Sourcing & Procurement in SAP S/4HANA Cloud 2008
this blog provides insights on SAP S/4HANA Cloud release 2008 for Sourcing & Procurement. In case you do not need all the information below and just briefly want to get an overview on the release highlights, please watch this video:
Before we start with the details, I would like to encourage you to read the blog series #justthefactsplease by Jennifer Ruscelle Petersen. The blog series clears up with market rumors in a very honest and open way by facing the pure facts. You will love the clear words, trust me.
Those of you who are in love with details, click on the link for the topic of interest to save scrolling time:
Enterprise Contract Management and Assembly**
Contract Management with SAP Ariba Contracts enables buyers to perform strategic sourcing activities and to integrate prices from SAP Ariba Contracts into SAP S/4HANA Cloud.With release 2008 we are now supporting the creation and transfer of scheduling agreements from SAP Ariba to SAP S/4HANA Cloud. In general, a scheduling agreement is a long-term agreement with a supplier covering the supply of materials to predetermined conditions, which are valid for a defined period and a defined total purchase quantity.
Fig. 1: Process flow for Contract Management with SAP Ariba Contracts.
The process runs like this: In SAP Ariba Contracts, strategic buyers can create a contract of the document category scheduling agreement (LP or LPA). Once the contract is set up, reviewed and approved in SAP Ariba Contracts, the scheduling agreement can be send to SAP S/4HANA Cloud. Here, the scheduling agreement is automatically created and its status set to ‘in release’ or approved based on the workflow configuration in SAP S/4HANA Cloud. From here, the purchaser can maintain the delivery schedules for the scheduling agreement. Please be aware that this innovation is available as soon as SAP Ariba 2008 is released.
According to the proverb “a rolling stone gathers no moss”, we improve step by step. This release we allow to inform workflow approvers about deadlines for pending approvals. Such a pending work item could be a purchase order hanging in the approval workflow as well as a blocked invoice waiting to be unblocked.There are two ways how a person can be notified: the pending task is marked as overdue in the respective ‘My Inbox’-app and/or an email notification can be triggered automatically. Recipients can be, for example, the manager of the last approver, a specific person – responsible for a cost center, or a project – or the workflow administrator.
To make usage of the deadline notifications, a business process configuration expert needs to configure the respective flexible workflow upfront. Currently supported are the flexible workflows for purchase orders and flexible workflow for supplier invoices, more to follow. Within the workflow configuration step you can define the time frame in which the step must be completed. It is also possible to define several deadlines and assign separate, pre-defined emails. If you define a very tight overdue deadline for a workflow step, you can also use the email notification as an information about a new work item.
Fig. 2: Overdue marked work items in ‘My Inbox’ – release of purchase order.
In order to make usage of the email notification an administrator needs to maintain an email template accordingly. The email can contain more detailed data, such as the invoice number, company code, supplier, or gross amount. More information how to configure that can be found here. By the way you can also define multiple time frames for each workflow step.
Fig. 3: A prerequisite for deadline notification mails is to maintain an email template, which can be customized.
Please watch the below demo to see the process flow for pending purchase order approval.
The purchase order output is enhanced to support the supplier ordering address to be displayed on the purchase order and purchase order change form. Suppliers can have several ordering locations, which are captured using the partner function ordering address in the purchase order. Other maintained communication details i.e. telephone, fax and email, of the OA partner function can be added. Therefore, an administrator needs to maintain the form templates in Output Parameter Determination upfront.
A further improvement of the purchase order output is the possibility to indicate the supplier material number separately. This requires the supplier material number to be maintained in the info record data. These enhancements improve the communication with the supplier and reduce the risk of misunderstanding and error.
Fig. 4: Possibility to add the supplier’s material number to the purchase order output.
The flexible workflow for purchase requisitions offers business configuration experts to mark one or more steps as optional. In case a step is skipped, the system will continue with the next step. Why is that important? Let’s assume you apply a custom BAdI for agent determination in order to find the correct recipient for the task. If the agent can not be determined, e.g. because the requisitioner does not have a manager, the step shall be skipped to continue with the workflow instead of ending in an error state. If you want to know what steps have been skipped, the workflow history log provides detailed information.
