recruiting SAP SuccessFactors Recruiting is the only comprehensive recruiting solution that helps you attract and engage top talent, select and hire the best-fit candidates, and then measure the business results. Unlike other solutions, you can focus on more than just the selection phase of the process. SAP SuccessFactors Recruiting allows you to do the following: Target the talent you need: the patented methodology of SAP SuccessFactors ensures that your jobs get in front of the right candidate with the right message at the right time. Engage easily and effectively: Apply marketing best practices to cultivate strong candidates so you have a pipeline that will save recruiters time and get results. Improve selection: SAP SuccessFactors uses social, mobile, and competency-based approach to evaluating candidates speeds up the hiring process but keeps it fair. Onboard seamlessly: Accelerate new-hire engagement and impact with automated forms, and broaden your access to people and resources in the employee social network. Get results you can see: Improve return on your recruiting dollars, and demonstrate how your recruiting strategy is driving business results. Succession and Development Successful business execution requires the right people in the right places for maximum impact throughout your organization. SAP SuccessFactors Succession and Development helps you identify, develop, and retain talent at every level of your company, keeping your workforce responsive and flexible. With a dynamic, comprehensive, and objective view of your workforce, you can recognize and bridge the talent gaps in your organization. SAP SuccessFactors Succession and Development enables you to do the following: Identify key positions: Succession management allows you to address current and potential talent gaps to reduce the risk of poor business execution. 286 Copyright. All rights reserved.

45 Lesson: Integrating with Success Factors Provide talent continuity: Proactively identify your go-to employees and develop them for upcoming job transitions. Gain workforce insights: Gain visibility into employee experience, expertise, performance, and career aspirations. Understand employee histories: Map every staffing move across the company and see gained employee experience. Improve career planning: Address talent gaps, engage employees, and accelerate learning with targeted development plans. Calibrate ratings: Ensure objective, accurate ratings across groups, and departments using competency-based criteria. Workforce Analytics Workforce Analytics improves decision making by helping companies find answers to key questions about workforce challenges and provides guidance to help solve them. Workforce Analytics provides answers that can help drive successful workforce initiatives. Features of SAP SuccessFactors Workforce Analytics include the following: Designed for business execution: Workforce Analytics is fully integrated with SAP SuccessFactors, is easy to use, and provides the insights and tools you need to take action. Built-in expertise: With more than 30 years of expertise in HR metrics built into our tools, technology, processes, and services, SAP SuccessFactors sets the standard for workforce metrics and benchmarks, and it provides the tools that make everyone successful. SAP SuccessFactors Workforce Analytics provides you with access to a community of experts. SAP SuccessFactors consultants offer proven excellence in HR analytics, planning, and metrics, and are available to share best practices and accelerate your business execution. Customers are encouraged to join a peer community and share ideas. Workforce Planning Workforce Planning helps you to manage your organization's exposure to significant risks from global talent shortages or an aging workforce. Understanding and closing the gap between current and projected talent needs can help you to execute strategy effectively. SAP SuccessFactors Workforce Planning helps you to ensure that you have the right people with the right skills, at the right time and cost, so that you can execute your business strategy successfully, now and in the future. Fully integrated with SAP SuccessFactors, Workforce Planning enables what-if scenario planning and analysis, allowing your leaders to act with confidence and a clear understanding of the financial and operational implications of your plans. Proper planning results in improved short-term and long-term recruiting, succession, learning, development, performance, and other workforce initiatives. For more information, see workforce-planning.html Copyright. All rights reserved. 287

46 Unit 6: Human Capital Management Cloud Transition Figure 140: Cloud Transition Scenarios for SAP Customers Cloud transition scenarios for SAP customers enable you to leverage existing investments, and connect with delivered integrations. SAP SuccessFactors and SAP Integration strategy is built on the following strategic pillars: Data Foundation: Builds the foundation for integrated data between SAP and SAP SuccessFactors - Include employee and organizational data (such as reporting relationships) - Eliminate double data entry and maintenance - Integrate two systems of records Process Integration: End-to-end process integration across a loosely-coupled suite - Driven by processes (for example, pay-for-performance, attract-to-hire) - Support end-to-end HR processes by bidirectional integration - Increase integration quality (for example, event-based and periodical) Seamless User Experience: Unified access for end users to all SAP ERP HCM processes, regardless of back-end system - Provide a single point of access across systems - Unified menus and navigation Customers benefit by additional choice of solutions based on their business needs. We offer a comprehensive portfolio of solutions to run your SAP ERP HCM processes fully in the cloud, onpremise, or in a hybrid deployment combining both. The following are some of the solutions we offer: Cloud-based technology 288 Copyright. All rights reserved.

47 Lesson: Integrating with Success Factors Real-time, bidirectional process integration Data integration Graphical flows and mappings Centralized monitoring and administration Prebuilt adapters Community marketplace (future) Compatible with content (mappings, for example) of SAP Process Integration and SAP Data Services (planned) Lower cost of change over time Integration Options Figure 141: SAP SuccessFactors and SAP Integration We have the capability to offer integration out-of-the-box more cost-effectively than any other combination of SAP and non-sap. The overall cloud strategy is best described as a loosely coupled suite (or a suite of best of breed). For example, you receive the benefits of cloud-based solutions on top of your on-premise solutions and allow for seamless integration. That is why the SAP SuccessFactors solutions for talent management and SAP ERP HCM are separate and we focus on the orchestration of the two. With our existing integration packages we ensure that all employee master data is available for all of the SAP SuccessFactors talent modules. That includes core talent management as well as learning and recruiting, and analytics. Deeper integration for areas such as compensation management and recruiting are supported with various interfaces. You can choose solutions based on your business needs. A comprehensive portfolio of solutions is available to run your SAP ERP HCM processes fully in the cloud, on-premise, or in a hybrid deployment combining both. These solutions allow you to do the following: Make the most of your investment Copyright. All rights reserved. 289

48 Unit 6: Human Capital Management - Complement and extend your on-premise core HR applications - Use a phased approach to transform your organization - Deploy an integrated suite of talent management applications at your pace Take advantage of easy implementation - Replace applications as needed; no need to switch everything overnight - SAP SuccessFactors and the SAP Business Suite run by hundreds of customers already Create a roadmap that fits your future - Strong roadmap of enhancements and new functionality with huge research and development investment ensure successful delivery - Benefit from increasing integration of SAP and SuccessFactors Provide standard integration, delivered and maintained by SAP - Programs, tools, and methodologies to help customers leverage a combination of SAP and SuccessFactors HR processes as seamlessly as possible and at the lowest possible TCO Design as a loosely coupled suite - A stable Core HR (on premise) while easily absorbing ongoing innovations in talent management via the cloud enabled to the clients - No platform interdependencies SAP SuccessFactors Functionality Figure 142: Talent Hybrid Overview 290 Copyright. All rights reserved.

