IMPLEMENTERS AND RE-IMPLEMENTERS

IMPLEMENTERS AND RE-IMPLEMENTERS

This post deals with how to implement ERP at a Class A level. Further,  it  applies  to  both  first-time  implementers  and  to  re-implementers, companies  whose  first  implementation  resulted  in Class C or D results and who now want to get the full bang for their buck. For those of you who’ll be re-implementing, be of good cheer:

Many  companies  now  getting  Class  A  results  got  there  via  re-implementation. The steps involved in a re-implementation are vir-tually identical to a first-time implementation; the main difference is that  some  of  the  necessary  steps  may  have  already  been  accom-plished satisfactorily.

Many companies today need to re-implement. Some of these are companies who, as we saw earlier, thought they were implement-ing ERP, but actually were only installing enterprise software. Their motivations were largely software-driven: Y2K compliance, legacy systems becoming unworkable, multiple hardware platforms sup-porting too many operational systems, etc. The problem is that, in many  cases,  the  new  software  was  installed  but  not  much  else changed.

Many companies’ ERP implementations in the past started out with  the  best  intentions  in  the  world.  Company  S,  for  example, wanted to re-engineer and improve processes, to improve the way they managed the business, and to give far better customer service to an increasingly demanding customer base. During the implementa-tion, however, they were overwhelmed by the software. Enterprise software tends to be highly complex, and complexity can make it very difficult to install. As the implementation project took longer

and longer, and cost more and more, top management became more and more impatient. The result: a decision to forget about imple-menting better business processes and just get the software running. 

Thus, Company S has new software but is still running the busi-ness in much the same old way, and thus they need to re-implement. If you’re in this category, this book is intended for you every bit as much as for the company implementing for the first time.

THE APPLICABILITY OF ERP

THE APPLICABILITY OF ERP

ERP and its predecessor, MRP II, have been successfully imple-mented in companies with the following characteristics:

• Make-to-stock

• Make-to-order

• Design-to-order

• Complex product

• Simple product

• Multiple plants

• Single plant

• Contract manufacturers

• Manufacturers with distribution networks

• Sell direct to end users

• Sell through distributors

• Businesses heavily regulated by the government

• Conventional manufacturing (fabrication and assembly)

• Process manufacturing

• Repetitive manufacturing

• Job shop

• Flow shop

• Fabrication only (no assembly)

• Assembly only (no fabrication)

• High-speed manufacturing

• Low-speed manufacturing

Within the universe of companies that make things—manufac-turing enterprises—ERP has virtually universal application. This book deals with how to implement ERP in any of the above envi-ronments. Some people struggle with this applicability issue; they sometimes say: “We’re different, we’re unique, it won’t work for us.”

We’ve heard that a lot over the years. What we have never heard is:

“We’re  different,  we’re  unique,  Generally  Accepted  Accounting Principles (GAAP) won’t work for us.” Well, ERP is the logistics analogof GAAP. It’s a defined body of knowledge that contains the standard best practices for managing that part of the business. The main difference between the two is that ERP and its predecessors have been with us for about four decades; double-entry bookkeep-ing and its offshoots have been around for four centuries. 

MANUFACTURING RESOURCE PLANNING - MRP

MANUFACTURING RESOURCE PLANNING 

A method for the effective planning of all resources of a manufac-turing  company.  Ideally,  it  addresses  perational  planning  in units, financial planning in dollars, and has a simulation capabil-ity to answer “what-if” questions. It is made up of a variety of functions, each linked together: business planning, sales and op-erations planning, production planning, master scheduling, mate-rial requirements planning, capacity requirements planning, and the execution support systems for capacity and material. Output from these systems is integrated with financial reports such as the business plan, purchase commitment report, shipping budget, and inventory projections in dollars. Manufacturing resource plan-ning is a direct outgrowth and extension of closed-loop MRP.

The next step in this evolution is called Manufacturing Resource Planning or MRP II (to distinguish it from Material Requirements Planning, MRP). A direct outgrowth and extension of closed-loop MRP, it involves three additional elements: 

1. Sales & Operations Planning—a powerful process to balance demand and supply at the volume level, thereby providing top management with far greater control over operational aspects of the business.

2. Financial  interface—the  ability  to  translate  the  operating plan (in pieces, pounds, gallons, or other units) into financial terms (dollars). 

3. Simulation—the ability to ask “what-if” questions and to ob-tain actionable answers—in both units and dollars. 

This was done only on an aggregate, “rough-cut” basis, but to-day’s advanced planning systems (APS) enable effective simu-lation at very detailed levels.

Now it’s time to define Manufacturing Resource Planning. This definition, and the one to follow, come from APICS—The Educa-tional Society for Resource Management. APICS is the leading pro-fessional society in this field, and its dictionary has set the standard for terminology over the years.

List of SAP CO Activities

List of CO Activities

The following are the List/steps-wise-configuration activities of of SAP CO Module :

• Introduction to SAP R/3
• Introduction to ERP, Advantages of SAP over other ERP Packages
• Introduction to SAP R/3 CO (Controlling)
• Enterprise Structure of CO (Basic Setting of CO)
• Defining Controlling Area
• Defining Number ranges for Controlling Area
• Maintain Planning Versions
• Cost element accounting:
• creation of primary cost elements from financial accounting area
• creation of primary cost elements from controlling area
• display of cost element master records
• change cost element master records
• primary cost element categories
• secondary cost element categories
• default account assignments
• Cost Center Accounting
• Defining Cost Center Standard Hierarchy
• Creation of Cost Centers and cost center groups
• display cost center master records
• change cost center master records
• creation of cost center groups
• posting to cost centers
• reposting of co line items
• Repost of Costs
• planning for cost centers
• Overhead Calculation
• creation of secondary cost element master records
• Creation and Execution of Distribution Cycle
• creation and execution of assessment cycles
• cost center reports
• Internal Orders
• Defining order types
• Creation of internal order master records
• display internal order master records
• change internal order master records
• postings to internal orders
• planning for internal orders
• reposting co line items for internal orders
• repost of costs for internal orders
• Report of Variance analysis for internal orders
• creation of real internal orders
• posting of business transaction to real orders
• definition of allocation structures
• definition of settlement profiles
• definition of planning profiles
• settlement of real internal orders
• budgeting and availability control
• maintain number ranges for budgeting
• define tolerances for availability control
• specification of exempt cost elements from availability control
• maintenance of budget manager
• Profit Center Accounting
• Basic Settings for Profit Center Accounting
• Creation of Dummy Profit Centers
• maintenance of control parameters for actual postings
• Maintaining planning versions for profit centers
• maintaining the number ranges for profit center documents
• Creation of profit center master records
• display of profit center master records
• changing the profit center master records
• Creation of revenue cost elements
• Automatic Assignment of Revenue elements for Profit Centers
• assignment of profit centers in cost center master records
• creation of account groups in profit center accounting for planning
• planning for profit and loss account items
• planning for balance sheet items
• posting of transactions into profit centers
• generating the variance reports for profit and loss account items
• Generating the variance reports for balance sheet items.
• Profitability analysis
• Maintaining the operating concern
• Define profitability segment characteristics
• Assignment of controlling area to operating concern
• Activating the profitability analysis
• Define number ranges for actual postings
• Mapping of SD conditions types to COPA value fields
• Creation of reports
• Viewing the reports
• Product costing:
• Product cost planning:
• creation of bill materials
• creation of activity type master records
• planning for activity hours
• activity type price calculation
• creation of work center master records
• creation of routings
• defining cost sheet( over head structures)
• assignment of cost sheet to costing variant
• creation of cost estimate with quantity structure
• marking
• releasing
• creation of cost estimate without quantity structure

Outline of SAP FI module

Outline of SAP FI module

The following are the steps-wise-configuration of SAP FI Module :

