ERP Advantages and ERP Project Launch

Before investing money and implementing enterprise resource planning the company shall analyze the benefits of erp .

Advantages of ERP:

1. Better sales and service is a serious gain.
2. It helps it shipping items on time to any where.
3. We can ship goods in less time.
4. Sales people can concentrate on sales rather than bothering about sales.
5. Customer service can be improved.
6. Productivity of labor increases by providing all the components at one palce .
7. Reduce purchase cost by providing the advance vision reports and procuring the data when
required over the market with best price.
8. Purchase cost will be reduced.
9. ERP reduces inventories.
10. The space available in the company will be used effectively.
11. Cash flow will be improved.
12.Productivity will be improved.
13. Employees job satisfaction will be better .

Cost and benefit analysis of Enterprise resource Planning:

This can be done either by top level people of the company or by the joint venture of middle level and high level people of the company.

The problem with high level committee is there won't be enough consensus among the total employees which is not desirable and joint group is advisable.

First higher level people of a module shall be educated regarding ERP and they shall do some home work and analysis regarding this implementation with number of meetings.

The cost and benefit shall be done in a conservative manner and shall not be over estimated the benefits so that people stay positive.

Having a good leader like general manager on the job through out the process of installation is a good idea and changing them will effect the process of erp implementation.

Who can be a ERP Project Leader ?

A person who is very much involved in the business shall be appointed as a project leader of erp and shall be made free from all other business jobs.

An outsider shall not be chosen like a project leader as he is not in touch with business process and people around him.To get the benifit of enterprise resource palnning the leader shall be well femilier with the business flow of the company.

The project leader of erp shall have operational knowledge of the business.Selecting a system person as head may give the disadvantage of not knowing what is the business process is exatly and the operational people won't have a good rappout which altimately effect the success of ERP project.

Project leader shall be the best person of the company who understand the business best.

If the operations head of a department is there in the company for more than five years with good skills he may suite to the job.

He shall have a good track record,good in managing the people and has excellent communication skills.

He shall the one who trusts and respects the peers.

Duty of ERP project leader :

Over seeing the education of erp to the entire team of company.

Follow up of the project schedule and seeing that they are as per plan.

The general way that project leader work and report as shown in the figure ERP TEAM.

Any way depanding on the company each one may have different structure and for a very big business with different wings it can have project leaders both for erp wing and software implementation wing and both of them can represenet and report further to company head about the progress of the project.

Project leaders can create a speific team of experts to study a specific issue which need a deep study of understanding and they will report back to team in a specified time.This is to make sure that all functioning of erp project is good.

During the process of implementing erp the form need a professional guidenace who are all ready there in their past during the process of implementing and running business with erp and femilier with the problems that are forth coming.

These expert guide the general manager,project leader,project team about the problems and guide them about the measures to be taken. The expert will ask all critical questions about the business and its erp implementation and the top management and project team shall look after all thease matters of concern before implementing the logic of erp. The outside expert act like a adviser for the erp project and his job is very critical in the success of implementing erp .

ERP makes the operational performance of business much better and hence it leads to big financial benefits to the company and self satisfaction and carrier growth to the employees.It is like win and win situation.

So the major initial steps in erp project are

1. Making a vision statement for project implementation.
2.What is the money going to spend on this process and what are the advantages ?
3.How to organize erp project?
4.Having a set of goals for specific time and how they are performed ?

These things shall be taken care by the high level people of the company together and analyze through out the implementation process.

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SAP CRM Customer as Business Partner Introduction

Customer Relationship management is a very important part in running any business and SAP provides a wonderful software to make the impression of a customer better so that he will be keep coming for the business and it is SAP CRM. The important factors determine the financial success of an enterprise are

1.Market-driven products
2.Profitability and
3.Sa1tisfied customers.

The company shall understanding these factors as a continuous and integrated cycle and not as areas of c o n f l i c t is the basis for a successful business strategy both now and in the future.

Customer relationship management (CRM) plays a important role for the above job and continuous and efficient customer service as well as knowledge of customer requirements forms the basis for market success and long-term business value.

If enterprises want to maintain and build on their market positions,they must try their best to improve their relationships with existing customers and work hard to acquire new customers.

It's the customer's choice today and thanks to internet now the customer to compare products and services from across the globe in detail. While the importance of products and services differs from individual to Individual, the most important decision making factors are product quality, availability, price, delivery reliability, and service.