Fig. 5: New property to mark a step as optional in ‘Manage Workflows for Purchase Requisitions’-app.
In order to control the visibility of sensitive data for specific users, administrators can define custom logic by implementing the BAdI ‘Change of Field Control for Purchase Requisitions’ in the ‘Custom Fields and Logic‘-app. A sensitive field can be for example the total value of a purchase requisition. The respective field status can be set to ‘hide’ inside the BAdI. The end user will not see the data on item and/or header level according to the configuration.
Fig. 6: Key users can control the visibility of the fields based on configuration and field control BAdI.
Please watch the following video in order to understand the effect on end user’s view:
The following improvement will ease the work for those administrators who plan to implement the BAdI ‘Determination of workflow agents for purchasing documents’. This is, less extensive coding is required to determine the purchase requisition approver for each step, because we introduce an optional field parameter ‘stepinfo’. This field provides information about the current step and the total number of steps. Currently, the new field is available for the business objects purchase requisition and central purchase requisition. Please be aware that this has no impact on previous implementations of the BAdI.
Fig. 7: New optional parameter containing the step information.
This release offers a new real-time KPI, namely ‘Parts Per Million’, that calculates the ratio of return deliveries and quality notifications to goods received. The analytical app shows the parts per million score by various dimensions, e.g. supplier, material group, purchasing organizations or plant. Buyers gain immediate insights into quality performance of the suppliers’ delivering goods. Therefore, this measure provides basis for discussion with the suppliers’ potential activities to improve quality. For a quick overview, play the video below:
The app ‘Supplier Evaluation by Quality Notification‘ helps strategic buyers to identify the suppliers with less received complaint notifications and thus with higher quality evaluation score. In addition to analyze the number of quality notification created against a supplier, a new score is now calculated showing the relative score of quality notifications and purchase order items. Additional measures for number of purchase orders and number of purchase order items are added. These measures support to gain immediate insights into quality performance of the suppliers.
Fig. 8: Additional measures for number of purchase orders, number of purchase order items and relative score of quality notifications and purchase order items.
If a flexible workflow for the approval of supplier invoices is in place, approvers receive their tasks via the ‘My Inbox‘-app. With this release, the work items support the display of detailed information about the invoice items of an invoice. Details can include information about the purchase order, the accounting object, the material, the quantity, the amount and the tax code. In order to view the detailed information for invoice items, administrators need to grant access for specific users by configuring the authorization using the business catalog SAP_MM_BC_INV_WIAPPROVE_PC (business role SAP_BCR_MM_INV_WIAPPROVE_PC). The enhancement will help task receivers to make a confident decision on how to proceed with an invoice.
Fig. 9: Display detailed information about the invoice items of an invoice in ‘My Inbox’-app.
For a general introduction to Central Procurement, please click here.
Central purchase contract hierarchy is a variant of central purchase contract. Central purchase contract hierarchies enable large enterprises to consolidate the requirements across various business groups. Therefore, it distributes the elements of the contract – grouping requirements per business group – into subordinate central contracts. Customers have the flexibility to configure the approval at enterprise and/or business group level. After approval, the subordinate central contracts are further distributed to the relevant connected systems and an applicable outline agreement can be used as source of supply. The usage of a subordinate central contract is then up to the respective business group. Furthermore, the central contract consumption per item and per distribution is being aggregated across the business groups. It is also possible to create a central purchase contract hierarchy from ‘Manage Purchase Requisitions Centrally‘- app by consolidating purchase requisition(s) across connected systems. This offers large enterprises a better spend visibility across all business groups and a new way to organize central purchase contracts.
Did we spark your interest? See the demo below to gain a deeper understanding.
