Two-Tier ERP – What’s new in 1711 SAP S/4HANA Cloud

[former_member261608]

This blog presents key highlights of the new functionalities of SAP S/4HANA Cloud release 1711 and the end-to-end business cases that can realized for Two-Tier ERP.

 

Sales

1. 
   

   Subsidiary as Sales Office- Sales from local stock:

   
   This is relevant for Subsidiaries which have a different line of business from the Headquarters or those which are capable to execute sales processes independently with their own customers. The Subsidiaries carry out their sales process independently. The Headquarter needs only the visibility in the Subsidiary’s operations.In this case the Headquarters receives the visibility of Quotations/Leads Conversion, Sales Order, Stock Overview, Payments Receivables from the Subsidiary using white-listed APIs/CDS views.


2. 
   

   Subsidiary as Sales Office- Returns to local stock: 

   
   This is also relevant scenario independent Subsidiaries. This deals with the Returns process of Sales from local stock, as depicted in the previous scenario. In this case, the Headquarters have a view on the Return Orders, Stock Overview and Financial Updates leveraging APIs/CDS views.


3. 
   

   Drop-shipment from Headquarters without Advanced Shipping Notification (ASN):

   
   In this case we are dealing with a Subsidiary which has closely intertwined business process with the Headquarter. The Subsidiary acts as a local sales office processing Sales Orders for Customers. The requirement is sent to the Headquarters and the goods is shipped directly from the Headquarters to the Customer's location by Drop-shipment. The Customer pays to Subsidiary and the Subsidiary in turn settles the transaction with the Headquarters. No Advance Shipping Notification is sent from the Headquarters to the Customer or the Subsidiary in this case. The integration between the Subsidiary and Headquarter is done using EDI.

Manufacturing

1. 
   

   Subsidiary as a Production Unit and Internal Supplier to the Headquarters:

   
   This scenario starts with an incoming Sales Order created at the Subsidiary with respect to Purchase Order from Headquarters through integration interface with the Headquarters' ERP. At the Subsidiary, the production process is triggered by a material requirement planning run for the product ordered by the Headquarters. Once the product has been produced, the delivery and billing of the produced goods completes the process. The Advance Shipping Notification (ASN) & Invoice would be sent to Headquarter through integration interface between the Subsidiary's SAP S/4HANA Cloud and the Headquarters' ERP. The Headquarters also has visibility on the Subsidiary's Production Order Confirmations.

 

Finance

1. 
   

   Financial Analytics: 

   
   In this Two-Tier ERP scenario, headquarter gets complete visibility of Financial Account Payables at Subsidiaries & Local Profitability process. This helps in monitoring the Performances of the Subsidiaries.
   
   Accounts Payable Manager Fiori Application provides an overview for the Financial Accounting related scenarios. The Accounts Payable Overview page focuses on the payable aging, blocked invoices, parked invoices, Days Payable Outstanding and so on and how this can be visualized to allow for better decision making by the accounts payable managers.
   
   SAP Digital Boardroom for SAP S/4HANA Cloud-based Real-time Financial analytics with enriched Financial Statement Version hierarchy, a well-designed Chart of Accounts (COA) that supports all of the organization's information, reporting and accounting needs, and is built on a foundation of consistent definitions for business attributes and data elements.

Sourcing and Procurement

1. 
   

   Procurement directly by Subsidiary with visibility to Headquarters: 

   
   This is a typical scenario where a Subsidiary is an independent entity equipped to run the procurement and manufacturing operations with ability to manage local inventory.The process starts with Customer Purchase Order received at Subsidiary, then system can check incoming Sales Orders against defined credit limits using credit management functionality before creating a Sales Order. Finally, Sales order is converted in to Purchase Order in the Subsidiary's system. The procurement process is carried out by the Subsidiary from the Vendor using the Purchase Order. The Headquarters has visibility of Periodic Financial update( Accounts Receivable for Billing and Accounts Payable for PO ) along with Sales Order, PO and Stock.

 

Accelerators

1. 
   

   Lean Master Data Management using external SCP Workflows: 

   
   This is an accelerator which provides a template implementation approach to the Customer for Business Partner creation request from the Subsidiary & approval from the Headquarters using a SCP Workflow. After approval the Business Partner is created both at the Headquarters ERP as well as Subsidiary's SAP S/4HANA Cloud. In case of rejection or inability to create the Business Partner at the Headquarters' database, the Requester from the Subsidiary is informed through a workflow.


2. 
   

   Purchase Order-Sales Order automation:

   
   This is an accelerator for automatically creating a Sales Order at the Headquarters referencing a Purchase Order from the Subsidiary with an API based approach.

 

From the SAP S/4HANA Cloud 1711 release, we will be having a section dedicated for Two-Tier ERP in SAP Best Practices Explorer. Insights on the features in store in future for Two-Tier ERP can be found in the SAP S/4HANA Cloud Road Map from this link. For the details on white-listed APIs for SAP S/4HANA Cloud you can refer this link.