Direct customer dialogue helps in getting a market share and enterprises now must focus their entire organization on the demands and activities of their customers. Enterprises must constantly be able to recognize changes in customer behavior and market developments and be able to adapt their resources and business processes with respect to it. Customer relationship management provides the know-how and the processes necessary to support this requirement efficiently.

Customer relationship management has long since outgrown the direct customer contact of the front office. SAP's integrated CRM approach considers the close interconnection of customer-specific processes with all aspects of enterprise management .An organization's knowledge of customer requirements and complaints can be used directly in product life cycle management (PLM) to help provide competitive offers that are in line with market requirements at any time.
The close links with supply chain management (SCM) and financial accounting provide quality of delivery and fulfillment.

However, customer requirements do not simply determine an enterprise's internal processes and they influence all business relationships.

Improving the exchange of information with sales partners partner or channel management plays a decisive role in many business areas.

The business processes, in turn, build on customer and partner knowledge and permeate the supply chain to ensure quality, performance, and profitability in procurement and logistics.

This entire process requires an efficient technological infrastructure, which must be able to consolidate information from different sources and make this information available at the touch of a button. It must offer both security and openness to support transparent business processes across the boundaries of the organization. The infrastructure must also be flexible enough to accommodate new developments at any time, such as changes to business processes, new technology, and expansion.

New application architectures like SAP are making it possible to use Web services to organize processes and changes quickly and across the organization A CRM solution must be flexible enough to incorporate such innovations in a way that allows enterprises to profit from them.

mySAP CRM offers a very broad range of functions and uses to make business better.

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The previous post deals with SAP edi out bound process with out message control with example.

SAP EDI Outbound Process without Message Control Contd.

The previous post deals with electronic data interchange for SAP with out message control and the example is displayed with payment order in detail. This post is in continuation with that previous post.

SAP EDI Accompanying Sheet for the Paying Company

Under Paying Company Codes, select the company code and view the details. You need to verify the settings in the EDI Accompanying Sheet Form field. A standard form, F110_EDI_01, is supplied in the standard system. This sheet prints the totals. The Form for the Payment Advice field should also be set appropriately.

The SAP Transaction code for this is FBZP and the Menu Path: From the IMG, choose Financial Accounting, Accounts Receivables and Accounts Payables, Business Transactions, Outgoing Payments, Automatic Outgoing Payments, Payment Method/Bank Selection, Configure Payment Program.

Vendor Master Data for SAP

A vendor master is created for vendors from whom you procure material. You must maintain the vendor for each purchasing organization that can procure from this vendor. We need some additional Company Code data fields in the vendor master record, as shown in Figure . The payment run program uses the following payment transaction fields.

Transaction code in SAP ERP IS XK01 and XK02 and the Menu Path: Logistics, Materials Management, Purchasing, Master Data, Vendor, Central, Create or Change.

EDI Configuration Components must be set up are basic settings of edi and the

Partner Profile for EDI :

Creating the Outbound View A partner profile is created for every business partner that sends or receives EDI documents. In the partner profile, an outbound record is created for each outbound message.

Create a partner profile for your vendor and your bank. Add an outbound record for the outbound message: REMADV and PAYEXT, as shown in Figures below respectively. The REMADV message is created for the vendor, and the PAYEXT message is created for the bank. Both messages use the IDoc type PEXR2001. Note that the partner function field is blank.

The payment process allows you to create a test IDoc message at the time of the proposal run. To enable this text, you must create an additional entry for the test message in the partner profile. This entry looks exactly like the entry for the REMADV and the PAYEXT messages except that the test flag should be turned on. In the initial stage, I recommend this optional step to test the process.

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SAP EDI Outbound Process without Message Control Payment Order

Electronic data Interface with out message control for SAP is a way of paperless data transmission and here we are going to discuss that with an example of payment order.

This post is the continuation of above link and here we are going to discuss regarding preparation phase of process.

Identifying Business Partners for EDI outbound process in SAP :

You must identify the business partner (vendor or bank) to whom you are sending the business document. The vendor number is an entry from your vendor master data (transaction XK02). The partner number for the bank is stored under the EDI partner profiles section in the DME (Data Medium) view of the house bank master entry (transaction FI12).

As an EDI person, you are responsible for making sure that there is a valid entry in the EDI partner number field. If a value does not exist, you will not be able to create a partner profile.

Identifying IDoc and Message Types

You identify the IDoc type and the message type to support the processPEXR2001 (IDoc) and PAYEXT and REMADV (message ).

