ES Fundamentals Short Course Manual to Print v3.3

ES FUNDAMENTALS FOR BUSINESS SHORT COURSE

2B ZCS Zambikes Case Study & Exercises 3A ZES Enterprise Systems Knowledge for Business (student reader) 3B ZMC Zambikes Model Company Case Study 4A ZN ERP Concepts & Navigation Workshop 5A ZP Procure to Pay Process (presentation) 5B ZP Procure to Pay Workshop I 5C ZP Procure to Pay Workshop I Datasheet 7A ZS Sales Order Processing (presentation) 7B ZS Sales Order Processing Workshop I 7C ZS Sales Order Processing Workshop I Datasheet 8A ZI Inventory Management Integration (presentation) 8B ZI Inventory Management Integration Workshop 8C ZI Inventory Management Integration Workshop Datasheet 9A ESEFA Exam Guidelines

© SAP SE Glossary Page i

GLOSSARY

AG Aktiengesellschaft

AP accounts payable

A/R accounts receivable

ASP application service provider

ATP Availability to Promise

BP business process

BOM bill of material (finished product recipe)

CO Controlling

cr credit

CRM customer relation management

DC distribution centre

DEG Deutsche Investitions- und Entwicklungsgesellschaft (German Investment and

Development Corporation)

dr debit

EDI Electronic Data Interchange

EMEA Europe, Middle East and Africa

ERP enterprise resource planning

ES enterprise system

ESEFA Enterprise Systems Education for Africa

FI Financial Accounting

FOB Free On Board

GBI Global Bike Inc.

G/L General Ledger

GPS Global Positioning System

GR goods receipt

GUI graphical user interface

IM Inventory Management

IP Internet Protocol

IR invoice receipt

IT information technology

ITIL Information Technology Infrastructure Library

ES Fundamentals for Business Curriculum : Glossary

© SAP SE Glossary Page ii

GLOSSARY

LMS

learning management system

MCQ multiple choice question

MM Materials Management

MRP materials requirements planning

MRP II manufacturing resource planning

OVGU Otto von Guericke University Magdeburg

PIR purchasing information record

PLM product lifecycle management

PO purchase order

RFID radio-frequency identification

RFQ request for quotation

SaaS software as a service

SCM supply chain management

SD Sales and Distribution

SMB small- to medium-sized business

SOA service-oriented architecture

SRM supplier relationship management

UCC University Competence Centre

UA University Alliances

UAC University Alliances Community

USD United States dollars

WM Warehouse Management

XML Extensible Markup Language

© SAP SE

CASE STUDY

Product

Zambikes Case Study Level

Undergraduate Graduate Focus

Company background Organizational structure Business processes Authors

Anjali Ramburn Patrick Wirz Gwamaka Mwalemba Lisa Seymour Version

3.1

MOTIVATION

This document introduces the Zambikes Case Study. It provides a historical background on the company’s strategy and operations and describes its current organizational structure, product strategy and core business processes. Business processes such as procurement, sales, inventory management and production are visualised.

PREREQUISITES

None.

NOTES

The Zambikes Case Study is fictitious and is based on an actual bicycle manufacturer located in Zambia. The ESEFA data set adapted for the SAP UA African curriculum is modelled on Zambikes.

ZCS Zambikes Case Study & Exercises

This document introduces the Zambikes Case Study which has been

exclusively developed for the SAP UA African curriculum. The case study

focuses on Zambikes' organizational structure and business processes.

© SAP SE Page 2B-2

CASE STUDY

Background

Zambikes started as an innovative project in 2007 with the aim of addressing the social challenges

that Zambians faced because of the difficult local transport situation. The growing demand for

affordable, convenient and versatile transport solutions, particularly in the rural areas, became

the foundation of Zambikes. The company’s philosophy comprises not only leaving a ‘social

footprint’ but also, committing itself to the mission of sustainable craftsmanship and of

manufacturing high quality bicycles locally, using a local workforce. Hence, the company links two

visions: firstly, the empowerment of local communities by providing employment and skills

development and secondly, making a contribution to the country’s economic well-being by

manufacturing and supplying sustainable products such as bicycles, Zamcarts and Zambulances

which address the socio-economic needs of Zambians, especially those who are in the rural areas.

These visions are captured by their popular slogan ‘Not only building bikes, but changing lives’.

Zambikes is a VAT registered company in Zambia. Its headquarters are located in Zambia’s capital

city Lusaka where sales, purchasing and manufacturing activities are managed. The company is

run by four managers and a foreman, and currently employs more than 30 Zambians. Its

operations span five departments: logistics and international sales, accounts and finance, sales

and marketing, production, and administration (admin).

The company’s main production facility is located in Mungwi, Lusaka West, where Zambikes

manufactures products for both the domestic as well as the export market. Zambikes procures

the various raw materials from both local and international vendors.

Product strategy

Zambikes develops two different basic bicycle types: the Transport Zambike and the Bamboo

Touring Bike. The Transport Zambike is a rugged steel frame bicycle mostly targeting local

customers. Because theirs is not the only steel bicycle sold in Zambia, Zambikes has differentiated

itself by painting all their steel bicycles yellow.

Bamboo Touring Bikes (as well as Bamboo Road Frames) are manufactured from locally grown

bamboo and are highly customized to suit individual needs. Being a high-end product, Bamboo

Touring Bikes are primarily intended for export and so far Zambikes has established a strong

customer base of cyclists and fun riders in Europe, America, Asia as well as other parts of Africa

such as South Africa.

The Zambikes product portfolio also consists of bicycle ambulances, known as Zambulances,

which easily transport patients, as well as cargo bicycle trailers, known as Zamcarts, which easily

transport heavy loads.

© SAP SE Page 2B-3

CASE STUDY

Since its inception in 2007, Zambikes has assembled and delivered over 10 000 bicycles,

manufactured over 1 000 Zambulances and 300 Zamcarts and built over 900 unique bamboo

frames/bicycles.

Manufacturing strategy

Zambikes prides itself on its environmentally sustainable and socially responsible manufacturing

processes. The added economic and emotional value of manufacturing bamboo bicycles is to

have a product which is grown in Africa, made in Africa and exported all over the world. The

manufacturing of Bamboo Touring Bikes is labour intensive. Bamboo Touring Bikes are custom

handcrafted by skilled Zambians, using one of nature’s fastest growing resources. The light and

extremely durable bamboo has great shock absorbing abilities, providing a smooth and pleasant

ride with a long lasting lifespan. The chosen high quality bamboo undergoes various procedures

such as cutting, curing, drying, gluing, wrapping and painting. Each bicycle frame takes over two

months to build.

Sales and distribution network

While Zambikes sells the Transport Zambikes, Zambulances and Zamcarts across Zambia, in

eastern, western and southern African countries, the bamboo bicycle frames are offered for

trade to companies around the globe. Zambikes’ market strategy, led by Tiki Mambwe, the sales

and marketing manager, is to constantly broaden the reach and accessibility of its products.

Hence, Zambikes relies on authorised bicycle dealers in Africa, Asia, Europe, North America and

Figure 3: Zambulance

Figure 2: Bamboo Touring Bike Figure 1: Transport Zambike

Figure 4: Zamcart

© SAP SE Page 2B-4

CASE STUDY

Australia to supply their own markets with high quality bicycles. Zambikes also offers trading

goods for sale to their Zambian customers such as bicycle pumps, water bottles and repair kits.

Current business processes

Procurement

Materials procured locally are sourced directly from local suppliers and payments are settled in

cash which is disbursed by the finance manager, Ms Viera Funjika. Viera then reconciles the

purchases against receipts returned. With regard to internationally procured materials, a typical

process starts with Viera e-mailing requirement specifications to the supplier. Once a supplier

and Zambikes have reached an agreement on details such as price, quantity and delivery dates,

the supplier issues an invoice via e-mail to Zambikes. Upon receipt of the invoice from the

supplier, Zambikes pays the full amount via electronic bank transfer. Once the supplier has

confirmed receipt of the payment, the goods are dispatched to Zambikes. Since Zambia is a land-

locked country, it has to depend on the neighbouring country ports for the delivery of its

materials from international suppliers. Therefore at times there are unforeseen delays impacting

their production process. The fact that Zambikes needs to settle the entire invoice before the

dispatch of materials is another challenge. There have been incidents in the past where payments

were delayed and transfers were blocked, complicating the procurement process even further.

Sales

The sales process starts with a customer making an enquiry or requesting a quotation

telephonically, via e-mail, through the company’s website or via Facebook or Twitter. A sales or

admin employee, usually Ms Margret Mwaanga for local sales and Mr Paul Mulenga for

international sales, sends a sales quote to the customer and once the customer confirms the

quote and agrees to the terms and conditions set by Zambikes, they send a purchase order. Sales

result from 80% of the inquiries, with 20% rejecting quotations. The sales or admin employee

captures the order onto a spreadsheet. At this point, the sales or admin employee e-mails the

customer a sales order with a projected delivery date. The next step requires the sales or admin

employee to forward the sales order to the finance department so that the information can be

captured on the accounting system. An invoice is subsequently generated, which the finance

manager sends to the customer, requiring them to pay at least 50% of the due amount as a down

payment. A final invoice is sent once the delivery to the customer is underway. Local customers

mainly use cash or cheques while international customers rely mostly on bank transfers.

Payments are recorded by the bank and are visible to the finance manager via electronic banking.

Once the finance manager receives a payment confirmation from a customer and confirms that

the down payment is reflected in their bank account she notifies the sales manager via e-mail,

telephone or sms, who then initiates the delivery process. If the sales order requires customized

bicycles, which is often the case for international customers, then the international sales

manager, Paul Mulenga, notifies the factory supervisor to initiate the production process

accordingly.

© SAP SE Page 2B-5

CASE STUDY

All their manufactured and assembled products are packaged in Mungwi and are sent to the

Lusaka warehouse where final quality checking before delivery takes place. All deliveries within

Lusaka are done using Zambikes’ trucks. Deliveries outside Lusaka but within Zambia are sent

using trucks, buses or private cars, depending on the arrangements between Zambikes and the

customer. All international orders are delivered through FedEx and the sales manager gives

customers a tracking number for their delivery. The finance manager sends the final invoice,

which requests the customer to settle the outstanding balance on their account.

Currently, Zambikes acknowledges that international bank transfers can be challenging,

particularly in cases where additional bank charges are incurred. The customer often overlooks

these charges and hence the amount paid is incorrect (20% of payments). This requires further

follow-ups and negotiation between the finance manager and the customer until the final

outstanding amount is settled.

Production

At the factory, production is triggered either by a customer order or through forecasting which is

based on past experiences of seasonal demands. All production orders are manually written on a

blackboard. The production supervisor, Mr Wyson Nkwazi, draws a production table with

different columns displaying details such as the date the order was received, the client name, the

number of finished products to be delivered and the delivery due date. To ensure availability of

all required parts for the production process, a manual ‘stock in hand’ materials count is initiated.

Throughout the production process, the production supervisor updates the sales manager who in

turn updates the customers on the status of their orders via e-mail. However, from time to time,

due to the high production loads, customers are not sent regular updates on the production

process. When the production process is complete, the finished products are placed in storage

awaiting shipment and delivery.

The production process, which is long already, can be delayed due to various factors including:

occasional power cuts, the failure of production tools, shortages of skilled resources and/or

unavailability of required raw materials.

Inventory management

In the Mungwi warehouse, all stock that comes in and out is recorded on paper and the record is

submitted to Lusaka. A typical stocktaking exercise happens every two weeks and involves a

physical count whereby a warehouse employee, Mr Benjamin Banda, counts and records the

quantities of all goods (raw materials, semi-finished goods, finished goods as well as trading

goods) on an A4 sheet. Since there is no electronic system to capture the stock count at the

Mungwi warehouse, a copy of the A4 sheet is sent to the admin office where the information is

captured onto their inventory system by Margret Mwaanga, the admin and inventory manager. A

similar process is followed for the goods stored at the Lusaka warehouse. The stocktake adjusts

any discrepancies between the actual stock available and stock amounts recorded on the system.

© SAP SE Page 2B-6

CASE STUDY

Reporting

At the end of each month, Zambikes generates various reports, through the collation of

spreadsheets, to track the payments made to different suppliers, the amount of raw material

stock received and the number of sales orders received. However, due to the fact that Zambikes

predominantly uses e-mail to communicate internally and externally (with their customers and

suppliers) the company finds generating these reports time consuming and finds it difficult to

gather all the required information. As a result, Zambikes is unable to accurately track and

measure its key performance areas.

© SAP SE Page 2B-7

CASE STUDY

ZCS Exercise 1 Time 10 min.

Exercise: Understanding the organizational structure of Zambikes

Task: Based on the Zambikes video and the above case study, map the organizational structure of

Zambikes. Your organogram should include the functional areas and the head position titles

where possible.

© SAP SE Page 2B-8

CASE STUDY


Exercise: Understanding Zambikes’ product strategy

Task: List the products that Zambikes sells and classify them into the three inventory categories

(trading goods, finished goods, semi-finished goods).

© SAP SE Page 2B-9

CASE STUDY


Exercise: Mapping Zambikes’ suppliers and customers network

Task: Who are Zambikes’ suppliers and customers?

© SAP SE Page 2B-10

CASE STUDY


Exercise: Understanding the procurement process

Task: Describe the sequence of steps/tasks in the procurement process, and the paper or

electronic outputs of each task. What are some of the challenges or risks of the procurement

process? How can the process be improved to address these challenges?


CASE STUDY


Exercise: Measuring and monitoring business processes

Task: Can you think of some standard/key reports which Zambikes could use to monitor their

procurement process on a regular basis? Can you think of what Zambikes could measure on a

monthly or quarterly basis to monitor the productivity, quality and cost of the procurement

process?


CASE STUDY


Exercise: Understanding the sales process

Task: Describe the sequence of steps/tasks in the sales process, and the paper or electronic

outputs of each task. What are some of the challenges or risks of the sales process? How can the

process be improved to address these challenges?


CASE STUDY




sales process on a regular basis? Can you think of what Zambikes could measure on a monthly or

quarterly basis to monitor the productivity, quality and cost of the sales process?


CASE STUDY


Exercise: Understanding the inventory management process

Task: Describe the sequence of steps/tasks in the inventory management process, and the paper

or electronic outputs of each task. What are some of the challenges or risks of the inventory

management process? How can the process be improved to address these challenges?


CASE STUDY




inventory process on a regular basis? Can you think of what Zambikes could measure on a

monthly or quarterly basis to monitor the productivity of the inventory process?

© SAP SE

STUDENT READER

Level


Enterprise System concepts Authors

Lisa Seymour

Version

3.1

MOTIVATION

This reader introduces a number of theoretical and practical issues concerning business processes, their implementation, their management and their mapping into an enterprise system (ES). The module enables the students to understand how ES software supports business processes and how enterprise systems are implemented to match organizational business processes. The students will understand organizational data and master data as well as how they are implemented in SAP enterprise resource planning (ERP) as well as the relevant benefits and costs that need management.

PREREQUISITES

None.

NOTES

This reader has been developed by the ESEFA programme exclusively for the SAP UA African curriculum.

ZES Enterprise Systems Knowledge for Business

This reader explains the relevant enterprise systems concepts that

organizations should understand so as to get value from their

enterprise systems.

© SAP SE Page 3A-2

STUDENT READER

Contents

Reader overview ................................................................................................................................ 2

Enterprise system definitions ............................................................................................................ 3

ERP ................................................................................................................................................ 3

MRP and MRP II ............................................................................................................................ 3

ERP II.............................................................................................................................................. 3

ERP III............................................................................................................................................. 3

ERP vendors and solutions ................................................................................................................. 4

ERP implementations ......................................................................................................................... 4

The design phase and the 4 ERP data types ...................................................................................... 5

Organizational data ....................................................................................................................... 5

Master data ................................................................................................................................... 6

Business processes / transactional data ....................................................................................... 6

Reporting data .............................................................................................................................. 6

The divided software life cycle of ERP systems ................................................................................. 7

Table configuring or customizing .................................................................................................. 7

Code modification and code customizing ..................................................................................... 7

The ERP business case and ERP costs ................................................................................................ 8

Hardware and software costs ....................................................................................................... 8

Other implementation costs ......................................................................................................... 9

ERP benefits ..................................................................................................................................... 10

Integration................................................................................................................................... 10

Improvement of business processes .......................................................................................... 11

References and further reading ....................................................................................................... 13

Reader overview

Learning objective

Understand enterprise system concepts needed for business Time: 120 min

© SAP SE Page 3A-3

STUDENT READER

Enterprise system definitions

There are multiple types of enterprise systems and many have evolved over time. Many different types and their evolution are defined here.

ERP

Enterprise resource planning (ERP) has been defined as enterprise-wide information system software designed to co-ordinate all resources, information and activities needed to complete business processes and measure performance. ERP is the foundational layer that provides information structure, knowledge capture and business control [5]. An ERP system is packaged enterprise system software that covers most core business functions including finance, accounting, sales, operations management, purchasing, and human resource management [6].

MRP and MRP II

ERP systems are an extension of earlier materials requirements planning (MRP) and manufacturing resource planning (MRP II) systems. MRP systems form the base of many ERPs and are used to plan production and raw materials purchases for future periods. Information used in MRP runs would include supplier lead times and finished product recipes or bills of material (BOMs).

ERP II

ERP systems are often referred to as ‘back-office’ software and as ‘a label that may no longer be appropriate for evolving enterprise and inter-enterprise systems’ [9]. Hence the product and other definitions have evolved.

In ERP II or second generation ERP, the system moves beyond the enterprise boundaries (or a basic ERP system) and into the customer and supplier space including the supply, design, and engineering collaboration area [15]. In the SAP Business Suite product this included adding extra modules such as product lifecycle management (PLM), customer relationship management (CRM), supply chain management (SCM), and supplier relationship management (SRM) to the SAP ERP software (Figure 1). These modules include more user friendly portals and business intelligence and analytics.

ERP III

In ERP III or third generation ERP, marketplace fans and critics are integrated into the extended ERP organizations. This is through collaboration, direct contact, social media, and various data streams [15]. This brings customer input, needs, wants, and insight into the enterprise.

Figure 1 SAP Business Suite components

© SAP SE Page 3A-4

STUDENT READER

ERP vendors and solutions

ERP vendors have undergone substantial consolidation over the last decade. The current top ERP vendors in terms of licence revenue include SAP, Oracle, Sage, Infor and Microsoft. There are also many open-source ERP products available, such as Compiere and ERP5. The market has increased from mainly large organizations to include small- and medium-sized organizations and many ERP vendors are targeting niche vertical segments with ERP products. Some of the products in this space include software as a service (SaaS) ERP solutions which are attracting growing interest in the marketplace [4].

In the ESEFA curriculum we are teaching enterprise systems using the SAP ERP system. In SAP the core modules are given two letter codes (Figure 2). Examples include:

In Accounting

CO (Controlling)

FI (Financial Accounting)

In Logistics

SD (Sales & Distribution)

MM (Materials Management)

ERP implementations

The implementation of an ERP system can be said to follow the six phases of the Information Technology Infrastructure Library (ITIL) application management process (Figure 3):

1. The requirements determination phase.

2. The design phase. 3. The build and test phase. 4. The deploy phase includes all the

planning required before the organization ‘goes live’ with the new ERP system.

5. The operate phase starts with the ‘go live’ event and needs to ensure that the application is available for end users.

6. The optimize phase needs to include ongoing evaluation, benefits realisation as well keeping up with upgrades and new releases.

Figure 3 The six phases of application management

Figure 2 SAP ERP core modules

© SAP SE Page 3A-5

STUDENT READER

The design phase and the 4 ERP data types

During the design phase, the adopting organization needs to produce a detailed description of how the company intends to run its business processes with the ERP software. This is often referred to as the business blueprint. A business blueprint comprises the following four ERP data types, organized in a hierarchy:

Organizational units / data

Master data

Business processes with tasks (transactions)

Reports.

Organizational data

Organizational data represents the structure of the business. For instance, when implementing a SAP installation the business is essentially modelled in SAP through creating organizational units and assigning them to the organizational structure. This is done through customizing (referred to later). Figure 4 summarises the main organizational data elements in SAP ERP across the modules used in this course.

Some of these are now described.

Client: A self-contained unit in a SAP system with separate master records and its own set of tables. The highest organizational element. Represented by a 3-digit key in the SAP system.

