3513 Deep Dive on SAP Financial SCM Collections Management Module

]

Orange County Convention Center

Orlando, Florida | May 15-18, 2011

SAP FSCM Collections Management

Sashidhar Narahari

President & CEO

HighRadius Corporation

email: [email protected]

Real Experience. Real Advantage.

[ Functionality Overview

Define collection strategies /

rules

Define work item assignment

to users / groups

Monitor and reallocation of

workload

Incoming / Outbound collection

calls

Process daily worklist based on

prioritization

Record customer

contact and

follow up

Collection Supervisor Collection Specialist


[ Text

Double-Click to

open customer

work item


[ Text

Record promise

for payment or

customer contact

at the invoice level


[ Text

Promise for

payment has been

recorded


[ Text

Record customer

contact resulting

in completion of

the work item


[ Text

Work item

completed


[

8

Streamline Customer-Facing Activities

Enable central company wide common processes

Leverage collections management to identify and prioritize

customers that need to be contacted after automated

collection attempts have failed, enabling a proactive approach

to receivables management

Daily worklists to improve user productivity

Increase efficiency and effectiveness of customer-facing

communication

Incoming / Outbound Calls

Outbound Correspondence Generation


[

Enable a system independent company wide common

processes using one platform. So, how does it work?

Connect Non-SAP AR systems and SAP FI-AR systems (< R/3 4.7)

into one single instance of Collections Management

– Non-SAP AR

systems can be

connected as a

substitute system

which enables the

transfer of master

data and

document data



[

Start

Invoice Posted

to AR

X Days Past Due?

Automatic

Dunning

Type of

Contact

Creation of

Dispute Case

Resubmission for

follow up

End

Promise to

Pay

No

Yes

Accounts Receivable Worklist

Generation

Customer Contact

End

Dunned X

times?

Automatic Worklist

Generation

Prioritization

based on Strategies

Individual Dunning

Notice OR FI

Correspondence

Generate Account

Statement

Re-Print Invoices

Invoice

Paid?

No

Yes

Enhancement Pack 5

Proactive approach to receivables management



[

Streamline Customer Contact Activities

SAP Collections Management

ECC

6.0

Enhancement Pack

2 4 5

Create Invoice-Level promise for payment

Create Invoice-Level promise for payment with installments

for customers on payment plans

Create dispute case for open invoices that are disputed

Create dispute case, or customer-disputed object, for claims

not related to an open receivable

Create customer-level resubmission, or follow up reminder

on a specific date

Create invoice-level resubmission, or follow up reminder,

with ability to insert attachments

Ability to re-print SD invoices



[

Streamline Customer Contact Activities

SAP Collections Management

ECC

6.0

Enhancement Pack

2 4 5

Create notes with reference to one or many invoices with

the ability to insert attachments. New tab with a

consolidated overview of all notes.

Ability to generate individual dunning notices on an ad hoc

basis. Dunning Data will be visible in the customer contact

log.

Ability to include attachments upon creation of customer

contact.

Ability to generate Ad Hoc FI-Correspondence:•Bank statements

•Open Item Lists

•Individual correspondence

•Customer Statements

Ability to email contact logs to the customer or extract

them if needed for sending a customer to collections



[

13

Key Learning's for a Successful Deployment & ROI

Five Considerations for a Successful Implementation

1. How to define your organizational structure

2. What data Is needed and where?

3. How to define your collection strategies & assign to collection

groups

4. How to set up your business partner collection profile

5. How to generate worklists for prioritization and assignment

1. How to define your

organizational structure

2. What data Is needed and

where?

3. How to define your collection

strategies & assign to

collection groups

4. How to set up your business

partner collection profile

5. How to generate

worklists for prioritization

and assignment


[

• A group of customers that can

be collected with the same

strategy

Collection Group

• Determines when a customer

should be contacted for

collection activities

• Prioritizes a collector’s

worklist

Collection Strategy

Before we begin…. Let’s review some key concepts in

FSCM Collections Management

Key Learning’s for a Successful Deployment & ROI


[

Company Code 3000 & 1000 /

Credit Segment 2000

US Collection Segment

Large Retailers

Collection Group

John Smith

Collection Specialist

Tom Jones


Nancy Johnson

Substitute

01/01/09 –01/20/09

SME Customers

Collection Group

Tina Miller


Company Code 4000 /

Credit Segment 1000

Canada Collection Segment

Collection Group

Mark Taylor


Laura Fortin


Jake Pelletier





where?



collection groups



5. How to generate


and assignment


[

What information is needed for processing of

receivables?

