Sales in SAP S/4HANA 2021 – Part 2
Companies have multiple operational nodes like Sales, Transportation, Warehouse Operations, Billing, and Finance. The billing department is considered as one of the critical nodes as they engage with customers and vendors to ensure that cash cycle flow is maintained at an optimal level. Additionally, it is important as it is about managing the account of your customers, and since it has financial repercussions.
In the following blog, I will give you an engineering expert view of some selected highlights of our SAP S/4HANA 2021 for Sales.
The blog is built as a series of 3 parts and present the key highlights for:
- Part 1: Low Touch Sales Order Processing
- Part 2: Sales Billing and Sales Pricing; Claims, Returns, and Refund Management
- Part 3: Master Data Management; Sales Contract Management; Sales Monitoring and Analytics
To name just a few highlights that we have in store for Sales Billing and Sales Pricing; Claims, Returns, and Refund Management:
- Schedule jobs for preliminary billing documents
- Printing of attachments from preliminary billing documents together with billing documents
- Support for a new sales kit variant (third BOM) in the advanced returns process
- Ability to show the purchase order in the document flow of a return order in the SAP Fiori app
- … and more.
All these innovations will also be available for SAP S/4HANA Cloud, private edition.
Introduction: Preliminary billing document
The volume of transactions in a medium-sized company is enormous, and it consumes a huge amount of time to validate the correctness of the bills. To decrease this work of validation, you can use the preliminary billing document which is the basis for repeated negotiations with customers regarding billing document details.
This preliminary billing document is an optional intermediary document between the billed reference document (for example, a debit memo request) and the final billing document (usually an invoice). It is created solely for negotiation purposes and is structurally identical to a standard billing document. Preliminary billing documents ensure that both parties (supplier and customer) are fully aligned regarding the upcoming settlement.
Schedule jobs for preliminary billing documents
Related to the Low-Touch Sales Order Processing described in my part 1 blog, an automated, “No-Touch” billing process is certainly the way forward, where a billing team’s involvement is necessary only to deal with billing exceptions. Our first step here is that we have introduced with the SAP S/4HANA 2021 release the possibility to schedule single or periodic jobs for the automated creation of billing documents with reference to preliminary billing documents.
This allows removing manual steps to finalize preliminary billing documents, triggering automated workflows.
Picture 1: Referencing preliminary billing documents when creating billing documents.
With the SAP S/4HANA 2021 release, we introduced a new SAP Fiori app “Schedule Billing Creation for Preliminary Billing Documents”, and you can now schedule single or periodic jobs for the automated creation of billing documents with reference to preliminary billing documents. The app offers a range of selection criteria to select the preliminary billing documents for which you want to create billing documents
You are the billing clerk and you want to schedule the automatic batch creation of billing documents on the basis of preliminary billing documents at a certain time each month. That is, you want to schedule jobs to convert preliminary billing documents to actual billing documents.
Doing so reduces the manual effort that is usually required to create billing documents for existing preliminary billing documents. To schedule recurring jobs that run in the background at the specified times, you can make use of the “Schedule Billing Creation for Preliminary Billing Documents“ SAP Fiori app.
Picture 2: Improve usability by removing manual steps to finalize preliminary billing documents and trigger automated workflows.
You can use this app to do the following:
- Schedule the creation of billing documents based on preliminary billing documents
- Easily set up single and recurring jobs
- Copy and modify existing jobs
- Select the preliminary billing documents to be processed by specifying a wide range of selection criteria
- Use the job log to check whether creation was successful or diagnose issues
Printing of attachments from preliminary billing documents together with billing documents
In certain situations, it can make sense to ensure that a preliminary billing document is approved by a designated approver before the billing clerk can create the final billing document. You could, for example, define that preliminary billing documents with a net value higher than USD 10,000, or all those intended for a specific customer, must always go through an approver.
When workflows are set up correctly, both the billing clerk requesting approval and the designated approver receive notifications and tasks in the My Inbox app. While approvers are notified about pending approval requests and prompted to release, reject, or request rework of the document, approval requesters are informed about the release, reject, or required rework action that the approver took with regard to the submitted document. In addition, billing clerks can respond to a rework request by indicating that rework is not really required.
Now with the SAP S/4HANA 2021 release, when an approver or requester of approval requests for preliminary billing documents receives an approval-related task in their My Inbox app, they can now view a PDF-based preview of the corresponding preliminary billing document.
Picture 3: The preview enables quick verification that the final, printed billing document will be exactly as intended.
Introduction: Return Management
Returns management is a process that involves interfacing with customers who wish to return a product, and then collecting, organizing, and restocking inventory that has been returned or exchanged. A returns management process is part customer support, part logistics, and part inventory management.
With the impact of COVID-19, online sales are on the increase and in the future, online commerce around the world has become even more important for many. This situation has increased the need for many businesses to make the returns process quick and easy and the return process has become a priority to avoid warehouses full of unprocessed returned products.
