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Intelligent ERP Update: SAP S/4HANA Cloud 1902 Release for Two-Tier ERP (S/4HANA Cloud for Subsidiaries)

This blog and video below presents key highlights of the new functionalities of SAP S/4HANA Cloud release 1902 covering the end-to-end business cases that can realised in Two-Tier ERP deployment.

 

Finance

  1. Treasury payment request integration

As the shift to cloud is accelerating “Hybrid” plays a key role in this transformation. Winning companies are looking into a mix of using their current IT environments and plugging in cloud according to business priorities. A significant business priority is the finance transformation and in particular the treasury function.

With the first release for treasury hybrid landscape, in 1808 release, customers can manage their Treasury and Risk Management in S/4HANA Cloud and keep the other Finance module in an existing ERP environment (preferably S/4HANA OP).

This deployment helps in having a centralized treasury station for the entire enterprise while also integrating the central treasury station with the central FI system. To realize this, SAP delivered whitelisted API’s during 1808 release. Using these API’s, cloud system can be used as a shadow FI system and customers can replicate all postings via idocs to the central system. This solution can be envisaged for the postings. But the treasury payments were still done in S/4HANA Cloud treasury system.

In order to streamline the treasury payments, with the new communication scenario SAP_COM_0442 released in 1902, payments can be triggered in cloud system and the payment requests can be created in the central FI system.

 

  1. SAP Global trade services integration with SAP S/4HANA Cloud for compliance management.

SAP Global trade services helps customers accelerate their cross-border supply chain by automating and streamlining trade processes to control their costs, reduce the risk of penalties and fines, and clear customs faster.

SAP GTS integration with SAP S/4HANA Cloud provides a centralized global trade management with a single repository for all compliance master data and content for customers running in a multi-tier landscape.

Here, the headquarters runs SAP S/4HANA OP along with SAP GTS 11.0 and subsidiary runs S/4HANA Cloud.

Customers can integrate SAP Global Trade Services 11.0 on-premise with SAP S/4HANA Cloud for ERP to utilize existing rules in SAP Global Trade Services to manage their trade in the cloud.

With this integration customers can now synchronize primary master data like customers, suppliers and material masters and relevant import and export documents

Business benefits includes leveraging the existing investment on global trade services infrastructure for a best-of-breed deployment of an international trade solution with minimal new configuration.

 

Procurement

Centralized contract management is used to negotiate a global longer-term agreement between an organization and a supplier regarding the supply of materials or the performance of services within a certain period as per predefined terms and conditions. Flexible distributionfunctionality is an enhancement in 1902 to already delivered central procurement functionalities.

Organizations can choose to distribute the entire quantity of the central contract to each of the connected purchasing organization by creating local contracts in the connected systems. Which also means that, each system might correspond to 100% of the target quantity with reference to central contract, totaling more than 100% of the target quantity. For example, if there are 3 connected systems in procurement landscape, users could allocate each of them 100% of the target quantity, meaning the sum of the distribution would be 300% of the target quantity of the central contract.

Business benefit is such that now each purchasing organization could then create purchase orders for up to 100% of the target quantity. Consumption at each subsidiary is updated back to central SAP S/4HANA system helps to monitor of contract consumption and renewal of expiring contracts across all subsidiary on real-time basis. This also makes it  possible find the target and released quantity of the contracts to measure against defined KPIs.

 

 

Other major innovation delivered in 1902 release include capabilities to manage workflows for centrally managed purchase Requisitions.

Typically, in a centralized purchasing setup, all purchasing activities are designed to flow through headquarters. However, organization would need ERP system that is flexible enough to configure and  then manage workflow for purchase Requisition either in subsidiary or at headquarters. This would help to leverage purchasing volumes as a means to reduce cost of their operations.

Business users can configure workflows for the approval process of centrally managed purchase requisitions. The app provides options to define preconditions for the release of centrally managed purchase requisitions and provides several options to determine the approvers for their release.

 

Accelerators

A dedicated section and Scope Items relevant for Two-Tier ERP in SAP Best Practices Explorer can be found here

For the details on white-listed APIs for SAP S/4HANA Cloud you can refer this section.

From 1902 release of SAP S/4HANA Cloud, a dedicated section in roadmap viewer has coverage related to Two-tier ERP.

 

For more information on SAP S/4HANA Cloud, check out the following links:

Follow me @Srivatsan Santhanam & @Srivats_S  and via @SAP

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