49 Lesson: Integrating with Success Factors With the talent hybrid model, you can run core HR processes (for example, personnel administration, organizational management, payroll) on-premise with SAP ERP HCM connected with talent solutions (performance management, learning, recruiting) and optionally workforce analytics, all in the cloud, with SAP SuccessFactors. Pre-Delivered Process Integration Compensation Figure 143: Pre-Delivered Process Integration Compensation The figure, Pre-Delivered Process Integration Compensation, shows the pre-delivered process integration between SAP SuccessFactors Compensation and SuccessFactors HCM integration 1.0 SP2. The delivered integration is as follows: 1. Send current salary information to SAP SuccessFactors Compensation. 2. Plan compensation in SAP SuccessFactors Compensation with SAP employee, organizational, and salary data. 3. Pay approved merit increases, bonuses, and lump-sum payments with SAP Payroll. LESSON SUMMARY You should now be able to: Understand the integration with Success Factors Copyright. All rights reserved. 291

50 Unit 6: Human Capital Management 292 Copyright. All rights reserved.

51 Unit Learning Assessment 1. Profit Centers can be used as investment centers. Determine whether this statement is true or false. X X True False 2. Which of the following elements are part of the organizational structure? Choose the correct answers. X X X X A Payroll area B Jobs C Employee group D Persons 3. is assigned to a company code. Choose the correct answer. X X X X A An employee group B A personnel subarea C A payroll area D A personnel area Copyright. All rights reserved. 293

52 Unit 6: Learning Assessment 4. Which of the following functions can an employee perform by using Employee Self-Service (ESS)? Choose the correct answers. X X X X A Search the Who s Who B Submit travel expenses C Check employee reviews D Update banking information 5. Which of the following areas are covered in Manager Self-Service (MSS)? Choose the correct answers. X X X X A Performance appraisal (employee reviews) B Change requests of an employee C Monitoring D Execution 294 Copyright. All rights reserved.

53 Unit Learning Assessment - Answers 1. Profit Centers can be used as investment centers. Determine whether this statement is true or false. X X True False 2. Which of the following elements are part of the organizational structure? Choose the correct answers. X X X X A Payroll area B Jobs C Employee group D Persons 3. is assigned to a company code. Choose the correct answer. X X X X A An employee group B A personnel subarea C A payroll area D A personnel area Copyright. All rights reserved. 295

54 Unit 6: Learning Assessment - Answers 4. Which of the following functions can an employee perform by using Employee Self-Service (ESS)? Choose the correct answers. X X X X A Search the Who s Who B Submit travel expenses C Check employee reviews D Update banking information 5. Which of the following areas are covered in Manager Self-Service (MSS)? Choose the correct answers. X X X X A Performance appraisal (employee reviews) B Change requests of an employee C Monitoring D Execution 296 Copyright. All rights reserved.

55 UNIT 7 Purchase to Pay Processing in SAP S/4HANA Lesson 1 Describing the Purchase to Pay Business Process 299 Lesson 2 Defining the Master Data Used in the Purchase to Pay Process 312 Exercise 24: Create a Material Master Record 317 Lesson 3 Creating a Vendor Master Record 323 Exercise 25: Create and Extend a Vendor Master Record 327 Lesson 4 Listing Additional Vendor Specific Master Data Records 331 Exercise 26: Create a Purchasing Info Record 335 Lesson 5 Creating Purchase Requisitions 341 Exercise 27: Create a Purchase Requisition for a Stock Item and a Consumable 347 Material Lesson 6 Creating Purchase Orders 351 Exercise 28: Create a Purchase Order with Reference to PReq. 353 Exercise 29: Run an Internal Order Report 357 Exercise 30: Evaluate Purchase Orders 361 Lesson 7 Posting a Goods Receipt for a Purchase Order 366 Exercise 31: Post a Goods Receipt for a Purchase Order 373 Exercise 32: Transfer Posting for Material 377 Lesson 8 Copyright. All rights reserved. 297

56 Unit 7: Purchase to Pay Processing in SAP S/4HANA Processing Vendor Invoices 381 Exercise 33: Post the Vendor Invoice 387 Exercise 34: Query the Supplier Account 391 Lesson 9 Processing the Automatic Payment Run 395 Exercise 35: Create an Automatic Payment Run 397 Exercise 36: View Vendor Accounts 403 UNIT OBJECTIVES Describe the purchase to pay business process Create a material master record Create a vendor master record List additional vendor specific master data records Create a purchase requisition for stock item and consumable material Create a purchase order Integrate ARIBA functionality with procurement in SAP S/4 HANA Post a goods receipt for a purchase order Post the vendor invoice Process the automatic payment run 298 Copyright. All rights reserved.