According to the boy band New Kids on the Block and the song “Step by Step”.. we improve (while dancing 😉 ). Commodity Pricing has been introduced in the last blog. This release we did several enhancements to the first shipment as follows. Price information for materials in central purchase contracts can be maintained for different time periods. With commodity pricing integration, it is possible to mention the commodities used and to calculate the price for items by including the value of the respective commodities. Next to plant-independent conditions, it is now possible to maintain plant-specific conditions. Here the distribution of only relevant price information to local purchase contracts in the connected systems is feasible. In addition, scales for item conditions can be maintained and real-time price simulation be performed to understand the effective value. Also, users get the possibility to maintain the reason for a price change whenever a new condition validity is created, condition values are updated or conditions are deleted.
Fig. 10: Price simulation of commodity pricing in central purchase contract.
We also bring some workflow improvements in Central Procurement with 2008. To save manual effort and to reduce operational costs, we enable the approver to navigate to the connected system himself and edit the purchase requisition during the approval process. There is no need anymore to wait and rely on the initiating employee to update the information and send it back for approval. That way a flexible centralized approval of purchase requisitions can be offered. The responsible approver can use the approval app along with centrally managed application to navigate to the purchase requisition in the connected system.
Fig. 11: ‘My Inbox’-app showing Centrally Managed Purchase Requisition. Approvers can open the purchase requisition item for editing in the connected system using the direct navigation button.
A central purchaser can now perform mass changes to central purchase contracts. It is possible to select specific central contract information that can be downloaded into a Microsoft Excel file. Central purchasers can modify the information on central purchase contracts, e.g. add new header distribution and item distribution records, using the local excel file. In case version-dependent fields are changed, the system creates a new version of the affected central purchase contract. This feature facilitates the maintenance of large volumes of data while increasing process efficiency.
Fig. 12: Mass Changes to Central Purchase Contracts.
Enterprise Contract Management and Assembly**
SAP S/4HANA Cloud for Enterprise Contract Management and Assembly (ECMA) is an integrated application with SAP S/4HANA Cloud that runs on SAP Cloud Platform. ECMA facilitates the authoring and assembly of legal content for efficient and effective contract management.
Enterprise Contract Management and Assembly enables users to easily extend workflow tasks as users can define a custom step in a workflow. In addition, it is possible to determine custom agents using enhanced responsibility management. There are some prerequisites in order to make usage of this feature. Please read the documentation for further information.
Fig. 13: Ability to define custom step for specific business purposes.
We offer now the option to create categories using custom data source, i.e. customer specified CDS views. This will reduce the total cost of development by enabling category generation. Also here a key user, needs to define category models required to generate dynamic categories using the ‘Generate Categories from Table’ option in the app Categories.
Fig. 14: Generate categories from customer specified CDS views:
We allow to define if a virtual document needs to be assembled automatically. In addition, users can update the modified variables and trigger reassembly of a virtual document. To gain a better overview, users can view a list of documents that require content refresh, e.g. when the attributes of a legal transaction are changed. As a prerequisite, a key use will have to implement the BAdI ‘Define Automatic Template Determination for a Virtual Document’, to classify the automation level of a virtual document by providing values in the Assembly Automation Level field and a valid template ID. Please read the documentation here.
Fig. 15: Ability to trigger update and reassembly of virtual documents.
Fig. 16: Indicate content refresh is required when the attributes of a legal transaction are changed.
Fig. 17: View a list of documents that require content refresh.
I hope you like what we do 🙂 For more information on SAP S/4HANA Cloud, check out the following links:
- SAP S/4HANA Cloud release info: http://www.sap.com/s4-cloudrelease
- Sven Denecken’s SAP S/4HANA Cloud release blog
- The Link Collection for Sourcing & Procurement here
- SAP S/4HANA Cloud Release Blogs here
- SAP S/4HANA PSCC Digital Enablement Wheel here
- Inside SAP S/4HANA Podcast here
- Best practices for SAP S/4HANA Cloud here
- SAP S/4HANA Cloud Customer Community: register here
If you face any issues or questions, please check out the following video that guides you to the right access point: