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SALES AND DISTRIBUTION

BUSINESS BLUEPRINT

Submitted to

ABC LIMITED

By

XYZ LIMITED
AUGUST 2009
VERSION 2.0
DOCUMENT INFORMATION
Project Name Document Name Document Location
ABC Business Blueprint_ Document Server
SD_ V2.0

DOCUMENT HISTORY
Version Document Date Author Reviewed BY Change
Name Control
1.0 ABC_ Business Venkata.C Srinivasan VS
Blueprint_
SD_ V2.0

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© XYZ Limited, 2007, All Rights Reserved.
This document is proprietary to XYZ Limited. XYZ and ABC use

You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
TABLE OF CONTENTS

1 EXECUTIVE SUMMARY..........................................................................5
1.1 BACKGROUND......................................................................................5
1.2 BUSINESS BLUEPRINT OVERVIEW...........................................................5
1.3 SALES & DISTRIBUTION........................................................................7
1.4 IMPLEMENTATION SCOPE.......................................................................7
1.4.1 FUNCTIONAL SCOPE...................................................................................7
1.4.2 GEOGRAPHICAL SCOPE...............................................................................9
1.4.3 BUSINESS PROCESS SCOPE........................................................................9
1.4.4 STANDARD SALES PROCESSING IN SAP......................................................10
1.4.5 GENERAL SETTINGS.................................................................................13
1.5 MODULE INTEGRATION........................................................................13
1.5.1 MM - MATERIALS MANAGEMENT.................................................................13
1.5.2 FICO – FINANCE & CONTROLLING..............................................................14
1.5.3 PS – PROJECT SYSTEMS............................................................................14
1.5.4 QM - QUALITY MANAGEMENT.....................................................................15
2 ORGANISATION STRUCTURE................................................................16
2.1 ORGANISATION ELEMENTS - SALES & DISTRIBUTION..............................16
2.1.1 CONTROLLING AREA.................................................................................16
2.1.2 COMPANY CODE.......................................................................................16
2.1.3 SALES ORGANIZATION..............................................................................17
2.1.4 DISTRIBUTION CHANNEL..........................................................................18
2.1.5 DIVISION................................................................................................18
2.1.6 SALES AREA............................................................................................19
2.1.7 SALES OFFICE..........................................................................................19
2.1.8 PLANT.....................................................................................................20
2.1.9 STORAGE LOCATION.................................................................................21
2.1.10 SHIPPING POINT......................................................................................22
2.2 OVERALL ORGANISATION STRUCTURE...................................................23
3 MASTER DATA....................................................................................24
3.1 CUSTOMER MASTER............................................................................24
3.1.1 GENERAL DATA........................................................................................25
3.1.2 COMPANY CODE DATA..............................................................................25
3.1.3 SALES AND DISTRIBUTION DATA...............................................................25
3.1.4 CUSTOMER ACCOUNT GROUPS..................................................................25
3.2 MATERIAL MASTER..............................................................................26
3.2.1 GENERAL DATA........................................................................................26
3.2.2 SALES AND DISTRIBUTION DATA...............................................................26
3.3 PRICING MASTER................................................................................27
3.4 CLASSIFICATIONS FOR SALES MASTERS................................................28
3.4.1 CUSTOMER GROUPS.................................................................................28
3.4.2 MATERIAL GROUPS...................................................................................28
3.5 OTHER DATA......................................................................................28
3.5.1 TERMS OF PAYMENT.................................................................................28
3.5.2 TAX CODE...............................................................................................29
3.5.3 TAX RELEVANCY OF MASTER RECORDS.......................................................29
3.5.4 ACCOUNT ASSIGNMENT............................................................................29

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
4 BUSINESS PROCESSES........................................................................31
4.1 PRE-SALES HANDLING - INQUIRIES.......................................................31
4.1.1 Purpose...................................................................................................31
4.1.2 Master Data.............................................................................................31
4.1.3 Business Process......................................................................................31
4.1.4 Document for Inquiry at ABC.....................................................................32
4.1.5 Item Categories for Inquiry at ABC.............................................................33
4.1.6 Schedule line Categories for Inquiry at ABC.................................................33
4.1.7 BPML LINK...............................................................................................33
4.2 PRE-SALES HANDLING – QUOTATION....................................................33
4.2.1 Purpose...................................................................................................33
4.2.2 Master Data.............................................................................................34
4.2.3 Business Process......................................................................................34
4.2.4 Document for Quotation at ABC..................................................................35
4.2.5 Item Categories for Quotation at ABC.........................................................35
4.2.6 Schedule line Categories for Quotation at ABC..............................................35
4.2.7 BPML LINK...............................................................................................35
4.3 SALES ORDER.....................................................................................36
4.3.1 Purpose...................................................................................................36
4.3.2 Master Data.............................................................................................36
4.3.3 Business Process......................................................................................36
4.3.4 Document for Order at ABC.......................................................................38
4.3.5 Item categories for Order at ABC................................................................38
4.3.6 Schedule line categories for Order at ABC....................................................38
4.3.7 BPML LINK...............................................................................................38
4.4 BILLING/INVOCING.............................................................................39
4.4.1 Purpose...................................................................................................39
4.4.2 Master Data.............................................................................................39
4.4.3 Business Process......................................................................................39
4.4.4 Document for Billing at ABC:......................................................................40
4.4.5 BPML LINK...............................................................................................41
5 LOCALIZATION FOR INDIA...................................................................41
5.1 COUNTRY INDIA (CIN) VERSION...........................................................41
5.1.1 Purpose...................................................................................................41
5.1.2 Master Data (EXCISE MASTERS).................................................................42
5.1.3 Features for ABC......................................................................................42
6 GAPS IDENTIFIED AND CLOSED...........................................................44
7 TRANSACTION CODES.........................................................................45

1 EXECUTIVE SUMMARY

1.1 BACKGROUND

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
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public, private or commercial use, without prior written permission from XYZ Limited.
ABC LTD is an associate of the ABC Group and is headquartered in Chennai. The
company is engaged in design, engineering, procurement, construction and project
management services. ABC LTD has a diversified basket of services in the field of
engineering services which include:

 Turnkey Projects
 Power Plants
 Metallurgical Plants
 Water and Sewage management
 Wind Energy

1.2 BUSINESS BLUEPRINT OVERVIEW


This document summarizes the findings of the XYZ consulting team and ABC Limited
Team, with respects to SAP processes to be implemented in ABC LTDProject.

Following activities were carried out during different phases of the project.

 AS IS Documentation
 plant Visit
 Business Process Master List (BPML)
 Business Blue print Documents (BBP’s)
 GAP Analysis
 Organization Structure Workshop
 Stakeholders/Process Owners Workshop

The information was gathered through above activities carried out during different
phases of projects i.e. reviews of business processes, business procedures,
documentation and relevant reports

The purpose of Business Blueprint document is to prepare to move forward with the
implementation of ABC Limited SAP R/3 system. At the conclusion of the blueprint, the
XYZ consultants will determine the SAP functionality required to run the ABC Limited
business.