Identifying Workflow Parameters of SAP:

In this step you identify the organizational object (user ID, position, workcenter, and so on) responsible for handling errors associated with this EDI transaction. You can choose from several types of organizational BUSINESS objects.
The Setup Phase

After you identify the parameters, you set up the EDI components required for each transaction and the master data necessary from an EDI perspective. The master data is required before you can do some of the EDI settings. For example, you cannot create a partner profile before you create the vendor master.

Master Data Requirements

The type of master data and the required fields from an EDI perspective in the master data vary for each transaction. Your task is not necessarily to maintain the entire master data, but you should be aware of the fields required from an EDI perspective. These fields might not be required fields otherwise in the master data of ASAP.

The values in these fields populate critical information in the IDoc or are absolutely required fields in the EDI standards. For example, an Account at Vendor field in the vendor master populates the Sender field in the IDoc's control record. The cross−reference sheet will help you identify the fields that must be filled for your business needs.

Partner Settings for the House Bank

The transaction code is FI12
and the Menu Path: From the IMG, choose Financial Accounting, Bank Accounting, Bank Accounts, Define House Banks.

A bank ID is created at a company code level for every bank with which you have an account. This ID uniquely identifies the bank and contains general information such as the contact person and bank address, as shown in Figure .

The DME view in the bank master contains information about the data medium used to transfer funds. In the DME view, the EDI partner profile section identifies the partner number assigned to the bank for EDI purposes. This entry must be filled with a value that uniquely identifies the bank as an EDI business partner.

If this entry does not exist and you want to add a value in this field, you must also click the partner profile button to create the partner profile record. The system will not let you exit without a partner profile entry.

Make sure that an account exists in the bank and that details such as the G/L account and bank account number are filled in, as shown in Figure below.

The previous discussion is regarding ERP software selection for a project.

ERP Software Selection and Implementing the Project

We have discussed regarding ERP implementing process and its advantages in the previous post.Here we are going to discuss what kind of software the company has to choose and how to start launching the erp project.

ERP software helps in connecting every transaction of business into a centralized data base which can be accessed by the authoriesed management positions.

Basing on transactions financial books of the company which implemented erp adjusted automatically.

ERP system is complex but its interface will be simple to use.

Better implement enterpreize resource software and erp process supeartely which makes the job easy.

First ES software then ERP system is a good choice.

Implementing ES software and ERP creates resources problems and dampen the business process.

ERP software selection :

Software vendor shall go through the business process and if he says that he has most of the software
readily available you can select the software.

Company shall Check the list of software providers and understand who suits to business needs .

Implementation teams shall be combined for both software and ERP installation.Running a pilot test of erp software is needed to understand how it is performing.

Having a extended support is needed for the success of erp.

Additional software outside can be implemented with erp and they are called bolt up software.

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SAP EDI with out message control

SAP EDI Outbound with out Message Control

Here we are going to discuss regarding SAP EDI outbound process with out message control and the example taken here is payment remittance process which is a common business transaction.

Overview of Remittance Advice and Payment Order for SAP FICO :

The remittance advice/payment order (820 in ANSI X12, PAYADV in EDIFACT) is a transaction that can be used for three purposes.

1.To advise a financial institution (a bank) to make payment to a payee on your behalf (the payer) ·

2.To report the completion of payment to a payee by a financial institution (a bank) ·
To advise a payee about a payment that has been made to the payee's account either by a payment order or through other means (inbound)

3· When sent to a bank, this transaction contains financial instructions (clearing information) that the bank uses to process the payment data. This information has no significance for a payee.

In the SAP system, this transaction is implemented in the FI module. Figure shows the business partners involved in the process and the messages exchanged between them. The process begins with an invoice received in the system from a vendor, for goods or services procured from the vendor. The invoice can be entered manually in the system or can be input via EDI. When the invoice is due, payment must be made.

In the SAP system, the payment is generated through a payment run program that is scheduled periodically to process outstanding invoices. This process selects entries that are due and creates a payment proposal. The payment proposal allows you to view and edit payments that will be made.

After the proposal has been verified and changed (if necessary), the actual payment run can be scheduled. The payment run will create the necessary payment documents, such as checks or payment advice, to be sent to a bank and/or a vendor.

Analysis Phase of SAP EDI outbound with out message control

The analysis phase consists of analyzing business requirements and comparing them with the standard functionality of SAP.