This is why the evolution of returns management is part of the Digital Transformation and thus the challenges in returns management are technological challenges concerning the efficiency in returns processing and are an important process from a customer satisfaction perspective.
Advanced Returns Management for Customer Returns
Previously, you can only create accelerated returns (return type: CBAR). With the SAP S/4HANA 2021 release, we introduced new features in the manage customer returns to make the returns process quick and easy and now you can manage all types of returns orders that are based on Advanced Returns Management for Customer Returns.
With this Advanced Returns Management, you can handle all returns scenarios, such as returns made at the counter, returns that involve a shipment to the warehouse – including subsequent reverse logistics – and direct shipments from customer to vendor. At different times during the process, you can refund the customer with a credit memo or compensate them with a replacement material.
Advanced Returns Management also provides for the automatic creation and tracking of all the documents necessary for logistical and financial processing. These include returns deliveries, goods movements, returns purchase orders, returns stock transport orders, credit memo requests, subsequent deliveries free of charge, and credit memos.
Note: As a prerequisite, you must have made the required settings to activate Advanced Returns Management. For more details, see Advanced Returns Management for Customer Returns
New in SAP S/4HANA 2021
If you have received the returned product, you could check the product received flag, the goods receipt document would be generated automatically.
Picture 4: New product received flag.
Two more logistical follow-up activities:
The logistical follow-up activity code allows you to specify the next step in the logistical processing of the return (such as Receive into Plant, Ship to Other Plant, or Ship to Vendor). Depending on the logistical follow-up activity that you select, you may have to specify additional information such as the next plant or a vendor. The logistical follow-up activity triggers the creation of the relevant logistical documents in the background.
You can also specify what you propose to be the next logistical follow-up activity after the material has been inspected. This is then automatically displayed as the logistical follow-up activity in the material inspection transaction. You would typically do this if a customer calls or sends an e-mail informing you that they are returning material and you want to plan the logistical follow-up activity in advance when you enter the returns order, based on what the customer tells you.
With logistical follow-up Activities: Immediately Move to Free Available Stock, Immediately Move to Scrap, the returns product finishes the logistical activity at once. The logistical status goes to Complete.
Picture 5: Using one of the additional follow-up activities one completes the customer return from the logistics point of view.
Support multiple refund controls:
You can control when and how the refund for a specific Advanced Returns Management-based returns order is to be processed in the system. You can use the relevant refund control to, for example, send a replacement to the customer immediately, issue a particular refund amount by creating a credit memo directly, or postpone the refund determination to a later time.
Refund immediately is available for both refund types.
- Type Credit Memo: Create Credit Memo. (product is received as a precondition)
- Type Replacement Product: Immediate Delivery. (The goods for free of charge replacement order is issued immediately. )
Picture 5: More refund control options.
Handling bill of materials (3rd BOM Variant)
The system supports BOM materials, irrespective of whether pricing and inventory management takes place for the BOM header material or the components. The BOM structure definition may also include service materials. You can also enter a full product that is defined as a BOM material with the BOM usage Sales and Distribution. The system treats BOM items for header or components that are not relevant for inventory management as a single service material.
When you enter a BOM material, the system explodes the components according to the structure definition. When creating the returns order item for the BOM material with reference, you can either configure a re-explosion or a quantity copy in the copy control settings. You can only enter a quantity relationship deviant from the structure definition when the BOM material or full product quantity equals 1.
To ensure consistent logical processing of the BOM header and components, the system copies the logistical data that you enter for the BOM header to the component items. You cannot change the data for the components. By contrast, you can enter refund data both for the BOM header and components according to the pricing relevance. In the case of full products, for which tied empties have their own pricing, you can release the refund for tied empties immediately, whereas you can defer the refund decision for the full products to a time after the material inspection. Use the Fast Change function to quickly set the refund control for the selected tied empties items.
In SAP S/4HANA 2020, the Manage Customer Returns app is able to handle two bill of material variants
- ‘ERLA’ Sales BOM Variant: Pricing and inventory management for Sales BOM main item, whereas components are processed as ‘explanations’.
- ‘LUMF’ Sales BOM Variant: Pricing and inventory management for Sales BOM components, Sales BOM main item is processed as ‘explanation’.
Now in SAP S/4HANA 2021, the SAP Fiori app can support
- 3rd BOM Variant: Pricing at Sales BOM main item, and inventory management at Sales BOM components.
Picture 6: Set the follow-up activity at the main item level, and it’s applied to all components automatically.
Search reference document (Sales order, Invoice) by delivery number:
With the SAP Fiori app Manage Customer Returns, right now you can search the reference document (sales order, invoice) by delivery document number.
Based on the identified reference document, customer returns can be created.
Assign a batch number to items:
If the returned goods are managed in batches, you can assign a batch number to each returns order item. The batch number will be copied to the subsequent documents in the returns processing.