57 Unit 7 Lesson Describing the Purchase to Pay Business Process LESSON OBJECTIVES After completing this lesson, you will be able to: Describe the purchase to pay business process Purchase to Pay Overview As a long-term SAP user, you want to gain an overview of the purchase to pay process. Therefore, you need to know the basic functions covered in purchasing and the integration aspects. Figure 144: Purchase-to-Pay Business Process The figure, Purchase-to-Pay Business Process, shows the steps of the purchase-to-pay business process, which are follows: 1. Determine requirements. Copyright. All rights reserved. 299

58 Unit 7: Purchase to Pay Processing in SAP S/4HANA The responsible department manually creates a purchase requisition to inform purchasing of its requirements. The system can automatically generate a purchase requisition with the Materials Requirements Planning (MRP) process. 2. Determine the source of supply. As a buyer, you can use the source of supply determination to create requests for quotation (RFQs) and then enter the quotations. You can also refer to purchase orders, contracts, and conditions that already exist in the system. 3. Select the vendor. Price comparisons between various quotations make it easier for you to select vendors. The system can send rejection letters automatically. 4. Handle purchase orders. You can create purchase orders manually or let the system create them automatically. When you create purchase orders, you can copy data from other documents (such as purchase requisitions or quotations) to reduce the number of entries you have to make. You also have the option to work with outline agreements. 5. Monitor purchase orders. You can monitor the processing status of purchase orders in the system. For example, you can determine whether a delivery or an invoice has already been received for a purchase order item. You can remind vendors about outstanding deliveries. 6. Receive goods. When you enter inbound deliveries in the system, you refer to the associated purchase order. This reduces the number of entries you have to make and allows you to check whether the type of goods and the quantities delivered match the purchase order. The system also updates the purchase order history. 7. Verify the invoice. When you enter invoices, you can reference the purchase order, the delivery note number, or the bill of lading. You must enter the delivery note number and the bill of lading at the time of goods receipt. After entering one of the documents, the system performs a three way accounting match to verify that the total invoice amount agrees with the goods receipt quantity at the purchase order price. 8. Make payments. You can pay the vendor s open items using the payment program. The accounting department is responsible for running the payment program on a regular basis. Co-Deployment of SAP Supplier Relationship Management (SRM) and SAP Supplier Lifecycle Management (SLC) Procurement and SAP SRM S/4HANA Integration Co-Deployment of SAP SAP SLC The functional scope of SAP SRM will gradually be made available within SAP S/4HANA. The related functions will become part of the procurement solution of SAP S/4HANA. In the first 300 Copyright. All rights reserved.

59 Lesson: Describing the Purchase to Pay Business Process release of SAP S/4HANA, on-premise edition, a limited functional scope might be available compared to SAP SRM. The coverage will grow over time. Technically, the procurement solution within SAP S/4HANA is not a successor to the SAP SRM components. Therefore, the SAP SRM software components and SAP S/4HANA cannot be installed on the same system. Technically, it is not a co-deployment, but, in the future, the procurement solution will evolve to take over the SAP SRM functions. Customers with SAP SRM and SAP Business Suite on one server need to reimplement the procurement processes that have been used on SAP Business Suite source release within the SAP SRM installation on the SAP S/4HANA, on-premise edition system. It is not possible to install the SAP SRM software components within the SAP S/4HANA stack. The functional scope of the new procurement solution available with the first release of SAP S/4HANA is not identical with the SAP SRM functions. The goal is that, over time, the functional scope of SAP SLC will be available within the SAP S/ 4HANA stack. Customers who have deployed SAP SLC on SAP ERP and want to migrate to SAP S/4HANA, can continue to use those parts of the SAP SLC functionality that have been integrated into the SAP S/4HANA Core and are referred to as Supplier and Category Management. Customers who have been using a standalone SAP SLC system can continue to use it, but have to use MDG-S for supplier data integration. For the functional differences and for more information, see the simplification item, Dedicated SAP Supplier Lifecycle Management (SAP SLC) business processes. The functional scope of Supplier and Category Management in SAP S/4HANA is currently not identical to the SAP SLC functionalities. Master categories in purchasing category are not available. As a successor, material groups are available in purchasing categories. The following transactions are not available in SAP S/4HANA, on-premise edition: ME21, ME22, ME23, ME24, ME25, ME26, ME27, ME28 ME51, ME52, ME53, ME54, ME59, MR01, MR1M Classic SAP ERP Materials Management (MM) transactions and BAPIs for the business objects Purchase Order, Purchase Requisition, and Supplier Invoice have been replaced by the corresponding transactions and BAPIs made available with SAP R/3 Enterprise With SAP S/4HANA, on-premise, these classic MM transactions and BAPIs will no longer be available. The replacements that are available since SAP R/3 Enterprise 4.70 will be used. See the following SAP notes: : FAQ: End of Support of ME21, ME51, and BAPI_PO_CREATE and so on : Replacing MR01 / Functions of MR1M (Release 4.6) Foreign Trade and SAP Global Trade Services (GTS) Currently, there are two software services for international trade transactions: Foreign Trade and SAP Global Trade Services (GTS). Foreign Trade is part of standard Materials Management (MM). SAP GTS is an external service that can be installed on a separate instance. With SAP S/4HANA on-premise edition 1511, the foreign trade solution will be not available because SAP Global Trade Services is the successor for the business requirement. Copyright. All rights reserved. 301

60 Unit 7: Purchase to Pay Processing in SAP S/4HANA For Intrastata, customers can leverage functionality within SAP S/4HANA, on-premise edition Additional functions for import and export management are available with SAP GTS. The customer needs to check whether 3rd party foreign trade systems are in use for foreign trade processes. Because of the replaced foreign trade functionality in SAP S/4HANA, it is possible that third party foreign trade system will need adjustments by the respective third-party Solution or Service Provider. However, SAP GTS can be connected to SAP S/4HANA to run the respective foreign trade processes. Logistics Material Management Inventory Management Actual stock quantity data will be calculated on-the-fly from the new material document table MATDOC. The advantage of the new MM-IM data model is the capability of simple and fast reporting, because the most information is in one place (the MATDOC table). The following transactions are not available with SAP S/4HANA: MB01, MB02, MB03, MB04, MB05, MB0A, MB11, MB1A, MB1B, MB1C, MB31, MBNL, MBRL, MBSF, MBSL, MBST, and MBSU. The SAP ERP 6.0 stock inventory management data model consists of the two document tables MKPF for document header information and MSEG for document item data. Additionally there were aggregated actual stock quantity data stored in several tables. Some of these tables also store material master data attributes like the tables MARC, MARD and MCHB. Such tables, with material master data attributes as well as actual stock quantities, will be named as hybrid tables. In contrast, there are also tables, such as MSSA, containing only aggregated actual stock quantities for sales order stock. Such tables will be called replaced aggregation tables. With SAP S/4HANA, this data model has been changed significantly. The new denormalized table, MATDOC, has been introduced which contains the former header and item data of a material document as well as a lot of further attributes. Material document data will be stored in MATDOC only and no longer in MKPF and MSEG. Additionally, the aggregated actual stock quantities will no longer be persisted in the hybrid or replaced aggregation tables. Instead, actual stock quantity data will be calculated on-the-fly from the new material document table MATDOC, for which some of those additional special fields are used. With the new MM-IM data model, the system works on database level in an INSERT only mode without DB locks. For stock decreasing processes, there will be still ABAP locks to ensure stock consistency. A further advantage of the new MM-IM data model is the capability of simple and fast reporting because the most information is in one place: MATDOC. The following tables of the SAP ERP 6.0 world still exist in SAP S/4HANA as DDIC definition, as well as database object, and the hybrid tables will still be used to store the material master data attributes. For compatibility reasons, there are Core Data Service (CDS) Views assigned as proxy objects to all those tables, ensuring that each read access to one of the tables below still returns the data as before in SAP ERP 6.0. The CDS Views perform the on-the-fly aggregation of actual stock quantities from the new MM-IM data model and join the master data attributes from the material master data table. All customer coding will work as before, because each read access to one of the tables will get redirected in the database interface layer of NetWeaver to the assigned CDS view. Valuation of special stock is derived from customizing as well as the material master 302 Copyright. All rights reserved.