Identifying Business Processes

The remittance advice transaction is part of the Accounts Payable application under the FI module. The transaction is F110 for starting the payment run program.
The payment run program is a two−step process. In the first step, called a proposal run, you create a proposal that allows you to view and edit the payments that will be generated. The proposal run can also create test IDocs that can be analyzed and verified before the actual IDocs are generated. The test IDocs are not transmitted to the bank or the vendor.

In the second step, the actual payment run program is executed. At this time, the program generates the output that is sent to your vendors and banks. Thus, identifying a business process helps you understand your company's business rules and the SAP process.

Identifying User Exits Available in the SAP EDI Process

The user exits for the outbound remittance advice process are FEDI0003 and FEDI0004. To see a list of all user exits and their purposes, execute transaction SMOD, enter the enhancement name (FEDI0003 or FEDI0004), click the Documentation button, and select Display.

The previous post deals with SAP Master data for ABAP programmer.

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ERP Introduction

SAP Master Data for ABAP Programmer

At the core of ERP server system SAP will store master data and every ABAP programmer shall know about the basics of this master data.

The master data in the SAP system represents the characteristics of the business entities or the business objects used in the system, for example, material, customer, and vendor. These are stored in Material Master, Customer Master, and Vendor Master tables.

SAP also has organizational objects that represent the various organization entities. These entities have a defined business responsibility and are used to represent the company's structure in different forms, such as the purchasing organization, sales organization, and company code.

An organizational object and an SAP organizational object are bit different. Organizational objects are entities such as users, positions, and jobs. SAP organizational objects are company codes and sales organizations. They were named SAP organizational objects because of their relevance to the SAP system.

When master data is created in the system, we define views for each SAP organizational object, depending on the master data. For example, when you create a vendor, you create a separate view for each company code and purchasing organization that deals with the vendor,. A view holds information specific to the respective SAP organizational object.

Similarly, if you are creating a customer master, you have a separate view for each sales area, which consists of a sales organization, distribution channel, and division. For the material master, you have views that are based on plants, storage locations, sales organizations, and so on.

You cannot create a purchase order for a vendor that has not been defined for your purchasing organization. You cannot order a material for a plant if the material has not been created for that plant and all this shall be done at the system level during the process of SAP project initiation.

Material Master Data for SAP:

A material master is created for materials you procure from a vendor. You must create a view for the plant to which the materials will be delivered. Although these are not EDI requirements, you cannot create a purchase order without this information.

Transaction code in SAP for this is MM01, MM02 and the Menu Path is Logistics, Materials Management, Material Master, Material, Create (general), Immediately .

Vendor Master Data for ERP SAP :

Transaction for this is XK01 and XK02 and the Menu Path: Logistics, Materials Management, Purchasing, Master Data, Vendor, Central, Create .

A vendor master is created for vendors from whom you procure material. Maintain the vendor for each purchasing organization that can procure from this vendor. The following fields must be entered in the vendor master for EDI in their respective views.

Purchasing Master data for EDI outbound process with message control :

Order Currency, Terms of Payment, and Incoterms must be filled. Incoterms define the commonly used trading terms established by the International Chambers of Commerce. If they are not filled, they need to be filled when creating a purchase order.

SAP Purchasing Information Records:

The Transaction code for this ABAP screen is ME11 and Menu Path is Logistics, Materials Management, Purchasing, Master Data, Info Record, Create A vendor material information record contains vendor−specific information about a material.

For example, if you procure a particular material from three vendors, each vendor might call it a different name, the delivery times can be different, and the prices can vary. You store the vendor−specific information about a material in this table.

Figure below shows that material DPC1020 in your system is identified as VEN1000 at your vendor, Computer Mart Corporation. The fields in this table are required. You are not required to send the vendor's part number on an EDI transaction. It is the vendor's responsibility to convert the customer part number to the vendor's internal number.

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ERP Introduction

EDI Outbound Process with Message Control Purchage Order Cond.

EDI outbound process with message control is introduced previously for purchase order and this post is in continuation with it.

Setup Phase for purchase order of EDI message control:

The Partner Profile: Creating Message Control and the Outbound View.

SAP Transaction code for this is WE20.

A partner profile is created for every business partner that sends or receives EDI documents. In the partner profile, a Message control record and an outbound record are created for each outbound message, as shown in the following ABAP screen.

Create a partner profile if it does not exist. Add the Message control data and outbound data for your message.

EDI Message Control: Creating Condition Records

SAP Transaction code for this is MN04.

Create a condition record for the output type identified in the preparation phase. The condition records are used to define the conditions under which the output type should be proposed. When you create a condition record, you choose the business rule on which you want to create your condition records.