Company code: A company represents an independent accounting unit. Countries require companies to prepare financial statements. Therefore company codes are created for each company and financial statements are created at the company code level. A company code can be assigned one or more charts of accounts for financial reporting purposes. The company code is a four character code such as ZM00 for the Zambikes Company.

Plant: An organizational element within a company. A plant produces goods, renders services or makes goods available for distribution. A plant can be a manufacturing facility, a warehouse or distribution center or an office from which services are rendered.

Storage location: Allows the differentiation of material stocks within a plant. Examples would include raw materials, finished goods, semi-finished goods, trading goods etc.

Shipping point: The part of the company responsible for shipping. A shipping point can service (and hence is assigned to) one or more plants. A plant can be serviced by no shipping points, one shipping point or many shipping points. Shipping points can refer to rail, postage, road, etc.

Purchasing organization: The purchasing organization negotiates conditions of purchase with suppliers (vendors) for one or more plants or companies. Pricing conditions are set at the purchasing organization level.

Company Code (FI)Client Plant (Log.) Storage loc

Ship point

Purch Org (MM)

Sales Org (SD)

Division (SD) Dist. Channel (SD)

Sales Area (SD)

Purch Grp (MM)

Sales Office (SD) Sales Group (SD)

Figure 4 Some SAP organizational data

© SAP SE Page 3A-6

STUDENT READER

Purchasing group: The purchasing group refers to a buyer or a group of buyers who is/are responsible for certain purchasing activities. The purchasing group cannot be assigned to a purchasing organization. This data element is useful for reporting purposes.

Sales area: Made up of sales organization, distribution channel and division. Each sales and distribution document must be assigned to a sales area. A sales area can belong to only one company code.

Sales organization: Responsible for distributing goods and services. Each sales organization can be assigned to only one company code. A company code may have many sales organizations.

Distribution channel: The means through which saleable materials or services reach the customer, for example: wholesale, retail, internet.

Division: Used to group materials and services, normally into product groups. For example: cars, spare parts.

Master data

Master data is data that is shared across systems and business processes and is used repeatedly by and may be affected by several business processes. When implementing an ERP, master data is uploaded from legacy systems and post-implementation master data is maintained centrally and may be used by all applications and authorised users. Master data types would include customers, suppliers (called vendors in SAP), inventory items (called materials in SAP) and employees. An individual master data record can contain substantial data. For example, the master data record of a finished good like a transport bike would include the name, the code, the weight, the unit of measure, the quantity in stock etc.

Business processes / transactional data

The sequence of tasks in each business process is decided during the design phase and then customized. Examples of business process tasks are creating a purchase order, receiving goods and creating a sales order. Business process tasks are then executed in an ERP system through transactions. For an operational system to be able to capture and update transactions, the referenced master data must already be in place. When running these tasks, transactional data or records of business events are created. Transactional data is stored at the document level and embedded in the documents are the various elements of master data [11]. Document-level transaction data is detailed and consists of headers, footers and line items.

Reporting data

Summary transaction data is mostly used as reporting data and has master data and organizational data elements in it, for example, the monthly number of purchase orders per vendor or per company code.

© SAP SE Page 3A-7

STUDENT READER

The divided software life cycle of ERP systems

Software applications have traditionally been classified as either custom-built or off-the-shelf software. While ERPs are commercial packages that are purchased or leased from software vendors, they do not fit cleanly into this distinction [2]. To benefit from ERP vendors’ ongoing development and maintenance, adopters enter into long-term partnerships with ERP vendors. ERP packages evolve through new releases that fix bugs in earlier versions and provide new functionality [10]. ERP adopters also have an indirect influence on subsequent releases of an ERP product through the logging of development requests and through representation on user groups. Consequently, the implementation and ongoing usage of an ERP system is fundamentally different from custom-built and off-the-shelf systems [3].

Table configuring or customizing

During the build and test phase and before an adopting company can use an ERP package, the package must be configured to fit organizational structures (organizational data) and business processes [3]. This table configuration means setting parameters (and/or tables) within the boundaries of the provided ERP functionality to match the organization’s mode of wanting to do business [8]. ERP packages can support a wide range of organizational possibilities through configuration, and adopting companies spend a great deal of effort on configuration. With SAP, table configuring is referred to as ‘customizing’ and is available on the SAP menu (Figure 5). Configuring an ERP system package is largely a matter of making compromises and of balancing the way the enterprise wants to work with the way the ERP package system lets it work [1].

Code modification and code customizing

The process of table configuration differs fundamentally from programming or development. ERP adopters do have the option of programming and development to change or add functionality. With SAP, these tools are available on the SAP menu under Development (Figure 5). Code modification refers to changing the ERP software package code to perform unique business processes [1]. This modification is strongly discouraged. When the modified programming objects are subsequently changed by the ERP vendor with subsequent releases they have to be integrated manually by developers which can be risky and costly. Other programming options, referred to as code customizing, are preferred to modifications as here ERP adopters add their own programming objects within the area set aside for adopters’ objects, or develops new interfaces [8]. Research has shown that many companies have had to use programming options in various ways to meet essential business needs [2]. Programming options are not supported by the vendor, reduce the adopter’s ability to benefit from the vendors’ continued development of the packages, create dependencies on programmers and reduce the ease of software upgrades [8]. While the adopters’ activities of implementing and operating ERP systems are important, so are vendors’ activities of software development, maintenance, enhancement and support. Hence this relationship in maintaining software is referred to as the divided software life cycle of ERP [3].

Figure 5 SAP menu for development and customizing

© SAP SE Page 3A-8

STUDENT READER

The ERP business case and ERP costs

To build a realistic business case prior to implementing an ERP system, an understanding of the benefits and costs of an implementation is needed. As with many IT projects, costs are incurred upfront and benefits only start accruing after implementation. The costs and benefits need to be managed carefully by the adopting organizations. Hence the ESEFA programme is working within Africa to teach enterprise systems knowledge to Engineering, Accounting and Management students. Research has shown that many organizations underestimate the cost of ERP implementation [12]. Table 1 summarises the main ERP costs.

Table 1 ERP costs [12]

Hardware costs Servers Clients

Networking Storage

Software costs Database management system ERP licences

Operating systems

Implementation services costs

Training Customization and developments

Project management Change management

Broader organizational costs

Initial productivity losses Key employee time

Hardware and software costs

While many organizations will install an ERP system on-premise there are other, off-premise options such as software as a service (SaaS) and application service providers (ASP) which should be investigated and can reduce hardware and software costs. Open-source enterprise system options can reduce software costs.

Although ERP installations are extensive and complex, for an on-premise ERP system the minimum software costs would include:

the ERP software

an operating system

the database management system.

Most ERPs have evolved to include many modules and a business can choose to purchase these modules individually or collectively. The ERP software costs would include the initial ERP licence and an ongoing maintenance charge.

On-premise ERP systems have a client server architecture. The central servers run the database management system and perform all related functions such as backup, data integrity, access control and security. The local workstations or clients can be desktop computers, laptops or mobile devices and their software that receive the data from the server and present the data. Therefore hardware costs could include:

upgrading of employee desktops or laptops

upgrading of the network

a few servers with substantial disk space.

Various servers are required as ERP servers tend to be arranged within a hardware system landscape. A company with SAP ERP would have at least three clients installed on different

© SAP SE Page 3A-9

STUDENT READER

servers and with a transport management system to move changes between clients. This is to avoid any unnecessary (and most likely costly) disruptions to business operations. The three required clients include:

development: here any proposed changes through customizing, modifications or enhancements are made to the software

quality assurance: used for testing changes

production: the system that the company uses on a day-to-day basis to record its business transactions.

Other implementation costs

The bulk of the implementation costs are on implementation services and implementation service costs are the costs that are most often understated [12]. These costs include:

customization and development tasks

training of project members and end users

project management and

change management.

One reason for understating costs is that management do not understand the divided software life cycle of ERP and that IT skills are required to perform customizing and development tasks. These skills are also required during the optimize phase. For the effective functioning of ERP systems business analysis skills related to mapping organizational requirements to the processes and making customizing decisions are extremely important [10]. These IT skills are expensive and can often be scarce depending on the ERP product being adopted. The ESEFA programme is working within Africa to teach Enterprise Systems skills to Information Systems, Informatics, Computer Science and IT students so that these IT skills are more available and affordable to adopting organizations.

Change management and training costs can often be understated as managers are unaware of the nature of the changes in work practices and business processes occurring with an ERP implementation. Further organizational costs include:

initial productivity losses

key employee time.

Key employees, especially middle managers, need to be involved in the design of the new business processes and practices. With the change in work practices and software, organizations will inevitably incur initial productivity losses. This can be reduced by ensuring sufficient key employee involvement in the design and ensuring sufficient focus on change management and training.

© SAP SE Page 3A-10

STUDENT READER

ERP benefits

Enterprise systems promise many business and technological benefits. Yet many organizations struggle to identify and quantify potential benefits upfront [13]. Benefits also need to be managed after implementation as part of the process of benefits realisation. While managing the costs initially falls to the ERP project managers, managing the benefits needs to be devolved to the managers in the organization and hence need to be clearly understood by managers. Two benefits that are often referred to are:

integration

improved business processes.

These benefits are now explained.

Integration

Enterprise systems promise integration on many levels such as:

system integration

interface integration

global integration

data integration

business integration.

System integration is a benefit to an organization as the fewer IT systems an organization has, the fewer systems need to be supported by IT staff and the fewer interfaces need to be developed between systems. The cost of integrating systems can be substantial and the greater the number of interfaces the higher the complexity and the greater the risk to business continuity. If the interfaces developed are not real-time then this can also impact negatively on real-time data accuracy. IT costs can also be reduced if the IT environment supported has fewer database management systems, programming languages and customizing environments.

Interface integration refers to the benefit in providing a single consistent user interface for users and developers. If the number of systems in an organization increases, then the number of systems employees also needs to increase. As each software application is different, this places a training burden on employees and can result in reduced productivity.

Business integration refers to the transactions performed in one business unit being visible and impacting real-time on other business units. For example, sales orders are viewed by production and accounting and are used to schedule production, create invoices and update financials. Business integration enforces discipline and organization around the defined business processes. It is however possible not to achieve business integration. For example an organization may allow each of its functions to adopt a different enterprise system or to configure the same enterprise system differently. Also, if only some modules are purchased and installed then the business integration between modules is not achieved [10].


STUDENT READER

Data integration refers to having one shared common database across the organization in which organizational data and master data are shared. This is a benefit to the organization as data is only entered and stored once; hence there is no data redundancy or data inconsistency. This also results in improved reporting and management information. In SAP, the data from the material master is used:

in Purchasing, for ordering

in Inventory Management, for goods movement postings and physical inventory

in Invoice Verification, for posting invoices

in Sales and Distribution, for sales order processing

in Production Planning and Control, for material requirements planning, scheduling, and work scheduling.

Data integration can have a negative impact on the functional aspects of an organization. Sources of conflict between the goals and objectives of core business functions and the ERP software can occur when information is entered into the ERP system, when information is processed, and when information output is retrieved from the system. Most core functions provide information used elsewhere in the organization and utilise information entered elsewhere in the organization. The ERP software constrains each core function because the software is configured to prescribe precisely what data can be entered and the format by which that data can be entered or retrieved [7]. For this reason, managers of core business functions need to agree to the levels of data designed in the business blueprint.

Global integration refers to the ability of an ERP to support multiple languages, currencies and regulations simultaneously, allowing seamless global transactions and reports.

Improvement of business processes

The major reason organizations give for implementing ERP systems is an improvement of business processes. What this implies is that business processes do change when a company implements an ERP. This can result in substantial changes to organizational structures and job design. Hence the need for change management and training. The improvement of business processes needs to be managed after implementation by the business to ensure that the stated benefits are achieved. Here are some ways in which ERPs can assist in improving business processes:

the automation of work practices

data integration and central storage and protection of data

business integration

built-in controls

provision of reports for monitoring and managing of processes

best practices / standard processes.

Best practices and standard processes: There is an incorrect perception that ERP systems contain ‘best practices’ and with minimum thought an organization can implement the software and then will be performing best practice. A best practice is defined as a method which has been judged to be superior to other methods and is therefore the most efficient way to perform a task. Best practices are normally identified through surveys of select organizations that are judged to have achieved superior performance in a particular domain. Because they are designed to fit the needs of many organizations, enterprise systems are built to support generic business processes that may differ quite substantially from the way any particular organization does


STUDENT READER

business. By talking to many businesses the vendors of enterprise systems have crafted what they claim to be ‘best practices’. These best practices represent a powerful reason to adopt enterprise systems without modifying them because few organizations claim to have redesigned all their business processes for cross-functional efficiency and effectiveness [10].

From these descriptions the implicit assumption is therefore that a practice can be described through a number of explicit characteristics – initiatives or organizations that exhibit a high number of these characteristics thus come to represent the best practice within a domain. Yet it is a fallacy that a ‘practice’ has substantial properties that can be transferred from firm to firm within one society and culture, and even to another culture [14]. Organizations do seek out best practices in an attempt to find a technique or method that has worked for another organization, which they can copy. Yet copying confuses the outcome with the process, and disregards that the process may be the outcome you are seeking [14]. The idea that a ‘best practice’ can be described through a few characteristics identified through industry surveys is misguided. Practices embody human competence and are the ever-refined result of an ongoing learning process.

Therefore the described processes within an ERP cannot be confused with ‘best practice’. The described ‘standard processes’ within the ERP should be used only as a catalyst for developing a suitable, sometimes similar process. The processes have to be adapted or refined continuously to fit the total environment of the adopting organization. This once again stresses the importance of management involvement in the design of the relevant business processes, using the ERP standard processes as a base.


STUDENT READER

References and further reading

1. Al-Mudimigh A, Zairi M and Al-Mashari M (2001) ‘ERP software implementation: an integrative framework’, European Journal of Information Systems 10(4): 216–226.

2. Brehm L, Heinzl A and Markus ML (2001) ‘Tailoring ERP systems: a spectrum of choices and their implications’. Proceedings of the 34th Hawaii International Conference on System Sciences, 3–6 January, Maui, Hawaii, pp. 1–9.

3. Brehm L and Markus ML (2000) ‘The divided software life cycle of ERP packages’. Proceedings of the 1st Global Information Technology Management (GITM) World Conference, 11–13 June, Memphis, Tennessee, USA, pp. 43–46.

4. Faasen J, Seymour L and Schuler J (2013) 'SaaS ERP adoption intent: explaining the South African SME perspective’. In G Poels (ed.) Sixth International Conference on Research and Practical Issues of Enterprise Information Systems (CONFENIS) 2012. IFIP LNBIP 139, pp. 35–47. Available http://link.springer.com/book/10.1007%2F978-3-642-36611-

5. Freyermuth J and Shepherd J (2010) ‘The enterprise resource planning (ERP) market: potential buying window beginning to close?’ AMR Research. Available http://i.zdnet.com/whitepapers/IBM_GBS_MM_ERP.pdf

6. Jansen van Vuuren I and Seymour LF (2013) ‘Towards a model for user adoption of enterprise systems in SMEs’. In Enterprise Systems Conference (ES), 7–8 November 2013, Cape Town, South Africa, pp. 1–9. IEEE.

7. Lindley JT, Topping S, and Lindley LT (2008) ‘The hidden financial costs of ERP software’. Managerial Finance 34(2): 78–90.

8. Luo W and Strong DM (2004) ‘A framework for evaluating ERP implementation choices’. IEEE Transactions on Engineering Management 51(3): 322–333.

9. McGaughey RE and Gunasekaran A (2007) ‘Enterprise resource planning (ERP): past, present and future’. International Journal of Enterprise Information Systems 3(3): 23–35.

10. Markus ML, Axline S, Petrie D and Tanis C (2000) ‘Learning from adopters' experiences with ERP: problems encountered and success achieved’. Journal of Information Technology 15(4): 245–265.

11. Morris H and Vesset D (2005) ‘Managing master data for business performance management’. IDC White Paper.

12. Mukwasi CM and Seymour LF (2014) ‘The growing trend of small to medium-sized enterprises adopting Enterprise Resource Planning systems: an analysis of business cases in Zimbabwe and South Africa’. In Proceedings of the International Conference on Emerging Trends for Sustainable Development and Human Capacity Building in the Third World Nations (ICETSDHCB), pp. 337–344, ISBN: 978-7016-8128-247. Available http://jetems.scholarlinkresearch.com/articles/THE%20GROWING%20TREND%20OF%20SMALL.pdf

13. Mukwasi CM and Seymour LF (2012) ‘Enterprise resource planning business case considerations: a review for small and medium-sized enterprises’. Journal of Innovation Management in Small and Medium Enterprises Volume 2012, Article ID 752328. Available http://tinyurl.com/bu7p3hd

14. Roode D (2006) ‘The question concerning best practices’. Research Seminar, Department of Information Systems, 29 November. Available http://www.commerce.uct.ac.za/informationsystems/seminars

15. Wood B (2010) ‘ERP vs. ERP II vs. ERP III Future enterprise applications’. Available http://www.r3now.com/erp-vs-erp-ii-vs-erp-iii-future-enterprise-applications

http://link.springer.com/book/10.1007%2F978-3-642-36611-

http://i.zdnet.com/whitepapers/IBM_GBS_MM_ERP.pdf

http://tinyurl.com/bu7p3hd

http://www.commerce.uct.ac.za/informationsystems/seminars

http://www.r3now.com/erp-vs-erp-ii-vs-erp-iii-future-enterprise-applications

© SAP SE

CASE STUDY

Product

Zambikes model company Level


Company background Organizational structure Business processes Authors

Patrick Wirz Lisa Seymour Version

3.1

MOTIVATION

This document introduces the fictitious Zambikes model company. It provides a historical background on the company’s strategy and operations.

PREREQUISITES

None.

NOTES

While Zambikes is an actual bicycle manufacturer located in Zambia, the Zambikes model company is fictitious. The ESEFA data set adapted for the SAP UA African curriculum is configured for the Zambikes model company.

ZMC Zambikes Model Company Case Study

This document introduces the fictitious Zambikes model company. The

Zambikes model company has been developed exclusively for the SAP UA

African curriculum. The class exercise focuses on the organizational

structure.

© SAP SE Page 3B-2

CASE STUDY

The Zambikes model company

While Zambikes is an actual bicycle manufacturer located in Zambia, the Zambikes model company is fictitious and is used for educational purposes only.

The partnership

International market expansion includes a partnership between Zambikes (introduced in the case study) with the international bicycle company, the Global Bike Group.

Global Bike Group has handcrafted, signature composite-frame touring bicycles which are world renowned. Their off-road bicycles are also recognised as incredibly tough.

The companies have merged their strategies and operations for an exciting collaboration which allows Zambikes to extend its customer base and its range of products.

The Global Bike Group

The Global Bike Group is composed of Global Bike Inc. in the US, and GBI Europe.

In the US, the Dallas facility manufactures products and distributes to the central US and internet retailers. GBI also has warehouses in both San Diego and Miami, the US ports used for shipping and export.

GBI Europe has its headquarters in Heidelberg, Germany. Heidelberg is the main manufacturing facility and it handles all shipping for southern Europe. The Hamburg warehouse handles all shipping to the UK, Ireland, the Middle East and Africa.

The Zambikes model company

For the new Zambikes model company, we need to design the business blueprint which includes organizational data, master data, business processes and reporting data.

© SAP SE Page 3B-3

CASE STUDY

ZMC Exercise 1 Time 20 min.

Exercise: Understanding the organizational structure of the Zambikes model company

Task: Based on the Zambikes model company description, detail the organizational structure needed in an SAP ERP system. Your organizational structure should include:

clients

company codes

plants

storage locations (only in Zambia)

shipping points.

© SAP SE

WORKSHOP

Product

SAP Business Suite 7.0 Level

Undergraduate Beginner Focus

SAP ERP 6.0 EhP4 Navigation Author

Stefan Weidner Lisa Seymour Version

3.1

MOTIVATION

This material explains how to navigate in SAP systems. It is aimed at students at universities, universities of applied sciences and other educational institutions with no previous experience of SAP software. It can be used in the classroom or for self-study.

On completion of the course, students will be able to navigate through the user interface to work on transactions independently.

The material also serves as a reference for occasional users of SAP systems.