The Blueprint and its associated appendices present a summarized perspective of all
functional business processes that will be implemented. As such, the Blueprint
document will serve - from this point forward the dual role of both official project
scope as well as system acceptance criteria.

The body of this document describes the organizational structure, Master Data, and
R/3 functional process flows to be implemented at ABC Limited. Generally,

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
requirements, certain key requirements are explicitly identified and summarized to
highlight their importance to ABC Limited and to document the approach proposed to
meet the requirement.

One section of the document summarizes identified gaps. The project team has
discussed this list with agreement on the approach going forward. Acceptable
approaches may require:

 Additional programming or technical effort


 Recognition and acceptance of procedural changes ("Workarounds") using
standard R/3 Additional resource commitment
 The deferral of a feature to a later phase like in BIW or CS or SRM or CRM
module.
 Simply the recognition and acceptance of a limitation – meaning, the
recognition and acceptance of a product gap, arising due to the non-
availability of the feature in the SAP software.

Other section of the document summarizes Organization Structure, Master Data and
Business Processes. These were used as per Accelerated-SAP (ASAP) Methodology to
discuss the ABC Limited requirements in detail.

The Blueprint reiterates the R/3 organizational structures that have been identified
and will serve as the basis for the initial configuration activities. No significant
configuration and customisation choices have been identified that will prevent the
future implementation of additional capabilities within the R/3 environment.

The information gathered and documented in the Blueprint is sufficient for the team to
go forward into the Realization phase. However, it is critical that both the XYZ and
ABC Limited team agree on the scope of the project as presented in this document.
Acceptance - by both teams - is required to move the project into the next phase.

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
1.3 SALES & DISTRIBUTION
The Sales and Distribution module in SAP contains all of the software functionality included
in managing pre-sales activities, receiving & managing sales orders and billing customers
for products/Services sold. A major focus for ABC’s implementation will be to successfully
match ABC’s business requirements with the Sales and Distribution Module in SAP R/3.

This section provides an overview of XYZ understanding of the various processes such as
Order Fulfilment, Customer management, and Sales processes followed at ABC vis-à-vis
SAP functionality. These have been arrived at after close interaction with key business
users, conduction of business process workshops and study of existing processes.

The activity resulted in the formulation of AS-IS Documents, which in turn formed the
basis for arriving at Business Process Master List (BPML). BBP’s would form basis of
configuring the final system. The following gives an overview and scope of business
processes to be covered in SAP.

1.4 IMPLEMENTATION SCOPE


1.4.1 FUNCTIONAL SCOPE

ORGANISATIONAL SCOPE

ABC-Chennai, Vanagaram office is responsible for the sales and marketing of the
goods and services for projects that are being carried out in India. ABC has 13
registered offices across 13 states; these sales offices along with Chennai
(Vanagaram) office are also responsible for sales planning, order execution along with
co-ordination with Sales Accounting group, which processes accounts receivables and
sales accounting functions of invoicing, taxation, documentary payments and
credit/debit notes etc.

ABC DIVISIONS

ABC has three main business divisions categorized into 10 sub divisions in total with 2
additional revenue generating units. ABC operates with the following divisional
structure:

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
Business Head Category

Renewable Energy Division

Bio Mass power projects Sub Division

Hydel power projects Sub Division

Ethanol projects Sub Division

Process & Metallurgy Division

Structure & Mega projects Sub Division

Power projects Sub Division

Chemical projects Sub Division

Steel projects Sub Division

Conveyor projects Sub Division

Municipal Services Division

Pipe rehabilitation projects Sub Division

Water projects Sub Division

Wind Energy Generation Division

Keelviraanan Sub Division

Chitradurga Sub Division

Satara Sub Division

Trading Division

1.4.2 GEOGRAPHICAL SCOPE

ABC is structured its operations into projects catering to various divisions and these
projects are operated at across 13 states.

The following units are within the scope of SAP Implementation at ABC:

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
Sales Offices Sales Offices
Kolkatta Andhra Pradesh
Gujarat Orissa
Kerala Karnataka
Jharkhand Chattisgarh
Maharastra Rajasthan
Tamil Nadu Delhi
Punjab

1.4.3 BUSINESS PROCESS SCOPE

 Master Data
o Customer
o Material
o Conditions
o Outputs
o Tax Codes
o Tax Classifications for customer and material
 Pricing
 Pre-sales
o Inquiry
o Quotation
 Order Fulfillment
o Sales Order
 Billing
o Billing Document
o Outputs
 Country India Version

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
1.4.4 STANDARD SALES PROCESSING IN SAP

The SD module allows executing different business transactions based on sales


documents defined in the system. These sales documents are grouped into three
categories:

 Pre-sales documents: Inquiries and Quotations


 Sales orders
 Complaints, such as Credit and Debit memo requests.

During sales order processing, the system carries out basic functions such as:

 Monitoring sales transactions


 Calculating pricing and taxes

Depending on how the system is configured, these functions may be completely


automated or may also require some manual processing.

There is a document flow function in the system. The document flow shows the entire
chain of documents – inquiry, quotation, sales order, invoice and accounting
document. It is nothing but the flow of data from one document to another document.

When a sales document is created, the system proposes much of the data from
master records, preceding documents and automatically determined by the system.

The following graphic shows how the various types of sales documents are inter-
related and how data subsequently flows into shipping and billing documents.

PP

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
1.4.4.1 MASTER DATA

It comprises Material, customer, condition and other master data. The master Data in
an integrated SAP environment is used by all components in the SAP Logistics System.
The integration of all master data in a single database object eliminates redundant
data storage.

1.4.4.2 PRICING

The term pricing is used broadly to describe the calculation of prices (for external use
by customers or vendors) and costs (for internal purposes, such as cost accounting).
Conditions represent a set of circumstances that apply when a price is calculated. For
example, a particular customer orders a certain quantity of a particular product on a
certain day. The variable factors here - the customer, the product, the order quantity,
and the date - determine the final price the customer gets. The information about
each of these factors can be stored in the system as master data. This master data is
stored in the form of condition records.

1.4.4.3 PRE SALES HANDLING

Pre-sales business processes in the system is represented using the functions for
inquiries and quotations. Customer inquiries and quotations to the customer can be
entered and monitored.

The inquiry is a request from the customer to provide him with a sales quotation. A
quotation presents the customer with a legally binding offer for delivering a product or
providing a service within certain fixed conditions. The data that is stored in sales
queries forms the basis of subsequent documents and sales analysis, wherever
referenced.

1.4.4.4 ORDER FULLFILMENT

This covers the process of Order, Contracts and Outline Agreements Entry that contain
committed quantities at special prices and payment terms and customer-material
information for certain customers with the standard functions such as the following:

 Pricing defined for various customer/material, customer (ship-to-party) /


material, material pricing group conditions.

