Model of a company according to SAP ERP

1. SAP Implementation
Organizational Structure Overview

2. Overview
• What is an SAP Organizational Structure?
• Organizational Structure Defined
• ES Data Organizational Structure
• Organizational Structure Options
 Simple Organization Structure
 Complex Organization Structure
• Reporting Implications
• Master Data Implications
• Organizational Structure Decision Tree
• Next Steps . . .

3. SAP Organizational Structure
What is an Organizational Structure:
Arrangement of SAP Configuration Elements that defined data relationships within the
SAP system . The Organization Elements provide data keys for SAP Transactions, Master
Data Definitions, and Transaction Reporting.
Why is the Organizational Structure Important:
The SAP Organizational Structure is one of the most fundamental decision made during an
SAP implementations. Without an Organizational Structure definition or strategy:
• Transactions cannot be processed in the SAP environment.
• Master Data cannot be defined for any of the SAP functions.
• Reporting strategies cannot be developed.
• Business Processes cannot not be completely defined in the SAP system.
 Transactions
 Data Maintenance

4. Organizational Structure Defined

5. Organization Structure Relationships
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Materials Management
One-to-One Many-to-One Many-to-Many
Relationship Key:
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area

6. Application Level - Client
Definition
A Client is the parent organization of the SAP system.
Overview
• Each SAP Client contains an independent master data and transaction database.
• A Client is specified when a user logs on to the SAP System.
• Master data can be maintained in more than one Client through ALE (Application Link Enabling) technology.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area
General Rules:
One Client enabling shared
master data and transaction
reporting.

7. Finance / Controlling - Chart of Accounts
Definition
Mechanism for grouping selected G/L accounts. The Chart of Accounts enables the definition of G/L
account descriptions, number ranges, and required fields.
Overview
• The account must be activated for each Company Code in the form of a G/L master record prior to use
during a transaction.
• The Chart of Accounts must be the same across Company Codes if Consolidation functionality is used.
• An Alternative Chart of Accounts can be used if there are alternative G/L reporting requirements for select
Company Codes.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
General Rules:
Single Chart of Accounts.
Sales Organization
Distribution Channel
Division
Sales
Area

8. Finance / Controlling - Company Code
Definition
The Company Code represents a company in the sense of an independent accounting unit.
Overview
• Company Codes are independent from each other in a legal sense.
• Each Company Code has its own Chart of Accounts. This means a balance sheet and income statements can be
produced for each company code.
• A Company Code will have a single currency.
• Company Codes are used as a key for defining master data.
• Transactions can occur between Company Codes through inter-company processes.
General Rules:
Limit the number of
Company Codes. This will
minimize data maintenance
and improve system
performance.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area

9. Finance / Controlling - Controlling Area
Definition
The Controlling Area is an organization unit in Accounting utilized to divide the business organization from
a cost accounting standpoint.
Overview
• A Controlling Area contains a Controlling Area currency or Group Currency for cross Company Code
reporting.
• Period Allocations and Evaluations can be executed with Controlling Area statistical data.
• A single Controlling Area is recommended, unless a company does not require global reporting and
regional reporting is fundamentally different.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
General Rules:
A single Controlling Area
enabling both global and
regional management
reporting.
Sales Organization
Distribution Channel
Division
Sales
Area

10. Finance / Controlling - Company
Definition
The Company is a combination of dependent or independent companies that can be used for
consolidation purposes.
Overview
• The Company is a consolidation entity that allows roll-ups of financial statistics between more
than one Company Codes.
• The Company Codes that roll-up to the Company must be linked to the same chart of accounts.
• Companies should be used to group Company Codes when broken down below the legal entity
level.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
General Rules:
No Companies required, if
Company Codes are not
broken-down below legal
entity level.
Sales Organization
Distribution Channel
Division
Sales
Area

11. Finance / Controlling - Credit Control Area
Definition
The Credit Control Area is an organization unit that specifies and checks a credit limit for customers.
Overview
• A Credit Control Area can be assigned to multiple Company Codes allowing cross company credit
checking.
• A Credit Control Area performs credit checks in one common currency. Credit checks across currency is
possible through defined exchanges rates.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
General Rules:
Minimize the number of
Credit Control Areas to
number of Credit
Management centers.
Sales Organization
Distribution Channel
Division
Sales
Area