LEARNING METHOD

The learning method used is ‘guided learning’. This is a suitable method because navigating in SAP systems is a fundamental skill but also very complex.

The benefit of this method is that knowledge is imparted quickly. Students also acquire practical skills and competencies. This method explains a process or procedure in detail.

Exercises throughout enable students to put their knowledge into practice and remember it better.

ZN ERP Concepts and Navigation Workshop

Introduction to Navigation and ERP concepts in SAP ERP Solutions and Products

© SAP SE Page 4A-2

WORKSHOP

ZN 1: Logging on and off and the SAP ERP screen

Task Log on to the system, view the SAP screen and log off.

Complete the exercises at the end of the section with the help of the Notes. Time 20 min.

ZN 1: NOTES

Your SAP number

Throughout this course we will use ### (a 3 digit number between 001 and 999) to refer to your SAP number.

Look up your SAP number on the course environment for this course or get it from your lecturer.

My SAP number

###

________

SAP Logon

From your desktop, find and double-click

If it is not there, choose Start ► All Programs ► SAP Front End ► SAP Logon

A dialog box similar to the one shown appears. Click Connection. The list of systems may be shorter than in the dialog box shown here. Choose the ESEFA system specified by your lecturer and choose Log on or press Enter.

SAP Logon

Logon screen

The Logon screen appears. The system requests the client, your user, and password. A client is organizational data. Use the client number given by your instructor. For you to be able to log on as a user, a user master record must be created for you in the relevant client. For reasons of access protection, you must enter a password when you log on. Your password entry is case-sensitive.

Then click (Enter).

Logon screen

Client: _ _ _ User: _ _ _

_ _ _ _

Initial password: _ _ _ _ _ _

New password

When you log on for the first time, the system requests you to change your password. You need to enter your new

password twice. To confirm your new password, click (Enter).

New password

© SAP SE Page 4A-3

WORKSHOP

REMEMBER your password.

The first time you log on you will see a copyright note. Confirm it by clicking or pressing Enter. The initial screen with the SAP Easy Access menu appears.

SAP Easy Access menu

The SAP system displays the SAP Easy Access menu on the Start screen as standard. It enables you to navigate in the system using a clear tree structure. Click the small arrows to expand the menu tree. The menu tree is specific to your role (business function in the company).

SAP Easy

Access menu

Menu bar

Menus shown in the menu bar are related to the application you are using; that is, they are context-sensitive. Most menus have sub-menus.

Menu Bar

Standard toolbar

Icons in the standard toolbar are available on all screens. Icons that you cannot use in the current application are grayed out. When you hover the cursor over an icon, a quick info text appears.

Standard

toolbar

Title bar

The title bar displays the name of the transaction you are currently using.

Title bar

Application toolbar

The application toolbar contains icons for the transaction you are currently running.

Application

toolbar

Status bar

The status bar shows information about the current system status as well as warning and error messages.

Status bar

Log off

Choose System ► Log off to end the current session. The confirmation prompt shown on the right informs you that unsaved data will be lost. Once you are certain that you have saved all entries, you can confirm the prompt by choosing Yes.

Log off

© SAP SE Page 4A-4

WORKSHOP

ZN 1: EXERCISES

Log on to the system Choose the ESEFA System in the SAP Logon. Use the client, user and initial password given. When you log on for the first time, a dialog box appears in which you enter your new individual password twice. Client: 2nn (enter the UCC allocated client number for the training) User: ZMB-### Password: zmbinit

Update your user account with your name

From the menu bar, choose System ► User Profile ► Own Data.

Enter your last name and first name in the Address tab.

Click (Save) to save your changes. Log off and log on again.

Answer Q1.1–1.3

ZN 2: Transactions and sessions

Task Get familiar with SAP’s transaction and session concept.


ZN 2: NOTES

Run a transaction

There are three main ways of running a transaction interactively in the SAP system:

Use the SAP Easy Access menu

Use Favorites

Enter the Transaction code.

Run transactions

SAP Easy Access menu

You use the tree structure of SAP’s Easy Access menu to navigate to a transaction. You then double-click the transaction to run it. The name or title of the transaction is then shown in the title bar.

SAP Easy

Access menu

Favorites

If you use a transaction frequently, you can drag & drop the transaction from the menu to your favorites or insert it into your favorites.

From the menu bar choose Favorites ► Insert transaction and enter the transaction code.

You can then double-click it to run it without having to navigate through the SAP Easy Access menu.

To organize your favorites in folders you first need to create folders (topic areas): choose Favorites ► Insert Folder. Give the folder a name. You can create as many folders as you like. You can move folders or favorites using drag & drop.

Favorites

© SAP SE Page 4A-5

WORKSHOP

or

Transaction code

A transaction code of generally four characters is assigned to each transaction (not each screen) in the SAP system. The quickest way to run a transaction in the SAP system is to enter the transaction code.

Note: The Command field in which you enter transaction codes can be found in the top-left corner. Click the small triangular symbol to display/hide it.

If you know the code for a transaction, you can enter it in the Command field in the upper left corner of your screen. Press Enter and the initial screen of the transaction appears.

To find the transaction code of the transaction you are currently using, click the triangular symbol

in the status bar, on the far right bottom and choose Transaction.

Note: Click the small triangular symbol to display/hide the status bar menu

Transaction

code

Transaction code field

Transaction code display

Transaction icons

The standard toolbar features five important icons to use in transactions:

(also ) Corresponds to the Enter key and confirms your entries

Saves your entries on the current screen/transaction

Corresponds to the Escape key and takes you to the previous screen

Exits the current transaction

(also ) Cancels the transaction (in case of system problems).

Transaction

icons

Exit a transaction

You can exit or leave a transaction and go back to the SAP Easy Access menu

by choosing , , or . The dialog box shown here may appear. Make sure that there is no unsaved data in your current session and choose Yes to acknowledge the message.

Exit a

transaction

Search for a transaction

You can also search for transactions (or transaction codes) in the SAP Easy Access menu by running the transaction code: SEARCH_SAP_MENU.

Choose a text you would like to search for and

click . The search results are displayed in

SEARCH_

SAP_MENU

© SAP SE Page 4A-6

WORKSHOP

a list. There you find the transaction code (in some cases there are none assigned) and the path in the SAP Easy Access menu (read from bottom to top).

In the example on the right the shortest SAP Easy Access menu path for Customer Archiving is Logistics ► Sales and Distribution ► Master Data ► Business Partner ► Customer Archiving.

Sessions

In some cases it makes sense to work with two or more transactions at the same time. In SAP systems, you can open up to six sessions simultaneously with real parallel processing. However, too many open sessions can result in slower system performance.

To open a new session, click (Creates new session) or choose System ► Create Session.

To close a session, click (Exit) or choose System ► End Session.

Sessions

Transaction control parameters

You can use various control parameters before a transaction code to influence what happens to the session when you call a new transaction.

/n Exits the current transaction /i Closes the current session /o Opens a new session

For example, /oMM03 opens a new session and runs transaction Display Material in the new session.

Transaction

control parameters

/n

/i

/o

© SAP SE Page 4A-7

WORKSHOP

ZN 2: EXERCISES

Add the following transactions to your favorites: MKVZ and ME21N. Answer Q2.1 Run the following transaction from the SAP Easy Access menu: Logistics ► Materials Management ► Material Master ► Material ► Display ► Display Current.

Answer Q2.2–2.3

Exit the transaction.

Run VA03. Answer Q2.4

Exit the transaction. Search for the transaction code and the shortest menu path for Process Billing Due List.

Answer Q2.5–2.6 Open four sessions and then close all but two sessions. Answer Q2.7

Run List of Vendors: Purchasing from your Favorites menu.

Before you can execute a report you need to enter selection criteria in a selection screen to restrict the amount of data you can see.

Enter your SAP number ### in the Search Term field and clear values from all other fields.

Click (Execute). You should see a list of your vendors. Answer Q2.8

Choose the vendor Get a Brake. Click (Display).

Browse through the three Vendor screens by clicking and .

In enterprise systems, Master Data such as Vendors are assigned to Organizational Data. Answer Q2.9

Exit the transaction.

ZN 3: Help and searching lists

Task Get familiar with SAP’s help and list search functions.


ZN 3: NOTES

Several types of help are available in the SAP system. The most frequently used ones are the F1 and F4 keys.

F1 and F4

help

© SAP SE Page 4A-8

WORKSHOP

Field explanations

F1 provides you with explanations for fields, menus, functions, and messages. In the F1

help, you can click to get technical information.

F1 for fields

Possible entries

F4 gives you possible entries. You can also use the F4 help by clicking (Possible entries) directly right of a selected field. You can use wildcard searches to search easily within the possible entries:

wildcard * (represents many characters)

wildcard + (represents one character).

For example, in the diagram shown in the Navigation notes above you can enter ‘Becker*’ in the Name field and then choose F4 to find all customers whose name starts with ‘Becker’.

In the ESEFA client your user account has been given its own master data. To find your master data enter your SAP number ### in the Search Term field.

F4 for

possible entries

Context sensitive Help

The Help menu contains more help.

From the menu bar choose Help ► Application Help for context-sensitive help on the transaction you are currently using.

Choose SAP Library to open the entire online SAP Library. You can also access it at help.sap.com.

Context-sensitive

Help

ZN 3: EXERCISES

From the SAP menu run Logistics ► Sales and Distribution ► Sales ► Order ► Create. Click in the Order Type field and then show the Field explanation. Answer Q3.1

Click in the Sales Org field and then list the Possible entries. Answer Q3.2

Click in the Distribution Channel field. Answer Q3.3 Run transaction MK03 and click in the Vendor field. Use F4 to answer the questions. Answer Q3.4–3.6

Exit the transaction. Run Create Purchase Order from your favorites and then open and read the context-sensitive Help. Answer Q3.7–3.8 The final three questions are advanced and have no help to challenge your navigation. Answer Q3.9–3.11

© SAP SE Page 4A-9

WORKSHOP

Exercise questions

1. QUESTIONS 1.1. What is your name? (used to update your user account)

1.2. What is your SAP number?

1.3. In which part of the SAP screen are messages displayed?

2. QUESTIONS 2.1. What is the transaction title of MKVZ?

2.2. What is the transaction title of Logistics ► Materials Management ► Material Master ► Material ► Display ► Display Current:

2.3. What is the transaction code of Logistics ► Materials Management ► Material Master ► Material ► Display ► Display Current:

2.4. What is the transaction title of VA03?

2.5. What is the shortest menu path for Process Billing Due List?

2.6. What is the transaction code of Process Billing Due List?

2.7. What is the disadvantage of having many sessions (windows in the SAP system) open in parallel?

2.8. What vendor number is given to the vendor ‘Get a Brake’?

2.9. List two organizational data field types that the Vendor Master is assigned to?

3. QUESTIONS 3.1. List the five sales document types you can add to your user as

mentioned in the Order Type field explanation.

3.2. List the code and name for the Sales Org in Zambia.

3.3. What is the name and code of the two distribution channels assigned to ZM00?

3.4. How many vendors have been assigned to your SAP number?

3.5. What is the name of the vendor assigned to your SAP number in Ndola, Zambia?

3.6. How many vendors assigned to your SAP number have a name ending in ‘s’? (Use a wildcard in your search).

3.7. List three transaction codes that the Help topic for Create Purchase Order relates to.

3.8. List the SAP module and sub-module code for Purchasing.

3.9. What 4 tires are sold by Zambikes?

3.10. There are 10 delivery blocks that have been customized for Zambikes. What is block 2?

3.11. How many G/L accounts have been assigned to the Zambikes Company code?


WORKSHOP

Exercise solutions [30]

1. QUESTIONS 1.1. What is your name? (used to update your user account)

1.2. What is your SAP number?

1.3. In which part of the SAP screen are messages displayed?

ANSWERS [4] Name saved on SAP [2]

Correct SAP number [1]

Status bar [1]

2. QUESTIONS 2.1. What is the transaction title of MKVZ?

2.2. What is the transaction title of Logistics ► Materials Management ► Material Master ► Material ► Display ► Display Current:

2.3. What is the transaction code of Logistics ► Materials Management ► Material Master ► Material ► Display ► Display Current:

2.4. What is the transaction title of VA03?

2.5. What is the shortest menu path for Process Billing Due List?

2.6. What is the transaction code of Process Billing Due List?

2.7. What is the disadvantage of having many sessions (windows in the SAP system) open in parallel?

2.8. What vendor number is given to the vendor Get a Brake?

2.9. List two organizational data field types that the Vendor Master is assigned to.

ANSWERS [10] 1. List of Vendors

Purchasing

2. Display Material

3. MM03

4. Display Sales Order

5. Logistics > Sales and Distribution > Billing > Billing Document > Process Billing Due List

6. VF04

7. slower system performance

8. 127###

9. Purchasing Org; Company Code [2]

3. QUESTIONS 3.1. List the five sales document types you can add to your user as

mentioned in the OrderType field explanation.

3.2. List the code and name for the Sales Org in Zambia.

3.3. What is the name and code of the two distribution channels assigned to ZM00?

3.4. How many vendors have been assigned to your SAP number?

3.5. What is the name of the vendor assigned to your SAP number in Ndola, Zambia?

3.6. How many vendors assigned to your SAP number have a name ending in ‘s’? (Use a wildcard in your search).

3.7. List three transaction codes that the Help topic for Create Purchase Order relates to.

3.8. List the SAP module and sub-module code for Purchasing.

3.9. What four tires are sold by Zambikes?

3.10. There are 10 delivery blocks that have been customized for Zambikes. What is block 2?

3.11. How many G/L accounts have been assigned to the Zambikes Company code?

ANSWERS [16] 1. order; RFQ; quotation;

schedule agreement; contract [2.5]

2. ZM00; Zambikes [2]

3. IN Internet; WH Wholesale [2]

4. 36

5. Ndola Forest

6. 11

7. ME21N, ME22N, ME23N [1.5]

8. (MM-PUR) [2]

9. Off Road, Racing, Touring, Trailer tires

10. Political reasons

11. 95

Page 5A-1© SAP SE

Page 5A-2© SAP SE

Page 5A-3© SAP SE

Page 5A-4© SAP SE

Page 5A-5© SAP SE

Page 5A-6© SAP SE

In a SAP system, the organizational levels are structures that represent the legal or organizational views of anorganization.

This is a crucial step in your project and is a pre-requisite for all subsequent activities.

Page 5A-7© SAP SE

Page 5A-8© SAP SE

Client

• A self-contained unit in a SAP system, with its own set of tables.

Company code

• Smallest organizational unit for which financial statements need to be prepared.

Plant

• Within a company.

• Facility for manufacturing, distribution, storage, or rendering services.

Storage location

• Allows for differentiation between the various stocks of a material in a plant.

Page 5A-9© SAP SE

Page 5A-10© SAP SE

Page 5A-11© SAP SE

Page 5A-12© SAP SE

Master data is data that remains unchanged. Master data contains information that is needed again and again inthe same way.

Page 5A-13© SAP SE

Page 5A-14© SAP SE

Data under vendor master data is grouped under three headings.

Page 5A-15© SAP SE

Page 5A-16© SAP SE

The material master record is a company’s central source of material-specific data. The material master containsdescriptions of all materials that an enterprise procures, produces, and keeps in stock. It is the centralrepository of information on materials (such as inventory levels) for the enterprise.

Material master is used in all areas of logistics.

All areas, such as purchasing, inventory management, materials planning, and invoice verification, can jointly usethe stored data.

Page 5A-17© SAP SE

Since different user departments within a company work with one material, and each department storesdifferent information relating to it, the data in a material master record is sub-divided according to specificviews.

Page 5A-18© SAP SE

Plant: This level contains the data for each branch or plant location within a certain company. The dataimportant to Purchasing is stored at this level.

Examples of this data are the maximum and minimum order quantities of a material and the reorder point. Youaccess the plant data by entering the plant key.

Page 5A-19© SAP SE

Page 5A-20© SAP SE

Page 5A-21© SAP SE

Page 5A-22© SAP SE

Page 5A-23© SAP SE

Page 5A-24© SAP SE

Page 5A-25© SAP SE

This is a standard view of the procure to pay process and the most common one. It may vary significantly basedupon the company procedures, the products/services, purchases and other factors. SAP allows businesses totailor it to their needs.

A procurement process starts with a certain need in the organization. The needs can be satisfied by procuringcertain goods.

The cycle starts with a requisition or need that needs to be filled. This can come from Planning (MRP), manually.

The purchase team invites your source of supply.

Based on different criteria based on quality, price and time, a vendor is selected. The purchase order is thedocument to fill the need: usually includes the vendor name, cost/price, quantity, terms and other pertinentinformation.

The selected vendor is notified.

The goods are shipped and brought to the organization.

The goods are received and then put away/stored.

An invoice is received from the vendor.

After the tolerances/verifications have been are met, a payment is made according to the terms agreed to onthe purchase order.

Page 5A-26© SAP SE

Requisitions can be created indirectly in the following ways:

Via materials planning and control

The component Consumption-Based Planning suggests materials that need to be ordered on the basis of pastconsumption or usage figures and existing stock levels. The order quantity and the delivery date aredetermined automatically.

Via production orders (from the component PP Production Planning and Control).

Page 5A-27© SAP SE

Purchase requisitions are internal documents used to ask your purchasing department to procure a particularquantity of a material or a service for a given time frame.

Page 5A-28© SAP SE

Page 5A-29© SAP SE

Page 5A-30© SAP SE

A quotation is legally binding on the vendor for a certain period.

A quotation consists of line items which specify the total quantity, cost and delivery date of an offered materialor service.

Determining which vendors to send RFQs to is the first step.

The system can help you to choose which vendors are to receive an RFQ if some or all of the information set outbelow is available:

Info records

Source list .

Page 5A-31© SAP SE

Page 5A-32© SAP SE

Price level

This sub-criterion compares the relationship of a vendor's price to the market price. If the vendor's price is lowerthan the market price, the vendor receives a good score; if it is higher than the market price the vendor isassigned a poor score.

Price history

This sub-criterion compares the development of the vendor's price with the market price.

Goods receipt

This sub-criterion is used to evaluate the quality of the material that the vendor delivers. Quality inspectiontakes place at the time of goods receipt.

Quality audit

This sub-criterion is used to evaluate the quality assurance system used by a vendor/company in manufacturingproducts.

Page 5A-33© SAP SE

The purchase order can be used for a variety of procurement purposes. You can procure materials for directconsumption or for stock. You can also procure services.

You can use purchase orders to cover your requirements using external sources (i.e. a vendor supplies a materialor performs a service). You can also use a purchase order to procure a material that is needed in one of yourplants from an internal source, i.e. from another plant.

Page 5A-34© SAP SE

Page 5A-35© SAP SE

Page 5A-36© SAP SE

Page 5A-37© SAP SE

Page 5A-38© SAP SE

If a material is delivered for a purchase order, it is important for all of the departments involved that the goodsreceipt entry in the system references this purchase order, for the following reasons:

- Goods receiving can check whether the delivery actually corresponds to the order.

- The system can propose data from the purchase order during entry of the goods receipt (for example, thematerial ordered, its quantity, and so on). This simplifies both data entry and checking (over-deliveries andunder-deliveries).

- The delivery is marked in the purchase order history. This allows the purchasing department to monitor thepurchase order history and initiate reminder procedures in the event of a late delivery.

- The vendor invoice is checked against the ordered quantity and the delivered quantity.

- The goods receipt is valuated on the basis of the purchase order price or the invoice price.

Page 5A-39© SAP SE

When you enter a goods movement into the system, you must enter a movement type to differentiate betweenthe various goods movements. A movement type is a three-digit identification key for a goods movement.

The movement type plays an important role in

- updating quantity fields

- updating stock and consumption accounts

- determining which fields are displayed during entry of a document in the system.

Page 5A-40© SAP SE

Page 5A-41© SAP SE

When you enter a goods movement, you start the following chain of events in the system:

A material document is generated, which is used as proof of the movement and as a source of information forany other applications involved.

The stock quantities of the material are updated.

If the movement is relevant for Financial Accounting, one or more accounting documents are generated and thestock values in the material master record are updated, as are the stock and consumption accounts.

Depending on the movement type, additional updates are carried out in participating applications. All updatesare based on the information contained in the material document and the financial accounting document.

Page 5A-42© SAP SE

It is in Logistics Invoice Verification that incoming invoices are verified in terms of their content, prices andarithmetic. When the invoice is posted, invoice data are saved in the system. The system updates the datasaved in the invoice documents in Materials Management and Financial Accounting.

