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SRM 7.0 in the Business Suite

SRM 7.0 in the SAP Business Suite

SRM 7.0 is scheduled to be released in Q4 as part of the SAP Business Suite release. The Procurement vision remains the same – to be an integrated sourcing and procurement platform that supports purchasing as a strategic value contributor to the business – but the delivery model will change with the Business Suite release. The Business Suite will draw on the core strengths of SAP Supplier Relationship Management (SRM) and ERP Materials Management (MM) to deliver the Procurement vision.

Procurement Platform – Stable Core

SRM 7.0 will deliver a stable core (software architecture and ESOA services) on which customers can extend the functionality. SAP will provide additional Procurement functionality to the core through optional enhancement packs, which will provide customers with the latest technology and business processes without a costly upgrade. In other words, there are no foreseeable plans for SRM 8.0, but there is a long-term roadmap that delivers new procurement features and functions through a series of enhancement packs.

 

Business Suite 

If we take a look at traditional software delivery, an upgrade requires an “all or none” deployment and thorough testing. By contrast, in the enhancement pack model, customers can pick and choose the functionality they want to deploy using a switch framework to “flip the switch” on the functionality they want to deploy. Thus, customers can target the functionality that provides the greatest benefit to their business. In addition, the enhancement packs are lightweight and isolated testing reduces the testing effort for customers.

From a development perspective, the Business Suite concept enables Procurement to leverage functionality that is in the suite. For Procurement, the main contributors will be SRM and MM. MM has a long successful history in tactical processes, including subcontracting, complex services, material planning, and industry-specific processes to name just a few. SRM, on the other hand, has delivered simplified user interfaces, supplier collaboration, centralized purchasing, and strategic purchasing functionality, such as sourcing, contract management, supplier management, and spend analytics. Future development will leverage SRM’s and MM’s core capabilities to deliver complete and integrated Procurement scenarios to customers. Accordingly, the Business Suite, with the inherent enhancement pack approach, will enable SAP to bring innovative Procurement features and functions to market more quickly.

New in SRM 7.0

The following are some key developments in the first SRM 7.0 release that demonstrate the Business Suite concept. This is not an exhaustive list of new functionality (more to come in future blogs).

ERP and SRM Harmonization

The challenge in coupling processes from two different applications, SRM and MM, is an inconsistent user interface depending on the application serving the process step. To address that challenge, the applications now follow a consistent and streamlined floor plan that achieves a consistent look and feel throughout the process. We worked with our customers’ end users to develop these floor plans for objects, quick activities, and guided procedures and further tested the user interfaces with our customer influence groups. The new user interfaces streamline user interaction with the system by mitigating the number of clicks and reducing scrolling.

 

Harmonized UI 

Not only did we achieve a consistent look and feel across procurement processes, but also we consolidated business objects to a single screen to streamline processes for the purchasing role. Purchasers can now search and access all their business documents, such as ERP and SRM purchase orders, on a single, customizable power list called a Personal Objects Work List (POWL). On the POWL, users can define their workspace by assigning documents, and creating various queries and views. As proof to the power of the POWL, 8 steps of a 12-step use case to create a purchase order can be performed on the single POWL screen.

 

POWL 

Service Procurement

The Service Procurement development in SRM 7.0 is a prime example of how SRM and MM can come together in the Business Suite to enable a process. In SRM 7.0, the focus for Service Procurement development is complex services procurement – more specific, planned maintenance and construction scenarios. The specification for these complex services is often captured in a service hierarchy. The Services module within MM (MM-SRV) does a very good job of enabling a requisition-to-invoice process for these complex services. Moreover, SRM 7.0 brings sourcing and supplier collaboration capabilities to the process, as well as a catalog repository for the hierarchical service specifications. Thus, as the picture shows, SRM enhances the MM-SRV process as bidders will be able to bid on the detailed service specifications, and winning suppliers will be able to create service entry for the detailed specifications in Supplier Self Services (SUS) (among other functions).

 

Service Procurement 

Central Contract Management

SRM 7.0 will also deliver a central contract repository for procurement contracts. The central contract repository will leverage the SRM contract capabilities, such as hierarchies, discounts, and versioning, and make contracts available as a source of supply in SRM and ERP. All information related to the contract, such as contract call-offs and recognition of rebates/discounts, can be accessed centrally in the central contract repository. It is worth noting that this is not the same as Contract Lifecycle Management, which provides the legal contract authoring functionality and central contract repository for all contracts. Central Contract Management in SRM 7.0 refers to the outline agreement that is used to achieve compliance in the operational procurement process.

Sourcing Enhancements

As mentioned above, one of SRM’s core contributions to the Business Suite is Sourcing, which has been developed in SRM for some time. Accordingly, purchasers can leverage that development from ERP. Purchasers can start a RFx process in SRM directly out of ERP, either through the Sourcing Cockpit or by directly creating a bid invitation. All related information to that request, such as status, can be accessed in ERP. Stay Tuned

There are a number of topics I did not cover in this blog, such as Spend Analytics, ESourcing, Contract Lifecycle Management, deployment, technology, and a significant number of new Procurement core features. Stay tuned because we will cover some of the additional functionality in future blogs. Further information will also be available in the SAP Service Marketplace (http://service.sap.com/srm), such as Delta, Overview (Level 1), Feature/Function (Level 2), and installation/configuration presentations.