• Introduction to SAP R/3
• Introduction to ERP, Advantages of SAP over other ERP Packages
• Introduction to SAP R/3 FI
• Financial Accounting Basic Settings:
• Define Company
• Define Company Code
• Assignment of company to company code
• Definition of business area
• Definition of fiscal year variant
• Assignment of fiscal year variant to company code
• Definition of posting period variant
• Assignment of posting period variant to company code
• Open and close posting period
• Defining document type & number ranges
• Maintenance of field status variants
• Assignment of field status variant to company code
• Definition of tolerance groups for GL accounts
• Definition of tolerance groups for employees
• Assignment of tolerance groups to users
• Taxes on Sales & Purchases (input & output)
• Creation of chart of Accounts
• Defining Accounts Groups
• Defining Retained Earnings Account.
• General Ledger Accounting:
• Creation of General Ledger Master (with and with out reference)
• Display/Change/Block/Unblock of general ledger master
• Document Entry posting normal postings and posting with reference
• Display and change of documents
• Display of GL balances
• Display GL account line items
• Parked documents
• Hold documents
• Creation of Sample Document and postings with sample documents
• Defining recurring entry document and postings with recurring doc.
• Creation of account assignment model and posting
• Configuration of line layouts for display of GL line items
• Reversal of individual documents, mass reversal , reversal of cleared items and reversal of accrual and deferral documents
• Defining Exchange Rate types and Translation ratios
• Define Exchange rates & posting of foreign currency transactions
• Interest calculations on term loans
• Accrual and Deferral documents
• Accounts Payable
• Creation of vendor account groups
• creation of number ranges for vendor master records
• assignment of number ranges to vendor account groups
• Creation of tolerance group for venders
• Creation of vendor master (display/change/block/unblock of vender master)
• Posting of vendor transactions (invoice posting, payment posting, credit memo)
• Settings for advance payments to parties (down payment) and clearing of down payment against invoices (special GL transactions)
• Posting of partial Payment & Residual Payment
• Creation of payment terms,
• Creation of house banks and account ids.
• Creation of check lots and maintenance of check register
• display check register
• cancellation of un issued checks
• creation of void reasons
• cancellation of issued checks
• posting of purchase returns
• Configuration of automatic payment program
• Payment to vendors through APP
• Defining correspondence & party statement of accounts
• Accounts receivable:
• Creation of customer account groups
• creation of number ranges for customer master records
• assignment of number ranges for customer account groups
• Creation of tolerance group for customers
• Creation of customer master (display/change/block/unblock of vender master)
• Posting of customer transactions (sales invoice posting, payment posting, debit memo)
• Settings for advance payment from parties (down payment)
• Configuration of settings for dunning
• generating the dunning letters
• defining correspondence and party statement of accounts
• Bills of exchange
• posting of sales returns
• Asset Accounting
• Defining chart of depreciation
• creation of 0% tax codes for sales and purchased
• assignment of chart of depreciation to company code
• Defining account determination
• definition of screen lay out rules
• definition of number ranges for asset classes
• Integration with General Ledger & Posting rules
• Defining Depreciation key
• definition of multilevel methods
• definition of period control methods
• creation of main asset master records
• creation of sub asset master records
• Acquisition of fixed assets
• sale of fixed assets
• transfer of assets
• Scrapping of assets,
• Depreciation run
• Line item Settlement of assets under construction of capital work in progress
• New General ledger accounting:
• Parallel ledgers
• document splitting
• Segments.
• Reports
• Financial statement version
• General Ledger
• Accounts Payable
• Accounts Receivable
• Assets Reports

Complete List of SAP Modules

Complete List of SAP Modules

This page contains following topics :

A)   Environments for SAP ERP

1.     Supported Hardware

2.     Supported Database

3.     Supported Operating System

B)   COMPLETE MODULES OF SAP ERP

1.     Basis

2.     ABAP/4 Programming

3.     FI (Financial Accounting)

4.     CO (Controlling)

5.     EC (Enterprise Controlling)

6.     TR (Treasury)

7.     IM (Investment Management)

8.     HR (Human Resource)

9.     SD (Sales and Distribution)

10. Logistics Information System

11. MM (Materials Management)

12. PM (Plant Maintenance)

13. PP (Production Planning)

14.  QM - Quality Management

15. BW (Business Warehousing)

16. IS (Industry Solutions) / SAP for Industries specific solutions

17. CS (Customer Service)

18. SMB

19. CA (Cross Application Components)

20. PS (Project Systems)

21. mySAP SEM

22. mySAP CRM (Customer Relationship Management)

23. mySAP Product Life Cycle Management

24. SCM (SAP Supply Chain Management)

25. Netweaver

26. mySAP SRM (Supplier Relationship Management)

 

A) ENVIRONMENTS FOR SAP

1.    Supported Hardware for SAP ERP

SAP can be installed on the following systems. The functionality and programming technique is same for all systems.

1.1.           HP

1.2.           IBM

1.3.           Sun

1.4.           AT&T

1.5.           AS400

1.6.           Bull

1.7.           Sequent

1.8.           SNI

1.9.           Compaq Digital

2.    Supported Database for SAP ERP

SAP is a back-end-free ERP system. That means the following Database can be used in SAP software. The functionality/programming technique is same for all database system.

2.1.           Oracle

2.2.           MS SQL

2.3.           Informix

2.4.           Sybase

2.5.           Adabas D

2.6.           DB2 for AIX

2.7.           DB2/400

 

3.    Supported Operating System for SAP

SAP can be installed on the following platforms (Operating systems):

3.1.           MS Windows NT

3.2.           OS/400

3.3.           Unix

3.4.           Solaris

3.5.           AIX

3.6.           HP UX

3.7.           Sinux

B) Complete SAP Modules:

1.    SAP Basis

1.1.           Security (BC - SEC)

1.2.           Application Link Enabling (ALE)

1.3.           Remote Function Calls (RFC)

1.4.           Object Linking and Embedding (OLE)

1.5.           Common Program Interface Communications (CPI-C)

1.6.           Electronic Data Interchange (EDI)

1.7.           Customizing (BC-CUS)

1.8.           ABAP Programming and Runtime Environment (BC - ABA)

1.9.           Client Server Technology (BC - CST)

1.10.       Network Integration (BC - NET)

1.11.       Basis Services/ Communication Interfaces (BC - SRV)

1.12.       Computing Center Management System (BC - CCM)

1.13.       Upgrade General (BC - UPG)

1.14.       Change and Transport System (BC - CTS)

1.15.       Operating System Platform(BC - OP)

1.16.       Database Interface, database platforms (BC - DB)

1.17.       Front End Services (BC - FES)

1.18.       ABAP Workbench (BC - DWB)

1.19.       Documentation and Translation Tools (BC - DOC)

1.20.       Controls and Control Framework (BC - CI)  

1.21.       Business Management (BC - BMT)

1.22.       Middleware (BC - MID)

1.23.       Computer Aided Test Tool (BC - CAT)

1.24.       Ready to Run R/3 (BC - BRR)

1.25.       Authorisations System Monitoring with CCMS Workload Alert Monitor

2.    ABAP/4 Programming

2.1             ABAP Workbench

2.2             Menu Painter

2.3             Screen Painter

2.4             Data Dictionary

2.5             SAP Script

2.6             Business Workflow (BC - WF)

2.7             ALE

2.8             EDI

2.9             Business Connector

2.10         Business Server Pages

2.11         Internet Application Server

2.12         Mercator Report Painter

2.13         ALV reporting

2.14         Report writer

2.15         Dialog Programming

2.16         Repository Information System

2.17         ABAP 00

2.18         IDOCS

2.19         LSMW

2.20         Smartforms

2.21         EBP

2.22         ASAP methodology

2.23         ABAP Query

3.    SAP FI (Financial Accounting)

3.1.           General Ledger Accounting (FI - GL)

3.2.           Special Ledger (FI - SL)

3.3.           Extended Ledger

3.4.           Accounts Payable (FI- AP)

3.5.           Accounts Receivable (FI - AR)

3.6.           Asset Accounting (FI - AA)

3.7.           Bank Accounting

3.8.           Funds Management (FI - FM)

3.9.           Travel Management (FI-TM)

3.10.       Consolidation

4.    SAP CO (Controlling)

4.1.           Cost Centre Accounting (CO - CCA)

4.2.           Overhead Cost Controlling (CO - OM)

4.3.           Activity Based Coding (CO - ABC)

4.4.           Product Cost Controlling (CO - PC)