An invoice can be processed in Logistics Invoice Verification in various ways:

• Invoice verification online

• Invoice verification in the background

• Automatic settlements

• Invoices received via EDI.

Page 5A-43© SAP SE

Note: Moving average price is updated if there is a price difference.

Page 5A-44© SAP SE

Page 5A-45© SAP SE

Requisition: nothing really happens unless we get the goods or pay for them.

The system processes the transactions for you using the automatic account assignment.

When we receive these, it can match the receipt against the PO.

Debit Inventory (we now have additional inventory value).

Credit GR/IR (we are awaiting an invoice for the inventory).

Page 5A-46© SAP SE

Once we get the receipt:

Debit GR/IR – now a wash (entry is reversed)

Vendor AP Credit – we owe (it is debited: now a wash)

Some companies book it as a liability right away (previous slides), but it really isn’t until you receive thegoods

Unique to SAP

Credit bank account (paid, now we have less cash)

Page 5A-47© SAP SE

Goods receipt

Debit Inventory

Credit GR/IR

Invoice receipt

Debit GR/IR

Credit AP

Payment program (A/P)

Debit: AP

Credit Bank

Page 5A-48© SAP SE

Page 5A-49© SAP SE

Page 5A-50© SAP SE

Page 5A-51© SAP SE

Page 5A-52© SAP SE

Page 5A-53© SAP SE

Page 5A-54© SAP SE

Page 5A-55© SAP SE

Page 5A-56© SAP SE

Page 5A-57© SAP SE

Page 5A-58© SAP SE

© SAP SE

WORKSHOP

Product SAP ERP G.B.I. Release 6.07 Level Undergraduate Graduate Beginner Focus Materials management Authors Bret Wagner Stefan Weidner Anjali Ramburn Version 3.2

MOTIVATION The data entry requirements in the exercises are minimised because much of the data is stored in the SAP system. This stored data, known as master data, simplifies the processing of business transactions. In this workshop, we will display a master record, create a purchase order, a goods receipt, and an invoice and post a payment to a particular vendor. You will then run a purchasing report and create a dashboard.

PREREQUISITES Before you use this workshop, you should be familiar with navigation in the SAP system.

NOTES This workshop uses the ESEFA data set, which has been created exclusively for the SAP UA African curriculum.

ZP Procure to Pay Workshop I

This workshop explains an integrated procure to pay process in detail

and thus fosters a thorough understanding of each process step and

the underlying SAP functionality.

© SAP SE Page 5B-2

WORKSHOP

Contents

Part I: Procure to pay (ZP) process overview ........................................................................ 3

ZP 1: Display vendor master data (Get A Brake) ................................................................... 4

ZP 2: Display a raw material master record .......................................................................... 7

ZP 3: Create a purchasing info record ................................................................................... 9

ZP 4: Create a purchase order............................................................................................. 13

ZP 5: Create a goods receipt for purchase order ................................................................ 15

ZP 6: Enter invoice receipt from vendor ............................................................................. 17

ZP 7A: Display invoice ......................................................................................................... 19

ZP 7B: Display purchase order history ................................................................................ 19

ZP 8: Post payment to vendor ............................................................................................. 20

ZP Exercise questions .......................................................................................................... 22

ZP Exercise solutions (Part I) ............................................................................................... 24

Part II: Procure to pay reporting ......................................................................................... 26

ZP 9: Using Crystal Reports ................................................................................................. 26

ZP 10: Using Dashboard Reports ......................................................................................... 28

ZP Exercise solutions (Part II) .............................................................................................. 31

© SAP SE Page 5B-3

WORKSHOP

Part I: Procure to pay (ZP) process overview

Time 120 min.

Learning objective Understand and perform a procurement cycle.

Scenario In order to execute a complete procurement process you will take on different roles within the Zambikes company, e.g. a purchasing agent, a warehouse employee, an accounting specialist. Overall, you will be making use of the Materials Management (MM) and the Financial Accounting (FI) modules of SAP ERP.

Employees involved Viera Funjika (Finance manager) Wyson Nkwazi (Production supervisor) Benjamin Banda (Warehouse / factory employee) Margret Mwaanga (Admin & inventory manager)

The procure to pay process starts with the displaying of master data records. A vendor (Get A Brake) master record is displayed. Then a raw material master record is displayed (Brake Kit). From the information in the raw material and the vendor master records, the system creates a purchasing info record. You then create a purchase order. Once goods are received, a goods receipt is issued to verify the physical receipt in stock. After the creation of an invoice, the procure to pay cycle ends when payment is made.

The graphic below displays the complete process.

Process

description

© SAP SE Page 5B-4

WORKSHOP

ZP 1: Display vendor master data (Get A Brake)

Time 10 min.

Task Display vendor master data using the SAP Easy Access menu.

Zambikes has numerous vendors both locally and overseas. Margret wants to Short Description view the details of one local vendor (Get A Brake).

Name (Position) Margret (Admin & inventory manager)

Vendors are established in both accounting and purchasing. In order to be active, the vendor master record requires three views – general, accounting, and purchasing. Vendors can be created centrally, meaning that all views are generated at the same time, or responsibility can be distributed to accounting and purchasing for creating and maintaining their respective views.

Vendor master

To display a new vendor, follow the menu path:

Logistics ► Materials Management ► Purchasing ► Master Data ► Vendor ► Central ► Display (XK03)

This will produce the following screen.

Menu path

XK03

Use the F4 help to find the vendor number in the Vendor field.

The following screen will appear.

© SAP SE Page 5B-5

WORKSHOP

Choose the Vendors by Country/Company Code tab.

Use the company code and your search term to search for a vendor.

Enter ZM00 in the Company Code field.

Enter *### in the Vendor field (Replace ### with the last 3 digits of your SAP number).

Click (Enter).

ZM00

*###

Choose Get A Brake from the list of vendors displayed. The following screen is displayed.

Record vendor number

Enter the purchasing organization as ZM00 if the field is not already populated.

Select all the displayed options below.

ZM00

Use (F7) to select all the options

displayed

© SAP SE Page 5B-6

WORKSHOP

Then, click (Enter). The following screen is displayed.

© SAP SE Page 5B-7

WORKSHOP

Click (Navigate) to switch between screens.

Answer questions for Exercise ZP 1.

After answering the questions, click (Exit) once to return to the initial screen.

ZP 2: Display a raw material master record

Time 15 min.

Task Use the SAP Easy Access menu to display a raw material master record.

Short Description Wyson wants to report on the current moving average price of a brake kit.

Name (Position) Wyson (Production supervisor)

To display a raw material master record, follow the menu path:

Logistics ► Materials Management ► Material Master ► Material ► Display ► Display Current (MM03)


Menu path

MM03

Use the F4 help to find the material number.

Choose the Plant Material by Description tab. The screen below appears.

© SAP SE Page 5B-8

WORKSHOP

Enter MU00 in the Plant field.

Enter *### in the Material field (Replace ### with your 3-digit SAP number) as per the screenshot below.

Click (Enter).

Double-click Brake Kit to choose it from the list of materials.

Click

Choose all the displayed views.

Then, click (Enter).

MU00

*###

Brake Kit

Use Shift-F8 to select all the

views

The following screen is displayed:

In the Plant field, enter MU00 (Mungwi), Stor.

In the Stor. Location field, enter RM00 (Raw Materials).

MU00

RM00

© SAP SE Page 5B-9

WORKSHOP

Compare with the screen shown below.

Then, click (Enter).

On the Basic Data 1 tab, record your material number and division as per Exercise ZP2 (refer to exercises below).

Choose the Purchasing tab and note the purchasing group.

On the Accounting 1 tab, note the moving price of the material and currency used.

Material Number Division Purchasing Group Moving Price Currency



ZP 3: Create a purchasing info record

Time 20 min.

Task Use the SAP Easy Access menu to create purchasing info record.

Short Description Viera creates a new purchasing info record to record agreed conditions between a vendor (Get A Brake) and a material (brake kit)

Name (Position) Viera (Finance manager)

Purchasing info records store information about the terms for purchasing a specific material from a vendor. They are maintained for a vendor/material combination and can contain data for pricing and conditions, over-delivering and under-delivering limits, planned delivery date and availability period.

Purchasing info

record

To create a new purchasing info record, follow the menu path:

Logistics ► Materials Management ► Purchasing ► Master Data ► Info Record ► Create (ME11).


Note: Some of these fields might already be populated. Enter the information below where necessary.

Menu path

ME11


WORKSHOP

Enter your vendor number as noted from Exercise ZP1.

Enter the material number as noted in Exercise ZP2.

Enter ZM00 in the Purchasing Org. field.

Enter MU00 in the Plant field.

Choose Standard under Info category, then click (Enter).

The screen below is displayed.

127###

BRKT1###

ZM00

MU00

Standard

Enter the following data in the fields under Vendor Data.

Reminder 1, 2, 3 (1st, 2nd, 3rd Rem./Exped.): These three fields indicate reminders to be issued to the vendor. Negative value indicates that the vendor

-1

1


WORKSHOP

should be notified prior to quotation or delivery date.

Vendor Mat. No: material number that is used by the vendor for this material.

Vendor Material Group: material group used by the vendor for this material.

Salesperson: Name of the contact person.

Return Agreement: this can indicate if goods return is possible and if refunds are possible.

In the field Certif. Cat. under Origin data, enter the type of certificate issued by the vendor that applies to this material.

7

BRKT1###

RAW

Your name

03

1

After entering all the desired data, click Purch. Org. Data 1 in the top left corner of the screen. This takes you to the screen for entering Purchase Organization dependent information, shown below.

Purch. Org. Data

1


WORKSHOP

This view is maintained separately for every procurement type. We have chosen the standard procurement type, and we can populate several relevant fields here.

Planned Delivery Time: default time in days in which the material delivery is planned.

Standard Quantity: standard purchase quantity for material.

Minimum Quantity: do not allow procurement of a quantity less than stated here.

Maximum Quantity: we do not want to purchase more than this quantity at a time.

Net Price: net price of material per procurement unit.

Incoterms: trading and delivery terms. Choose EXW using the F4 key.

Enter Location Mungwi next to EXW.

7

10

5

100

600

EXW Mungwi

Once you have entered all the desired information about our material/vendor combination you can save the data.

Click (Save).

Record your purchasing information record (PIR) number.



WORKSHOP


ZP 4: Create a purchase order

Time 20 min.

Exercise Use the SAP Easy Access menu to create a purchase order.

Task Create a purchase order (PO) for a brake kit. Submit the PO to the vendor, Get A Brake. When received and accepted by the vendor, the PO creates a legally binding contract between the two parties.


In order to create a purchase order, follow the SAP Easy Access menu path:

Logistics ► Materials Management ► Purchasing ► Purchase Order ► Create ► Vendor/Supplying Plant Known (ME21N).

Menu path

ME21N

In the Vendor field, enter the vendor displayed in ZP1 (Get A Brake) or press F4 to find the number. To search for the vendor number, enter your three-digit number (###) as a Search term on the Vendors (General) tab, and Lusaka in the City field. In the result list, double-click the vendor number to choose it.

### Lusaka

Back on the Create Purchase Order screen, open the header data by clicking (Header).

In the Org. Data view, choose or enter ZM00 for Purchasing Org.

Choose or enter Z00 for Purch. Group.

Choose or enter ZM00 for Company Code.

(Note: These fields might already be populated.)

Then click (Enter).

ZM00

Z00

ZM00

Click (Item Overview) to open the item list. You have to enter the following materials and information (as shown below).


WORKSHOP

You can use the F4 help to search for and choose Brake Kit. Or you can use the Material by Material Type search tab.

Choose ROH as Material Type.

Enter *###(replace ### with your SAP number)as Material.

Double-click Brake Kit to choose it.

In the Plant field, enter MU00 and click (Enter).

Enter 10 as the PO quantity.

Material PO Quantity Delivery Date Net Price Currency Plnt

BRKT1### 10 Pre-populated when plant is entered

Pre- populated when plant is entered

Pre- populated when plant is entered

MU00

Click (Enter). If you receive a system message asking whether the delivery date can be met, accept it by pressing Enter.

Go to the Conditions tab in the Header section and record the total value of the purchase order: ______________ (ZMW). Record the order value.

Click (Header) and your screen should look like the one below.

ROH

BRKT1###

MU00

10

Click (Save) to save the purchase order.

A message will appear. To view the system messages, choose . The following message should appear.


WORKSHOP

The message tells you that you are creating a purchase order, but have not

generated any output to notify the chosen vendor. Click (Enter) to continue.

Then click (Save) again. This time we will save past the message indicating that no output device (i.e. Printer, FAX, EDI) was found to communicate this PO to the vendor. Choose .

Note that SAP will assign a purchase order document number (bottom-left of the

screen). Record your purchase order number.

Purchase order

document number

The purchase order screen is again blank, ready for another purchase order to be recorded.


Click (Exit) to return to the SAP Easy Access menu.

ZP 5: Create a goods receipt for purchase order

Time 15 min.

Exercise Use the SAP Easy Access menu to create a goods receipt.

Task Receive into inventory the stock items ordered from Get A Brake in the previous exercise. A goods receipt document will be created referencing our purchase order. This will ensure that we receive the products ordered within the timeframes requested and in quality condition. Goods on hand will be increased and an accounting document will be generated recognising the value associated with these goods.

Name (Position) Benjamin (Warehouse / factory employee)

To create a goods receipt, follow the menu path:

Logistics ► Materials Management ► Inventory Management ► Goods Movement ► Goods Receipt ► For Purchase Order ► GR for Purchase Order (MIGO)


Menu path

MIGO


WORKSHOP

Make sure that the GR goods receipt field (top-right corner) is set to 101.

Enter your PO number from the previous exercise. If you do not have the number, find it by using the F4 help (Purchasing Document per Vendor tab or Purchasing Document for Material tab). Then press Enter.

101

PO number

Ensure that the box in the OK column is populated with for each item. Checking it indicates that you want to adopt it into the goods receipt document and the right materials and right quantity have been delivered. If a line is grayed out,

minimise the Item Detail Data by clicking (Close detail data). For each item, ensure that the box in the OK column is populated with .

OK

In the SLoc column, enter Storage Location RM00 (Raw Materials). Then click (Save) to save your goods receipt.

RM00

Note that the SAP system will assign a unique number for this new goods receipt

document. This number will appear in a message at the lower-left corner of the

screen.

Goods receipt document

number




WORKSHOP

ZP 6: Enter invoice receipt from vendor

Time 10 min.

Exercise Use the SAP Easy Access menu to enter an invoice receipt.

Task Enter an invoice received from Get A Brake for (6 960 ZMW) associated with the recent PO and goods receipts. This invoice will be posted to an existing G/L account in your Chart of Accounts and saved as an Accounts Payable to Get A Brake. It will be settled by issuing a cheque to Get A Brake at a later date.


To enter an invoice, follow the menu path:

Logistics ► Materials Management ► Logistics Invoice Verification ► Document Entry ► Enter Invoice (MIRO)


Menu Path

MIRO

Enter today’s date as Invoice date (you can use F4 to display the calendar and press Enter to choose today’s date).

In the Amount field, enter the total amount from the invoice document.

In the drop-down menu next to the Tax Amount field, choose Code V1.

In the Text field, enter INVOICE 00-### (replace ### with your 3-digit SAP number).

Click the box next to Calculate tax. Check whether your screen looks like the screen below.

Today’s date

6 960

V1

INVOICE 00-###

Calculate tax


WORKSHOP

Choose Purchase Order/Scheduling Agreement in the bottom drop-down list and enter your PO number from the first exercise in the Text field next to it. Again, to find it you can use F4 and helpful search criteria such as vendor.

Click (Enter).

PO number

If the transaction is entered correctly (in respect to Debits and Credits), we will

have a green light with a zero (0.00) ZMW balance.

Note: Refer to questions for ZP6 before proceeding. Questions ZP6 1 and 2 should be answered at this stage.

We want to view what the actual postings will look like in the general ledgers. It is here that we can ensure that the Debit/Credit posting is correct and that the

accounts are affected correctly. Click to see whether the postings are correct.


WORKSHOP

Click (Save posting) to save the invoice receipt.

The system will again create a unique document number in the lower-left corner of

the screen.

Record the document number and answer the questions below.

Invoice document number



ZP 7A: Display invoice

Time 10 min.

Exercise Use the SAP Easy Access menu to display the invoice created.

Task Once an invoice has been posted, it can be viewed.


To display an invoice, follow the menu path:

Logistics ► Materials Management ► Logistics Invoice Verification ►Further Processing ► Display Invoice Document (MIR4)

Menu Path

MIR4


ZP 7B: Display purchase order history

Time 10 min.

Exercise Use the SAP Easy Access menu to display the purchase order history.

Task A purchase order history can also be viewed to determine whether the system has updated the open line items on receipt of the invoice.


To display the purchase order history, follow the menu path:

Logistics ► Materials Management ► Purchasing ►Purchase Order ► Display (ME23N)

Menu Path

ME23N


WORKSHOP



ZP 8: Post payment to vendor Time 10 min.

Exercise Use the SAP Easy Access menu to post a payment to a vendor.

Task Issue a payment to Get A Brake to settle the Accounts Payable. An accounting entry is made to Accounts Payable for Get A Brake and to the applicable bank account in the G/L.


To post a payment to a vendor, follow the menu path:

Accounting ► Financial Accounting ► Accounts Payable ► Document Entry ► Outgoing Payment ► Post (F-53)

Menu Path

F-53

First, enter today’s date as Document Date.

If requested, enter Company Code ZM00 and Currency/Rate ZMW.

In the Bank Data field group, use F4 to find and choose 10 0000 as the Bank Account and enter the amount you are going to pay (Enter Invoice Amount).

Today’s date

ZM00 ZMW

100000

6960

In the Open Item Selection field group, search for the account number for your Get A Brake vendor (use your search term ###) and enter it in the Account field.

Account Number

is your Vendor number


WORKSHOP

All other settings remain unchanged. Your screen should resemble the one above.

Choose . The following screen will appear.

Click (Save) to post your payment. Again, the system creates a unique document number. Record the document number:

Payment

document number


The Post Outgoing Payments screen is again blank, ready for another payment to

be entered. Click (Exit) to return to the SAP Easy Access menu. A pop-up box with the SAP warning message shown below will appear. Choose Yes. You have posted your payment, so no data will be lost.

Yes


WORKSHOP

ZP Exercise questions [25]

Unless stated otherwise, each question is worth one mark.

1. What is the SAP username you used for this workshop?

QUESTIONS ZP 1: Display vendor master [7]

1. SAP categorizes vendor master data into three groups. What are they? Under each group, give one example of the master data. [3]

2. What is the ‘vendor number’ and ‘vendor name’ displayed? [2] 3. State the country of origin of the selected vendor. 4. State the order currency used for the selected vendor?

QUESTIONS ZP 2: Display material master [5]

1. What is the material number displayed? 2. What is the division of the selected material? 3. What is the purchasing group of the selected material? 4. What is the moving price of the material? 5. What currency is used for the selected material?

QUESTIONS ZP 3: Creating a PIR [1]

1. What is your purchasing info record number?

QUESTIONS ZP 4: Create a purchase order [2]

1. What is the total value of the purchase order? 2. What is your PO number?

QUESTIONS ZP 5: Goods receipt [2]

1. Enter your PO number as recorded in ZP4.

2. Choose the PO history from the Item detail tab. What does the

entry tell you?

QUESTIONS ZP 6: Enter an invoice receipt [3]

1. What is the tax amount of the above transaction?

2. What is the total value of the transaction?

3. What is the document number for the invoice?

QUESTIONS ZP 7: Display purchase order history [3]

1. Display your PO history and list all the entries.


WORKSHOP

QUESTIONS ZP 8: Post payment to vendor [2]

1. What is the vendor’s account number as displayed?

2. Record your document number.


WORKSHOP

ZP Exercise solutions (Part I)

Unless otherwise stated, each question is worth one mark.

[25]

1. What is the SAP username you used for this workshop?

QUESTIONS ZP 1: Display vendor master [7]

1. SAP categorizes vendor master data into three groups. What are they? Under each group, give one example of the master data. [3]

2. What is the ‘vendor number’ and ‘vendor name’ displayed? [2]

3. State the country of origin of the selected vendor. 4. State the order currency used for the selected vendor?

General Data – Vendor name, Company Code Data – Company code, Purchasing Data - Purchasing org.