61 Lesson: Describing the Purchase to Pay Business Process and stored in the predecessor of the material document. The valuation is also stored in the material document and was stored in SAP ERP 6.0 in the aggregate tables MSSA, MSSQ, and MSSL respectively. In SAP ERP 6.0, there was just one possible valuation for special stock at order on hand, project stock and special stock with vendor. With the new MM-IM data model, various valuations would be possible but this is not available across the whole process chain. A change of the valuation after an initial posting on special stock will not be supported. The following transactions for entering and displaying goods movements (material documents), called MB transactions are not available with SAP S/4HANA. In SAP S/4HANA, the single-screen generalized transaction MIGO is available (transaction MIGO is available in SAP Business Suite since Release 4.6): MB01, MB02, MB03, MB04, MB05, MB0A, MB11, MB1A, MB1B, MB1C, MB31, MBNL, MBRL, MBSF, MBSL, MBST, and MBSU The transactions MMBE_OLD (Stock overview), MMBE (Stock overview), MB51 (Material Document List), MB52 (Display Warehouse Stocks of Material) and MB5B (Stock at posting date) are still available but will not be available midterm. Successor functionalities are already available as SAP Fiori applications or as Virtual Data Model (VDM) to be consumed by SAP Lumira or SAP Design Studio: MMBE_OLD: Fiori application Stock Single Material, VDM view C_MaterialStockActual MMBE: Fiori application Stock Single Material, VDM view C_MaterialStockActual MB51: Fiori application Material Documents Overview MB52: Fiori application Stock Multiple Materials, VDM view C_MaterialStockActual MB5B: Fiori application Stock Multiple Materials, VDM view C_MaterialStockByKeyDate Material Ledger Obligatory for Material Valuation Flexible valuation methods in multiple currencies Parallel accounting standards while simultaneously reducing required system resources and improving scalability of the business processes Statistical moving average price One major innovation in SAP S/4HANA in the area of MM is the significant increase of transactional data put through for high volume transactions, especially goods movements. Parallel statistical moving average valuation is not available in SAP S/4HANA, on-premise edition This simplification makes it obligatory to use the Material Ledger in all SAP S/4HANA systems. When a system is converted to SAP S/4HANA, the Material Ledger will be activated, if not active already. Latest trends in material management aim for improved and more flexible valuation methods in multiple currencies and parallel accounting standards, while simultaneously reducing required system resources and improving scalability of the business processes. Since the data model of the Material Ledger (ML) module supports these business requirements, it was chosen as the basis for material inventory valuation in the new solution SAP S/4HANA. Copyright. All rights reserved. 303

62 Unit 7: Purchase to Pay Processing in SAP S/4HANA It is important to distinguish between Material Ledger, in its role as an inventory subledger in Accounting, and business feature Actual Costing. Material Ledger, as the inventory subledger, valuates material inventories in multiple currencies and GAAPs in parallel. In addition, Material Ledger is a base prerequisite for the use of Actual Costing. With Actual Costing, you can valuate your material inventories, work in process and cost of goods sold with weighted average unit costs that are being calculated after the fact by evaluating business transactions of one or several posting periods. Other features, for example, actual cost component split, are provided by Actual Costing. Before SAP S/4HANA, the inventory valuation tables xbew(h) - tables: EBEW, EBEWH, MBEW, MBEWH, OBEW, OBEWH, QBEW, QBEWH - contained transactional, as well as master data attributes. With SAP S/4HANA, the inventory valuation tables still exist as DDIC definition, as well as database object. However, they will only be used to store material master data attributes. The transactional fields LBKUM, SALK3, and SALKV will be retrieved from the Material Ledger. Those fields are no longer updated in the original xbewh(h) tables. As a consequence, the tables need to be updated less often, which leads to a higher throughput due to fewer database locks. For compatibility reasons, there are Core Data Service (CDS) Views assigned as proxy objects to all those tables ensuring that each read access to one of the mentioned tables still returns the data as before. The CDS views consist of database joins in order to retrieve both master data from the original xbew(h) table and transactional data from Material Ledger tables. All customer coding, reading data from those tables, will work as before because each read access to one of the tables will get redirected in the database interface layer of NetWeaver to the assigned CDS view. If transactional fields are affected, Write access to those tables has to be adjusted If customers are not using the material ledger already, it will be activated during the conversion process. In MM02 and MR21, material prices can now be maintained in multiple currencies. In Financials, the inventory account balances are calculated separately for each currency and result, therefore, in a cleaner and more consistent valuation in currencies other than the local currency. A major innovation in SAP S/4HANA in the area of MM is the significant increase of transactional data throughput for high volume transactions, especially goods movements. To enable this from a technical point of view, application logic should avoid exclusive locking on the application layer. For goods movements, this can be achieved with few exceptions for materials with price control Standard, where the relation between unit costs for material inventory (standard price), and inventory quantity and inventory value is kept constant during goods movements. To calculate a consistent moving average valuation, the system is still forced to use exclusive locks. Therefore, the same increase of transactional data throughput cannot be achieved for materials with price control Moving Average in comparison to materials with price control Standard. In classic SAP Business Suite the system calculates for materials with price control Standard, also a moving average valuation in parallel, the so called "statistical" moving average price. Obviously this statistical valuation also requires exclusive locking. As said, exclusive locking is limiting the transactional data throughput, and therefore shall be avoided in SAP S/4HANA. In consequence, this parallel statistical moving average valuation is not available in SAP S/4HANA, on-premise edition The deactivation of the statistical moving average is not mandatory in SAP S/4HANA, but recommended to achieve a significant increase of transactional data throughput for goods 304 Copyright. All rights reserved.

