Product Compliance in SAP S/4HANA 2021 – Part 1
When you produce, sell, and ship products, you must comply with regulatory and stakeholder requirements for ingredients, registrations, provision of safety data sheets, labeling, packaging, and safe transportation. You need a solution that helps fulfill these requirements while also ensuring product marketability, reducing compliance costs, and protecting your brand.
In this blog series, I will give you an engineering expert view of some selected highlights for product compliance of our SAP S/4HANA 2021 for Product Compliance.
The blog is built as a series of 3 parts and present the key highlights for:
- Part 1: Foundation for Product Compliance
- Part 2: Dangerous Goods Management
- Part 3: Safety Data Sheet Management.
In this first blog, you can find information on functions that are used by all components of Product Compliance. To name just a few highlights that we have in store in the new release:
- Regulatory Content Service for Product Compliance and Regulatory Content 2021
- Manage Regulatory Graphics
- Manage Phrase-Enabled Fields
- Integration of Product Compliance Checks into Purchasing
- Work View of Unpackaged Products and Raw Materials
- Event Processing for Components with OELs Assessments of Products and Raw Materials
- New SAP Fiori apps to manage Safety Data Sheets
- … and more.
- All these innovations will also be available for SAP S/4HANA Cloud, private edition.
- You will find in this blog demos related to SAP S/4HANA Cloud, but the functionalities described in these demos also correspond to SAP S/4HANA 2021.
Compliance with the product and chemical-related regulations is a must for manufacturing companies. The challenges here are to keep up-to-date with increasing regulatory requirements and to meet the demands of customers, market, and industry.
With SAP S/4HANA, you can manage any compliance requirement and all required product, material,
and ingredient information. It automatically tracks and checks volumes of regulated substances and determines the compliance status of products and raw materials against regulatory and stakeholder requirements based on built-in regulatory content such as substance lists from more than 130 regulations.
Powerful reports and analytics provide visibility into the compliance of individual products, raw materials, and the whole product portfolio, and enable everyone in the company to retrieve compliance information easily. Native process integration ensures that only compliant products are developed, purchased, produced, sold, and shipped.
Regulatory Content Service for Product Compliance
Companies are facing complex and specific regulations in the market. With the ability to validate regulatory compliance early in the product development cycle, you avoid the risk of having to rework formulations containing banned or restricted substances or, worse, recall products if they do not meet regulatory obligations. or customers’ requirements.
With the update and enhancement of the integrated regulatory content, you stay compliant with your product portfolio using the most recent regulatory updates.
SAP provides the following new and updated compliance requirements in each solution area:
- Compliance Requirements
Regulatory Content Update
With the SAP S/4HANA 2021 release, we have enlarged the regulatory content. The update provides:
- 40 new versions or updated compliance requirements with this release
- In total, 136 compliance requirements (substance list check pattern) are available now
Safety data sheet management:
- Availability of 104 new or updated compliance requirements within this release
- In total, 97 compliance requirements for safety data sheets are now available
Dangerous goods management:
- 8 updated compliance requirements with this release
- In total, 14 compliance requirements are available now
- Embedded phrases for packaged dangerous goods notes and supplements to dangerous goods descriptions
- Updated phrases in firefighting measures, personal protection, first-aid measures, and ecological information
In total, over 300,000 listed substances, over 3,500 phrases, and over 2,500 graphics
Picture 1: With the integrated regulatory content, you stay compliant with your product portfolio using the most recent regulatory updates.
Note: For more information about SAP Content for Compliance Requirements, please click here to access the SAP Help Portal.
Manage Regulatory Graphics
In regulations for hazardous substances, such as the Global Harmonized System (GHS), or in dangerous goods regulations, graphics are used to convey specific information. The GHS uses pictograms to alert users of the exposure dangers when handling a hazardous substance. The pictograms are, for example, required on the labels of hazardous chemical products.
In dangerous goods regulations, graphics are used on labels and markings to, for example, provide the main information regarding the characteristics and dangers associated with the dangerous goods and how to handle a package.
Graphics used in Product Compliance are delivered as content by SAP. The graphics are grouped in graphic collections and are assigned to a compliance requirement version. Those collections can be viewed in the Manage Regulatory Graphics app.
Demo 1: Delivery of regulatory graphics such as handling and marking labels for dangerous goods.
Manage Phrase-Enabled Fields
The idea of Phrase Management is to provide standardized texts, called phrases, to consumers. These consumers could be, for example, applications that provide valuable help for specific fields, or document generation services that put texts in documents. A phrase is used in SAP S/4HANA for product compliance as a value for specific fields, such as in the compliance requirement World First Aid Measures or simply, Colors. Phrases contain standardized text strings that are provided in different languages. These phrases are used for processes and documents needed for transporting and selling your products in many different countries/regions. Phrases are provided as SAP content for complying with regional, national, and international regulations.
Demo 2: Compliance data foundation – Embedded phrases (note: no audio voice available)
Continuous delivery for phrases using a regulatory content service from SAP
The release cycle for SAP S/4HANA is based on a yearly release cycle (for more information, see Release and maintenance strategy for SAP S/4HANA).
However, it can for example happen, that the regulation has changed, and in order to sell your product to your customer, you must apply this new regulation today.
So, for this, you cannot wait for the next release cycle of S/4HANA and now we will have a continuous content delivery which is decoupled from the SAP S/4HANA release cycle, and with the 2021 release of SAP S/4HANA for Product Compliance, we will have that for phrases.
Stay tuned on the progress of this function as in the future release, SAP will continuously add more features here.
Picture 2: Release independent delivery of embedded phrases, provided by SAP
During the process, various automated tests like security, integration, and acceptance tests are performed. Connecting SAP S/4HANA for product compliance to the Regulatory Content Service takes place via SAP API Business Hub Enterprise, OAuth 2.0 client and RFC destination.