Vendor number – 127###

Vendor name – Get A Brake

Country of origin –

Zambia

Currency - ZMW

QUESTIONS ZP 2: Display material master [5]

1. What is the material number displayed? 2. What is the division of the selected material? 3. What is the purchasing group of the selected material? 4. What is the moving price of the material? 5. What currency is used for the selected material?

Material number - BRKT1###

Division – BI

Purchasing Group - Z00

Moving price - 600

Currency - ZMW

QUESTIONS ZP 3: Creating a PIR [1]

1. What is your purchasing info record number?

Purchasing info record no. – 53000000xx

(xx)- To be replaced by the unique number generated

QUESTIONS ZP 4: Create a purchase order [2]

1. What is the total value of the purchase order? 2. What is your PO number?

Total value of PO – ZMW

6 000.00

PO number – 45000000xx

(xx)- To be replaced by the unique number generated

QUESTIONS ZP 5: Goods receipt [2]

1. Enter your PO number as recorded in ZP4.

2. Choose the PO history from the Item detail tab. What does

the entry tell you?

PO number – 45000000xx

The POH confirms and displays the order and value of the order: The total order is valued at ZMW 6 000.00 for 10


WORKSHOP

Brake Kits

QUESTIONS ZP 6: Enter an invoice receipt [3]

1. What is the tax amount of the above transaction?

2. What is the total value of the transaction?

3. What is the document number for the invoice?

Tax amount - ZMW 960.00

Total value of transaction – ZMW 6 960.00

Document number – 51056001xx

QUESTIONS ZP 7: Display purchase order history [3]

1. Display your PO history and list all the entries

Entries relating to goods receipt and invoice receipt are shown.

QUESTIONS ZP 8: Post payment to vendor [2]

1. What is the vendor’s account number as displayed?

2. Record your document number.

3. Display your PO history and record all the entries [3]

Vendor’s Account Number – 127004

Document number – 1500000006

Entries relating to goods receipt and Invoice receipt are shown.


WORKSHOP

Part II: Procure to pay reporting Time 20 min.

SAP Business Intelligence provides a broad range of reporting tools to facilitate decision-making for different end users. SAP Dashboard Reports and SAP Crystal Reports are two reporting tools which are increasingly being used to generate various management as well as operational reports from data generated by business processes and transactions.

SAP Crystal Reports makes it easy to create simple reports. However, it also has a comprehensive set of tools needed to produce advanced or specialised reports. As part of Global Bike Group, Zambikes middle-level management now has access to Crystal Reports for analysing operational activities to facilitate decision-making by middle management.

SAP Dashboard Reports is a tool for creating interactive reports that allow decision-makers to quickly view key information that is core to strategic decision-making. They provide simple-to-use interfaces which can be embedded in a number of applications, including web pages and presentations.

ZP 9: Using Crystal Reports Time 20 min.

SAP Crystal Reports is reporting tool that is used to format reports. SAP Crystal Report makes it easy to create simple reports, and, it also has the comprehensive tools you need to produce complex or specialised reports.

EXERCISE ZP 9A: Using ZP Procurement Operational Report 1 [6]

On the learning management system (LMS), choose and open the ZP Procurement Operational Report 1.

(Ask your tutor/lecturer for the link).

An exception purchase order report can be generated on a daily basis for structured decision-making. Familiarise yourself with the information shown on-screen before answering the questions below.

1. In a few words, explain the purpose of the procurement exception report.

2. Provide a list of departments within an organization where such a report might be useful and explain how the report could add value to these departments. [2]


WORKSHOP

3. Can you think of how the historical information in the exception report could be useful for the organization in the future?

4. Zambikes would like to send a delivery reminder to all the suppliers from whom they are expecting deliveries in October. Based on the report, list the suppliers who would be sent a delivery reminder.[2]

5. What additional information would you add to improve the report? [2]

EXERCISE ZP 9B: Using ZP Procurement Operational Report 2 [4]


WORKSHOP

The expenditure report shows the monthly expenditure report for different categories of raw materials. Familiarise yourself with the information shown on-screen before answering the questions below.

1. Assuming that the criteria for vendor selection is cost of product, quality and compliance to agreed delivery time, list the vendors with whom Zambikes should avoid signing a long-term contract. Justify your answer.

ZP 10: Using Dashboard Reports Time 20 min.

Zambikes currently uses a spreadsheet to analyse their expenditure information. The managing director has indicated to his team that while the report contains all the necessary information, it is not easy to interpret and perhaps this information can be supplied in a more user friendly format. In response to these concerns, it was decided to build a reporting dashboard that was interactive, easy-to-use and supplied the necessary information.

A dynamic expenditure report was implemented. It enables users to have a quick overview of the data and to zoom and filter on particular aspects and extract further detailed information as required. The specific information they are concerned with is:

Purchasing expenditure for different categories of raw materials for the previous fiscal year (2013)

The actual expenditure details of each raw material in a particular category

The vendor information relating to each raw material

The countries from which a raw material can be procured


WORKSHOP

The yearly expenditure trend of each raw material.

Download and save the Zambikes expenditure html and Zambikes expenditure swf files to your local drive.

Zambikes expenditure html

Open the Zambikes expenditure html file and browse through the different charts. Familiarize yourself with the information displayed before answering the questions below.

EXERCISE ZP 10: Using the ZP Expenditure Report [10]

1. What are the countries of origin for the different raw materials in the Wheel and Tyre category?

2. What is the number of units imported for raw material DerailZMW Chain in the Derailleur and Brake category? [2]

3. What is the amount spent on procurement of materials in the Seat and Pedal category in 2011, 2012 and 2013. What can you say about the trend of expenditure? [4]

4. Assuming that the criteria for Vendor selection are the cost of product and the delivery time, list the vendors with whom you would recommend that Zambikes sign a long-term contract. Your focus is only on the following raw materials from the Frames category. Justify your answer. [3]

Steel Frame Racing Handle Bar


WORKSHOP

Trailer Load Platform


WORKSHOP

ZP Exercise solutions (Part II)

Unless otherwise stated, each question is worth one mark.

QUESTIONS ZP 9: Using Crystal Reports

1. In a few words, explain the purpose of the procurement exception report.

2. Provide a list of departments within an organization where such a report might be useful and explain how the report could add value to these departments.

3. Can you think of how the historical information in the exception report could be useful for the organization in the future?

4. Zambikes would like to send a delivery reminder to all the suppliers from whom they are expecting deliveries in October. Based on the report, list the suppliers who would be sent a delivery reminder.

5. What additional information would you add to improve the report?

To view the outstanding overdue goods movements or deliveries.

Procurement & purchase – escalations and follow up

Accounting & Finance – forecast/penalty fee

Production – forecast effect on product/

Assess performance of suppliers for renewal of contract

Allows the purchasing department to estimate when to purchase goods from specific suppliers

GetABrake

Malawheels

Steel Lite

Location – the further away, the bigger the probability of being late

Number of reminders sent

Overall % late deliveries per supplier

QUESTIONS ZP 9B: Using ZP Operational Report 2

1. Assuming that the criteria for vendor selection is cost of product, quality and compliance to agreed delivery time, list the vendors with whom Zambikes should avoid signing a long-term contract. Justify your answer.

Those vendors who have the highest item costs, a high % of defects and a higher % of late deliveries in their respective categories


WORKSHOP

QUESTIONS ZP 10: Using Dashboard Reports

1. What are the countries of origin for the different raw materials in the Wheel and Tyre category?

2. What is the number of units imported for raw material DerailZMW Chain in the Derailleur and Brake category?

3. What is the amount spent on procurement of materials in the Seat and Pedal category in 2011, 2012 and 2013? What can you say about the trend of expenditure?

2011 2012 2013

Off Road Seat Kit ZMW 196,320 223,805 219,329

Pedal Assembly ZMW 69,997 60,897 60,288

Racing Seat Kit ZMW 135,953 110,112 106,818

TOTAL ZMW 402,270 394, 814 386,435

4. Assuming that the criteria for Vendor selection are the cost of product and the delivery time, list the vendors with whom you would recommend that Zambikes signs a long-term contract. Your focus is only on the following raw materials from the frames category:

Steel Frame

Racing Handle Bar

Trailer Load Platform

Malawi and South Africa

612 + 398 + 696 = 1706

Decreasing Trend

Steel Frame: Equipment Expert

Racing Handle Bar: Lumumba Hardware

Trailer Load Platform: Steel Lite

© SAP SE Page 5C

DATA SHEET

Master data

Search term Vendor (Get A Brake) ###

Material (Brake kit) BRKT1###

Organizational units

Company Code (Zambikes) ZM00 Plant (Mungwi) MU00 Plant (Lusaka) LU00 Storage Location RM00 Purchasing Organization ZM00 Purchasing Group Z00

Employees involved

Margret Mwaanga Admin & inventory manager Viera Funjika Finance manager Benjamin Banda Warehouse / factory employee Wyson Nkwazi Production supervisor

Transactions

Display Vendor XK03 Display a Material MM03 Create a Purchasing Info Record ME11 Stock/Requirements List MD04 Create Purchase Requisition ME51N Create RFQ ME41 Change RFQ ME42 Maintain Quotation ME47 Price Comparison List ME49 Create Purchase Order ME21N Display Purchase Order ME23N Goods Receipt MIGO_GR Stock Overview MMBE Enter Incoming Invoice MIRO Post Outgoing Payments F-53 Vendor Balance Display FK10N G/L Account Balance Display FAGLB03

Document numbers

Vendor Master Number _______________________ Purchase Order Document Number _______________________ Goods Receipt Document Numbers ___________ ___________ Invoice Document Numbers ___________ ___________ Vendor Payment Document Number _______________________

ZP Procure To Pay Workshop I

Page 7A-1© SAP SE

Page 7A-2© SAP SE

Page 7A-3© SAP SE

Page 7A-4© SAP SE

Page 7A-5© SAP SE

Page 7A-6© SAP SE

Page 7A-7© SAP SE

Page 7A-8© SAP SE

Groups the company according to the requirements of Sales And Distribution (SD).

If you use the SAP SD module, you need to define at least one sales organization.

More than one sales organization can be assigned to a company code. However, a sales organization isuniquely assigned to a company code.

In the sales statistics, the sales organization is the highest summation level. All documents generated duringsales order processing (within the SAP SD module) such as a sales order, an outbound delivery or a billingdocument, belong to a sales organization.

Some master data is maintained at the sales organization level i.e. within the same company code, differentsales organizations will have different values for a particular master data attribute.

Page 7A-9© SAP SE

If you use the SAP SD module, you need to define at least one distribution channel and one division.

Page 7A-10© SAP SE

During the processing of SAP SD documents (e.g. a sales order), the system accesses various master dataaccording to the sales area. This master data includes, for example, customer master data, material masterdata, prices and discounts. In addition, the system carries out several checks concerning the validity ofcertain entries according to the sales area.

Page 7A-11© SAP SE

The plant is a location where material stock is kept. A plant can, for example, represent a production facilityor simply a grouping of locations (storage locations) in physical proximity.

You have to create at least one plant in order to be able to use the Sales and Distribution module.

A plant must be uniquely assigned to a company code.

The assignment between sales organizations and plants does not have to be unique.

When processing delivery of a sales order in SAP SD, a plant is used to determine the shipping point.

You assign a shipping point at plant level. A shipping point is a physical place and should be near thedelivering plant. More than one shipping point can be assigned to a plant. You can also assign shippingpoints to several plants.

Each outbound delivery is processed by one shipping point.

Page 7A-12© SAP SE

Page 7A-13© SAP SE

Page 7A-14© SAP SE

Page 7A-15© SAP SE

Mainly used for transactions in SD and Financial Accounting

General data

Applies to both sales and accounting.

Relevant to all companies and sales organizations in an organization.

General area includes, for example, the customer’s name, address, language, and telephone data.

Company code data

Specific to an individual company code.

Relevant for accounting.

Company code data includes, for example, the reconciliation account number, terms of payment, anddunning procedure.

Sales area data

Specific to a sales organization.

Applies specifically to the SAP SD module.

Data that is stored in this area includes, for example, data on order processing, shipping, and billing.

Page 7A-16© SAP SE

Stored in the customer master sales area data (tab page Partner functions).

During sales order processing, they are copied as default values into the relevant documents.

For sales order processing you need the mandatory partner functions (they can differ from one another orthey can be identical).

Mandatory partner functions include:

Sold-to-party: Places the order

Ship-to-party: Receives goods or services

Bill-to-party: Receives the invoice for goods or services

Payer: Is responsible for paying the invoice.

Other partner functions, such as contact person or forwarding agent, are not absolutely necessary for salesorder processing.

Page 7A-17© SAP SE

Page 7A-18© SAP SE

Page 7A-19© SAP SE

The slide describes material master data relevant to sales order processing.

Page 7A-20© SAP SE

Page 7A-21© SAP SE

Define your partner functions, transmission medium and time frequency.

Page 7A-22© SAP SE

Page 7A-23© SAP SE

Page 7A-24© SAP SE

Page 7A-25© SAP SE

Page 7A-26© SAP SE

Page 7A-27© SAP SE

The customer order cycle starts with pre-sales activities.

For example, in response to a customer inquiry , you create and send a quotation.

As part of sales order processing, you create a sales document.

As part of shipping processing, you organize and perform the delivery of goods.

In the billing process, you create the invoice and transfer all the necessary data into accounting.

As part of handling payments, you check open items and post incoming payments.

Page 7A-28© SAP SE

Pre-sales activities can include creating customer contacts, answering customer telephone queries, inquiriesand creating quotations.

Page 7A-29© SAP SE

The sales order contains information (organizational data + master data + transaction data) to process thecustomer’s request during sales order processing.

The system proposes data from master records and control tables that you have previously stored. As aresult, possible input errors occurring during sales order processing and the entering of redundant data areavoided.

A sales order can contain multiple items.

A sales order can be entered, based on preceding agreements e.g. a quotation or existing contracts, orwithout any preceding document.

A sales area is required on each sales order.

Page 7A-30© SAP SE

A sales order is an electronic document that records your customer’s request for goods or services. Thesales order contains all information to process the customer’s request during sales order processing.

The sales component thus automatically proposes data from master records and control tables. As a result,possible input errors occurring during sales order processing and the entering of redundant data is avoided.

You can enter a sales order with many items on a single screen.

Sales orders can also be created via the internet or through messages received from business partners.

Page 7A-31© SAP SE

Page 7A-32© SAP SE

Backward scheduling

Backward scheduling is always carried out first.

All four of the delivery and transportation scheduling lead times are subtracted from the customer'srequested delivery date to determine if this date can be met.

The transit time, loading time, and pick/pack time are subtracted from the customer’s requested deliverydate to calculate the required material availability date.

The system calculates backward scheduling as follows:

Requested delivery date minus transit time = Goods issue date

Goods issue date minus loading time = Loading date

Loading date minus transportation lead time = Transportation scheduling date

Loading date minus pick/pack time = Material availability date

If the material availability date or transportation scheduling date is calculated to be in the past, the systemmust then use forward scheduling.

Page 7A-33© SAP SE

Forward scheduling

Used when the material availability date or transportation scheduling date (as calculated by backwardscheduling) is in the past.

Also done if no product is available on the material availability date calculated by backward scheduling.

The system does an availability check to determine the first possible date when the product will beavailable.

This new material availability date forms the starting point for scheduling the remaining activities.

The loading time, pick/pack time, transit time, and transportation lead time are added to the new materialavailability date to calculate the confirmed delivery date.

Page 7A-34© SAP SE

A customer may specify that he or she will either accept only complete delivery of an order or agree toaccept several partial deliveries for an order or an order item.

Customer preference is indicated in the customer master record or in the customer material informationrecord and is copied into a sales order for that customer.

When you process an order or create a delivery, the system checks this indicator to determine whethercomplete delivery is required or whether partial delivery is permitted.

You can also manually enter or change the indicator when processing an order.

Page 7A-35© SAP SE

Page 7A-36© SAP SE

Page 7A-37© SAP SE

You can create one or several outbound deliveries from the order. You can also combine items from severalorders into one outbound delivery. To combine them successfully, the orders must all have the samecharacteristics that are essential for the shipping process, for example:

- Shipping point

- Due date

- Ship-to address.

The system carries out the following activities when an outbound delivery is created:

- Checks the order and materials to make sure the outbound delivery is possible (for example, it checks for delivery blocks or incompleteness)

- Determines the delivery quantity of an item and checks the availability of the material

- Calculates the weight and volume of the delivery

- Calculates work expenditure

- Packs the outbound delivery according to the reference order

- Checks the delivery situation of the order and any partial delivery agreements

- Generates a packing proposal

- Re-determines the route

- Adds information relevant for export

- Checks delivery scheduling and changes deadlines (if necessary)

- Assigns a picking location

- Carries out batch determination (if material is to be handled in batches)

- Creates an inspection lot if the material must pass a quality check

- Updates sales order data and changes order status.

Page 7A-38© SAP SE

Changes in delivery will update the sales order.

Page 7A-39© SAP SE

In the system standard settings, goods issue cannot be posted before the item relevant for picking has beenpicked completely. Therefore, delivery quantity and picking quantity (picked quantity) in the outbounddelivery must be equal.

Considering the picking lead time the picking date will be assigned based upon material availability.

The picking process involves taking goods from a storage location and staging the right quantity in a pickingarea where the goods will be prepared for shipping.

Depending on the picking procedure being used, you can either determine delivery-relevant data beforepicking or wait until after picking is completed to record it. Delivery-relevant data may be made up of thefollowing:

- Which batches a material is picked from

- Which serial numbers are picked

- Which valuation types the stock is taken from.

In the SAP Warehouse Management module the picking process can be highly automated through the useof transfer orders.

The packing component and related packing information enables you to:

- Update the stock situation of packing materials

- Monitor returnable packaging stocks at the customer's or forwarding agent's place of business

- Help find what was in a particular container (for example, if a customer maintains that they have received an incomplete delivery)

- Make sure that the weight and volume limits have been adhered to

- Ensure that products have been packed correctly (customer preference and UCC-128 considerations)

UCC-128: Universal Container Code – Uniform packing code

Page 7A-40© SAP SE

As soon as the goods leave the company, the shipping business activity is finished.

The outbound delivery forms the basis of goods issue posting. The data required for goods issue posting iscopied from the outbound delivery into the goods issue document, which cannot be changed manually. Anychanges must be made in the outbound delivery itself. In this way, you can be sure that the goods issuedocument is an accurate reflection of the outbound delivery.

When you post goods issue for an outbound delivery, the following functions are carried out on the basis ofthe goods issue document:

- Warehouse stock of the material is reduced by the delivery quantity

- Value changes are posted to the balance sheet account in inventory accounting (based on cost of goods sold)

- The billing due list is updated

- Requirements are reduced by the delivery quantity

- The serial number status is updated

- Goods issue posting is automatically recorded in the document flow

- A worklist for the proof of delivery is generated.

After goods issue is posted for an outbound delivery, the scope for changing the delivery documentbecomes very limited. This prevents there being any discrepancies between the goods issue document andthe outbound delivery.

Page 7A-41© SAP SE

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.

This component includes the following functions:

- Creation of:

• Invoices based on deliveries or services

• Credit and debit memos

• Pro forma invoices

- Cancellation of billing transactions

- Comprehensive pricing functions

- Issue rebates

- Transfer billing data to Financial Accounting (FI)

When processing the billing due list, you do not need to enter the individual documents to be invoiced. Thesystem lists the documents to be invoiced on the basis of the selection criteria you enter. It can alsocombine several deliveries in one invoice.

Process flow

1. You run a transaction for creating a billing due list.

2. You enter the selection criteria for the billing documents to be created. For example, enter billing type F2, if you want to create invoices with only this billing type.

3. You then display the billing due list. The system uses the selection criteria to create the billing due list (a list of sales documents to be billed). You can now process this list, e.g. select some or all of the sales documents to be billed.

4. You select the function for billing. The system creates the corresponding billing documents for the selected documents.

Page 7A-42© SAP SE

You can set the system to create one billing document for each sales document, i.e. one invoice perdelivery.

As long as certain data agree, you can also combine different documents (orders and/or deliveries) fully orpartially in a common billing document.