Within the Collection Worklist

Customer-Level Data

Within the Collection Work Item

AR Line Item Data

Collection Rules for prioritization of work items within

the collectors worklist




where?



collection groups



5. How to generate


and assignment


[ Enhance Worklist, Work Item and Collection Rules

Addition of customer-level data to the worklist or addition of AR line item data to the work item

Information can be used to streamline collection activities

Build collection rules based on additional data

Enhancement of the work list and work item data will provide central visibility to required

information

Enhanced worklist

which summarizes the

number and amount of

orders on credit hold

to streamline collection

efforts




where?



collection groups



5. How to generate


and assignment


[

Basic Rules

Collection Rules

Collection Strategy

Collection Strategy for Higher Risk SME

Customers

High to Medium Risk and greater than 80% Credit

Limit Utilization

Valuation: 15 points

Risk Category

Credit Limit Utilization

Past Due Invoices Over 15 days Past Due &

Dunned One or More Times

Valuation: 20 points

Dunning Level

Documents by posting key and document type

Individual Items Overdue Since N Days

Resubmission Due for the Customer

Valuation: 5 points

Resubmission Due for the Customer




where?



collection groups



5. How to generate


and assignment


[

Total Amount Past Due

Items with Open

Promise to Pay

Dispute Cases not in

a ‘To Be Collected’

Status

Items with a Current Dunning Notice

Items Arranged

for Payment

Amount ‘To Be

Collected’

Total Amount Past Due – Total of all overdue items in FI-Accounts Receivable

Items with Open Promise to Pay – If there items with an open promise to pay, or items

with a future payment promised on date, these items will be excluded from the ‘To Be

Collected’ amount

Dispute Cases not in a ‘To Be Collected’ Status – All open dispute cases, which have

not been updated with a status that is mapped to the ‘To Be Collected’ in collections

management, will be excluded from the ‘To Be Collected’ amount

Items with a Current Dunning Notice – If a line item in FI-Accounts Receivable has

recently been dunned, this amount will be excluded from the ‘To Be Collected’ amount.

Items Arranged for Payment – All amounts that are (a) collected with a debit memo

procedure or (b) where the account statement balance contains a payment

notification from the bank will be excluded from the ‘To Be Collected’ amount

BAdI: Amount To Be Collected: Can be used to enhance the to be

collected amount calculation

To Be Collected Amount Calculation




where?



collection groups



5. How to generate


and assignment


[ Collection strategy to collection group assignment will be different for different types of

customers

Small to Medium Sized Customers

Larger Retailers

Collection strategy to collection group assignment may need to change during different

periods of the month or year

Cash strategy at month end or year end

Regular strategy for collection during the month




where?



collection groups



5. How to generate


and assignment


[

Individual collection

specialist assignment in

the business partner

collection profile

Collection Specialist Assignment

Option for even distribution to each collection specialist within the collection group

Individual collection specialist assignment within the Business Partner Collection Profile

BAdI: Determination of Collection Group and Specialist per Segment

Automatic determination by accounting clerk in customer master, for example




where?



collection groups



5. How to generate


and assignment


[

Upon worklist

generation priority is

determined by the

valuation of each

collection rule within

the collection strategy




where?



collection groups



5. How to generate


and assignment


[

Prioritization of a collectors workload based on your

departmental objectives and KPI’s:

Aging of Open Receivables

Dunning Level and Amount Dunned

Broken and/or partial kept promise to pay

Dispute Cases in a to be collected status X days after initial collection

attempt

Integration of FI-AR/SD Credit Management Data

Credit Limit

Risk Category

Credit Exposure

Integration of Orders & Deliveries on Hold

Amount & Count on Hold

Identification of Customers with Non Sufficient Funds

System Demonstration: Collection Strategies


[ Text

Collection rules

within the collection

strategy


[ TextConditions within a

Collection Rule. If

all conditions are

true, then rule will

be valuated with 30

points.


[ Text

Simulation of

collection strategy

for a business

partner


[ Text

Determine if

expected

collection rules

have been valuated


[ Text

Simulation

results in a

High

Priority


[ Text

High priority

consists of the

following

collection rules


[ Text

Now that your

collection strategy has

been refined,

regeneration of the

worklist will re-

prioritize your

collectors workload


[ TextGo to your

UDM_SUPERVISOR

transaction to view

workload allocation

and prioritization


[ Text

Go to UDM_GROUP

transaction to switch from a

daily strategy to a CASH

strategy at the end of the

month, for example. Upon

regeneration of the worklist,

prioritization will be re-

determined accordingly


[

] Thank you for participating.

SESSION CODE:

3513

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