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SAP E-Sourcing application helps customers in streamlining the sourcing processes, managing procurement risk and compliance, reducing supplier costs and accelerating procurement cycle times. The benefits and the value are derived by supporting the following procurement processes within the E-Sourcing application:

  • Sourcing Project Management (A project is a strategic sourcing effort that organizes multiple sourcing events and ensures consistent buying discipline)
  • Request for Quote/Information/Proposal
  • Online Reverse Auction
  • Bidding and bid optimization
  • Contract Management
  • Supplier Registration/Evaluation/Selection

In order to deliver closed process loop and provide additional value on top of the value derived by core E-Sourcing functionalities it is required to integrate SAP E-Sourcing application with overall operational sourcing and source-to-contract scenarios in backend ERP as well as SRM applications.

Standard, out-of-the-box E-Sourcing integration to ERP 

The E-Sourcing product to be released in 2009 (version 6.0) will delivered containing standard, out-of-the box integration with ERP component of Business Suite 7. This standard integration between ERP and E-Sourcing will support all ERP releases starting from 6.0 (including all enhancement packs).

The processes to be supported with the standard E-Sourcing integration to ERP will be as following:

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The key features and benefits of the standard integration are:

  • Streamlined master data handling and alignment with ERP
  • Unified User Interface (E-Sourcing 6.0) with SRM / ECC
  • ERP Purchase Requisition transfer to E-Sourcing via intermediary ERP RFQ document (which can be automated)
  • Improved error handling and integration troubleshooting via synchronous interfaces
  • Standardized business document cross-referencing for full process completion
    Multi-language support
  • Configurable Integration parameters via Integrated Document Types (e.g. pricing conditions, text ID’s)
  • Local document validation prior to transfer to ERP for added consistency
  • Performance enhancements and extensibility improvements using standard ERP interfaces
  • Significantly faster deployment and configuration via standard integration content and components
  • Outline Agreement can either be a contract or a scheduling agreement

The PI (Process Integration) component also known as Exchange Infrastructure or XI is a mandatory component for the standard integration between E-Sourcing and ERP.

E-Sourcing/ERP Integration Package

For the releases of ERP (versions 5.0 and below) and E-Sourcing (versions 5.1 and below) the E-Sourcing/ERP Integration Package is available. It allows for the replication of a subset of master data from SAP ERP to E-Sourcing and enables business process integration to support procurement process flow. The supported scenarios of the Integration Package are the same as for the standard E-Sourcing/ERP integration (see the chapter above).  

The Integration Package is delivered as a packaged solution with the following required components:

  • ERP integration components (Programs and function modules, technical interface definitions)
  • E-Sourcing integration components (Configuration workbooks, Java libraries)
  • XI Content (Data mappings, Interfaces)
  • Configuration and user guide

The effort to deploy, connect and configure all of the components will depend on the available skills. SAP as well as its partners offer services to quickly deploy all of the components resulting in a fast time to value for customers.

The current integration package is the best starting point for any integration project between SAP E-Sourcing (ver. < 6.0) and SAP ERP (ver. < 6.0):

  • It offers well documented and described procedures to achieve integration inclusive of all the required objects and coding
  • It has been created to “jump-start” the integration efforts between SAP E-Sourcing and SAP ERP
  • With adaptation, it can easily be leveraged to integrate SAP E-Sourcing with non-SAP backends or SRM
  • This integration enables the process from initiation of a Purchase Requisition through to the creation of an Outline Agreement in the SAP ERP system.
  • This integration also minimizes errors or omissions by reducing the manual effort required to enable follow-on processes
  • In addition, the integration enables the synchronization of master data (such as materials and suppliers) between SAP ERP and SAP E-Sourcing to ensure one source of master data
  • By enabling the creation of ERP Outline Agreements as a continuation of the natural business process, this integration also enables the contract compliance process which is becoming more important to the customers

The E-Sourcing/ERP Integration Package supports E-Sourcing releases 5.0 and above and ERP 4.7 and above and the E-Sourcing customers have been using it to connect to their productive ERP systems.