The pricing conditions are dependent on characteristic values and maintained centrally
as master data. Apart from standard products, other products such Sample sales
(under excise invoice), Scrap sales, etc., Will also be managed through standard sales
order processing.

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© XYZ Limited, 2007, All Rights Reserved.
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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
1.4.4.5 BILLING

This covers the functions of:


 Creation of Invoices based on deliveries (Country India version Will be
used for processing excise duty and sales tax. This Will also cover the
preparation and maintenance of excise and sales tax registers.)
 Creation of Invoices based on deliveries.
 Issue credit and debit memos.
 Pro forma invoices.
 Transfer billing data to Financial Accounting (FI)

1.4.4.6 COUNTRY INDIA VERSION (CIN)

In SAP Country (India) specific statutory requirements are met through CIN. These
statutory requirements have an impact on the business requirement of customers in
India.

The scope of India Localization is restricted to statutory requirements covered by the


main logistics cycle covered by SAP. This essentially covers the procurement and sales
cycle. The areas covered are:

 Calculation of service tax, Education CESS and Higher education CESS


 Sales tax calculation and accounting
 VAT compliance

1.4.4.7 SALES ANALYSIS

These involve various forms of work lists for daily processing for sales and billing
processing.

Standard reports that are used for example invoices to customers, stocks at various
locations, status and tracking of orders, recording and management of financial
instruments etc.

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
1.4.5 GENERAL SETTINGS

The General settings in SAP consist of the following:

1.4.5.1 COUNTRY

o The country specific checks such as date format, decimal format, bank data,
postal data and control data needs to be maintained for a country. All the
country codes are already defined in SAP.

At ABC: Enter the required date format, the decimal format, bank data, postal data
and control data in the country for India.

1.4.5.2 REGION

The region is a further geographical classification within a country. The region is used
for: as a part of address, tax reporting in FI and pricing in SD (only for tax). The
usage of region can vary from country to country.

At ABC: The region Will be used to define the states in India. Zones are mapped as
Sales office in the new organization structure in SAP.

1.4.5.3 UNIT OF MEASURE (UOM)

This is the unit in which material is purchased, stocked, sold and moved. SAP has
standard unit of measures already defined.

At ABC: The UOM such as LOT, NO, KG, MT etc., will be defined in SAP for ABC.

1.5 MODULE INTEGRATION


Master and transaction data in Sales and Distribution are closely integrated with other
modules within Logistics and Finance. Business Transactions handled as part of SD
module have tight linkages with other modules especially in Finance and Production
Planning. The integration touch points of the Sales and Distribution with various
modules are detailed below.

1.5.1 MM - MATERIALS MANAGEMENT

 Definition of Material Types and Material Master records for finished and other
products belonging to various divisions

 Stock Transport Order Processing for transfer of goods between plants will be
done by MM Module.

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
1.5.2 FICO – FINANCE & CONTROLLING

 Creating linkages between Sales organization, highest entity in sales and


company code in Finance.
 Customer payment processing including advances payments.
 Billing and posting the data to accounting.
 Debit/Credit note creation for returns processing and wrong shipments etc.,
 Country Version India (CIN) comes with functions for calculating, posting, and
remitting excise duty:
 The system determines the excise and other taxes on your sales.
 You can create outgoing excise invoices, customized to your own requirements,
and make the appropriate accounting postings.
 The system offers functions for domestic sales from factories under excise
regulations.
 You can remit the excise duty using the delivered functions.
 VAT accounting will be applicable in case of ABC.

1.5.3 PS – PROJECT SYSTEMS

Project Systems is a one among the vital modules with which a sales order would
interact. A project would be created for every work order/job/contract. This
project would be linked to the sales process as a WBS (work breakdown structure)
element in the R/3 system.

 The WBS element so created by the PS is assigned to item.

 Also the milestone billing of the item in the sales order is blocked for billing
by default and is linked to the project network through the WBS element.

 As and when the project progress is updated in the PS module and milestone
is released in PS, the relevant billing block in sales order for the milestone
billing date in sales order is released and can be invoiced.

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form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
1.5.4 QM - QUALITY MANAGEMENT

The Quality Management (QM) component supports Sales and Distribution (SD) by
processing quality inspections and creating quality certificates for deliveries. A quality
inspection for a delivery allows checking the quality of products before it leaves the
plant.

 The Quality Management (QM) component supports sales and distribution


activities.

 With quality inspections for a delivery (based on sales organization, customer,


and material).

 With quality certificates for a delivery (with reference to sales organization,


customer, and material). The quality management team at the project site
would issue a Material receipt certificate to the vendor, after inspecting the
material/supply. This would release the material for project systems to use in
the project.

 The Material receipt certificate issued by the quality management team would be
used as a baseline to prevent invoicing the material/supply to the customer in
sales.

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
2 ORGANISATION STRUCTURE

2.1 ORGANISATION ELEMENTS - SALES & DISTRIBUTION


The first step in the implementation of the SAP System involves mapping the
enterprise structure of ABC into the organizational units of R/3. This structure
mapping must ensure that

 There is transparency at Operational level.


 All business processes can run smoothly, using resources as efficiently as
possible.
 The requirements for internal and external reporting are met.
 Segregation of various functions as Logistics and Sales.
 There is flexibility to add new entities to meet future growth.

2.1.1 CONTROLLING AREA

The controlling area is an organizational unit in Accounting used to subdivide the


business organization from a cost accounting standpoint.

 ABC -ABC Engineering Group of Companies Controlling Area

2.1.2 COMPANY CODE

The company code is the smallest organizational unit of Financial Accounting for which
a complete self-contained set of accounts can be drawn up for purposes of external
reporting.

The process of external reporting involves recording all relevant transactions and
generating all supporting documents required for financial statements such as balance
sheets and profit and loss statements.

 ABC - ABC company code

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
2.1.3 SALES ORGANIZATION

A Sales Organization is an organizational unit within Logistics that structures the


company according to its sales requirements. A sales organization is responsible for
selling materials and services. A sales organization has the following attributes:

 Legally, a sales organization is included in exactly one company code.


 One or more plants can be assigned to one sales organization. To facilitate
the supply of material and execution of other project related tasks from
various plants. However, at any given point of time one item/task can be
handled by only one plant.
 A sales organization can have its own customer and material master data
as well as its own conditions and pricing, same material can be used for
different sales organizations with different pricing.
 Sales employees can be assigned to a sales organization. This can also be
effectively used to restrict the employees from one sales organization to
view or change the business transactions or details of other sales
organization.
 Sales offices can be assigned to various sales areas to facilitate effective
business and project facilitation.
 All items in a sales & distribution document (sales order or a billing
document) belong to a sales organization.
 A sales organization is the highest summation level for sales statistics with
its own statistics currency. This can be vividly used to pull out profitability
reports at the business head level, as it is a sales organization in R/3
system.
 The sales organization is used as a selection criterion for the lists of sales
documents, delivery and billing due list and standard reports.
 A sales organization cannot share any master data with other sales
organizations. The master data must be created separately, by extending
the customer to one sales organization to the other. The data for a
distribution channel or a division can however be created for several
distribution channels or divisions. This can be used to achieve the
objective of giving the same material/customer different sales
characteristics in different sales organizations.