12. Sales and Distribution - Sales Organization
General Rules:
Limit the number of Sales
Organizations to one per
Company Code.
Definition
A Sales Organization stands for a selling unit in the legal sense. Sales Organizations are responsible the sales of
certain products or services, product liability, and customer’s right of recourse.
Overview
 All sales transactions are processed within a Sales Organization
 A Sales Organization can be included in only one Company Code.
 Master data may be defined within a Sales Organization. This allows a Sales Organization to have its own customer
and material master data as well as its own conditions, such as pricing.
 A Sales Organization may have its own sales document types.
 All items in a sales or distribution document (all items on an order, delivery, or invoice) belong to a single Sales
Organization.
 A Sales Organization is the highest summation level (after Client) for sales statistics.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area

13. Sales and Distribution - Distribution Channel
General Rules:
Limit the number of Distribution
Channels.
Definition
A Distribution Channel represents a channel of sales (Direct, Reseller, etc.) or a sub-level to the Sales Organization.
Overview
• Distribution channels are allocated to one or more Sales Organizations.
• Within a Distribution Channel, you can define your own master data for customers or materials as well as your own
conditions, such as pricing.
• You can create master data for a representative Distribution Channel which is then also used in other Distribution
Channels.
• Within a Distribution Channel, you can determine different sales document types.
• Sales order items belong to a single Distribution Channel.
• Delivery items can belong to different Distribution Channels.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area

14. Sales and Distribution - Division
Definition
A Division represents an organizational unit responsible for sales or profits for salable materials or services.
Overview
• Divisions are allocated to one or more Sales Organizations.
• Divisions are allocated to one or more Distribution Channels.
• A material always belongs to just one Division.
• You can define your customer master data at the Division level, as well as conditions, such as pricing.
• You can also create common customer master record data as well as conditions via a representative Division.
• Within a Division, you can define specific sales document types.
• You can alternatively determine for each sales document type that all items of a sales document must belong to the
same Division.
• The items of a delivery of a billing document can belong to different Divisions.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
General Rules:
Utilize shared Division for
master data maintenance
and transaction processing.
Sales Organization
Distribution Channel
Division
Sales
Area

15. Sales and Distribution - Sales Area
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Definition
A Sales Area is defined as the combination of Sales Organization, Distribution Channel, and Division.
Overview
• Customer master records are defined relative to the Sales Area.
• Pricing and other conditions are defined relative to Sales Area.
• Pricing strategy is dependent on Sale Area.
• A Sales Area may have its own sales document types.
• Reporting analysis can be performed specific to Sales Area.
General Rules:
Minimize the number of
Sales Areas, simplifying
system configurations,
master data maintenance,
and transaction processing.
Sales Organization
Distribution Channel
Division
Sales
Area

16. Materials Management - Purchasing Org.
Definition
A Purchasing Organization represents the overall responsibility of all procurement activities.
Overview
• A Purchasing Organization consists of any group of plants.
• A Purchasing Organization may supply several Plants, and a Plant may be supplied by several Purchasing
Organizations.
• Purchasing Organizations can be assigned to only one Company Code.
• Purchasing Organizations must be consecutively numbered across all Company Codes, with no two Purchasing
Organizations having the same numbers.
• A Purchasing Organization can be divided into one or more Purchasing Groups (not shown).
General Rules:
A single Purchasing
Organization, enabling both
global and regional procurement
and vendor management.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area

17. Materials Management - Plant
Definition
A Plant represent an overall physical or logical location responsible for managing inventories and its valuation.
Overview
• A Plant can either be a place of production or a single storage location, or a combination of closely situated
storage locations where stock is kept.
• Every Plant is assigned to a single Company Code. This allows stocks and stock values to be managed separately
in each company.
• Plants are assigned to Sales Organizations and Distribution Channels.
• A single Sales Organization can sell from several Plants.
• A Sales Organization can sell goods from Plants from other Company Codes using inter-company sales
processing.
General Rules:
Limit the number of plants to
minimize master data
maintenance and periodic
processes.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area

18. Materials Management - Storage Location
Definition
A Storage Location represents a physical or logical inventory location within a Plant.
Overview
• There can be one or more Storage Locations within a Plant.
• A Storage Location can be as detailed as a specific bin or as general as an entire Plant.
• Storage Locations are required to perform inventory movements as well as shipments.
• Storage Location specific data can be maintained within the Material Master.
General Rules:
Utilize Storage Locations to
distinguish inventory locations
rather than new plants.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area

19. