Enterprise Systems Integration Spring, 2012

High-Level OP Planning ECC 6.0 January 2008 Enterprise Operations Planning OP Execution High-Level OP Planning Procurement Process CO/PA Detailed OP Planning Forecasting Sales and Operations Planning Demand Management MPS MRP Execution Sales Information System Manufacturing Execution Warehouse Management Strategy Planning Vision Goals & Objectives Strategy Product Portfolio and Roadmap Sales Process January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2007. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Enterprise Planning Process Business Process platform

Factors which impacts Business Planning

Business Planning Process

Linking the Component Plans rate of turnover Financial Plan Revenue Plan Planned Profit price trend interest Investment Plan amortization Sales Plan Capacity Plan machine hourly rate work shedule bill explosion Cost Projection personnel costs Production Plan Personnel Plan costs of supply Overhead Costs Procurement Plan Source: Gluchowski, Gabriel, Dittmar

Intra-Enterprise Systems Integration Corporate Planning Accounting Supplier Management, Production Planning, Cost Planning, … Supplier Purchasing Prod. Sales Personnel Warehouse Customer Invoices Employee Salary Administration II: Amount-Oriented Processing Administration I: Value-Oriented Disposition and Planning Analysis and Controlling Strategic Enterprise Management Horizontal Integration Top Management Vertical Integration Middle Management Lower Management Source: Mertens, P., Meier, M.: Integrierte Informationsverarbeitung (2009), 1.

Enterprise Strategy Pyramid

Developing Operations Strategy Mission & Vision Assessment of Global Business Conditions Distinctive Competencies or Weaknesses Business Strategy Product/Service Plans Competitive Priorities Operations Strategy

Competitive Priorities Response time Cost Quality

Enterprise Systems Integration SAP Implementation Spring, 2012

R/3 SAP Module View Integrated Solution Client / Server Open Systems Financial Accounting Sales & Distribution Materials Mgmt. Controlling Production Planning R/3 Fixed Assets Mgmt. Integrated Solution Quality Mgmt. Project System Client / Server Plant Maintenance Open Systems Workflow R: real time. 3: 3-tier client-server architecture (database, application, and presentation layers) Human Resources Industry Solutions

Chart of Accounts United States Chart of Accounts Canadian Chart of ECC 6.0 January 2008 Chart of Accounts United States Chart of Accounts Canadian Chart of Accounts Each company may have the same chart of accounts in a given country: That way sales in Canada will go to the Sales account and sales in the US will go to the Sales Account For consolidation: these will match up Company Code 010 Company Code 038 Company Code 110 Company Code 117 January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Structure for Financial Accounting ECC 6.0 January 2008 Organizational Structure for Financial Accounting Client Company Chart of Accounts Code Fiscal Year Variant Credit Control Area You have to assign a chart of accounts to each company code. This chart of accounts is the operating chart of accounts and is used for the daily postings in this company code. You do not have to create a company You do have to create a company code The only reason to create a company is when you have to create a consolidated financial statement January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

General Ledger Company Code Data (continued) ECC 6.0 January 2008 General Ledger Company Code Data (continued) General Ledger Reconciliation Accounts A/R, A/P, GR/IR General Ledger Debit Credit $$ Subsidiary Ledger Accounts A/R, A/P, GR/IR When you post items to a subsidiary ledger, the SAP system automatically posts the same data to the general ledger at the same time. Each subsidiary ledger has one or more reconciliation accounts in the general ledger. These reconciliation accounts ensure that the balance of G/L accounts is always zero. This means that you can draw up financial statements at any time without having to transfer totals from the subledgers to the general ledger. Debit Credit GR/IR Debit Credit A/R Debit Credit A/P $$ $$ $$ January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Procurement Process (Procure-to-Pay) ECC 6.0 January 2008 Integration Procurement Process (Procure-to-Pay) Purchase Requisition Purchase Order Notify Vendor Payment to Vendor This is a standard view of the procure to pay process and the most common. It may vary significantly based upon the company procedures, the products/services purchases and other factors. SAP allow businesses to tailor it to their needs. Starts with a requisition or need that needs to be filled. This can come from Planning (MRP), manually or other The purchase order is the document to fill the need: usually includes the vendor, cost/price, quantity, terms and other pertinent information. [ part one of the 3-way match] Notifying the vendor The goods are shipped and brought to the organization The goods are received (typically at the dock) and then put away [ part two of the three way match] An invoice is received from the vendor [third part of the 3-way match] After the tolerances/verification of the 3-way match are met a payment is made according to the terms agreed to on the purchase order. Vendor Shipment Invoice Receipt Goods Receipt January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Sales Order Process (Order-to-Cash) ECC 6.0 Sales Order Process (Order-to-Cash) January 2008 Integration Check Availability Sales Order Entry Pick Materials Receipt of Customer Payment Pack Materials Not unlike the procure to pay process, this is completely configurable. You decide how you want the order to cash process to work and configure the system appropriately May start with Sales Order Check inventory If you do not have inventory –procurement process or production process Pick materials: from inventory Pack material: (optional) pack in box appropriate box or other Post Goods Issue (Title transfer) Invoice Customer –Create Accounts Receivable Collect Money Invoice Customer Post Goods Issue January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Production Process (Make-to-Stock) ECC 6.0 Production Process (Make-to-Stock) January 2008 Capacity Planning Schedule and Release Production Proposal (Planning/Other) Shop Floor Documents Order Settlement Goods Issue Goods Receipt Completion Confirmation January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2007. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Structures -cost center standard hierarchy Plant (Pxxx) Client (765) Chart of Accounts (Cxxx) Company Code (Cxxx) Fiscal Year Variant (2011) Credit Control Area (Cxxx) Purchasing Organization (Pxxx) Group (xxx) Shipping Point (Sxxx) Controlling Area (Cxxx) SL10 SL20 Cost Center Standard Hierarchy (PENINCxxx) ADMINxxx A005 A010 A015 A020