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form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
Sales Organization Code
Renewable Energy Sales Organization 1105
Chennai Sales Organization 1205
Kolkatta Sales Organization 1210
Structural Sales Organization 1215
Water Sales Organization 1305
Pipe Rehabilitation Sales Organization 1310
Wind Energy Sales Organization 1805
Trading Sales Organization 1810
Other’s (CER) 1815

If international projects are to be incorporated as a separate business unit in future,


sales organization numbers from 1900 to 1999 can be used.

2.1.4 DISTRIBUTION CHANNEL

A distribution channel is the channel through which saleable materials or services


reach customers. In ABC there would be only one distribution channel as this would
act as effective way of envisaging ABC business operation scope. A distribution
channel has the following attributes:

 Can allocate distribution channel to one or more sales organizations.

The following distribution channel has been identified for ABC.

Distribution Channel Code


ABC Distribution Channel 10

2.1.5 DIVISION

An organizational unit based on responsibility for sales or profits from saleable


materials or services. It basically represents various product lines.

Material division would be identified clearly at the time of defining material master
records for finished products.

A division has the following attributes:

 Allocate a division to one or more sales organizations.


 Allocate a division to one or more distribution channels.
 A material is always assigned to one division only.
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public, private or commercial use, without prior written permission from XYZ Limited.
At ABC: Only one division has been identified. The list of divisions in ABC is as
follows:

Division Code
Common Division 00

2.1.6 SALES AREA

Sales area is defined as a unique combination of sales organization/distribution


channel/division for which all transactions are entered in SAP. All such valid
combinations will be used as sales areas. A sales area can be used as a selection
criterion for lists and standard reports.

AT ABC: There would be separate and unique sales areas for selling the materials from
specific sales organizations.

2.1.7 SALES OFFICE

Every registered office of ABC in 13 states has been identified as a sales office.
Following are defined as sales offices in ABC

Sales Office Code


Chennai 1000
Kolkatta 1010
Delhi 1020
Andhra Pradesh 1030
Chattisgarh 1040
Gujarat 1050
Jharkhand 1060
Karnataka 1070
Kerala 1080
Maharastra 1090
Orissa 1100
Punjab 1110
Rajasthan 1120

2.1.8 PLANT

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public, private or commercial use, without prior written permission from XYZ Limited.
A plant is an organizational unit within Logistics, serving to subdivide an enterprise
according to procurement, maintenance, and materials planning. A plant is a place
where materials and services are provided.

The plant is an operating area or branch within a company. The plant is embedded in
the organizational structure as follows:

 The plant is assigned to a single company code. A company code can have
several plants.
 A plant can be assigned to several combinations of sales organization and
distribution channel.
 A plant can have several shipping points. A shipping point can be assigned
to several plants.
 A plant has its own material master data. This gives further flexibility of
maintaining the same material across various combinations of plant and
sales organizations.

The plant plays an important role in the following areas:

 Material valuation: When the valuation level is plant, the material prices
are defined for each plant. Each plant can have its own account
determination.
 Inventory Management: The material stocks are managed within a plant.
 Costing: In costing, valuation prices are defined only within a plant.

At ABC: Plant definition would be a part of MM Module.

Plant will be assigned to Sales Organization and Distribution Channel combination for
carrying out sales activity from that location.

The various Plants in ABC Ltd. (ABC) are:

Plant Code
Chennai 1000
Kolkatta 1010
Delhi 1020
Andhra Pradesh 1030
Chattisgarh 1040
Gujarat 1050
Jharkhand 1060
Karnataka 1070
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public, private or commercial use, without prior written permission from XYZ Limited.
Kerala 1080
Maharastra 1090
Orissa 1100
Punjab 1110
Rajasthan 1120

2.1.9 STORAGE LOCATION

Storage location in SAP allows differentiation between various stocks of materials in a


plant. These are the smallest unit in an organization hierarchy. These storage
locations can also correspond to physical storage points within ABC, if exclusively
needed.

A storage location has the following attributes:

 There may be one or more storage locations within a plant.


 Stocks are managed only on a quantity basis and not on a value basis at
storage location level.
 Storage locations are always created for a plant.

They are assigned to plants and are relevant for sales functions.

At ABC: There would be one logical storage location attached to each of the 15
plants, specified above. Storage Location definition would be a part of MM Module.

Storage Location Code


Storage Location 0001

2.1.10 SHIPPING POINT

The shipping point is an organizational unit in Logistics that carries out shipping
processing. The shipping point is the part of the company responsible for the type of
shipping, the necessary shipping materials and the means of transport. The shipping
point has the following attributes:

 A shipping point can be allocated to several plants.


 A delivery is always initiated from exactly one shipping point.
 The shipping point is used as a selection criterion for lists of deliveries, the work
list deliveries, picking and goods issue.

AT ABC: Each would have a common shipping point.

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public, private or commercial use, without prior written permission from XYZ Limited.
Storage Location Code
ABC Shipping Point 1000

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public, private or commercial use, without prior written permission from XYZ Limited.
2.2 OVERALL ORGANISATION STRUCTURE
The overall organization structure can be summarized in the figure below. The various
organizational elements are described with the code to be used in configuration
alongside.

3 MASTER DATA
In sales and distribution, products are sold or sent to business partners or services are
performed for them. Data about the products and services, as well as about the
business partners is the basis for sales processing. Sales processing with the SAP R/3
System require that the master data has been stored in the system.

In addition to sales and distribution, other departments of the company such as


accounting or materials management access the master data. The material master
data is stored in a specific structure in order to allow access from these different
views.

The processing of business transactions in sales and distribution is based on the


master data. In the SAP R/3 System, business transactions are stored in the form of
documents. These sales and distribution documents are structured according to
certain criteria so that all necessary information in the document is stored in a
systematic way.

Master data is maintained for customer, Pricing and finished goods. This is created
and maintained by responsible personnel in relevant sales function.

3.1 CUSTOMER MASTER


Customers are business partners with whom the organization does sales related
transactions. It is the central unit in the overall order fulfillment cycle and can denote
internal users, external customers or direct end consumers. It is advisable to maintain
data centrally in order to avoid duplicates and exercise effective control over master
records.

The various data elements for customer master records pertain to general information
like name, address, contact persons; accounting information pertaining payment
terms, shipping terms, G/L reconciliation account, customer classification towards tax
determination and relevant partner functions for the same.

Business related information on customer master is stored in the following structure


as a part of customer master and depicted below.