4.5.           Profitability Analysis (CO - PA)

4.6.           Material Ledger (CO - ML)

5.    SAP EC (Enterprise Controlling)

5.1.           Consolidation (EC - CS)

5.2.           Executive Information System (EC-EIS)

5.3.           Profit Center Accounting (EC - PCA)

5.4.           Business Planning and Budgeting

6.    SAP TR (Treasury)

6.1.           Cash Management (TR - CM)

6.2.           Loans Management (TR - LM)

6.3.           Market Risk Management (TR - MRM)

6.4.           Treasury Management (TR - TM)

6.5.           Funds Management (TR - FM)

6.6.           Information System

7.    SAP IM (Investment Management)

7.1.           Investment Programmes

7.2.           Investment Measures (orders/products)

7.3.           Corporation Wide Budgeting

7.4.           Appropriation Requests

7.5.           Automatic Settlement of Fixed Assets

7.6.           Depreciation Forecast

7.7.           Information System

8.    SAP HR (Human Resource)

8.1.           Recruitment

8.2.           Personnel Administration

8.3.           Benefits Administration

8.4.           Compensation Management

8.5.           Personnel Development

8.6.           Organizational Management

8.7.           Travel Management

8.8.           Training and Events Management

8.9.           Personnel Planning

8.10.       Time Management

8.11.       Incentive

8.12.       Wages

8.13.       Workflow

8.14.       Payroll

8.15.       Internet Scenarios

8.16.       Information System

9.    SAP SD (Sales and Distribution)

9.1.           Master Data

9.2.           Sales

9.3.           Sales Support

9.4.           Sales Information System

9.5.           Billing

9.6.           Special Business Transactions

9.7.           Shipping

9.8.           Transportation

9.9.           Credit Control

9.10.       QM in SD

9.11.       Internet

9.12.       Foreign Trade

9.13.       Electronic Data Interchange

10.           SAP Logistics Information System

10.1.       Purchasing Information System

10.2.       Sales Information System

10.3.       Inventory Controlling

10.4.       Retail Information System

10.5.       Production Planning and Control Information System

10.6.       Plant Maintenance Information System

10.7.       Project Information System

11.           SAP MM (Materials Management)

11.1.       Purchasing

11.2.       Invoice Verification

11.3.       Logistics (General)

11.4.       Logistics Information System

11.5.       Inventory Management

11.6.       Inventory / Valuations

11.7.       Materials Planning

11.8.       Workflow

11.9.       External Services Management

11.10.  QM in MM

11.11.  Warehouse Management

12.           SAP PM (Plant Maintenance)

12.1.       Preventative Maintenance

12.2.       Maintenance Order Management

12.3.       Maintenance Projects

12.4.       Service Management

12.5.       Maintenance Planning

12.6.       Equipment and Technical Objects

12.7.       Structuring Technical Systems

12.8.       PM Processing

12.9.       Work Clearance Management

12.10.  Internet Scenarios

12.11.  Customising

12.12.  Information System

13.           SAP PP (Production Planning)

13.1.       Make to Order (CR)

13.2.       Make to Order (PIR)

13.3.       Repetitive Manufacturing

13.4.       PP for Process Industries (PP - PI)

13.5.       PP - Processes

13.6.       Sales and Operations Planning

13.7.       Capacity requirements

13.8.       Master Planning

13.9.       KANBAN

13.10.  Production Orders

13.11.  Product Cost Planning

13.12.  Plant Data Collection

13.13.  Assembly Orders

13.14.  Information System

14.           SAP QM - Quality Management

14.1.       Planning

14.2.       Inspections

14.3.       Notifications

14.4.       Control

14.5.       Certificates

14.6.       Test Equipment Management

14.7.       QM-IS

15.           SAP BW (Business Warehousing)

15.1.       Data Warehousing

15.2.       BI Suite - Business Explorer

15.3.       BI Platform

15.4.       ODS Structures

15.5.       Development Technologies

15.6.       Info Cube

15.7.       Design Build

16.           SAP CS (Customer Service)

16.1.       Service Processing

16.2.       Controlling

16.3.       Service Contracts

16.4.       Workflow in Customer Service

17.           SAP SMB

17.1.       SAP SMB

18.           SAP CA (Cross Application Components)

18.1.       SAP Business Workflow

18.2.       Application Link Enabling (ALE)

19.           SAP PS (Project Systems)

19.1.       Basic Data

19.2.       Operational Structures

19.3.       Project Planning

19.4.       Approval

19.5.       Information System

19.6.       Project Execution and Integration

19.7.       Work Breakdown Structure

20.           mySAP SRM (Supplier Relationship Management)

20.1.       Self Service Procurement

20.2.       Service Procurement

20.3.       Plan Driven Procurement

20.4.       Spend Analysis

20.5.       Strategic Sourcing

20.6.       Catalogue Content Management

21.           mySAP SEM

21.1.       Business Consolidation (SEM-BCS)

21.2.       Business Information Collection (SEM-BIC)

21.3.       Business Planning and Simulation (BW-BPS)

21.4.       Corporate Performance Monitor (SEM-CPM)

21.5.       Stakeholder Relationship Management (SEM-SRM)

22.           mySAP CRM (Customer Relationship Management)

22.1.       CRM Enterprise

22.2.       Field Applications

22.3.       Interaction Center

22.4.       E-Commerce

22.5.       Channel Management

22.6.       Industry Specific CRM

23.           mySAP Product Life Cycle Management

23.1.       Document Management

23.2.       Engineering Change Management

23.3.       Enterprise Content Management

23.4.       Classification

23.5.       Basic Data for Process Manufacturing

24.           SAP SCM (SAP Supply Chain Management)

24.1.       SCM Process and Business Scenarios

24.2.       SAP Forecasting and Replenishment

24.3.       SAP Advance Planning and Optimization (SAP - APO)

24.4.       SAP Inventory Collaboration Hub (SAP - OCH)

24.5.       SAP Event Management (SAP - EM)

24.6.       SCM Basis

25.           SAP Netweaver

25.1.       SAP Masterdata Management

25.2.       Information Integration

25.3.       Portal Content

25.4.       Process Integration

25.5.       Knowledge Management

25.6.       Life Cycle Management

25.7.       SAP Business Intelligence

25.8.       SAP Visual Composer

25.9.       People Integration

25.10.  Application Platform

25.11.  SAP Web Application Server

25.12.  SAP Business Information Warehouse

25.13.  SAP Solution Manager

25.14.  SAP Enterprise Portal

25.15.  SAP Mobile Engine

25.16.  Security

26.           SAP IS (Industry Solutions) / SAP for Industries

SAP has the following industries specific solutions:

26.1.       Aerospace & Defence

26.2.       Consumer Products

26.3.       Defence & Security

26.4.       Retail

26.5.       Insurance

26.6.       Mill Products

26.7.       Higher Education & Research

26.8.       Industrial Machinery & Components

26.9.       Logistics Service Providers

26.10.  Automotive

26.11.  Chemicals

26.12.  Pharmaceuticals

26.13.  Banking

26.14.  Telecoms

26.15.  Life Sciences

26.16.  Mining

26.17.  Public Sector

26.18.  Service Provider

26.19.  Media

26.20.  Healthcare

26.21.  Oil & Gas

26.22.  Utilities

26.23.  Postal Services

Besides the above functionalities and flexibilities, SAP also adding new features, new modules, new environment and new industry specific solutions to its flagship ERP product continuously.

From the above list of diversify functionality, industry-specific solution with hardware and database independency depicts the power of SAP in the arena of ERP world.