If you want to guarantee that invoices are created separately according to certain criteria, you can do thisby defining certain split criteria.

Page 7A-43© SAP SE

When you post an incoming payment, the relevant general ledger (G/L) accounts will be updatedautomatically.

During this process, the system carries out

- a debit posting to the cash account and

- a credit posting to the customer receivables account.

Page 7A-44© SAP SE

Page 7A-45© SAP SE

The documents in a sales process are linked to one another, using the document flow.

SAP updates the order status every time a change is made to any document created in the customer ordermanagement cycle (order-to-cash).

The document flow and order status feature allows you to access the history and current status of yoursales processes at any time.

You can display the document flow as a list of linked documents. All preceding and succeeding documentsare displayed, depending on the document from which you call the list.

From this list, you can display the relevant documents or call up status overviews for the documents.

This provides an overview of the development of your sales processes at any time, allowing you to answercustomer questions quickly and reliably.

Page 7A-46© SAP SE

Page 7A-47© SAP SE

Page 7A-48© SAP SE

Page 7A-49© SAP SE

Page 7A-50© SAP SE

Page 7A-51© SAP SE

Page 7A-52© SAP SE

Page 7A-53© SAP SE

Page 7A-54© SAP SE

© SAP SE

WORKSHOP

Product

SAP ERP G.B.I Release 6.07 Level4 Undergraduate Graduate Beginner Focus

Sales order process Authors Bret Wagner Stefan Weidner Gwamaka Mwalemba Version 3.1

MOTIVATION

Although the workshop involves the creation of some master data, the data entry requirements have been minimised because most of the data is already created and stored in the SAP system. In the sales order process, you use master data for customers, materials (the products you sell) and pricing to simplify the sales order process.

PREREQUISITES

Before you use this workshop, you should be familiar with navigation in the SAP system.

NOTES

This workshop uses the ESEFA data set, which has been created exclusively for the SAP UA African curriculum.

ZS Sales Order Processing Workshop I

This workshop explains an integrated sales order process in detail and

thus fosters a thorough understanding of each process step and

underlying SAP functionality.

© SAP SE Page 7B-2

WORKSHOP

Contents

Part I: Sales order processing (ZS): Process overview ....................................................................... 3

ZS 1: Display customer master record ............................................................................................... 4

ZS 2: Create sales order ..................................................................................................................... 8

ZS 3: Display sales order .................................................................................................................. 13

ZS 4: Initiate delivery of goods ......................................................................................................... 15

ZS 5: Post goods issue ...................................................................................................................... 17

ZS 6: Create billing document for customer .................................................................................... 18

ZS 7: Post customer payment .......................................................................................................... 19

ZS 8: Display sales order .................................................................................................................. 22

ZS Exercise questions (Part I) [17] .................................................................................................... 24

Exercise solutions (Part I) ................................................................................................................. 26

Part II: Sales reporting ...................................................................................................................... 28

ZS 9: Using Crystal Reports .............................................................................................................. 28

ZS 10: Using Dashboard Reports ...................................................................................................... 31

Exercise solutions (Part II) ................................................................................................................ 33

© SAP SE Page 7B-3

WORKSHOP

Part I: Sales order processing (ZS): Process overview

Time 90 min.

Learning objective Understand and perform an integrated order-to-cash cycle.

Scenario In order to process a complete order-to-cash process you will take on different roles

within the Zambikes Company Ltd, e.g. sales agent, warehouse worker, accounting clerk. Overall,

you will be working in the Sales and Distribution (SD), the Materials Management (MM) and the

Financial Accounting (FI) departments.

Employees involved Margret Mwaanga (Admin & inventory manager)

Viera Funjika (Finance manager)

Benjamin Banda (Warehouse / factory employee)

You start the sales order process by displaying customer information (Pick &

Take) in Lusaka, Zambia. Then you create a sales order to process a sale of

Transport Zambikes to Pick & Take, a local chain store and a frequent

Zambikes customer. As you will have enough bikes in stock, you deliver the

products sold to your customer, create an invoice and receive the payment. As

you go through the process, you use a tool known as document flow, attached

to a sales order, to keep track of all the subsequent activities happening on

the order, such as delivery and payment.


Process description

© SAP SE Page 7B-4

WORKSHOP

ZS 1: Display customer master record

Time 15 min.

Exercise Use the SAP Easy Access menu to display a customer.

Task Zambikes has numerous customers both locally and overseas. Display one local customer

(Pick & Take) master record.

Name (Position) Margret (Admin &

inventory manager)

In order to display customer master data, follow the SAP Easy Access menu

path:

Logistics ► Sales and Distribution ► Master Data ► Business Partner ► Customer ► Display ► Complete (XD03).

Menu path

XD03

According to the SAP definition, in the Customer field, SAP expects you to put

in the unique key identifying the customer master record.

Customer

As you do not know any customer numbers in the Zambikes company, you

need to find them. In order to do so, position your cursor in the Customer

field and press F4.

F4

Tabs allow you to specify different search criteria. Values in the text boxes are

used to filter the search. On the Customers (by company code) tab, you may

enter any information you have about a customer you are looking for. In your

case, in the Search Term field, enter the three-digit SAP number (###) that

was given to you by your instructor.

###

© SAP SE Page 7B-5

WORKSHOP

Note Every time the curriculum material requests you to type in ###, please enter the three-digit

SAP number assigned to you for this class. As each student has his/her own set of data, this

number is used to distinguish between individual data sets. Please remember that all

participants are working in the same Zambikes company and if not setting their search criteria as

requested could see all master data (as in a real company). As for customer master records, if

you would like to see all 1 000 copies of each customer, you can leave the Search Term field

blank.

Then, click (Enter) or press Enter. This will produce the following screen.

Remember that the customer numbers could be different on your result

screen.

Choose Pick & Take by double-clicking it. The screen below will appear.

Pick & Take

© SAP SE Page 7B-6

WORKSHOP

To be able to view all customer master data (including Sales area relevant data), specify the sales area details as follows:

Sales Organization: Zambikes Sales Org.

Distribution Channel: Wholesale

Division: Bicycle.

Click (Enter) or press Enter to display the customer master record stored for Pick & Take. This will produce the following screen.

ZM00

Zambikes Sales Org

Wholesale

Bicycle

On this screen, you can see the general data of your Pick & Take customer. In

SAP, this means all information about this customer that is relevant to the

entire GBI concern (US, Germany and Zambia), such as global name and

address. You can click the other tabs to see other global data stored for Pick &

Take.

In order to display Zambikes specific data, click .

© SAP SE Page 7B-7

WORKSHOP

Note that the company code (ZM00) has been added to the screen. Data such as Reconciliation account or Sort key are company code-specific data and different values could be entered for other company codes, e.g. DE00 (Germany).

Answer questions for Exercise ZS 1.

After you are done, click (Exit) to return to the SAP Easy Access menu.

© SAP SE Page 7B-8

WORKSHOP

ZS 2: Create sales order

Time 20 min.

Exercise Use the SAP Easy Access menu to create a sales order.

Task Create a sales order for 10 Transport Zambikes to a popular local (Zambian) chain store Pick &

Take to start the sales order process.


inventory manager)

In order to create a sales order, follow the SAP Easy Access menu path:

Logistics ► Sales and Distribution ► Sales ► Order ► Create (VA01).

Menu path

VA01

Enter OR for Order Type (Standard Order), ZM00 for Sales Organization

(Zambikes), WH for Distribution Channel (Wholesale), and BI for Division

(Bicycles). Then click (Enter) or press Enter.

OR

ZM00 WH

BI

Order type OR is a standard sales order. Other order types can be

implemented, like cash sale, rush order, consignment sale, etc. The Sales

Organization, Distribution Channel and Division define the Sales Area, which

determines many of the terms of this sale, such as pricing.

Order type

Sales Area

© SAP SE Page 7B-9

WORKSHOP

First, enter the customer number for the Sold-to Party. In order to look up the

customer number again, use the F4 help to find customer Pick & Take.

Remember to put your SAP number (###) in the Search Term field. Also note

that your customer number will be different to the one displayed on the screen

below.

Sold-to party

###

Enter the PO number for this transaction. The PO number is supplied by the

customer and is the number the customer’s purchasing department uses to

track this transaction. When you save this sales order, the SAP system will

assign a sales order number to this transaction, which is the number you (the

supplier) will use to track this transaction. You enter the PO number supplied

by the customer in this Sales Order screen so that you can reference this

document by the customer’s PO number. Please enter your individual SAP

number (###).

PO number

###

Next, you need to enter the PO date. You can type in the date or you can use

the search capability to simplify this task. First click the PO Date field, then

press the F4 key. This will produce the pop-up calendar window which you can

use to choose any date. For this exercise choose today’s date as your PO date.

PO date

F4


WORKSHOP

Next, you need to set the customer’s required delivery date to three days in

the future. To do this, click the Req. deliv. date field, then press the F4 key.

This will again produce the calendar pop-up window. Double-click the date

three days in the future to choose it.

F4

Three days in the future

Now you need to specify that this customer wants to buy Transport Zambikes.

For the sales order form, you need the material number for this product, and

the search capability will allow us to find this number easily.

Click the first Material field, then press F4. The following screen will appear.

F4

Choose the Material by description tab to find a list of bikes you can sell. If you

can’t see the Material by description tab, Click (Search tabs) to get a list of

tabs (shown above), then choose Sales material by description. The following

screen will appear.


WORKSHOP

Enter ZM00 in the Sales Organization field and WH in the Distribution Channel

field. (The system may already have populated these fields.) As you want to

see only the sales goods for your SAP number, enter *### in the Material field.

So, if your SAP number is 005, enter *005. Please compare your screen to the

one shown above and note that your Material search/field criterion differs.

ZM00

WH

*###

Click (Enter) or press Enter. The system will produce a list of materials

ending with your number that Zambikes sells through Wholesale.

In the list, you can see that in addition to bicycles (finished goods) Zambikes

sells trading goods such as t-shirts or pads to its customers. For this task,

double-click the Transport Zambike to choose it. The material number for this

bike (ZMTP1###) is entered. Again, your material number will differ from the

one in the screen below.

ZMTP1###

Next, enter 10 in the Order Quantity text box, then click (Enter). This will

cause the SAP system to check the data you have entered and call up

additional data from the database. First, you will get an information message.

10

Click (Enter). You will get additional data on the Sales Order screen.


WORKSHOP

A significant amount of data retrieval and calculation has occurred:

Customer address data is now presented

The price for this order has been calculated

The total shipping weight has been calculated

The description of the bike is now presented

Click in the line with the Transport Zambike to highlight it. Then note several

icons below the All items list. Click (Item conditions) to display price and

other relevant conditions master data.

Pricing

This screen shows that each bike costs (Internal price) Zambian Kwacha (ZMW)

1 500 and no discounts or surcharges have been applied. Click (Back) to

return to the Sales Order screen. Click (Save) to save the sales order.

Note that SAP will assign a sales document number to this sales order

(bottom-left of the screen).

The Sales Order screen is again blank, ready for another sales order to be

entered.

Sales document number




WORKSHOP

ZS 3: Display sales order

Time 10 min.

Exercise Review the document flow.

Task There are many ways to access the document flow tool. One way is to start by displaying

the sales order document.


inventory manager)

SAP provides the Document Flow tool that tracks the entire sales transaction

process from beginning to end. The Document Flow tool is extremely

powerful because it can be used at any point in the sales order process. It

provides an audit trail of all of the documents within the order cycle. Further,

any of the referenced documents can be recalled and easily reviewed in detail

(drilling down) from the document flow.

Document flow

To display the sales order document, follow the menu path:

Logistics ► Sales and Distribution ► Sales ► Order ► Display (VA03).


Menu path

VA03

Your sales order number should be entered by default.

Note If you log off the SAP system after creating the sales order, the sales

order number will not be entered automatically. You can search for your sales

order number using the Sales documents by customer tab. Enter sales

organization ZM00 and the Purchase order number you had entered (###).

Sales document search

ZM00 ###


WORKSHOP

To access the document flow tool, click (Display document flow) or follow

the pull-down menu path:

Environment ► Display document flow.

Document flow

At the moment, the document flow for the Pick & Take sales order will look

like the image below. This shows that the sales order has been created and

nothing else (e.g. delivery, invoice generation, receipt of payment) has been

done on it.

To open the sales order, click the Standard Order line, and then click

(Display document). This should display the sales order created and saved in

ZS 2. Record the order number.

For each activity that follows, the document flow will be updated to include

the document generated by that activity.

Double click (Exit) to return to the SAP Easy Access menu.


WORKSHOP

ZS 4: Initiate delivery of goods

Time 15 min.

Exercise Use the SAP Easy Access menu to create a delivery note.

Task, Create a delivery document and

indicate the picking location and quantity in

order to begin processing the sales order.

Name (Position) Benjamin (Warehouse /

factory employee)

In order to create a delivery, follow the SAP Easy Access menu path:

Logistics ► Sales and Distribution ► Shipping and Transportation ► Outbound Delivery ► Create ► Single Document ► With Reference to Sales Order (VL01N).


Menu path

VL01N

Click in the Shipping Point field and press F4. A list of possible shipping points

will be shown. Choose the Zambikes shipping point in Lusaka (LU00). Enter a

selection date 3 days from today (use F4 to call up the calendar window). The

sales order number should be entered automatically. Click (Enter).

LU00

3 days from today

Note If you have logged off the SAP system after creating the sales order, the

sales order number will not be entered automatically. You can search for your

sales order number using the F4 help in the Order field. Use the Sales

documents by customer tab. Enter Sales Organization ZM00 and the purchase

order number you had entered (###).

Sales document search

F4

ZM00 ###


WORKSHOP

Notice that information from the sales order document has been copied into

the new delivery document. Note also that in creating the delivery document,

the SAP system performed a material availability check to make sure that

the material was available to meet the customer’s required delivery date.

The next step in the delivery process is to record the picking of the materials in the delivery document. Picking an order is the process of taking material from its storage location and moving it to a packing area. To record the picking of the material, you will make a change to the delivery document.

To enter the picked quantity, first click the Picking tab.

Before specifying the picking quantity, you will notice that in this case, the

storage location providing the picked materials is not automatically retrieved

by the system. Use the F4 key in the SLoc (Storage Location) field to find and

choose the Finished Goods storage (FG00). You can now enter 10 for the

picked quantity.

F4

FG00

10

Click (Save) to create this document and save the picking information. The

system will assign a unique number for this new delivery document. This

number will appear in a message in the lower-left corner of the screen.

Delivery document

number




WORKSHOP

ZS 5: Post goods issue

Time 5 min.

Exercise Use the SAP Easy Access menu to post a goods issue.

Task Post goods issue to complete the shipping

activities in the warehouse.

Name (Position) Benjamin (Warehouse / factory

employee)

Posting the goods issue reduces unrestricted stock (material available to sell to customers) to

reflect the inventory shipped – an inventory control function. In addition, legal ownership of the

goods changes hands from you to the customer as the goods leave the plant (FOB shipping

point) or when the goods are received by the customer (FOB destination).

From an accounting perspective, both inventory and costs of goods sold are impacted by this transaction. The system reflects that the materials are no longer available in stock regardless of the shipping terms.

Posting the goods issue is another change to the delivery document. To do

this, follow the menu path:

Logistics ► Sales and Distribution ► Shipping and Transportation ► Outbound Delivery ► Change ► Single Document (VL02N).


Menu path

VL02N

Confirm that the delivery document number is entered, then click

. You should get the following message in the bottom-left

corner of the screen.

Post goods issue

Open a new session and check the document flow of the order (Task ZS 3) to

see if it has been updated.




WORKSHOP

ZS 6: Create billing document for customer

Time 5 min.

Exercise Use the SAP Easy Access menu to create a billing document.

Task Invoice the customer for the bikes so that

payment can be received.


To do this, follow the menu path:

Logistics ► Sales and Distribution ► Billing ► Billing Document ► Process Billing Due List (VF04).


Menu path

VF04

In the Sales Organization field, specify Zambikes’ by entering (ZM00). In the

Sold-to Party field, enter your customer number (34###). (Remember to replace

### with your three-digit SAP number).

ZM00

34###

Note: Always remember to specify your customer (sold-to party) to avoid displaying and saving billing lists generated by other users.

Click (Execute). This will produce the following screen.


WORKSHOP

Make sure only one item is listed. Click . The system will

indicate that the invoice has been created by turning off the highlight on the

delivery line.

Open a new session and check the order’s document flow of the order (Task ZS

3) to see if it has been updated.


Double -click (Exit) to return to the SAP Easy Access menu.

ZS 7: Post customer payment

Time 10 min.

Exercise Use the SAP Easy Access menu to post a customer payment.

Task We assume that our customer, Pick & Take, has mailed us the payment for the bike order in

the form of a cheque. Before we deposit the customer’s cheque, we need to record the receipt

of this payment.

Name (Position) Viera (Finance

manager)

To do this, follow the menu path:

Accounting ► Financial Accounting ► Accounts Receivable ► Document Entry ► Incoming Payments (F-28).


Menu path

F-28


WORKSHOP

Use the F4 function key to enter today’s date in the Document Date field.

Then enter:

ZM00 for Company Code ZMW for Currency/Rate

100000 for Account (Bank data) 23000 for Amount.

Under Open item selection, click in the Account field and fill in your customer

number for Pick & Take (34###).

F4

ZM00 ZMW

100000 23000

34###

Customer search

After filling in all details (as displayed on the image above) click Process open

items in the top left corner. You will be directed to the following screen.

Open items

If the 23,000.00 amount is not displayed in blue, double-click it to assign the

payment to the accounts receivable. Confirm that the Not assigned field at the


WORKSHOP

bottom of the screen (see below) is balanced (0.00).

Note: Customers may have more than one invoice that must be paid, and may

send a cheque that will cover more than one invoice, so this screen facilitates

applying payments to more than one invoice.

Combined payments

After assigning the payment to the invoice (accounts receivable), click

(Save) to post the payment. You should get the following message at the

bottom-left corner of the screen.


Click (Exit). A pop-up box with the SAP warning message shown below will

appear.

You have posted the customer payment, so no data will be lost. Choose Yes to

return to the SAP Easy Access menu.


WORKSHOP

ZS 8: Display sales order

Time 10 min.

Exercise Review the document flow.

Task Display an existing sales order.


inventory manager)

To display the sales order document, follow the menu path:

Logistics ► Sales and Distribution ► Sales ► Order ► Display (VA03).

Menu path

VA03

Note: Your sales order number should have been entered by default.

Click (Display document flow) to open the document flow tool, or follow

the pull-down menu path: Environment ► Display document flow.

Document flow

The screen below shows what the document flow looks like once all activities

have been completed.

As mentioned on ZS 3, any document can be opened from the document flow.

For example, to look at the invoice, click the invoice line, and then click

(Display document). This should produce the following screen.


WORKSHOP

To access details of the invoice, follow the pull-down menu path:

Go to ► Header ► Header.


Note the details of the invoice, such as who created the invoice and when and

the customer’s PO number. Click (Exit) to return to the Document Flow

screen. Explore the document flow tool.


Double-click (Exit) to return to the SAP Easy Access screen.


WORKSHOP

ZS Exercise questions (Part I) [17]

QUESTIONS ZS 1: Display customer master record [1.5]

1. SAP categorises customer master data into three groups.

What are they? Give one example for each based on the Pick

& Take master data you just viewed.

QUESTIONS ZS 2: Create sales order [2]

1. To be able to create a sales order in the SAP system, one

needs to customise at least one Sales organization, one

distribution channel and one division. For this workshop you

have made use of Zambikes sales organization (ZM00),

Wholesale distribution channel (WH) and Bicycle division

(BI). Does Zambikes have any other sales organizations,

distribution channels, and divisions? What are they?

2. How much profit does Zambikes make from the sale of one

Transport Bike? What type of master data does selling price

fall under?

QUESTIONS ZS 4: Initiate delivery of goods [2]

1. When initiating delivery (creating outbound delivery), the

system asked you to specify the shipping point, selection

date as well as an order number. What does the selection

date refer to as far as SAP SD is concerned?

2. What is the difference between material availability date

and confirmed delivery date?

QUESTIONS ZS 5: Post goods issue [1.5]

1. Posting of goods issues has several implications in the

system. What are the implications (of posting goods issue)

to

a. Sales Order?

b. Stock?

c. GL Accounts?