E-Sourcing Integration to SRM

The standard integration between E-Sourcing and SRM will not be available in E-Sourcing 6.0 product but is planned for the future releases of E-Sourcing application after version 6.0.
Despite the unavailability of standard integration between E-Sourcing and SRM, a number of customer projects have successfully used the components and building blocks available for the ERP integration in order to integrate E-Sourcing with their SRM systems.
The observed integration approach between E-Sourcing and SRM is as following:
image
The presented integration approach between SRM and E-Sourcing assumes the following:
  • Master data are in sync between the ERP, SRM and E-Sourcing system. It must be ensured the same master data are present in E-Sourcing as in SRM. This is a process consideration and standard interfaces can be used for replication of master data from ERP to SRM as well as from ERP to E-Sourcing
  • SRM requirements (shopping carts) are transferred to E-Sourcing RFx via ERP Purchase Requisitions and RFQ. The ERP RFQ is simply a technical grouping mechanism and a starting point for the transfer of requirements from ERP to E-Sourcing and does not play a major role in the overall process
  • The above approach assumes SRM deployment in the so called “Classic” mode
  • The standard outbound mechanisms for document publishing are leveraged from E-Sourcing, in other words either from an Award or an Agreement in E-Sourcing standard outbound integration is used into XI. In the XI system it is necessary to decide if the document will be replicated to ERP or SRM. This can be modeled based on the content of the transactional document e.g. document type, organizational data or custom attributes
  • The Custom API in ERP can be quickly built based on the standard SRM interfaces

The integration approach for SRM described above can be used to integrate E-Sourcing versions 5.0 and above with SRM 5.0 and above and ERP 4.7 and above.

E-Sourcing integration with multiple backend systems  

One of the challenges for integrating E-Sourcing with SRM or ERP is in circumstances when there are multiple backend ERP systems.  SRM natively supports multiple backend system handling in master data and transactional layer. However, the E-Sourcing does not have those capabilities. The presence of multi ERP backend systems is addressed through the concept of key compounding. Let’s consider an example:

(SYS1 and SYS2 are different backend systems). The master data are extracted from both ERP systems and sent to E-Sourcing. Good business practice would suggest to perform some sort of matching/normalization/de-duplication via MDM system for reporting or roll-up purposes but this is an optional task and depends on the overall quality of the master data.

For example material #1000 can exists in both SYS1 and SYS2 systems. When importing the master data via PI (Process Integration) component the qualifier is added to the master data so in E-Sourcing system two materials are created (SYS1.1000 and SYS2.1000, etc). This way the same material or supplier can exists in the ESO database because of the qualifier.

Apart from materials and suppliers it may be necessary to compound plants, purchasing organizations, purchasing groups, company codes, payment terms etc; depending on the overall quality of the master data.

In the example above, once the custom API in SRM receives the message it can determine which master data are used and successfully create contracts. In SRM SYS1.1000 and SYS2.1000 now revert back to their original form of 1000 and the standard SRM functionality can process the data and create transactional documents.

Scripts could be developed in E-Sourcing for dropdown search where the results set is filtered by the users organization assignment; SYS1 or SYS2. This way the material(s) and vendor(s) associated with the user’s system are used in E-Sourcing tranactions. If the user is assigned/using SYS1 organization then only data for SYS1  will be displayed in search results.

E-Sourcing integration with SAP Spend Analytics

Apart from standard ERP integration E-Sourcing can also integrate with SAP Spend Analytics component. From reports executed in SPend Analytics component it is possible to initiate E-Sourcing project or an RFx event. This integration is supported as of E-Sourcing 5.1 and SAP Spend Analytics 2.0.

For more details please visit SAP Service Marketplace on: https://service.sap.com/srm -> E-Sourcing 5.x

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17 Comments

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    1. subrote mohapatra
      Nice blog.
      can you tell me if the limitation of only new vendors being interfaced to ERP (and not vendor changes made in E sourcing to ERP) has been addressed.

      regards
      Subrote

      (0) 
  1. Muthuraman Govindasamy
    Hi
    E-Sourcing does all SRM sourcing. Again what is necessary to have e-Sourcing?

    How difficult to  synchronize master data with ECC->SRM ( I aware)and again ECC->e-Sourcing.-> more efforts required right?

    Can I get customizing details of e-Sourcing?

    How can I recommend the customer either srm or e-Sourcing? if my business requires only sourcing .

    Thanks
    Muthu

    (0) 
    1. Marko Navala Post author
      Hi,
      I have provided the link to SAP Service Marketplace from where you can obtain the configuration details.
      Regarding your question on E-Sourcing vs SRM. It really depends on the customer requirements. There are also architectural as well as functional differences. We will look to address those in a separate blog.
      Marko
      (0) 
  2. Bhushan Indane
    Hi Marko

    This is a good article. Thanks for posting it.