63 Lesson: Describing the Purchase to Pay Business Process movements. It is important to note that the deactivation is not reversible. The deactivation of the statistical moving average is the consequence of a new lock behavior for materials with price control Standard. This new lock behavior does not use exclusive locks anymore. The activation of the new lock behavior leads to the deactivation of the statistical moving average. As a result, end users, creating material master data in SAP S/4HANA, have to select one of the following material valuation methods for a material: Price control Standard that offers a fixed price inventory valuation, no parallel statistical moving average valuation. Only dedicated business transactions can change unit costs (for example, MR21). But a significantly increased transactional data throughput for goods movements can be achieved. Price control Moving Average with which unit costs of material inventory might be changed by any business transaction, but transactional data throughput is still limited by the exclusive locking. The statistical moving average price is as the name already implies purely statistical and does not have an impact on actual financials-relevant valuation. Without the statistical moving average price in few scenarios an alternative way of valuation needs to be used. This concerns, for example: Balance Sheet Valuation: Selection variants must be checked and adapted. Product Cost Planning: Valuation variants must be checked and adapted. Even though Material Ledger is becoming obligatorily active, Actual Costing is not. Activation of Actual Costing is still optional. Output Management Print Channel The SAP S/4HANA Output Management supports the following Channels: - - Printout - XML Print Technology The SAP S/4HANA Output Management supports the following print technologies: - Smart Forms - Adobe Forms - Adobe Forms using Fragments Over the years, several output management tools have been established. Different applications are using different output management tools to determine what is to be communicated, how it is to be communicated and when it is to be communicated. In addition, if communication is via printing, different print form technologies have been established, such as SAP Script, Smart Copyright. All rights reserved. 305

64 Unit 7: Purchase to Pay Processing in SAP S/4HANA Forms and Adobe Form technology. For example, form determination (along with other output parameters) occurs via message determination (NAST) in SD and MM, while other applications use different output management technologies, for example, FIN. The output management based on NAST supports the following: Print Channels: - Print output - Fax - Telex - External send - EDI - Simple Mail - Special function - Events (SAP Business Workflow) - Distribution (ALE) - Tasks (SAP Business Workflow) Print Technologies: - SAP Script - Smart Forms - Adobe Forms There is a new and modern Output Management within SAP S/4HANA. The new output management by design includes cloud qualities like extensibility enablement, multi tenancy enablement, and modification free configuration. Therefore, the complete configuration differs from configuration that is used when output management is based on NAST. The configuration is based on BRF+ which is accessible for Customers on premise. Information about the configuration steps is available in the CSS note In SAP S/4HANA the target architecture is based on Adobe Document Server and Adobe Forms only. For the form determination rules (along with other output parameters) BRF+ functionality is used (in this sense in combination with the message determination). Regarding the forms especially footer and Logos for the new output management: The standard SAP Script Repository is used (Transactions: SO10 and SE78). A customer can maintain texts and logos centrally. The determination rules can be accessed via Customizing. The access is available for Customers on premise (and for Service Center in the cloud edition). SAP S/4HANA Analytics Real-time operational reporting approach enables a key user or creates and modifies reports, KPIs, or any other analytical data according to their needs, based on easy to use and cloud enabled administration tools. 306 Copyright. All rights reserved.

65 Lesson: Describing the Purchase to Pay Business Process The analytics functionality within SAP S/4HANA is designed for ultimate simplicity. The new SAP S/4HANA Analytics concept as the target architecture technology is based on OData and open CDS and is introduced in addition to the existing analytics functionalities in SAP Business Suite. Customers will be able to extract data from SAP S/4HANA, on-premise edition 1511 to their own BW Hub using the BW-extractors delivered by SAP. In some areas, extractors have been deprecated or can no longer be used with SAP S/4HANA, on-premise edition Please refer to the general restriction note for SAP S/4HANA, on-premise edition There, in section 11, restriction notes of multiple areas are listed which contain the list of no longer available BW extractors. Note: Data Source adjustments might be required to comply with changed Scope and data structures within SAP S/4HANA, on-premise edition This needs to be verified on customer-specific basis. Using selected SAP BW Extractors for transferring data to their own BW Hub will be possible for customers starting with SAP S/4HANA, onpremise edition 1511 FPS1. Search, Object Pages, and Quick Navigation Figure 145: Search, Object Pages, and Quick Navigation In the classical system setup, there is no global generic search existing across business documents and master data. Users can start separately masterdata maintenance transactions, but would not have the chance to see the relevant business documents and jump directly to these documents. Copyright. All rights reserved. 307

66 Unit 7: Purchase to Pay Processing in SAP S/4HANA In SAP S/4HANA, users can use the generic search, SAP Fiori apps or object pages to view (other) object pages and jump from there again to other SAP Fiori Apps, other object pages or Web Dynpros or Web GUIs. Object pages can also be shared via link and sent to other users to discuss business issues. SAP Fiori Inbox Figure 146: SAP Fiori Inbox On the left side of the figure, SAP Fiori Inbox, the business workflow screen in ERP is displayed. A workitem can be selected from the list and the details are shown. Customers frequently ask for mobile workflow capabilities. This is not possible in standard ERP. On the right side, you see the SAP Fiori inbox, with all work items on one screen. The screen on the right is updated if another item on the left side is selected. In addition, filtering and sorting are possible. Mobile approval is, of course, possible. 308 Copyright. All rights reserved.