QUESTIONS ZS 6: Create billing document for customer [1]

1. Generating/Saving a billing document (or invoice)

automatically creates debit and credit postings

simultaneously. Which account will be:


WORKSHOP

a. Debited?

b. Credited?

QUESTIONS ZS 7: Post customer payment [1]

1. Posting of incoming payment also creates debit and credit

postings simultaneously. Which account will be:

a. Debited?

b. Credited?

QUESTIONS ZS 8: Display sales order [8]

1. Provide document numbers for the following documents:

a. Sales Order

b. Outbound Delivery

c. Invoice/Billing

d. Payment


WORKSHOP

Exercise solutions (Part I)

QUESTIONS ZS 1: Display customer master record [1.5]

1. SAP categorises customer master data into three groups.

What are they? Give one example for each based on the

Pick & Take master data you just viewed.

General data e.g. Name

and street address

Company code data: e.g.:

Reconciliation account

(110000)

Sales area data e.g.

Currency (ZMW)

*0.5 marks for each answer

QUESTIONS ZS 2: Create Sales Order [2]

1. To be able to create a sales order in the SAP system, one

needs to customise at least one sales organization, one

distribution channel and one division. For this workshop you

have made use of Zambikes sales organization (ZM00),

Wholesale distribution channel (WH) and Bicycle division

(BI). Does Zambikes have any other sales organizations,

distribution channels, and divisions? What are they?

2. How much profit does Zambikes make from the selling of

one Transport Bike? What type of master data does price

fall under?

No other sales org., one

dist. channel (Internet), and

one division (Accessories).

*0.5 marks

800 ZMW, Conditions

*0.5 marks

QUESTIONS ZS 4: Initiate delivery of goods [2]

1. When initiating delivery (creating outbound delivery), the

system asked you to specify the shipping point, selection

date as well as an order number. What does the selection

date refer to as far as SAP SD is concerned?

2. What is the difference between material availability date

and confirmed delivery date?

Selection date is when

shipping processing begins.

It is either the ‘Material

availability date’ or the

‘Transportation Planning

date’, whichever is earlier.

The shipping process starts

on the ‘Selection date’ and

goods reach the customer

on the ‘Confirmed delivery

date’ *1 mark

Material Availability Date is

when materials/goods/

products should be

available and ready for

delivery. On this date, you


WORKSHOP

must be able to begin

picking, packing, labelling,

and loading the goods.

Delivery Date is when the

goods should arrive at the

customer’s address.

*0.5 marks each

QUESTIONS ZS 5: Post goods issue [1.5]

1. Posting of goods issues has several implications in the

system. What are the implications (of posting goods issue)

to:

a. Sales Order?

b. Stock?

c. GL Accounts?

Sales Order: Status is

updated and reflected on

the document flow.

Stock: Amount/Quantity

reduced by the delivered

quantity.

GL Accounts: Value

changes(based on cost of

sales) are reflected on the

balance sheet account.

*0.5 marks each

QUESTIONS ZS 6: Create billing document for customer [1]

1. Generating/Saving a billing document (or invoice)

automatically creates debit and credit postings

simultaneously. Which account will be:

a. Debited?

b. Credited?

Debited: Customer

Receivable Account

Credited: Revenue

*0.5 marks each

QUESTIONS ZS 7: Post customer payment [1]

1. Posting of incoming payment also creates debit and credit

postings simultaneously. Which account will be:

a. Debited?

b. Credited?

Debited: Zambikes

Cash/Bank account

Credited: Customer’s

receivable account

*0.5 marks each

QUESTIONS ZS 8: Display sales order [8]

1. Provide document numbers for the following documents:

a. Sales Order

b. Outbound Delivery

c. Invoice/Billing

d. Payment

2 marks for each document

reflected in the document

flow and successfully

processed.

Payment document can be

checked using FB03.


WORKSHOP

Part II: Sales reporting

SAP Business Intelligence provides a broad range of reporting tools to facilitate decision-making

for different end users. SAP Dashboards Reports and SAP Crystal Reports are two reporting

tools which are increasingly being used to generate various management as well as operational

reports from data generated by business processes/transactions.

SAP Crystal Reports makes it easy to create simple reports. However, it also has a

comprehensive set of tools needed to produce advanced or specialised reports. As part of Global

Bikes Group, Zambikes middle-level management now has access to Crystal Reports for

analysing operational activities to facilitate decision-making by middle management.

SAP Dashboard Reports is a tool for creating interactive reports that allow decision-makers to

quickly view key information that is core to strategic decision-making. They provide simple-to-

use interfaces which can be embedded in a number of applications, including web pages and

presentations.

ZS 9: Using Crystal Reports

Time: 10 min.

Operational Report 1

On the LMS, choose and open the ZS Sales Operational Report 1. (Ask your

tutor/lecturer for a link.)

The Sales Operational Report 1 (titled: Late Invoice Settlement Report) is an

exception report. This report can be generated on a daily basis for follow-up.

QUESTIONS ZS 9A [4]

1. Briefly describe what is displayed on the late invoice settlement report. Is

the report useful? Why? [2]


WORKSHOP

2. In your opinion, which departments can potentially make use of such a

report? For what purpose? [2]

Operational Report 2

On the LMS, choose and open the ZS Sales Operational Report 2. (Ask your

tutor/lecturer for a link.)

The ‘trading goods sales by year’ depicts the yearly revenue for different

categories of trading goods. This report can be used for semi-structured

decision-making. Familiarise yourself with the information displayed before

answering the questions below:

QUESTIONS ZS 9B [6]

1. Analyse and briefly discuss the sales trend of the different trading goods

as illustrated by the reports for 2012 and 2013. [1]

2. Based on this sales trend, forecast and justify the sales trend of the

different trading goods for 2014. Assume that the unit cost of trading

goods was 10% higher and the trend constant. [2]


WORKSHOP

3. Based on the trends, which trading goods should the organization invest

in? [1]

4. Which trading goods should the organization focus on, promote and

market more aggressively? Justify your answer. [2]


WORKSHOP

ZS 10: Using Dashboard Reports

Time: 20 min.

Zambikes currently uses a spread sheet to analyse their sales information. The managing

director has indicated to his team that while the report contains all the necessary information, it

is not easy to interpret and perhaps this information can be supplied in a more user-friendly

format to provide greater insight into their sales data to understand the trends and sales

performance. In response to these concerns, it was decided to build a reporting dashboard that

was interactive, easy-to-use and supplied the necessary information.

Zambikes has developed a sales dashboard to visualise sales data in a number of different ways. They want to be able to get a quick overview of the data and then be able to zoom and filter on particular aspects and then get further details as required. The specific information they are concerned with is:

Sales revenue for each product for each of their four different sales regions. (Revenue by region tab)

Sales net profit for each finished product (Bicycle Revenue).

On the LMS, download and save the Zambikes_sales 01.html and Zambikes

Sales 01.swf files to your local drive. (Ask your tutor/lecturer for a link.)

Zambikes Sales 01.html

Open the Zambikes Sales 01.html file and browse through the different

charts.

Familiarise yourself with the information displayed before answering the

questions below:

QUESTIONS ZS 10: [8] Use the Bicycle Revenue tab

1. What is the revenue generated from the sales of Transport Zambikes in

2013? [1]

2. In which month did sales reach its peak in 2013? [1]

3. Based on the profit trend for the previous years and the forecast profit

trend for 2014, forecast and justify the profit trend for 2015, assuming the

trend does not change. [2]


WORKSHOP

4. In terms of sales, besides Zambia, which other three African countries

generate the highest revenue? (Profit By Country map) [3]

5. Which country would you recommend Zambikes extend their marketing

efforts to, should they want to diversify sales of their finished products?

[1]


WORKSHOP

Exercise solutions (Part II)

QUESTIONS ZS 9A [4]

1. Briefly describe what is displayed on the late invoice settlement

report. Is the report useful? Why? [2]

2. In your opinion, which departments can potentially make use of

such a report? For what purpose? [2]

-Depicting a list of

customers who have not

yet made final payments

for specific orders . i.e late

payments

-Accounting and Finance –

profit shortcomings OR

Sales and Marketing –

follow up and track late

payments

QUESTIONS ZS 9B [6]

1. Analyse and briefly discuss the sales trend of the different

trading goods as illustrated by the report for 2012 and 2013?

[1]

2. Based on this sales trend, you are required to forecast and

justify the sales trend of the different trading goods for 2014?

Assuming that unit cost of trading goods were 10% higher and

the trend constant. [2]

3. Based on the trends, which trading goods should the

organization invest in? [1]

4. Which trading goods should the organization focus on, promote

and market more aggressively. Justify your answer. [2]

-Most trading good sales

level decreasing except for

Overall decrease in sales

-ZMW 3832758

-Water bottle – generating

profits

-Knee pads – generate

more revenue. More sales -

> more revenue

Any other answer that

makes sense

QUESTIONS ZS 10 [8]

1. What is the revenue generated from the sales of Transport

Zambikes in 2013? [1]

2. Which month did sales reach its peak in 2013? [1]

3. Based on the profit trend for the previous years and the

-ZMW 13,107,200

-July

-Profit Trend has been on a

steady increase from 2011,


WORKSHOP

forecast profit trend for 2014, forecast and justify the profit

trend for 2015, assuming the trend does not change. [2]

4. In terms of sales, besides Zambia which other 3 African

countries generate the highest revenue? (Profit By Country

map) [3]

5. Which country would you recommend Zambikes extend their

marketing efforts to, should they want to diversify sales of their

finished products? [1]

2012, 2013, through to

2014. It is therefore safe to

predict an increase in sales

for Zambikes assuming that

the trend does not change.

-Nigeria, Kenya, Namibia

-Extend its distribution

channel to Northern African

Market and extend the

Zambikes brand

© SAP SE Page 7C-1

DATA SHEET

Master data

Search term Customer (Pick & Take) ###

Material (Transport Zambike) ZMTP1###


Company Code (Zambikes) ZM00 Plant (Lusaka) LU00 Storage Location (Finished Goods and Semi-Finished Goods) FG00 & SF00 Sales Organization (Zambikes) ZM00 Distribution Channel (Wholesale) WH Division (Bicycles) BI

Employees involved Margret Mwaanga Admin & inventory manager Viera Funjika Finance manager Benjamin Banda Warehouse / factory employee

Transactions Create Sales Order VA01 Change Sales Order VA02 Display Sales Order VA03 Create Outbound Delivery with Order Reference VL01N Change Outbound Delivery VL02N Display Outbound Delivery VL03N Display Billing Document VF03 Maintain Billing Due List VF04 Post Incoming Payments F-28 Change Document FB02 Display Document FB03

Document Numbers Sales Order Number _______________________ Outbound Delivery Number _______________________ Payment Document Number _______________________

ZS Sales Order Processing Workshop I

Page 8A-1 © SAP SE

Page 8A-2 © SAP SE

Page 8A-3 © SAP SE

Page 8A-4 © SAP SE

Financial statements for companies include assets, liabilities and equity.

Inventory is recorded as an asset in financial statements.

The unit cost price for an inventory item includes all costs incurred to get the item ready for sale.

• The unit cost price is different to the sales price. The sales price should include a mark-up.

Inventory is often an organization’s greatest asset and therefore needs to be managed.

Insufficient inventory means lost sales and production delays.

There are more profitable ways to use cash than to tie it up in too much inventory or too many slow-moving items.

Incorrect inventory receipting and storage can lead to substantial losses.

Unmanaged inventory often means your financial statements are incorrect.

Page 8A-5 © SAP SE

Client

• A self-contained unit in a SAP system with its own set of tables.

Company code

• Smallest organizational unit for which financial statements need to be prepared.

Plant

• Within a company.

• Facility for manufacturing, distribution, storage, or rendering services.

Storage location

• Allows for differentiation between the various stocks of a material in a plant.

Shipping point

• Is the part of the company responsible for the type of shipping, the necessary shipping materials and the means of transport.

Page 8A-6 © SAP SE

The material master

• Contains all the information about a material that a company needs in order to manage it.

• It is used by most components within the SAP system.

Sales and Distribution

Materials Management

Production

Plant Maintenance

Accounting/Controlling

Quality Management

• Material master data is stored in functional segments called Views.

Page 8A-7 © SAP SE

For inventory management the material master contains the:

• The quantity of a material in every plant and storage location in the General Plant Data/Storage 1 screen.

• The item cost price (moving average price or standard price) of a material in the Accounting 1 screen for every plant.

Page 8A-8 © SAP SE

In the material master record, various stocks are managed at plant level and at storage-location level for both the current period and the previous period. The plant stocks (except for stock in transfer and stock in transit at plant level) are calculated as the total of all the storage location stocks. The following section describes the stock categories in the material master record.

Total valuated stock: Sum of all valuated inventory of a material. It consists of the valuated inventory your company owns. Materials that are not valuated would be non-stock materials and consignment materials.

Unrestricted-use stock: Company's own inventory that is physically located in a plant, valuated, and not subject to any kind of usage restrictions.

Quality inspection stock: Company's inventory that is in quality inspection. Inventory in quality inspection is valuated but does not count as unrestricted-use stock.

Blocked stock: Company's inventory that should not be used. It is not for unrestricted use in inventory management.

Stock in transfer: Quantity that was already withdrawn from stock at the issuing location (plant, storage location) during a two-step stock transfer but that has not yet arrived at the receiving location (plant, storage location). Stock in transfer is managed in the valuated stock of the receiving location, but it does not yet count as unrestricted-use stock. It can also not be inventoried.

Stock in transit: Stock in transfer that is created for a stock transfer via a stock transport order.

Page 8A-9 © SAP SE

The material master contains the valuation of a material and therefore it needs to be protected. There are built-in controls in ERP systems. For example, in SAP ERP:

• Master data changes can only be done by a few users. Other users are prevented by their authorisations.

• Master data can’t be deleted; can only be flagged for deletion (see Figure 1).

- Items flagged for deletion can be archived; only once archived can data be deleted.

• All master data changes are visible in change documents which detail exactly which changes were made (see Figure 2).

The screen shots in the example above have been taken from another SAP system. The material number was FLLIAN0023 and the user was INF011.

Page 8A-10 © SAP SE

Enterprise systems use the perpetual inventory system which keeps track of inventory real-time and is updated whenever inventory leaves or enters the organization’s control.

Inventory management risks can be substantial:

• Lost inventory refers to inventory that could be stolen or inventory that has been damaged due to improper storage.

Incorrect goods receipting can take many forms:

1. Not counting the quantity accepted. The number of items accepted is what needs to be paid for and this might be more than the actual number received or actually ordered.

2. Not checking the quality of items accepted. Once the items are accepted, if they are damaged, they still need to be paid for.

3. Accepting items that were not ordered. This can result in the costs of returning items.


For all goods movements, the system also creates a material document to show the transaction in the system.

• An accounting document is generated if the goods movement needs to update Financial Accounting (FI).


Most goods movements update financial accounting. These are reviewed in these slides. An important one which updates financial accounting is:

• Scrapping of stock (stock to stock movement)

Not all goods movements update financial accounting. For example the following don’t update FI:

1. Plant to plant movement (this is always within a company code)

2. Storage location to storage location movement (this is always within a plant)

3. Some stock to stock movements (for example unrestricted use to quality inspection stock)

4. Goods receipt for a transport order

5. Goods issue for a transport order within the same company code.


Material valuation

To valuate the materials various prices are stored in the material master record, such as:

• Future, current or previous standard prices.

• Moving price.

Valuation is preset as follows in the standard SAP ERP system:

• Moving price is used for materials procured externally.

• Standard price is used for in-house produced materials.

The moving price in SAP:

• Is the weighted average cost of an item of inventory.

• It is the total cost for all items / number of items.

• Needs to be recalculated for goods movements with vendors.



A stock transport order and its subsequent documents has several features and advantages over individual goods movements:

• Purchase requisitions can be converted into purchase orders or stock transport orders.

• The receipt can be planned at the receiving plant.

• You can enter delivery costs and a forwarder/carrier in the stock transport order.

• The goods receipt for the transport order can be posted to unrestricted-use stock, stock in quality inspection or to blocked stock.

• The entire process (goods issues and goods receipts) can be monitored via the PO history.


Some examples of goods movements in the diagram above:

1. Goods receipt from vendor

2. Goods receipt from production

3. Goods issue to customer

4. Goods issue to production

5. Company code to company code movement

6. Plant to plant movement (within a company code)

7. Storage location to storage location movement (within a plant)

8. Stock to stock movement (to change stock type, for example unrestricted-use to blocked stock)


At stocktake you count your physical inventory.

When you post the stock count, the system posts the inventory differences between stock counted (physical inventory) and the amount on the system (book inventory).

The material quantity is updated in the material master (via a material document).

The inventory G/L accounts are updated in financial accounting (via an accounting document).


Inventory (stock) counts are a control as they highlight inventory risks such as incorrect goods movements.

• For that reason the person performing and posting the stock counts needs to be different. This is a segregation of duty control.

• Differences posted need to be within tolerances set per user.

To further control goods movements:

• Once you post a goods movement you can’t delete the goods movement. To correct errors, you need to first cancel the incorrect document and then create a new document.


To manage inventory the following reports are important:

• Identifying low stock levels

• Identifying slow- or fast-moving stock

• Identifying lost stock

Document lists:

Material documents

Accounting documents for material documents

Cancelled material documents

Reason for movement

You can report on the total quantity or value of stock for different master data

E.g. stock types, material master records

You can report for all levels in the organizational hierarchy relevant to stock

E.g. Storage location, Plant, Company code, Client



© SAP SE

WORKSHOP

Product

SAP ERP

G.B.I

Release 6.07

Level

Undergraduate

Graduate

Beginner

Focus


Authors

Simha Magal

Stefan Weidner

Chris Bernhardt

Lisa Seymour

Version

3.1

MOTIVATION

Current trends such as higher

cost pressure, shorter cycles of

innovation, higher customer

expectations and globalisation

of markets make great

demands on companies, in

particular on inventory

management. Customers have

increasingly higher demands for

reliability, promptness and

flexibility of deliveries.


systems support the

management of inventory

levels in increasingly complex

supply chains.

PREREQUISITES

Before you use this workshop,

you should be familiar with

navigation, sales and purchasing

in the SAP system.

NOTES

This workshop uses the ESEFA

data set, which has been created

exclusively for the SAP UA African

curriculum.

ZI Inventory Management Integration Workshop This workshop includes exercises in entering stock counts and in an integrated inventory management process triggered by a stock transport order from a manufacturing facility to another managed storage location.

© SAP SE Page 8B-2

WORKSHOP

Inventory Management (ZI) Integration process overview

Time 60 min.

Learning objective Understand and perform an inventory process.

Scenario Inventory management is an important business function. An equilibrium is needed

between insufficient and surplus raw materials and finished goods. The inventory management

functions of the new system for Zambikes needs to be tested.

Process description Zambikes needs to ensure that inventory amounts are correct and that

there is sufficient inventory in the main distribution center in Lusaka. To do this they need to

ensure that the stock values at the manufacturing plant in Mungwi are correct and they need to

request goods from Mungwi to Lusaka via a stock transport order.


Assessment Throughout the workshop you need to enter answers to questions in the Exercises.

ZI 1: Display stock

Time 5 min.

Task View the amount and value of your

material inventory (stock).

Short description Viera needs to report on the

total value of material inventory for Zambikes.

© SAP SE Page 8B-3

WORKSHOP

To display the material inventory value, follow the menu path:

Logistics ► Materials Management ► Inventory Management ► Environment ►

Stock ► Warehouse Stock (MB52.)

MB52

In the Display Warehouse Stocks of Material screen, enter ZMTP1### as Material

(replace ### with your 3-digit SAP number). Ensure that all other search criteria fields

are blank and click (Execute).

ZMTP1###

Execute

The screen as above will be shown but with different values.

Answer questions for Exercise ZI 1.

Click (Exit) to return to the initial screen.

Keep this session open and click (Creates new session) to open another session for

the next exercises.

Exit

Open

session

ZI 2: Post stock count

Time 5 min.

Task Update the stock or inventory of your

finished goods.

Short description Viera is concerned that the

stock is incorrect. Margret is also expecting a

large order for transport bikes and wants to

ensure that the transport bike stock levels are correct. She requests that the production plant in

Mungwi does an accurate stock count and updates stock quantities accordingly. Wyson therefore

does a stock take of transport bikes at Mungwi and posts the correct stock count (120 bikes).