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public, private or commercial use, without prior written permission from XYZ Limited.
3.1.1 GENERAL DATA

Defined at the client level, and independent of any financial, or sales functions, it
includes company name, address, telephone number, region, unloading point etc.

3.1.2 COMPANY CODE DATA

Data relevant to ABC company code and includes account management data. The
customer can also be extended to other company codes like, SLL and OGPL.

3.1.3 SALES AND DISTRIBUTION DATA

This data is defined for a specific sales area, combination of sales organization,
distribution channel and division. It includes shipping terms, pricing data, shipping
conditions, delivery priority and partner functions relevant for shipping and billing.

3.1.4 CUSTOMER ACCOUNT GROUPS

Customer records are created for specific account groups (Sold to party, Goods
Recipient, Payer and Bill to Party). These groups control:

 Required fields for entering master data.


 Number Range assignment, internal or external for master records
 Valid partner functions
 One time customer

Separate account groups will be defined for finished goods customers and also internal
plants as customers.

Account Group Description No: From No: to


ZDOM Domestic Customers 110001 149999
ZINC International 150001 159999
Customers
ZINN Internal Customers 160001 169999

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public, private or commercial use, without prior written permission from XYZ Limited.
3.2 MATERIAL MASTER
Different company areas and SAP modules access the material master records, which
therefore must meet a wide variety of requirements. During sales processing, the
system repeatedly accesses the material master records. It is one of the basic sources
of data for sales processing. The material master record is accessed, for example, in
the inquiry, in the quotation and in the sales order. Data in the material master record
is also of great importance for shipping and billing. However, the data required for
shipping, for example, is not the same as that required for sales or billing.

Material master records form the basic source of data for sales processing. The
information relevant to general data, sales, plant, planning and storage related is
maintained through views in the material master. This data is used during order entry,
shipping and billing processes.

The sales and distribution data for a material is managed at the organizational levels
client, plant, sales organization and distribution channel. Therefore, the plant, the
sales organization and the distribution channel have to be entered for which a material
master record needs to be changed.

All data and information entered for a material is stored in the data structure of the
material master record. For sales and distribution, general data and sales and
distribution data in the material master record are relevant.

3.2.1 GENERAL DATA

General data in a material master record is identical for every sales organization, plant
and storage location. General data, which is of importance for all departments, is
always entered by the department, which creates the first part or view of the master
record. General data contains, for example, the material number that identifies it, the
material description, and units of measure, value, weight, volume and division.

3.2.2 SALES AND DISTRIBUTION DATA

Sales and distribution data in a material master record is defined for a specific sales
organization and distribution channel. The delivering plant, grouping terms for price
agreements and sales texts, for example, are included in sales and distribution data.
The fact that a material is linked to a distribution channel allows the material to be
sold with different conditions through the various distribution channels.

Sales and distribution data is divided into data that depends on the sales organization
and data that depends on the plant:

 Sales organization/distribution channel data

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public, private or commercial use, without prior written permission from XYZ Limited.
This data includes the delivering plant, the sales unit, the minimum order quantity and
the minimum delivery quantity.

 Plant data

This data applies to a plant and all its storage locations. Examples of plant data are
MRP data, such as the safety stock quantity, the reorder level, or the shipping
processing time.

3.3 PRICING MASTER


The term pricing is used broadly to describe the calculation of prices (for external use
by customers or vendors) and costs (for internal purposes, such as cost accounting).
Conditions represent a set of circumstances that apply when a price is calculated. For
example, a particular customer orders a certain quantity of a particular product on a
certain day. The variable factors here - the customer, the product, the order quantity,
and the date determine the final price the customer gets. The information about each
of these factors can be stored in the system as master data. This master data is
stored in the form of condition records.

The standard R/3 System includes predefined elements for routine pricing activities.
For example, the standard system includes condition types for basic pricing elements,
such as material prices, customer and material discounts, and surcharges such as
freight and sales taxes.

During pricing, the system calculates amounts based on a combination of automatic


procedures and manually entered data. The system automatically transfers pricing
data - for example, information about prices, surcharges, and discounts - from the
condition records into sales and billing documents. Depending on the pricing policies,
one can change prices manually during sales order processing. For example, user is
able to enter or change certain discounts within a specified range.

Pricing data will be maintained using condition records. These will be administered
centrally and controlled by centrally.

At ABC: There Will be a separate set of pricing conditions that Will be maintained for
the calculation of excise, local and central sales tax, service tax etc. These will be
handled using SAP standard functionality under CIN.

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public, private or commercial use, without prior written permission from XYZ Limited.
3.4 CLASSIFICATIONS FOR SALES MASTERS
The Sales Master Data Classifications in SAP consists of the following:

3.4.1 CUSTOMER GROUPS

Customer groups are available in customer master.

Following customer groups are defined for ABC

Customer Group Code


Private 11
Government 12
Semi Government 13
International 14

3.4.2 MATERIAL GROUPS

There are five fields in sales order item view additional data tab, these fields are
Material group 1, Material group 2, Material group 3, Material group 4, and Material
group 5. Material group in material master will be used to group particular grade
material code.

At ABC: Material groups would be used for pricing and reporting analysis purpose.
This will be defined by MM and for details please refer to MM BBP

3.5 OTHER DATA

3.5.1 TERMS OF PAYMENT

The terms of payment are defined for the customers. Aspects of accounting such as
due date for net payment in the invoice is defined and managed in FI module. The
short texts for the terms of payment can be stored for SD.

At ABC: This will be a part of FI Module. For details please refer to the FI BBP.

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public, private or commercial use, without prior written permission from XYZ Limited.
3.5.2 TAX CODE

Sales tax code represents the specifications used for calculating and displaying tax. It
Will have sales tax rates for each combination of LST/VAT and any other subsequent
tax as applicable or CST. Separate sales tax code should be maintained. The sales tax
code is defined for each country in which one of company codes is located.

At ABC: This will be a part of FI/SD Module. Different sales tax codes will be defined
in ABC to cater to different requirement.

3.5.3 TAX RELEVANCY OF MASTER RECORDS

The tax relevance for customers and materials can be defined to determine the tax
code in pricing. There are separate tax classifications for customers and tax
classifications for materials. The respective tax classification is assigned in the
customer and material master.

At ABC: Depending on the tax codes at ABC, the customer and material tax
classification will be defined. For example, full tax, tax exempt classification for
material; and tax with Form C, tax without Form, tax-exempt classification for
customer.

 0-Exempt
 1-full tax

The tax code will be determined based on the following condition tables:

 Region of Delivering Plant / Region of Customer Plant/ Material Tax Classification /


Customer Tax Classification.

3.5.4 ACCOUNT ASSIGNMENT

The account assignment is used to determine revenue accounts at the time of billing.
An accounting document gets generated automatically when a billing document is
created in SAP. The revenue accounts are automatically determined based on account
assignment.