67 Lesson: Describing the Purchase to Pay Business Process SAP Fiori Apps for Procurement Figure 147: SAP Fiori Apps for Procurement As shown in the figure, SAP Fiori Apps for Procurement, there are three types of SAP Fiori apps: transactional SAP Fiori apps, analytical SAP Fiori apps, and object pages. This figure shows the SAP Fiori App Portfolio for SAP S/4HANA Sourcing and Procurement 1511 on-premise. Copyright. All rights reserved. 309

68 Unit 7: Purchase to Pay Processing in SAP S/4HANA Solution Explorer Streamlined Procure to Pay Figure 148: Solution Explorer Streamlined Procure to Pay Core ERP processes have remained unchanged, but there are new market trends due to the digital transformation. Although the processes have not changed, the way they are executed has. For example, the way the consumers want and the speed at which they expect their orders to be fulfilled has changed. Trends such as sensors, which enable Internet of Things scenarios, and big data, which fundamentally changes how we interact with information, consumer grade user experience on any device, easy to consume cloud services, entering new markets, which are not just global, but also hyperconnected. To stay relevant in these times of massive disruptions, enterprises are forced to see if their internal systems are supporting the new business realities. Consequently, enterprise management has to adapt to this changing digital world (digital transformation). It is clear to see that technology is disruptive. This is precisely why we need to talk about digital transformation. Driven by the combination of ever-growing digitization and evolving consumer demands, digital transformation is the use of new technologies to drive significant business improvements. This includes capitalizing on new opportunities as well as effectively transforming existing business. In this new world, the CIO (Chief Information Officer) focus is fundamentally changing, because the business is changing. Managing the traditional IT scope is no longer sufficient. Instead, new priorities need to be tackled. For the CIO to stay relevant, he or she needs to embrace these changes and talk business, or become relegated to a pure non-strategic operations role. CIOs need to rethink their strategic purpose in the organization and start a journey to achieve the strategic purpose. 310 Copyright. All rights reserved.

69 Lesson: Describing the Purchase to Pay Business Process Streamlined Procure to Pay Solution Capabilities Figure 149: Streamlined Procure to Pay Solution Capabilities Streamlined Procure To Pay provides the following four end-to-end solutions: Operational Procurement Invoice and Payables Management Sourcing and Contract Management Supplier Information and Master Data Assigned to the end-to-end solutions are solution capabilities, as follows: No changes: here no new development was done for 1511 on-premise Enhanced: new additional development was done for 1511 on-premise SAP Fiori UI: one or more new SAP Fiori UI or SAP Fiori apps was developed for this solution capability LESSON SUMMARY You should now be able to: Describe the purchase to pay business process Copyright. All rights reserved. 311

70 Unit 7 Lesson Defining the Master Data Used in the Purchase to Pay Process LESSON OBJECTIVES After completing this lesson, you will be able to: Create a material master record Material Master Data As a long-term SAP user, you want to gain an overview of the master data used in the purchase to pay process. Therefore, you need to know master data used and the usage of them. Figure 150: Material Number Field Length Extension SAP S/4HANA, on-premise edition 1511 can support a material number with 40 characters. The appropriate, related SAP development entities (domains, structures, table types, and transparent tables, external and internal interfaces, user interfaces, and so on) have been adapted accordingly. Where required, automated logic is in place and executed automatically in case a customer converts a current SAP Business Suite system into SAP S/4HANA, on-premise edition There might be constellations about which a customer needs to be aware, for example as follows: In certain constellations there might be the requirement to adapt custom code related to the material number field length extension. In a multi-system landscape, the customer has to decide if and when to switch on the extended material number functionality, as the switch impacts how compatible the system communicates within a system landscape. 312 Copyright. All rights reserved.

71 Lesson: Defining the Master Data Used in the Purchase to Pay Process The material number field length extension was done with SAP S/4HANA and is available within the SAP S/4HANA, on-premise edition 1511 and SAP S/4HANA, cloud edition For the first step into SAP S/4HANA SAP Simple Finance, on-premise edition 1503 the maximum field length is still 18 characters long. Note that the next version of SAP Simple Finance, on-premise edition, which will be based on Enhancement Package 8, will also be based on an 18 characters long material number. Extending the material number on the database means that the field length of the MATNR field on the database has been extended from 18 to 40 characters. This has been done in all tables (and all fields within the tables) in which a material number can be stored. Although the maximum length of the database field used to store the material number is now 40 characters, the way how the material number content is stored in the database field has not been changed compared to SAP Business Suite. This means that, for such fields, no data conversion is normally needed when converting from SAP Business Suite to SAP S/4HANA, on-premise edition This holds especially true for pure numeric material numbers. With standard Customizing (leading zeroes are not significant, lexicographic flag not set), pure numeric material numbers are still restricted to 18 characters and will be filled up on the database only up to 18 characters by leading zeroes. This is the same behavior as in SAP Business Suite. Overall, the chosen way of storing material number content avoids data conversions in the database. Note that data conversion will be needed when a material number is stored in a field that has a concatenated content, and the material number is part of that concatenated content: Concatenation in the code uses the complete technical length of the field (which now is 40 characters) and is also reflected in the database content. This will be explained in detail later in this Simplification Item. Usually a customer has a multi-system landscape: The ERP system is connected to miscellaneous internal and external (SAP or non-sap) systems. Accordingly, an SAP S/4HANA, on-premise edition 1511 system with a material number field length of 40 characters needs to consider this multi-system landscape requirement where not all related systems are able to deal with a 40 character material number. Furthermore, it cannot be assumed that all ERP systems in a customer landscape will be converted to SAP S/4HANA, on-premise edition 1511 at the same point in time. That means that the external interfaces used for integration have to be compatible to old versions of the interface. This is especially relevant for the commonly used integration techniques BAPI, RFC, and IDoc, because these techniques rely on a fixed length and order of fields in the transmitted data. Simply extending the material number field (or other extended fields) in these interfaces would therefore technically break the version compatibility. We have decided to provide a technical-version compatibility for released external interfaces in the way that is commonly used and proposed for BAPI interfaces: The already existing field keeps its original length and a new field has been added at the end of the structure (or as new parameter) that allows transmitting material numbers with 40 characters. Besides this, it must be ensured that no material number (or other extended field) can be maintained in the system with a content length greater than the old length of the field. To enforce this and to make the field length extension as far as possible non-disruptive for the SAP S/ Copyright. All rights reserved. 313