This service provides the following key features:
- Continuous delivery of embedded phrases.
- Runs on the SAP Business Technology Platform.
- Included in the SAP S/4HANA for product compliance license.
- Configuration and connection follow highest security standards.
- SAP Note 3055767 Information published on SAP site
- First Step After Configuration: Activate Regulatory Content
- Background Processing Jobs Update
- SAP Content for Product Compliance
Integration of Product Compliance Checks into Purchasing
For compliance-relevant products in a stock transfer order, the system checks whether a safety data sheet is required and whether the relevant safety data sheet is available in the specified languages.
If a product has been classified as a dangerous good, the system also checks if all necessary dangerous goods data is available, and whether transportation of the product is allowed.
Depending on the outcome of this check, the system sets the corresponding status for the item. Based on the item status, the system also sets a status in the header of the stock transfer order.
The following checks are integrated into purchasing documents:
Supplier Check: When a purchaser creates or edits purchase order for a compliance-relevant product, the system checks the status of the supplier assessment.
Safety Data Sheet Check: When a purchaser creates or edits an intercompany stock transfer order for a compliance-relevant product, the system verifies for the product:
- Whether a safety data sheet is required.
- Whether the relevant safety data sheet is available in the defined languages.
Dangerous Goods Check: When a purchaser creates or edits an intercompany stock transfer order or a purchase order with transport responsibility for a compliance-relevant product classified as a dangerous good, the system checks whether transportation of the product is allowed, forbidden, or restricted.
Picture 3: Prevent executing noncompliant procurement processes for all relevant products
You can find more information about the integration of Product Compliance into purchasing processes in the Product Assistance for Product Compliance. See Product Compliance Data in Purchasing Processes.
Work View of Unpackaged Products and Raw Materials
With this feature, you can get an overview of the data available in the system for a given raw material or unpackaged product. The data is organized similarly to a safety data sheet – it is grouped and sorted identically. This allows you to easily manage the data received from your suppliers and maintain it in the system.
Picture 4: Simplify the data management processes for all SDS-relevant data, by grouping and ordering the data identically to SDS sections.
You can use this app to:
- View the safety data sheet relevant data for a raw material that is available in the system.
- View the processing status of the data.
- View the person who is currently assigned to work on the data.
- Navigate within the sections and update the data based on information from supplier.
Specifying Legal Areas for Product Compliance
Legal areas are used in product compliance to define, for example, legal compositions, legal deviations from material-based compositions, or to specify how to use the product.
For each legal area, you can now assign the country/region for which the legal area is relevant.
SAP provides the standard legal area (World) representing a legal area that is generally valid.
Demo 3: Increased compliance for safety data sheets based on country/region (including audio).
Effects on Configuration
You can specify legal areas and assign countries/regions to these areas in the Specify Legal Areas for Product Compliance Customizing activity under à Product Compliance à Foundation for Product Compliance.
Monitor Volumes for Substances that are Exported to a Country/Region
In many countries, regulations state that, above a certain quantity of chemicals and other hazardous substances, you must register with the authorities the maximum quantities of these substances that you plan to purchase, import, produce, sell, or export in a certain period.
The goal of substance volume tracking is to help you comply with chemical regulations according to which you must track and monitor the volumes of regulated substances that you import to, export to, or produce in a country/region within a certain period of time.
Substance volume tracking is integrated with the logistics processes for purchasing, manufacturing, and sales. It tracks, calculates, aggregates, and monitors the imported, produced, and exported substance volumes that result from these processes.
By comparing the recorded quantities with the limit values, the system can warn you in good time before a limit value is exceeded. If a limit value is exceeded, the system can also block the respective business process. This means you can ensure that you stay below the quantity limits.
With the SAP S/4HANA 2021 release, we introduce the Monitoring of Volumes of Substances that are Exported to a Country or Region and with this feature you can get an overview of the aggregated volumes of substances that are exported to a country/region by a legal entity in your company.
Demo 4: Substance Volume Tracking enable customers to monitor the volumes of substances which are exported to a country or region (including audio).
Substance volume tracking supports the following functions:
- Tracking volumes of imported, exported, and produced substances on a legal entity level and based on the relevant compliance requirements.
- Definition of legal entities and mapping manufacturing, supplying, or receiving plants to these legal entities.
- Substance volume aggregation based on the tracking period of the relevant compliance requirement version.
- Calculation of substance volume tracking status based on the aggregated volumes and the thresholds in the respective compliance requirements.
- Monitoring substance volumes, providing detailed information about the aggregated substance volumes, and tracing information back to the specific logistics document via the Monitor Substance Volumes (F4693) app.
You can use substance volume tracking with the delivered sample compliance requirement definitions for 43 countries/regions. You can create new versions of the sample definitions and make adjustments in the new version, such as defining additional exemptions, changing the default threshold, or changing substance lists. You can also activate and use your own compliance requirement version to track and monitor substance volumes.
You need more information on this? Read the following:
Event-Driven Tracking: With this feature, you can get event-driven substance volume tracking that captures change events and updates the substance volumes accordingly. In addition, you can get improved determination of the relevant compliance requirement version based on its effective date
Monitor Substance Volumes: With this app, you can monitor and analyze the volumes of substances that are imported, produced, or exported by a specific legal entity of your company, and then aggregated by the tracking period of the relevant compliance requirement version. You can quickly identify substances that approach or exceed the thresholds defined in the relevant compliance requirements. You can also examine the details of the aggregated substance volumes to find out which business process scenario they belong to, in which month they were tracked, and which business process document they originate from.
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 Product Compliance 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