Master Data Relevant for Account Assignment

The account relevance for customers and materials can be defined to determine the
revenue accounts at the time of billing. There are separate account assignment groups
for customers and account assignment groups for materials. The respective account
assignment group is assigned in the customer and material master.

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public, private or commercial use, without prior written permission from XYZ Limited.
At ABC: Depending on the revenue account determination at the time of billing, the
customer and material account assignment group will be defined.

Customer Acc Assignment Group Code


Divisible Contract 01
Indivisible – Govt 11
Indivisible – Others 12
International Customers 21
O & M Customers 31

Material Acc Assignment Group Code


Supply 01
Design & Engineering 02
Civil Works 03
Erection & Commissioning 04

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public, private or commercial use, without prior written permission from XYZ Limited.
4 BUSINESS PROCESSES

4.1 PRE-SALES HANDLING - INQUIRIES


Inquiries represent a customer’s request to a company to provide sales, Services and
Projects information without obligation. An inquiry can relate to materials or services,
conditions and if necessary delivery dates. The sales area that accepts the inquiry
becomes responsible for further processing.

4.1.1 Purpose

Also every tender notice (Henceforth referred to as inquiry in this document) found
apt for primary consideration by the marketing/proposal team, would be entered into
the system as an inquiry. Depending on the decision whether to bid or not to bid , the
inquiry will either be succeeded by the quotation in R/3 system or will be rejected with
an appropriate note to facilitate, analysis and understanding at a later stage. This is
typically a pre bid information capture scenario.

When ABC gets a inquiry from a direct customer it would record the requirements in
an inquiry and use it for further analysis or processing.

4.1.2 Master Data

Customer Master, material master, Payment terms, Pricing condition records, output type,
Tax code, Tax classification.

4.1.3 Business Process

The New Product Inquiry will be handled through respective Sales organization for
regular product through SAP as mentioned below.

 Receipt of Inquiry, from a direct customer, the Inquiry is registered in the


system.
 Customer inquiry comprises one or more items that contain the quantity of
a material or service that the customer asked for.
 ABC could also use a dummy customer (provision) to represent a direct
customer in case it feels that the customer might not show up or is a first
time customer. This way it could reduce the amount of customer master
data which is not a potential business proposal.
 Also every tender notice found apt for primary consideration by the
proposal team, would be entered into the system as an inquiry. Depending
on the bid or no bid decision, the inquiry will either be succeeded by the

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next document in R/3 system or will be rejected with an appropriate note
to facilitate, analysis and understanding at a later stage.
 The total quantity of an inquiry item can be subdivided between the
schedule lines in different amounts and relevant delivery dates.
 Also, the sub components of an item or the bill of quantities as referred by
ABC (Henceforth referred to as Bill of Material (BOM) in this document) can
be made to be automatically determined for standardized materials/items.
 Valid conditions for an item are listed in the item conditions and can be
derived individually from the conditions for the whole document. Business
partners can be specified in sold-to parties as different partner functions.
 While creating the inquiry the prices can be quoted manually in the R/3
system if rates are readily available or in case found out from the vendor,
ABC can choose to optionally enter the vendor conversation details in the
Item text (this feature is always available in R/3 system).
 In case of tender notice related inquiries, after creation of the inquiry in the
system and if the proposal/management team decides not to bid, then, the
inquiry can be rejected in the system.
 In case the customer rejects the inquiry or doesn’t show up before a
specified period of time (this is maintained as the validity period of the
inquiry), the inquiry can be rejected on the system.
 A print out can be obtained from the system for the inquiry and given to
the direct customer as an acknowledgement of inquiry or giving the
required pricing details for the item/material/service requested.
 In case the proposal team decides that the inquiry can’t be fulfilled, it can
optionally, issue a letter of regret to the customer.

4.1.4 Document for Inquiry at ABC

Type of Inquiry Document CODE No. From No: To


Lumpsum Inquiry Z1IN 11000001 11299999
Item rate Inquiry Z1IR 11300001 11499999
Wind Mill Inquiry Z1IW 11500001 11599999

4.1.5 Item Categories for Inquiry at ABC

Item Categories Description


Z111 Inquiry Supply Item
Z112 Inquiry WIP non matching sub
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public, private or commercial use, without prior written permission from XYZ Limited.
item supplies
Z113 Inquiry Service Item
Z118 Inquiry Spares
Z114 Inquiry Supply and Services.

4.1.6 Schedule line Categories for Inquiry at ABC

Schedule line category Description


CD Schedule line with out delivery

4.2 PRE-SALES HANDLING – QUOTATION


A quotation presents the customer with a legally binding offer for delivering a product
or providing a service within certain fixed conditions. This offer is legally binding for
the company within a specified time period. A sales area can reply to a customer
inquiry with a customer quotation or use it to refer to a business partner contact.

4.2.1 Purpose

In case the proposal team/marketing team/management decides to bid for a tender


notice, it can create a tender (henceforth referred to as a quotation in the document)
in the R/3 system with reference to the previously created inquiry for the tender
notice.

Also, can issue a quotation to any direct customer either with or without reference to
previously created inquiry. However, the recommended is to create a quotation with
reference to previously created inquiry if it exists in the R/3 system.

4.2.2 Master Data

Customer Master, Material Master, Pricing Conditions, Output type, Payment terms,
Tex codes, Tax classification.

4.2.3 Business Process

Prepare Quotation to the customer based on the Inquiry/Tender notice, after firming
up the price to be quoted. Pricing and taxes will be defaulted from the condition
records and optionally can also be manually altered to suit various billing needs.
Payment terms will be selected. Customer requested delivery date would be entered
line item wise.

 A customer quotation comprises one or more items that contain the


quantity of a material or service that the customer asked for.
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public, private or commercial use, without prior written permission from XYZ Limited.
 Also, as discussed above in the Inquiries pre sales phase, after initial
discussion, if the proposal team decides to bid, then a quotation document
is created in the R/3 system with reference to the previous Inquiry (Tender
Notice).
 The total quantity can be subdivided between the schedule lines in different
amounts and relevant delivery dates.
 Also, the sub components of an item Bill of Material (BOM) can be made to
be automatically determined for standardized materials/items.
 In this case the tender or bidding checklist and other documents have to be
manually managed as this is customer/client specific.
 A customer master record is required to effective capture of client
information and for further analysis.
 The valid conditions for an item are listed in the item conditions and can be
derived individually from the conditions for the whole document.
 Pricing elements can be manually adjusted to suit various kinds of
contracts namely lumpsum, item rate or cost plus.
 In case the quotation validity has expired and the tender result is yet to be
declared, or after tender results are declared and if ABC is the L1 bidder,
then appropriate adjustments can be done by changing the existing the
quotation. It could be prices or material/item changes.
 In case ABC business requires that a new quotation needs to be created
pertaining to the existing tender, it can create another quotation in the
system with reference to the existing quotation. This is generally done
when there is a major alteration in the tender scope.
 To enable authorization/approval of quotation before giving to the
customer an appropriate control can be maintained in R/3 system.
 In case ABC is not the L1 bidder or if the customer has cancelled the
quotation or has not turned within the validity of the period, the quotation
would be rejected on the system by manual intervention.
 Also in future, if there is requirement that a customer/client just wants a
quote for supply of spares for an already existing plant/project, the same
can be maintained in R/3 system.
 Various profitability figures are updated in the background for subsequent
review and analysis. They could be used by the management to take
betterment or corrective decisions for future business operations.