72 Unit 7: Purchase to Pay Processing in SAP S/4HANA 4HANA customers, the extended material number functionality must be switched on explicitly. Only after this decision it is possible to allow more than 18 characters for the material number. The changes described have been done for BAPIs, IDocs, and released remote-enabled function modules. This has additionally been implemented where necessary for remote function calls issued by the SAP S/4HANA system and for unreleased remote-enabled function modules that are used to communicate with other SAP Business Suite products like SAP SCM or SAP CRM. A complete list of relevant function modules, IDocs, and structures that have been extended in this way can be found in the piece lists in the simplification database. For released Web Services (SOA), adding a new field or extending the material number field was not necessary as these services usually already allow material number with up to 60 characters in their interfaces. After an SAP Business Suite System has been converted to SAP S/4HANA, on-premise edition 1511 or an SAP S/4HANA on-premise edition 1511 was newly installed, the extended material number functionality will by default be switched off. The default setting, both after the move to SAP S/4HANA and for new installations, is that the extended material number functionality is NOT activated. To use a material number with 40 characters, the customer needs to activate this functionality. The following settings are required: 1. Activation of the Extended Material Number Functionality The activation is realized as client-dependent customizing table. IMG Cross-Application Components General Application Functions Field length Extension Activate extended fields. Alternatively, use transaction FLETS (For the table maintenance the authorization group FLE [authorization object S_TABU_DIS] is required). 2. Changing the Material Number Format Transaction OMSL allows a customer-specific settings regarding the material number field length. Here, the settings need to be adapted to allow a field length of more than 18 characters. Define Output Format of Material Number can be accessed via IMG Logistics General Material Master Basic Settings. Note: If the extended material number functionality is activated in a system, it cannot be easily deactivated as values may exist in different fields that are only allowed with extended material number The Long Material Number within the Discrete Industries & Mill Products (DIMP) add-on. The extension of the material number is a well-known requirement in SAP Business Suite requested by several customers. An add-on solution was provided several years ago as part of the industry solution DIMP. The DIMP LAMA-functionality is a part of the industry solution Automotive, which is one component of the Add-On DIMP. The industry solution DIMP is part of SAP S/4HANA, on-premise edition 1511, but the DIMP long material number (LAMA) functionality with the LAMA is not part of SAP S/4HANA. The reason is 314 Copyright. All rights reserved.

73 Lesson: Defining the Master Data Used in the Purchase to Pay Process purely based on the fact that the material number is natively extended to 40 characters within SAP S/4HANA. Material Master Record Figure 151: Material Master Record The material master record is a central source of material-specific data in your company. You use the material master record in all areas of logistics. Integrating all the material data in a single database object eliminates the problem of data redundancy. All areas, such as purchasing, inventory management, materials planning, and invoice verification, can use the stored data at the same time. You use the data stored in the material master for many activities, including the following: Purchasing data for ordering purposes Inventory Management data for posting goods movement and physical inventory management Accounting data for material valuation Materials planning data to plan your material requirements Several user departments within a company work with one material, and each department stores different information. Therefore, the system subdivides the data in a material master record according to each specific user department or view. Each user department has its own view of a material master record and is responsible for maintaining this data. Copyright. All rights reserved. 315

74 Unit 7: Purchase to Pay Processing in SAP S/4HANA Material Master Organizational Levels Figure 152: Material Master Organizational Levels Some material data is valid for all organizational levels, while some is valid only for certain levels. The system organizes the material data so that it reflects the structure of a company. This ensures that you can administer the material data centrally, without putting an unnecessary load on the database due to redundant information. The following are examples of organizational level data: Data at the client level Data stored at the client level refers to material data valid for your entire organization. Data at the plant level Data stored at the plant level refers to all data that is valid within a plant for all storage locations belonging to that plant. Data at the storage location level Data stored at the storage location level refers to all data valid for a particular storage location. Client, plant, and storage location organizational levels are relevant for the external procurement process. These levels play a role when you enter data for purchasing, inventory management, and accounting. Other organizational levels can be relevant for other departments. For example, you enter the sales and distribution data depending on the sales organization and the distribution channel. Therefore, you must specify a warehouse number and storage type for the Warehouse Management (WM) data. 316 Copyright. All rights reserved.

75 Unit 7 Exercise Create a Material Master Record Business Example You have decided to include a stronger lock into your bicycle. Therefore, you need to create a new material master record for the lock to be included later in the structure (BOM) of the finished product. As a responsible person for the material master data you create a new material initially for plant Note that in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. The Material Master created in this exercise is required for one or more subsequent exercises in this course. 1. Create a new material master record, T-R9##, for the industry sector Mechanical Engineering and with the material type Raw Materials, as follows: Field Material Industry Sector Material Type Value T-R9## Mechanical Engineering Raw Material 2. Create the following views for Plant 1010 in Storage Location 101C: Basic Data 1 Purchasing Purchasing Order Text General Plant Data / Storage 1 Accounting 1 3. Enter the following data in the specified views: Copyright. All rights reserved. 317

76 Unit 7: Purchase to Pay Processing in SAP S/4HANA View Basic Data 1 Purchasing Purchase Order Text General Plant Data / Storage 1 Data The short description for the material Lock Ultra Strong TERP10- ##. Maintain the short description in DE Schloß extra stark. The base unit of measure is PC (Piece). The Lock is assigned to the material group L002 Material Group Raw Material. The gross weight and the net weight of the Lock is 50 G (Gram) Purchasing Group Z## is responsible for procuring the Lock. The Goods receipt processing time is 1 day. Reminder letters (expediters) regarding undelivered goods must be sent after 10, 20, and 30 days after the date when delivery is due. Under-delivery or over-delivery of the material is not acceptable. Choose the suitable purchasing value key. The material should be posted to Quality Inspection when posting Goods Receipt. Mark the corresponding entry. The material supplied must be in accordance with our technical specification The Lock will be stored in storage bin BL-01 at the storage location 101C. Accounting 1 You assign the Lock to the valuation class 3000 Raw Materials 1. The lock is valuated using the moving average price of 5 per 1 Piece. The currency automatically populates based on the company codes currency. 318 Copyright. All rights reserved.