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  • Hello,
    Thanks for the latest update on SRM7.0
    Would like to know about the Predelivered Integration Content for XI/PI wrt latest SRM 7.0? SAP recommends to go with PI for SRM & ECC integration as same as SRM5.0 or is there any change?

    Also would like to know the seamless integration of ECC, eSourcing ? What are the recommendations for this ??

    Thanks in advance
    Krishna Moorthy

      • Hi Mike,

        What is the combination of SRM 7 PPS + Document Builder and eSourcing / CLM? Is it suggestble?

        Why two solutions for the same Business scenario - more of confusion.

        How do you judge CLM Fitment with SRM 7 PPS?

        Is it suggestble to have CLM for Strategic contracts side,

        SRM 7 PPS for more of operational contract side...

        Please throw some light on this topic - Lot of confusion when CLM also promoting by SAP ... 🙁

        Thank you,
        Sai

        • Typically Document Builder and CLM (Contract Lifecycle Management) are not deployed together.  Document Builder is an on-premise (behind the firewall) application for developing contracts for the PPS (Procurement for Public Sector) deployment.  CLM is an on-demand contract authoring tool for customers who want to deploy a subscription-based or hosted deployment.  Two solutions exist to meet these two different deployments, on-premise vs on-demand.  

          SRM 7.0 PPS contracts are outline agreements that are used for contract compliance in operational procurement processes.  By contrast CLM and Document Builder serve to create the entire legal contract with all the terms and conditions (not just the operational terms and conditions).  CLM or Document Builder would be a front end to the SRM 7.0 contract where terms and conditions would be fed to the outline agreement for contract compliance in operational procurement.

          SAP promotes 2 products because SAP serves many different customer needs: public sector, on-demand, and on-premise customers. 

          • Thank you so much for the information.

            If client implmented SRM 7 PPS ( as of now with out document Builder Functionality), if the requirement arises for to contract creation through legal clauses, not just commercial conditions.

            on-premise solution needed - not hosted one!

            what can be the best solution?

            is that Document Builder 3.0 as its licence included in SRM 7 PPS Package

            or

            CLM eSOurcing - which need separate hardware, software and licensing part etc.,

            At these conditions, which product would be given more importance in view of SAP???

            Is that SAP SRM 7 PPS or eSourcing /CLM?

            oTher way for an existing SAP SRM 7 Customer - Is SAP Promoting Both ( SRM 7 PPS + DB + Records management or eSourcing/CLM) the products with equal oppurtunity???

            Thanks a lot for the respones...
            SRP

          • If the requirement is an on-premise solution with PPS, then I would propose Doc Builder.  It's not which product is given more importance by SAP, but what product meets the customer's requirements. 
          • Thank you so much, may be DB+Records management would be the right approach as both solutions addressing the requirement similar fashion.

            Both have Pros and cons...

            Great help!

            SRP

  • Hello,
    Thanks for the latest update on SRM7.0

    What are the functionalities available as part of CLM. Can the contract documents related to Bidding and Contract be reviewed by many users using work flow.

    What are the contract execution side functionalities, does it support Contract Close Out Process

    • Just to clarify, the central contract that I discussed is a procurement contract our outline agreement.  The central contract contains the terms and conditions to control operational procurement, such as price conditions, supplier, payment terms, authorizations, etc. 

      By contrast, CLM or Contract Lifecycle Management, is a complementary application that manages the lifecycle of a contract and contains all the contract clauses, including the structured terms that are passed to the outline agreement.  We will have a future blog from our  CLM solution manager to explain contract lifecycle management and how it relates to central contract management in SRM 7.0. 

      Like the SRM contracts of earlier releases, the central contract can be created from Bidding and contains workflow and authorizations to manage the contract creation, editing, and renewal processes. 

      Thanks,
      Mike

  • Hi,
      I had heard earlier that the Public sector(PS) functionality is going to be merged in SRM 7.0 ? Is that a correct assumption? Also can you list the features that are being provided in PS implementation.
     
    Thanks
    • Procurement for Public Sector (PPS) is a SRM add-on.  Customers that want the Public Sector functionality will turn on that functionality in the configuration. 

      The next PPS release will provide significant procurement functionality for the acquisition and management of complex services and supplies - in an integrated ERP environment. 

      Overview of planned functionality:
      -     Complex Pricing Structures
      -     Hierarchical Line items
      -     Option Line Items
      -     Mixed Contract Types
      -     Business Partner Management Schema
      -     Enhanced Tendering
      -     Enhanced Financial Processes

      Rebecca Hughes in Public Sector Solution Management is an active blogger.  Look for her blogs for more on PPS.

    • Procurement for Public Sector (PPS) is a SRM add-on.  Customers that want the Public Sector functionality will turn on that functionality in the configuration. 