4.2.4 Document for Quotation at ABC

Type of Quotation Document CODE No. From No: To


Lumpsum Quotation Z1QT 21000001 21299999
Itemrate Quotation Z1QR 21300001 21499999
Wind Mill Quotation Z1QW 21500001 21599999

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public, private or commercial use, without prior written permission from XYZ Limited.
4.2.5 Item Categories for Quotation at ABC

Item Categories Description


Z121 Quotation Supply Item
Z122 Quotation WIP non matching
sub item supplies
Z123 Quotation Service Item
Z128 Quotation Spares
Z124 Quotation Supply and Services.

4.2.6 Schedule line Categories for Quotation at ABC

Schedule line category Description


CD Schedule line with out delivery

4.3 SALES ORDER


The sales order is a contractual agreement between a sales organization and a sold-to
party about delivering products or providing a service for defined prices, quantities
and times.

In the sales order, functions such as pricing and printouts are available. The system
checks whether the material is available for the requested delivery date and if
necessary, transfers the requirements to materials planning. Shipping deadlines and
shipping points are determined in delivery scheduling.

4.3.1 Purpose

Once the customer has confirmed the quotation or has decided to place an order after
inquiry or quotation or directly on first interaction, an order can be created for supply
of material, and or services.

This document would enable ABC to start the work and co-ordinate with project
systems.

Also trading and sale of wind energy power and carbon credits accumulated would be
handled using the same process in R/3.

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form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
4.3.2 Master Data

Customer Master, Material Master, Pricing Conditions, Output type, Payment terms,
Tax codes, Tax classification.

4.3.3 Business Process

 Ability to monitor end-to-end sales order processing as an integrated


process with complete visibility to all participating entities like material
purchase, project systems.
 Reduce the number of documents managed and steps involved right from
order entry to order fulfillment.
 After the letter of intent (LOI) or letter of acceptance (LOA) is given after
ABC being the L1 bidder and price negotiations being done and capture in
the quotation, an order is created in R/3 system with reference to the
quotation.
 Line items in a sales order can or will be attached to a WBS element,
defined by Project Systems. This would enable the project progress to be
effectively linked to work order and prevent billing without necessary
authorization from project systems.
 Design and manage flexible pricing conditions for prices, taxes,
surcharges/discounts based on product and distribution channels/division
combinations and multiple billing requirements for lumpsum, item rate and
cost plus contracts.
 Prices would be ideally copied from the previous reference document which
can be either inquiry or quotation and changed manually if required.
 A relevant billing break up (henceforth referred to as billing plan in this
document) can be maintained in the order.
 Billing break up print out can be issued to the customer as a pro forma
invoice in R/3 system
 As and when the project stage is completed and there is a requirement for
invoicing the billing plan can be updated/released in the order to facilitate
relevant invoice creation.
 Multiple ship-to customers in a single sales order.
 Also, in case of customer only requesting for spares supply, order can be
created in the R/3 system and pricing be manually updated. This can again
be created individually or with reference to inquiry or quotation.
Whenever, an order is created with reference to a previous document the
pricing is automatically copied from the previous document and can be
manually fine tuned/altered.
 Provision to capture concessions / full rate of excise duty and sales tax.
 Capture of tax relevant data like ECC no, ECC Registration Number, Range
etc and Sales tax no (CST/LST).

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
 One can specify the delivery time at header level and these influences the
delivery times for all items in a sales order but you can also enter different
delivery times for single item at item level. To facilitate phase wise supply
of material during project execution.
 In case of any changes during the execution of the project the same can be
updated in the order and informed to the customer. This could be
regarding any change in billing plan or price escalations or material
changes.
 The change can either originate from ABC and flow as information to the
customer or originate at customer and flow to ABC as information.
 Also, an order can be manually cancelled in the R/3 system and
appropriate reason can be maintained in the system. This would terminate
the job and subsequent functions.
 Various profitability figures are updated in the background for subsequent
review and analysis. They could be used by the management to take
betterment or corrective decisions for future business operations.
 Foreign projects can also be handled with the same order. They would be
handled out of Chennai sales office and Chennai plant. The figures would
be only in INR.
4.3.4 Document for Order at ABC

Type of Order Document CODE No. From No: To


Lumpsum Order Z1OR 31000001 31499999
Wind Mill Order Z1OW 31500001 31599999
Itemrate Order Z1SR 31300001 31499999

4.3.5 Item categories for Order at ABC

Item Categories Description


Z131 Order Supply Item
Z132 Order WIP non matching sub
item supplies
Z133 Order Service Item
Z138 Order Spares
Z134 Order Supply and Services.
Z139 Order Item Rate

4.3.6 Schedule line categories for Order at ABC

Schedule line category Description


CD Schedule line with out delivery

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form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
4.4 BILLING/INVOCING
Billing represents the final processing stage for a business transaction in Sales and
Distribution. Information on billing is available at every stage of order processing and
delivery processing.

Credit / Debit memo are part of the billing process.

4.4.1 Purpose

The billing process at ABC would be according to an appropriate billing plan


maintained in the order. The billing milestones can be released as per the project
progress.

This would effectively handle the various pricing needs vis-à-vis lumpsum, item rate
and cost plus, and billing needs of supply, erection and commission and sales.

This is the base document based on which the customer would make payments.

Debit / Credit memo are used for passing on a credit / debit to customer on account of
material rejection, short supply, price increase / decrease, commissions etc.,

4.4.2 Master Data

Customer Master, Material Master, Pricing Conditions, Output Types, Tax codes, Tax
classification, payment terms.