77 Unit 7 Solution Create a Material Master Record Business Example You have decided to include a stronger lock into your bicycle. Therefore, you need to create a new material master record for the lock to be included later in the structure (BOM) of the finished product. As a responsible person for the material master data you create a new material initially for plant Note that in this exercise, when the values include ##, replace ## with the number your instructor assigned to you. The Material Master created in this exercise is required for one or more subsequent exercises in this course. 1. Create a new material master record, T-R9##, for the industry sector Mechanical Engineering and with the material type Raw Materials, as follows: Field Material Industry Sector Material Type Value T-R9## Mechanical Engineering Raw Material a) On the Launchpad, choose the Create Material tile. b) On the Create material (initial screen), enter the data provided in the table. c) Press Enter. 2. Create the following views for Plant 1010 in Storage Location 101C: Basic Data 1 Purchasing Purchasing Order Text General Plant Data / Storage 1 Accounting 1 a) On the Select Views screen, select the views listed above. Copyright. All rights reserved. 319

78 Unit 7: Purchase to Pay Processing in SAP S/4HANA b) Choose Continue. c) In the Organizational Level dialog box, enter the following data: Field Value Plant 1010 Stor. Location 101C d) Choose Continue. 3. Enter the following data in the specified views: View Basic Data 1 Purchasing Purchase Order Text General Plant Data / Storage 1 Data The short description for the material Lock Ultra Strong TERP10- ##. Maintain the short description in DE Schloß extra stark. The base unit of measure is PC (Piece). The Lock is assigned to the material group L002 Material Group Raw Material. The gross weight and the net weight of the Lock is 50 G (Gram) Purchasing Group Z## is responsible for procuring the Lock. The Goods receipt processing time is 1 day. Reminder letters (expediters) regarding undelivered goods must be sent after 10, 20, and 30 days after the date when delivery is due. Under-delivery or over-delivery of the material is not acceptable. Choose the suitable purchasing value key. The material should be posted to Quality Inspection when posting Goods Receipt. Mark the corresponding entry. The material supplied must be in accordance with our technical specification The Lock will be stored in storage bin BL-01 at the storage location 101C. Accounting 1 You assign the Lock to the valuation class 3000 Raw Materials 1. The lock is valuated using the moving average price of 5 per 1 Piece. The currency automatically populates based on the company codes currency. a) On the Create Material T-R9## (Raw Material) screen, enter the following data on the Basic Data 1 tab: Field Description Base Unit of measure Value (For EN:) Lock Ultra Strong TERP10-## (For DE:) Schloß extra stark PC 320 Copyright. All rights reserved.

79 Lesson: Defining the Master Data Used in the Purchase to Pay Process Field Material Group Value L002 Gross Weight 50 Weight Unit G Net Weight 50 b) Choose the Additional data icon and maintain the description in DE. Language DE: Schloß extra stark. c) On the Purchasing Data view, enter the following information: Field Purchasing Group Value Z## Purchasing Value Key 1 GR Processing Time 1 Post to Inspection Stock X d) Review any warning messages and choose Enter to clear the messages and proceed to the next data screen. e) On the Purchase order text screen, enter the following text: The material supplied must be in accordance with our technical specification For DE press Create Text and select German. Enter the following text: Das Schloß muss unserer technischen Spezifikation entsprechen. f) On the Plant Data / Storage Location 1 tab, in the Storage Bin field, enter BL-01. g) On the Accounting 1 data tab, enter the following information: Field Value Valuation Class 3000 Per Unit Price 5 Price Control V h) Save your entries and close the tile. Copyright. All rights reserved. 321

80 Unit 7: Purchase to Pay Processing in SAP S/4HANA LESSON SUMMARY You should now be able to: Create a material master record 322 Copyright. All rights reserved.

81 Unit 7 Lesson Creating a Vendor Master Record LESSON OBJECTIVES After completing this lesson, you will be able to: Create a vendor master record Vendor Master Record As a long-term SAP user, you want to gain an overview of the master data used in the purchase to pay process. Therefore, you need to understand the new business partner from the perspective of a vendor. Figure 153: Business Partner Approach in SAP S/4HANA There are redundant object models in the traditional ERP system where the vendor master and customer master is used. The (mandatory) target approach in SAP S/4HANA is the Business Partner approach. Business partners can be categorized as a person, group, or organization, as follows: Copyright. All rights reserved. 323

82 Unit 7: Purchase to Pay Processing in SAP S/4HANA An organization represents units such as a company (for example, legal person), parts of a legal entity (for example, department) or an association. Organization is an umbrella term to map every kind of situation in the day-to-day business activities. A group represents a shared living arrangement, a married couple, or an executive board. With current development, transaction BP is the single point of entry to create, edit, and display master data for business partners, customers, and vendors. It is planned to check the introduction of the Customer/Vendor Integration in the pre-checks and the technical transition procedure of SAP S/4HANA A system where the customer/vendor integration is not in place will be declined for the transition. The Business Partner Approach is not mandatory for the SAP S/4HANA Finance, The user interface for SAP S/4HANA Cloud & On Premise is transaction BP. There is no specific user interface for customer/vendor like known from SAP Business Suite (Transactions XD01, XD02, XD03 or VD01, VD02, VD03 / XK01, XK02, XK03 or MK01, MK02, MK03 and so on, are not available). Calls to these transactions are redirected to transaction BP. Clients who implemented Financial supply chain management (FSCM), the business partner functionality is not something new that used to take care of credit management, collections, and so on. Business Partner and Assigned Roles Figure 154: Business Partner and Assigned Roles The Business Partner is created and different roles are assigned depending on the usage of the BP. The different roles are still assigned to the organizational levels like company code and 324 Copyright. All rights reserved.