To start, you can be very specific, so choose a business rule that has vendor number as one of the fields. Specify the values for the medium as 6 (EDI) and the timing to suit your needs. Initially, you can specify the timing as 4 to indicate immediate .

The SAP Workflow Settings: Creating the Task Profile:

Outbound messages require the following actions on workflow settings.
  1. Verify the basic workflow settings. ·
  2. Set up the organizational unit. ·
  3. Create a task profile for the error tasks.
To get started quickly, you can make the error task a General task. Doing so fulfills the requirement for the task profile. You can use your user ID as the person responsible in the partner profile, in which case you do not require the setting up of the organizational unit.

Further this edi outbound process with message control for purchase order example will be explained in the coming posts.

You can refer EDI outbound process with message control
and Message Control edi parameters for SAP
and EDI message control example with purchase order introduction
and ERP Implementation process and advantages

EDI Outbound Process with Message Control for Purchage Order

SAP EDI outbound process with Message Control is dealt with purchase order in detail with example sap abap screen shots.

Purchase Order overview:

The purchase order transaction is a business document sent by a customer to a vendor to procure materials or services. This transaction set provides for customary and established business and industry practice relative to the placement of purchase orders for goods and services.

The Analysis Phase of edi outbound process with message control of purchase order:

The analysis phase consists of analyzing business requirements and comparing them with the standard functionality of SAP. It's useful to have a good understanding of the SAP business process because, in several cases, you can fill gaps by customizing the system. If gaps cannot be filled via customizing, you should explore the use of user exits to meet your business needs .

Identifying SAP purchase order Business Processes

Identify the SAP business process that supports the EDI transaction in which you are interested. Sometimes the lingo in SAP can be different from what you are accustomed to. The online help is very useful at this stage. You will have to identify the SAP transaction from which you can initiate the process.

For example, the purchase order transaction is part of the Materials Management module. The transaction is ME21 for creating new purchase orders. This information, although not tricky, helps you understand which business process will be used and at which stage you initiate the process.

For example, if you are going to send out an advance shipment notice transaction, you can carry it out at the time of creating a delivery or after a goods issue process. Thus, identifying a business process helps you understand your company's business rules.

Developing a Cross Reference Sheet and Performing a Gap Analysis

In the analysis phase, you identify the gaps between the SAP−provided functionality and your business needs. Customers develop a cross−reference spreadsheet that maps the IDoc data fields to the SAP data elements and the EDI standards. A template is provided for reference . This cross−reference list helps to identify gaps between your business needs and the standard system. Every company develops the cross−reference sheet in one form or another for each transaction.

Identifying Available User Exits in SAP :

As a result of the gap analysis, you discover gaps between your business needs and the standard SAP functionality. If the gaps cannot be filled using one of the customizing options, you can use one of the user exits. User exits allow you to add customized code formally to an existing SAP process. They have been provided at strategic points in the process and are supported during an upgrade. You can browse 1the list of user exits by using the CMOD/SMOD transactions.

The user exit for the outbound purchase order transaction is MM06E001. To view a list of all user exits and their purposes, execute transaction SMOD, enter the enhancement name MM06E001, click the Components button, and select Display.

Identifying the IDoc Type and Message Type of EDI :

Identify the IDoc type and the message type to support the process: ORDERS02 and ORDERS .
You might wonder why there are multiple IDocsORDERS01 through ORDERS05 . The last two digits represent the version. ORDERS05 is a newer version, which means that it still has all the segments of the original version, ORDERS01.

ORDERS02 and higher support configurable materials. Always use the latest version of an IDoc type unless you specifically need the older version. Each IDoc type is thoroughly documented. To look up the IDoc documentation, execute transaction WE60.

Identifying the Message Control Parameters

The next step is to identify the Message control parameters. For each application there is an application ID from which you can drill down to other components of the Message control. You must determine the application ID and output type used in the process.

Application ID: EF
Output Type: NEU

Identifying the Process Parameters

In this step you determine the process code for your IDoc type and message type combination. Execute transaction WE41 for a list of process codes available in the system. The process code for generating the ORDERS message using the ORDERS02 IDoc is ME10.

Identifying the Workflow Parameters In this step you identify the organizational object (user ID, position, workcenter, and so on) responsible for handling errors associated with this EDI transaction.

The set up process of edi outbound process with message control for purchase order will be discussed in the next post.

The next post deals with edi outbound process with message control for purchase order is continued here.

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