© SAP SE Page 8B-4

WORKSHOP

To enter the material inventory, follow the menu path:

Logistics ► Materials Management ► Physical Inventory ► Difference ► Enter w/o

Document Reference (MI10).

MI10

In the Post Document, Count and Difference screen, enter MU00 as the Plant and

FG00 as Storage Location. Click (Enter) or press Enter.

MU00

FG00

Enter ZMTP1### as Material (replace ### with your 3-digit SAP number), enter 120 as

the Quantity, and 1 as Stock Type (STy). Click (Save) to save your order.

You should receive an information message in the status bar. Double-click the

message to read it.

ZMTP1###

120

1

Save



Exit

ZI 3: Display stock (after stock update)

Time 5 min.

Task View the value of your material inventory

(stock).

Short description Margret needs to report on the

changed total value of material inventory (stock) for

© SAP SE Page 8B-5

WORKSHOP

Zambikes.

To display the material inventory value, change (toggle) to your session that has

transaction MB52 open.

MB52

In the Display Warehouse Stocks of Material screen, enter ZMTP1### as Material

(replace ### with your 3-digit SAP number). Ensure that all other search criteria

fields are blank and click (Execute).

ZMTP1###

Execute


Click (Exit) once to return to the initial screen. Keep this session open and change

back to your other session for further exercises.

Exit

Change

session

ZI 4: Create stock transport order

Time 10 min.

Task Create a stock transport order.

Short description Margret wants to ensure that there

is sufficient transport bike stock in Lusaka. She creates

a stock transport order to request material to be

transported from Mungwi to Lusaka.

To create a stock transport order, follow the menu path:

Logistics ► Materials Management ► Purchasing ► Purchase Order ► Create ►

Vendor / Supplying Plant Known (ME21N).

ME21N

In the Create Purchase Order screen, change the order from standard PO to Stock

Transp. Order and accept any warning messages by pressing Enter. Fill in MU00 as the

Supplying Plant.

Stock

Transp.

Order

MU00

Click (Expand items) to expand the Item Overview. Enter ZMTP1### as Material

(replace ### with your 3-digit SAP number), 10 as PO Quantity, 2 days from today as

ZMTP1###

10

2 days from

today

© SAP SE Page 8B-6

WORKSHOP

Delivery Date, LU00 as Plant and FG00 as Storage Location. Confirm your entries by

clicking (Enter) or pressing Enter.

LU00

FG00

Compare your entries with the screenshot above. Then, click (Save) to save your

order. You may receive a warning message which you can ignore by pressing Enter.

The system will assign a unique stock transport order document number.

Save

Stock

transport

order

number



Exit

ZI 5: Issue goods

Time 5 min.

Task Create a goods issue from the issuing plant.

Short description Benjamin records all stock that

leaves the Mungwi plant. In this example he is

transporting the requested transport bikes to Lusaka.

To create a goods issue, follow the menu path:

Logistics ► Materials Management ► Inventory Management ► Goods Movement

► Goods Movement (MIGO).

MIGO

In the screen, change the Material Document drop down to Goods Issue and adjust

the type of Goods Issue to a Purchase Order.

Goods

Issue

Purchase

Order

Input your Stock Transport Order Number in the blank space next to it. Stock

transport

order no.

© SAP SE Page 8B-7

WORKSHOP

If you have not written down the TO (Transport Order) number you created in the

second task, use the F4 help in the TO Number field (first blank field next to the

second drop-down field). In the following screen choose the Purchasing Documents

for Material search tab by clicking (Change search). Then, enter ZMTP1### as

Material and press Enter.

Now double click your entry.

After you have filled in your transport order number click (Enter) or press Enter.

When your order comes up click (Open detail data) to expand the Detail Data.

Choose the Where tab and check Item OK and enter Finished Goods as Storage

Location by using the F4 help. Confirm your entries by clicking (Enter) or pressing

Enter.

Finished

Goods

Then, click (Save) to save your goods issue. The system will assign a unique

material document number.

Save



Exit

© SAP SE Page 8B-8

WORKSHOP

ZI 6: Display stock (in transit)

Time 5 min.

Task View the value of your material inventory again.

Short description Margret would like to view the

material inventory again to ensure that the stock is on

its way and that the system is reflecting stock

correctly.

To display the material inventory value, toggle to your session with transaction

MB52.

Change

session

In the Display Warehouse Stocks of Material screen, enter ZMTP1### as Material.

Ensure that all other search criteria fields are blank and click (Execute).

ZMTP1###

Answer question for Exercise ZI 6.

Click (Exit) to return to the initial screen.

Keep this session open and change back to your other session for further exercises.

Exit

Change

session

© SAP SE Page 8B-9

WORKSHOP

ZI 7: Receipt goods

Time 5 min.

Task Receive goods at receiving plant.

Short description Margret records

the inventory arriving in Lusaka by

creating a goods receipt.

To create a goods receipt, follow the menu path:

Logistics ► Materials Management ► Inventory Management ► Goods Movement

► Goods Movement (MIGO).

MIGO

In the screen, change the Material Document drop down to Goods Receipt, adjust the

type of Goods Receipt to a Purchase Order, and input your Stock Transport Order

Number in the blank space next to it. If you have not recorded the TO number, use

the F4 help, as explained in the issue goods task. Then, click (Enter) or press Enter.

Goods

Receipt

Purchase

Order

Stock

Transport

Order

Number

When your order comes up choose the Where tab and check Item OK and enter

Finished Goods as Storage Location by using the F4 help. Confirm your entries by

clicking (Enter) or pressing Enter.

Item OK

FG00

Then, click (Save) to save your receipt. The system will assign a unique material

document number.

Save


Exit

ZI 8: Display stock (after receipt)

Time 5 min.

Task View the value of your material

inventory again.

Short description Margret wants to

display the value of the material

inventory again to ensure that the

new system works correctly.

To display the material inventory value, change to your session with transaction

Change

session


WORKSHOP

MB52. MB52

Enter ZMTP1###. Ensure that all other search criteria fields are clear and click

(Execute).

ZMTP1###


Click (Exit) twice to return to the SAP Easy Access screen.

Exit

ZI 9: Display stock transport order

Time 10 min.

Task Display a stock transport order.

Short description Margret wants to

ensure that both goods movements

are shown on the stock transport

order.

To display a stock transport order, follow the menu path:

Logistics ► Materials Management ► Purchasing ► Purchase Order ► Display

(ME23N).

ME23N

In the Display Purchase Order screen, click

(Other purchase order) and enter your Stock

Transp. Order

Stock

Transp.

Order

Under Item, choose the Purchase Order History tab. The Goods receipt and Goods

issue should be listed as shown. Double click each document to display it.

Purchase

Order

History


WORKSHOP

Answer question for Exercise ZI 9.

Click (Exit) to return to the SAP Easy Access menu and log off.

Exit

Logoff


WORKSHOP

ZI Exercise questions [25]

Unless otherwise stated, each question is worth one

mark.

QUESTIONS ZI 1: Display stock [3]

1. How many of your transport bikes are there in the two

Zambian plants?

2. What is the total value of your transport bikes?

3. There are columns in this report other than unrestricted

stock. Explain what blocked stock is (you can search on the

internet) and why Zambikes might use it.

QUESTIONS ZI 2: Post stock count [6]

1. What is your physical inventory document number? [4

marks for correct quantity; plant; material and storage

location]

2. How many transport bikes do you now have in the two

Zambian plants?

3. The message states that the stock count document

updated the book inventory balance. What is book

inventory and how is this different to actual inventory?

QUESTIONS ZI 3: Display stock (after stock update) [2]

1. What is the total value now for your transport bikes in all

Zambian plants?

2. What is the difference in value from before and why?

QUESTIONS ZI 4: Create stock transport order [8]

1. What is your stock transport order number? [6 marks for a

correct document and all subsequent material documents]

2. Reflect back on when you created a purchase order in a

previous workshop. What are the main differences

between a purchase order and a stock transport order?

3. Do you think that a stock transport order updates stock

quantities and why?

QUESTIONS ZI 5: Issue goods [2]

1. Think back to your sales workshop. How does a goods issue

to a customer impact on stock quantities?

2. What do you think is the impact on stock quantities for this


WORKSHOP

goods issue for a transport order?

QUESTIONS ZI 6: Display stock (in transit) [1]

1. Is inventory in transit shown under the receiving plant or

the issuing plant?

QUESTIONS ZI 8: Display stock (after receipt) [2]

1. What impact did the goods receipt have on stock

quantities?

2. How is this different to a goods receipt for a purchase

order?

QUESTIONS ZI 9: Display stock transport order [1]

1. Reflect back to your purchasing workshop. What two

documents are displayed on the Purchase Order History tab

for a purchase order to a vendor that has been paid?


WORKSHOP

ZI Exercise solutions

Unless otherwise stated, each question is worth one

mark.

QUESTIONS ZI 1: Display stock [3]

1. How many of your transport bikes are there in the two

Zambian plants?

2. What is the total value of your transport bikes?

3. There are columns in this report other than unrestricted

stock. Explain what blocked stock is (you can search on the

internet) and why Zambikes might use it.

100 in Mungwi and 30 in

Lusaka.

ZMW 195 000

Blocked stock is stock that

can’t be sold. Zambikes

might use this for stock

that did not meet their

quality standards.

QUESTIONS ZI 2: Post stock count [6]

1. What is your physical inventory document number? [4

marks for correct quantity; plant; material and storage

location]

2. How many transport bikes do you now have in the two

Zambian plants?

3. The message states that the stock count document

updated the book inventory balance. What is book

inventory and how is this different to actual inventory?

Mark using MI22.

(an extra 20)

Book inventory is the

amount of inventory or

stock in your official

records. Actual inventory is

the amount of inventory or

stock actually in your

storerooms.

QUESTIONS ZI 3: Display stock (after stock update) [2]

1. What is the total value now for your transport bikes in all

Zambian plants?

2. What is the difference in value from before and why?

ZMW 225 000.

Difference of ZMW 30 000

because of the extra 20

bikes.

QUESTIONS ZI 4: Create stock transport order [8]

1. What is your stock transport order number? [6 marks for a

correct document and all subsequent material documents]

2. Reflect back on when you created a purchase order in a

previous workshop. What are the main differences

between a purchase order and a stock transport order?

3. Do you think that a stock transport order updates stock

quantities and why?

Mark using ME2N.

A purchase order is

requesting materials from a

vendor/supplier while a

transport order is

requesting materials from a

plant.

No, as stock has not

actually moved or changed.

QUESTIONS ZI 5: Issue goods [2] A goods issue to a customer


WORKSHOP

1. Think back to your sales workshop. How does a goods issue

to a customer impact on stock quantities?

2. What do you think is the impact on stock quantities for this

goods issue for a transport order?

decreases stock because

stock leaves the

organization.

This goods issue transfers

stock within the company

from one plant to another.

QUESTIONS ZI 6: Display stock (in transit) [1]

1. Is inventory in transit shown under the receiving plant or

the issuing plant?

The receiving plant.

QUESTIONS ZI 8: Display stock (after receipt) [2]

1. What impact did the goods receipt have on stock

quantities?

2. How is this different to a goods receipt for a purchase

order?

Stock changed from in

transit to unrestricted-use

within the same plant

A goods receipt for a

purchase order will

increase stock within a

company and plant.

QUESTIONS ZI 9: Display stock transport order [1]

1. Reflect back to your purchasing workshop. What two

documents are displayed on the Purchase Order History tab

for a purchase order to a vendor that has been paid?

Goods receipts and

invoices.

© SAP SE Page 8C

DATA SHEET

Master data

Material (Transport Bike) ZMTP1###


Company Code (Zambikes) ZM00 Plant (Mungwi) MU00 Plant (Lusaka) LU00 Storage Location FG00 Purchasing Organization ZM00 Purchasing Group Z00

Employees involved Margret Mwaanga Admin & inventory manager Viera Funjika Finance manager Benjamin Banda Warehouse / factory employee Wyson Nkwazi Production supervisor

Transactions

Display Warehouse Stocks of Material MB52 Post Stock Count Display Physical Inventory Documents for Material

MI10 MI22

Create Stock Transport Order ME21N Issue Goods MIGO Receipt Goods MIGO Display Stock Transport Order ME23N

Document numbers

Differences for Physical Inventory Document Number _______________________ Stock Transport Order Document Number _______________________ Goods Issue Document Number ___________ ___________ Goods Receipt Document Number ___________ ___________

ZI Inventory Management Integration Workshop

© SAP SE

EXAM GUIDELINES

Product

Exam Guidelines

Level

All

Focus

Exam format Sample questions Exam policies & procedures Authors

Gwamaka Mwalemba Karin Reissenauer Anjali Ramburn Lisa Seymour

Version

3.1

MOTIVATION

This document outlines the exam format, sample questions as well as exam policies and procedures. It is each student’s responsibility to ensure that they are familiar with the content of this document and that they comply with all policies and procedures. ESEFA reserves the right to make changes at any time.

PREREQUISITES

ESEFA Terms and Conditions for Students

NOTES

This document has been created for the SAP UA African curriculum.

Exam Guidelines

This document outlines the exam format, sample questions as well as

exam policies and procedures.

© SAP SE Page 9A-2

EXAM GUIDELINES

EXAM FORMAT

Exam duration 2 hours

Number of questions 40

Question format MCQs

Pass mark 51%

COMPETENCY AREAS

Section/Competency area Percentage Number of questions

Enterprise Systems 25 10

Procurement 30 12

Sales 30 12

Inventory Management 15 6

TOTAL 100 40

© SAP SE Page 9A-3

EXAM GUIDELINES

SAMPLE QUESTIONS

Competency area: Enterprise Systems

1. Which of the following extra modules or functions are added into second generation ERP

or ERP II products? There are two (2) correct answers.

a. MRP

b. CRM

c. SCM

d. SOA

2. Which of the following extra modules or functions are added into ERP III or third

generation ERP products? Choose the correct answer.

a. Social media

b. PLM

c. SaaS

d. MRP

3. Benefits realisation needs to be managed as part of which application management

process phase? Choose the correct answer.

a. Customizing

b. Business case development

c. Design

d. Optimize

4. Which of the following software costs can be incurred in Enterprise Systems projects?

There are two (2) correct answers.

a. Database management systems

b. Ongoing maintenance charges

c. Servers

d. Project management

Competency area: Procurement

1. In SAP ERP, warehouse personnel are entering a goods receipt referencing a purchase

order for stock material. What organizational levels in SAP ERP are required to

successfully post the goods receipt? There are three (3) correct answers.

a. Plant

b. Business area

c. Controlling area

d. Storage location

e. Company code

© SAP SE Page 9A-4

EXAM GUIDELINES

2. Logistic invoice verification, in SAP ERP, is the process whereby a vendor's invoice is

compared to the goods receipt document and the purchase order. What business

integration processes, within SAP ERP, occur with the completion of logistic invoice

verification? There are three (3) correct answers.

a. The vendor master record is updated

b. The provisions in the GR/IR clearing account are reversed

c. The on-hand quantity in the material master is updated

d. The purchase order history is updated

e. An open item is created in the vendor's account

3. You are explaining how the procurement cycle in SAP ERP integrates with SAP Financial

Accounting to a colleague. Which procurement cycle business transaction in SAP ERP

creates a financial accounting document? There are three (3) correct answers.

a. Create a vendor master record

b. Post a goods receipt with change in material valuation

c. Create vendor payment

d. Create a purchase requisition

e. Enter an invoice receipt

4. The SAP ERP system contains many organizational levels, which are responsible for particular

functional areas. Which of the following organizational units are relevant only for the Procure-to-

Pay business process? There are two (2) correct answers.

a. Purchasing organization

b. Storage location

c. Company code

d. Plant

e. Purchasing group

5. The purchasing view of the material master is relevant at what organizational level?

a. Company code

b. Client

c. Storage location

d. Plant

e. Purchasing group

© SAP SE Page 9A-5

EXAM GUIDELINES

Competency area: Sales

1. The following organizational data are required when creating a sales order, EXCEPT:

a. Division

b. Sales organization

c. Distribution channel

d. Customer number

e. Company code

2. A sales area is an important organizational unit in SAP ERP and especially in the

SAP SD application. Which of the following statements are true regarding sales areas?


a. A sales area is a unique combination of sales organization, distribution channel and

division

b. A sales area is a unique combination of sales organization, distribution channel and

shipping point

c. A sales area is a combination of shipping point, distribution channel and division

d. A sales area is assigned to exactly one company code

e. A sales area is assigned to exactly one plant

3. Which of the following is not part of condition master data? There is one (1) correct

answer.

a. Prices

b. Discounts

c. Freights

d. Terms of payment

e. Taxes

4. What are the effects of goods issue? There are three (3) correct answers.

a. Material master data updated

b. Document flow updated

c. Stock value reduced

d. Revenue is increased

e. Customer master data is updated

5. For a Sales Order Process as implemented in SAP ERP, when a billing document is created

what integration points occur? There are three (3) correct answers.

a. The customer's credit account is updated

b. On hand inventory is decreased

c. Actual demand is reduced

d. An open item is posted on the customer's account

e. Revenue is increased

© SAP SE Page 9A-6

EXAM GUIDELINES

Competency area: Inventory Management

1. Which of the following organizational data elements are used in inventory reports? There

are two (2) correct answers.

a. Material

b. Purchasing organization

c. Storage location

d. Plant

2. Which of the following transactions can increase the value of inventory in a company?


a. Purchase order

b. Goods issue

c. Goods receipt

d. Post stock count

3. Which of the following goods movements can have an impact on financial accounting?


a. From unrestricted use to stock in quality inspection

b. Goods receipt for a transport order

c. Plant to plant movement

d. Goods issue to production

e. Material to material (stock to stock) movement

EXAMINATION POLICY AND PROCEDURES

Listed below are key exam policies and procedures to be aware of. ESEFA reserves the right to

make changes at any time. It is each student’s responsibility to ensure that they comply with all

policies and procedures.

Examination information

Full participation in the course is required as entry requirement to write the examination.

A formal form of identification (with your photo on it) has to be shown to the test centre

personnel.

The candidate must arrive at the testing centre at least 15 minutes prior to the scheduled

test appointment. If the candidate arrives more than 15 minutes late, it is at the

discretion of the testing centre personnel whether the candidate can be seated without

disrupting the examination in progress.

The candidate is not permitted to bring papers, books, bags, computers, cell phones,

personal organizers, cameras or calculators into the testing room. Scratch paper will be

© SAP SE Page 9A-7

EXAM GUIDELINES

provided by testing centre personnel for use while testing. All scratch paper is collected

and destroyed by testing centre personnel at the end of the examination.

The candidate must complete the examination alone and independently. No extra help of

any kind is allowed.

The examination is timed and cannot be interrupted or extended.

Candidates must follow the proctor's instructions.

The examination questions and tasks are protected by copyright and must not be written

down, copied, photographed or otherwise reproduced in whole or in part, nor made

available to others in any form.

If a candidate disturbs the examination or breaks any examination rule, that candidate

will be excluded from the examination immediately.

Assessment and results

The examination consists of 40 multiple choice questions (MCQs) and is marked

automatically in accordance with general rules defined by ESEFA.

Some MCQ questions will require multiple correct answers. For such questions you will

need to select all of the correct answers in order to receive full credit. You will be given

partial credit for selecting a correct answer and will be penalised for selecting an incorrect

answer. For instance, question X is worth 1 point and has options A, B, C, D, E where A and

B are correct choices. Each correct answer has a point value equal to the question point

value divided by the number of correct answers. Thus, a student will get 0.5 points for

selecting A or B. They will be penalised 0.5 points for selecting C, D or E. Note: Even

though a question could have a negative point value based on the grading logic (as in this

example), the actual lowest possible total point value for a multiple correct, multiple

selection question cannot be less than zero.

Candidates are informed of their result by receiving a score report at the end of the

examination.

Upon passing the examination participants will receive a SAP UA Certificate of Proficiency

in ES Fundamentals. Participants who do not write or do not pass the examination will

receive a SAP UA Certificate of Attendance for full participation in the course.

SAP UA will hold the results of the examination in a database in order to be able to

ascertain, if necessary, what qualification a candidate holds.

Retake policy

If a participant fails the examination, the examination may be repeated once. A second

failure of the examination will require re-enrolment in the course in order to qualify to sit

the examination again.