Support ‘Returns Order Reason’:
You can select a predefined returns order reason in the returns order header. The returns order reason indicates why the returns order was created. This reason could be used as one of the selection criteria in sales statistics. As a prerequisite, returns order reasons need to be defined first in Customizing.
For non- Advanced Returns Management returns, such as lean returns, the header-level returns order reason is copied to the return reason for each item.
Picture 7: View the returns order reasons in the returns order list.
Export customer return worklist to Microsoft Excel:
With the SAP Fiori app ‘Manage Customer Returns’, you can now export the worklist to Micorosft Excel.
Show returns purchase order on process flow:
With the SAP Fiori app ‘Manage Customer Returns’, now in the process flow, the returns purchase order can be displayed with more detailed information if 3rd party supplier return is involved in customer returns processing.
- With follow-up activity ‘0007 Direct Ship to Supplier’, a returns purchase order is created directly after releasing the customer return.
- With follow-up activity ‘0005 Ship to Supplier’, a returns purchase order is created after performing the inspection and releasing the inspection document.
Picture 8: Track returns purchase orders in the process flow in the scenarios of returning goods to suppliers.
Allow to change supplier address:
For the follow-up activities Shipment to Supplier and Direct Shipment to Supplier, you can now select a different return address of the supplier if the default address proposed by the system does not meet your requirements.
You can use price management to calculate net values in the sales process. From quotation to contract or order, from billing to accounting: All business documents share the same source for price information.
Price management enables the following:
- You can deliver accurate prices for your customers
- You can strengthen loyalty by building better customer relationships through flexible price management
- During the sales process, you can define individual prices for materials, customers, and so on.
Manage Prices – Sales
With the SAP S/4HANA 2021 release, you can define price maintenance scenarios to control whether price conditions can be maintained in business documents.
You can now use the app to do the following:
- View details of your condition record imports, including time, status, and relevant follow-up actions
- Define upper and lower limits for condition amounts in condition records
For condition supplements, you can define the upper and lower limits by data import
- Display and maintain the additional fields
- Export field descriptions to spreadsheets
In addition, a data clearing job is scheduled every three months to delete your temporary data about the import history, including import logs, imported spreadsheet files, and errors in data import.
Picture 9: Make several price-relevant attribute values in the exported spreadsheet easier to read and understand.
With this app, you can now display and maintain the following new fields:
- Payment terms: The key that composes of cash discount percentage and payment periods
- Fixed value date: Specifies the date on which the terms of payment related to the sales document become effective.
- Additional value days: Specifies the number of days between the billing date and the date on which the terms of payment for the sales document become effective.
- Condition description: Description of a condition record or a condition supplement
The app now offers another data export option that allows you to export not only field IDs but also field descriptions to spreadsheets to facilitate your understanding of the exported fields. Please be noted that this export option could take more time due to the increased data volume. Also, exporting descriptions of custom fields is not possible.
Video 1: Watch an example of creating condition records for a new product based on existing condition records of a similar product. Click here to watch the demo.
Define Upper and Lower Limits for Condition Amounts
With the Manage Prices – Sales app and the OData API Condition Record for Pricing in Sales, you can now define upper and lower limits for condition amounts in condition records. The lower and upper limits are used to restrict the manual changes to condition amounts in the sales documents. With the specified upper or lower limit or both, any manually entered condition-amount beyond the specified range in the sales documents would be prevented with an error. Additionally, the upper and lower limits of a condition record can also be replicated to external systems by using the SOAP API Condition Record for Pricing in Sales – Replicate.
If during manual processing, you exceed or drop below a defined limit, the system informs you with an error message.
The mentioned APIs are available on the SAP API Business Hub (https://api.sap.com).
Access for Auditors to Archived Price Master Data
Revenues and Sales are one of the sensitive areas and related to this, the auditors need also access to the price management, and prices are always renegotiated, and old prices archived.
With the SAP S/4HANA 2021 release, auditors are able to directly display archived price master data (condition records) that have been used in sales orders or billing documents to determine the sales price.
Picture 10: Auditors can directly access detailed information of archived price master data like creation and change data.
Thanks for reading this blog post. Stay tuned!
If you are also interested in other Line of Business, I would like to draw your attention to my link collection blog – The Link Collection
If you want to learn more and actively engage with SAP subject matter experts on SAP S/4HANA Cloud, join our SAP S/4HANA Cloud Customer Community. This platform which is available to SAP S/4HANA Cloud customers and partners has a clear mission: deliver an interactive community to engage with one another about best practices and product solutions.
For more information on SAP S/4HANA Cloud and SAP S/4HANA 2021, check out the following links:
- SAP S/4HANA release info: sap.com/s4hana
- SAP S/4HANA Community here
- The Link Collection for Sales here
- SAP S/4HANA PSCC Digital Enablement Wheel here
- Inside SAP S/4HANA Podcast here
- Join the SAP S/4HANA Movement
- Best practices for SAP S/4HANA here
- Help Portal Product Page here
- Feature Scope Description here
- What’s New here