Asset Accounting Components Intangible assets Tangible assets Financial assets - Fixed assets Leased assets Assets under construction Intellectual property Patents Trademarks Securities Long term notes (debts) - Mortgages

Asset Management (Lifecycle) Cost center Asset master creation (AA) Asset Report (AA) Business Area Vendor master Asset Acquisition (AA) External Plant/location Vendor invoice Asset Addition (AA) Depreciation Charge Outgoing payment Asset Retirement (AA) AA: asset accounts Asset Transfer (AA) Customer/Scraping Customer Master Customer Invoice Customer Payment Within/outside Company code

Comparative Reporting ECC 6.0 Comparative Reporting January 2008 Liquidity Calculation Retained Earnings Report Financial Accounting (FI) Balance Sheet Income Statement External Reporting Cost Center Reports Financial accounting is external and feeds the external reporting requirements Managerial Accounting is internal only Product Costs Reports Managerial Accounting (CO) Profit Margin Profit Center Reports Internal Reporting January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Financial Reports Reporting Types Internal External Reporting Version 1.0 January 2007 Financial Reports Reporting Types Internal Reporting External Reporting ES Database Integrated Information External Interfaces ES Reporting Features The Rushmore Group, LLC

Balance Sheet ECC 6.0 January 2008 Assets top Liabilities middle Owner’s equity bottom Compares one year the next January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Income Statement ECC 6.0 January 2008 Revenues Expenses Profit on bottom Microsoft’s income statement January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Version 1.0 Financial Ratios January 2007 Financial ratios are the tools used to analyze financial condition and performance. Financial ratios can be divided into five basic types: Liquidity, leverage (debt), coverage, activity, and profitability. No one ratio is itself sufficient for realistic assessment of the financial condition and performance of a firm. With a group of ratio, reasonable judgments can be made. Comparing one company with similar companies and industry standards over time is crucial. Such a comparison uncovers leading clues in evaluating changes and trends in the firm’s financial condition and profitability. This comparison may be historical, but it may also include an analysis of the future based on projected financial statements. The Rushmore Group, LLC

HCM Process in the Employee Lifecycle 12-28

Organizational Structure The Organization and Planning module is the foundation for the Personnel Planning and Development Area. Objects are linked to each other by relationships. Linking organizational units results in the production of organizational charts. Positions occupied by individuals belong to an organizational unit. Within HR Planning the term “job” is used as a classification. Every position is described by a job.

HCM: Process/Functions Version 1.0 HCM: Process/Functions January 2007 Recruitment Cost Planning Reporting Training and Development Manage Work Time (CATS) Payroll Administration Hire Employee ESS Employee Self-Service Compensation & Benefits CATS – Cross Application Timesheet The Rushmore Group, LLC

Business Process Integration ECC 6.0 Business Process Integration January 2008 HCM Transactions Master Data Org Data Rules HCM HCM HCM January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2007. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Corporate Performance Management „One cannot manage what cannot be measured!“ Vision Events Goals/ Results Strategies Business Processes Measure Compare Aus der Analyse werden Aktionen angestoßen; Feedback führt zur Anpassung der Strategie Act Decide

Balanced Scorecard Approach

Dashboard definition “A dashboard is a visual display of the most important information needed to achieve one or more objectives; consolidated and arranged on a single screen so the information can be monitored at a glance” (Few, 2004) Why should dashboards be used in the decision making process? The ability to receive, process and remember information can be increased by the use of visual appliances But: To effectively support decision makers, problem representation has to match the task that is to be performed

The New Intelligence Platform of SAP Name is changed to SAP Crystal Dashboard Design The New Intelligence Platform of SAP Please check sdn.sap.com for latest version SAP Crystal Dashboard Design (formerly Xcelsius) is the flagship product for dashboarding and visualization Rapid development of dashboards by drag and drop Replacing SAP Bex Web Application Designer Connectivity through XML and webservice connectors Source: (SAP AG 2009)

SAP Crystal Dashboard Design (Xcelsius) Extremely attractive Highly interactive Feather light Highly scalable Easy to build and maintain Source: K. Jason, M. Ty (2008). Which BI Client To Use. Retrieved 02/15/2009 from http://www.sdn.sap.com