4.4.3 Business Process

 Invoices would be created based only on the billing plan which is


specified in the order. To facilitate billing, every billing milestone is
linked to project milestone in the order and has a billing block which
would prevent invoicing to the customer without confirmation from the
project systems. This block has to be removed before proceeding to
invoicing.
 The 3 contract types required by ABC would be maintained i.e.,
lumpsum, item rate and cost plus. The prices would flow from the order,
but can be manually changed in the invoicing document, if ABC deems
the change necessary.
 Depending on the type of contract and type of item i.e., if it is a supply
or erection, commission and civil work, appropriate print out can be
given choosing an appropriate output option.
 This print out can be handed over to the customer
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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
 Also, various types of taxes or charges can be maintained either
automatically or manually like VAT, CST, Service Charge, Education
CESS and higher education CESS depending on supply, Erection and
Commissioning, Civil or work. These taxes would depend upon the
material type and would vary for state to state in few cases.
 ABC could also Issue credit and debit memos to the customer in case of
damaged spares being sent or billing variations if accidentally sent
across.
 Billing document can either have same or different Bill-to-Party and
Payer.
 Order reason can be assigned for the Debit / Credit memos.
 ABC can also cancel billing transactions.
 The prices and figures in the billing document/invoice would be
transferred automatically to Finance and Control module and capture in
relevant G/L accounts automatically. This is done in the background.
 Single or multiple items can be culminated into a single invoice.
 Various profitability figures are updated in the background for
subsequent review and analysis. They could be used by the
management to take betterment or corrective decisions for future
business operations.

4.4.4 Document for Billing at ABC:

Z1BR ABC Billing Request 91300001 91499999  


ABC Billing Request
Z1CR Cancel 91700001 91799999  
Z1BI ABC Invoice 9100000001 9100099999 1000
Z1EI ABC Export Invoice 9101000001 9101099999 1010
    9102000001 9102099999 1020
    9103000001 9103099999 1030
    9104000001 9104099999 1040
    9105000001 9105099999 1050
    9106000001 9106099999 1060
    9107000001 9107099999 1070
    9108000001 9108099999 1080
    9109000001 9109099999 1090
    9110000001 9110099999 1100
    9111000001 9111099999 1110
    9112000001 9112099999 1120
    9113000001 9113099999 1130
         
Z1CB ABC: Invoice Cancel 8100000001 8100099999 1000
    8101000001 8101099999 1010
    8102000001 8102099999 1020
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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
    8103000001 8103099999 1030
    8104000001 8104099999 1040
    8105000001 8105099999 1050
    8106000001 8106099999 1060
    8107000001 8107099999 1070
    8108000001 8108099999 1080
    8109000001 8109099999 1090
    8110000001 8110099999 1100
    8111000001 8111099999 1110
    8112000001 8112099999 1120
    8113000001 8113099999 1130

5 LOCALIZATION FOR INDIA

5.1 COUNTRY INDIA (CIN) VERSION

5.1.1 Purpose

Most of the country-specific functions for India relate to Financials and Logistics. The
main areas are as follows:

 Excise duty and the central value-added tax system (CENVAT)


 Withholding tax (also known as tax deducted at source)
 Sales tax
 Maintenance and printing of statutory excise registers. CIN comes with
functions for calculating, posting, and remitting excise duty.
 The system determines the excise and other taxes on sales.
 Creation of outgoing excise invoices, customized to your own
requirements, and makes the appropriate accounting postings.
 Functions for domestic sales and supply from various states designated
as plants in R/3 system.
 All goods movements are recorded in the appropriate excise registers,
including register RG 23D.
 Remit the excise duty using the delivered functions.

CIN Will be used to maintain, local and central Sales tax, VAT, Service charge,
education CESS and higher education CESS; surcharge based on customer and
material classification and ship-from/to region combination. The relevant G/L account
codes will be defined for the same.

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You may not modify, copy, reproduce, republish, upload, post, transmit or distribute any material from this document, in any
form or by any means, nor may you modify or create derivative works based on the text of any file, or any part thereof for
public, private or commercial use, without prior written permission from XYZ Limited.
Excise duty will be calculated for finished goods and miscellaneous products at the
time of removal of goods from the plant based on chapter ID and excise
customer/material indicators.

5.1.2 Master Data (EXCISE MASTERS)

In CIN, the excise masters consist of the following:

Chapter ID
This is to define the chapter IDs and corresponding descriptions as described in the
excise tariff structure.

Material and Chapter ID combination


For each material, you specify chapter ID, material type (whether RM, capital goods or
a FG), etc.

Customer Master (Excise Data)


The customer master Will have excise details such as customer’s tax registration
numbers and customer excise duty indicator.

Customer Excise Master, Material Excise masters, Tax Code Records

Tax code: Will be created by using combination of following components:

The components can be chosen as per requirement to arrive at a tax code.

5.1.3 Features for ABC

In CIN, SD component handles sales processes as found in India. In addition to the


generic functions, it allows to:

Sales Taxes

For central sales tax and local sales tax, there are two condition records each, one for
the basic tax (JCST and JLST respectively), and one for surcharges (JCSR and JLSR).
These are all tax conditions and are posted with the account key MWS or MW3. When
you create a condition record for the sales taxes, you must specify a tax code that you
want the tax to be posted under in Financial Accounting (FI).

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public, private or commercial use, without prior written permission from XYZ Limited.
6 GAPS IDENTIFIED AND CLOSED

GAP1:

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public, private or commercial use, without prior written permission from XYZ Limited.
7 TRANSACTION CODES
Transaction T- Code
Create Sales Order VA01
Change Sales Order VA02
Display Sales Order VA03
List of Sales Orders VA05
Sales Order Error Log V.01
List of Incomplete Sales Orders V.02
Display Incoming Orders V.12
Incomplete SD Documents V_UC
Create Billing Document VF01
Change Billing Document VF02
Display Billing Document VF03
Process Billing Due List VF04
List billing documents VF05
Cancel Billing Document VF11
Display Customer (Centrally) XD03
Display Material Master MM03
Output Processing for Mat. Documents MB90
Tax Record Conditions VK11 OVKB
Tax Record Conditions VK12 OVKC
Tax Record Conditions VK13 OVKD
Tax Record Conditions VK14 OVKE
Create Material Price V-41
Change Material Price V-43
Display Material Price V-44
Create Customer-Specific Price V-49
Display Cust.price V-52
Create Cust.disc./surcharge V-61
Change Cust.Disc/Surcharge V-63
Display Cust.Disc/Surcharge V-64
Create Condition VK11
Change Condition VK12
Display Condition VK13
Create Output: Sales VV11
Change output: Sales VV12
Display Output: Sales VV13
Create Output : Billing VV31
Change output: Billing VV32
Display Output: Billing VV33
Create Inquiry VA11
Change Inquiry VA12
Display Inquiry VA13
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public, private or commercial use, without prior written permission from XYZ Limited.
Transaction T- Code
Inquiries list VA15
List of Incomplete Inquiries V.03
Create Quotation VA21
Change Quotation VA22
Display Quotation VA23
Quotations list VA25
List of Incomplete Quotations V.04
Expiring Quotations SDQ1
Expired Quotations SDQ2
Completed Quotations SDQ3
Output from Billing Documents VF31
Return Delivery per Mat. Document MBRL
Output Processing for Mat. Documents MB90
Credit Limit Changes FD24
Change Customer Credit Management FD32
Display Customer Credit Management FD33
Credit Management FRMN
Material & Chapter ID Combination J1ID
Customer Excise Details J1ID

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public, private or commercial use, without prior written permission from XYZ Limited.

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