      The next PPS release will provide significant procurement functionality for the acquisition and management of complex services and supplies - in an integrated ERP environment. 

      Overview of planned functionality:
      -     Complex Pricing Structures
      -     Hierarchical Line items
      -     Option Line Items
      -     Mixed Contract Types
      -     Business Partner Management Schema
      -     Enhanced Tendering
      -     Enhanced Financial Processes

      Rebecca Hughes in Public Sector Solution Management is an active blogger.  Look for her blogs for more on PPS.

      • In addition, with SRM 7.0 Procurement for Public Sector is not an add-on anymore but, like industry solutions, is already in the SRM 7.0 application and can be used by simply activating the corresponding switch, an illustration of the use of the switch framework in the SRM 7.0 application architecture. The release 3.0 of Procurement for Public Sector has entered ramp-up at the same time as SRM 7.0
      • In SRM 5.0 Pcard fucnitonality is supported only in Stand alone scenario.

        Is P-card functionality Available for all the scenarios in SRM 2007 .

        Regards
        Mani

        • In SRM 7.0, pcard will be supported in the local and extended classic scenarios.  You can run pcard in the classic scenario using the custom field functionality to pass the pcard information to the backend system.  Many customers have implemented the custom field scenario in the classic scenario prior to SRM 7.0. 
  • Since SRM and SUS generally work in tandem, can you please shed some light on the direction of SUS. Whether any upgrades are planned for that product and what is the plan for integration with SRM 7.0 in Extended Classic Mode.
    • For SRM 7.0, we enabled SUS for the MM-SRV scenario described under Service Procurement.  SUS can now handle the service specification structure that is passed from the MM-SRV purchase order.  In addiition, suppliers can create service entries based on the service specification structure.

      Regarding your Extended Classic question, we are planning SUS development for Extended Classic in a future SRM 7.0 enhancement pack. 

    • There is an integration package for master data and process integration between ESourcing and ERP.  More specific, a bid invitation can be created in ESourcing from ERP.  From the award in ESourcing, a purchase order or contract can be created in the ERP system.
  • Thanks for the good info; we are looking at SRM 7.0, but cannot find how that affects BI/BW standard content version 7.  Will the BI content that is for r5 work with 7?

    Thanks.

    • Typically the Sourcing Cockpit has been stable so I'm not sure what you mean. 

      SRM 7.0 exited Ramp Up early.  In our Ramp Up experiences we found SRM 7.0 to be very stable, which was one reason for the early exit.

  • Hi,
    You mentioned that the status of an RFX in SRM 7.0 can be viewed from ECC. Can you explain a little bit more? If a purchase requisition is created in ECC and transferred to SRM, and then an RFX is generated, from where in ECC can be viewed the status of the RFX created in SRM?
    Thanks
    Ezequiel
    • Business Suite 7 uses a Harmonized role for ERP and SRM to allow the Buyer to perform both ERP and SRM activities in the portal.  The RFx status would be viewed in the portal using the harmonized role.  The buyer would use a Personal Objects Work List (POWL) to view the document status.

  • Hi Michael

    Can you be able to explain me the integration between the SRM and FICO Integration ?
    How Accounts Payable , MM and SRM are integrated?
    Please reply me
    Thanks

    Meenakshi.N

      • There are hundreds of integration points between SRM and MM.  In general, SRM has several deployment modes that allow you to utilize the backend MM system as much as you want: local/standalone, classic, extended classic and decoupled.  In classic, you can use SRM to create and approve requisitions.  These requisitions can be forwarded to the backend system as requisitions, POs, or reservations.  In extended classic, POs are created in SRM, and a copy of the PO is replicated to the backend system.  In either case, the follow on documents can be created in SRM or MM. For the decoupled scenario, you can configure based on the product category how you want to process the purchasing documents (classic, extended classic, or local).

        As I mention in the blog,  in SRM 7.0 we have more tightly integrated purchasing processes to couple MM and SRM processes using enterprise services.  The central contract management, services procurement, and integrated sourcing processes are examples of those couplings.

        For AP, once the invoice is verified in SRM or MM (eg: 2-way or 3-way match), the invoice is forwarded electronically to AP to run the payment processes.

    • I mentioned several technical scenarios in the other blog reply.  FICO is a necessary component for all tose techincal scenarios (local, classic, extended classic, and decoupled).  Largely, FICO is needed to update the accounting objects and to control the purchasing processes.  As examples, SRM can assign the requirements to account assignments (cost center, order, asset, project, etc) and update GL accounts.  The system can track budgets and keep people from exceeding budgets on their purchases.  SRM invoices need to be forwarded to AP for payment.  SRM also has functionality for PCard, and FI transactions will be updated based on pcard activity and reconciliation. 

      Mike

  • Hi Michael,

    Could you let me know:

    1. whether category management functionality is any more supported/provided in sap srm7.0 ?

    2. Is there any SAP link on the configuration doc of the same?

    3.If not available in sap srm7.0 then which software component(e.g SAP retail / e-sourcing etc.) provides this functionality ?

    Regards,

    Chandan(chandanroy_c@yahoo.com)