    I have one question. How get the integration package for e-sourcing 5.1?

    Thanks in advance.

    Bhushan

    (0) 
  3. Ritesh Mehta
    Hi Marko,
    Nice blog.
    Infact I needed an information,
    is Esourcing 6.0 based on NW CE or NW 7.0?
    Thanks in advance for response.
    (0) 
  4. Madhankumar BB
    I have one question.

    We have a requirement where i need to integrate E-Sourcing 5.0 with R/3 4.6c and SRM 3.0/EBP 4.0 with Extended classic scenario.

    What is the integaration who you suggest.

    And is it possible to integrate the contract with SRM MDM 2.0?

    Regards,
    Madhan

    (0) 
    1. Marko Navala Post author
      Hi Madhan,
      Since you have SRM in extended classic scenario you will probably want to negotiate the contract in E-SOurcing (using CLM) and pass those contracts to SRM. You will than be able to create extended-classic PO’s in SRM from replicate dcontracts. Some of our customers did this for teh indorect goods and services.
      For direct goods you may still want to negotiate using E-Sourcign but in that case you create the contract directly in ERP and create PO’s against those contracts in ERP. The integration to ERP you can do based on the Integration Package. In case of SRM you will need to do some work in SRM btu for the most part you can leverage the ERP integration package. We have live customers who have doen exactly this.
      Marko
      (0) 
  5. Suji Thampi
    Hello,

    Based on the graphical representation in the blog, it seems that SAP CLM(&or E-Sourcing) can work with Documents (or contents) attached to the ERP as part of outline agreement in SAP ERP rather than creating a new content management store in SAP CLM.

    Could you please help to clarify / confirm this.

    Thanks
    Suji

    (0) 
    1. Marko Navala Post author
      Hi Suji,
      E-Sourcing (CLM) cannot work with documents in ERP. If you look into note 1313088 you will see that attachment transfer is not supported between ERP and E-Sourcing.
      Marko
      (0) 
  6. Albeniz Crespo
    Hello,
    I just heard that E-sourcing does not understand services as line items as organized in breakdown hierarquies as seen in ERP MM-SRV. Are there any plans in the roadmap to engineer this function on it?
    (0) 
    1. Marko Navala Post author
      Hi,
      The standard support for Service masters is definitely in the roadmap beyond E-Sourcing 6.0.

      Service Master support is out of scope for E-S 6.0 and also the previous releases (5.0 and 5.1).

      Nevertheless, if a customer requires service master support they will be able to model the transfer of the services master but this will require consulting work and would not be treated as a standard integration. The limitation of this approach is that full-blown service hierarchies would not be supported – in other words – only the simple 2 level service structure. In general there will be four points to be addressed:

              * Extraction of Service Master from ERP (already possible via SERVMAS IDoc) and mapping of the extracted Service Master data into a file structure readable by E-Sourcing. This could be the same as for material but with an extension to indicate it is a service rather than a material
      (this is how SRM functions, for example)
              * Modeling of the destination objects for services (either existing material master with extension to indicate it is a services or user defined master data object). This would include modeling of custom pickers/search helps for services  
              * Modeling of processes for services – some unique requirements exist when integrating documents in E-Sourcing containing service masters with ERP  (e.g. service structures,      account assignments, item categories)
              * Extending current integration objects and modules to support service related transaction document transfer to ERP. Current ERP interfaces (BAPI’s) should be able to handle creation of documents containing services

      The above approach has productively been used by customers.

      (0) 
  7. Scott Beam
    Hi. Would appreciate any insights or thoughts into why organizations might use SAP e-Sourcing (v5.0 or higher) with SRM (v7.0)? Are there any companies doing this today…if so what was their reasoning for deploying both solutions and how did they integrate them??  Thanks
    (0) 
    1. Community User
      Through SRM 5.0 e-procurement can be done, we are using it also. what is the purpose of e-souricng over & above SRM from procurement point of view.

      pl elaborate.

      regards

      I Basak

      (0) 
  8. Jagdeep Singh
    Hi

    When we need for EBP  & E-Sourcing togahter.. we need to have different clinets for EBP & E-Sourcing ?

    & how we can use the functionality of C-folders in E-sourcing ?

    Thanks in advance

    (0) 

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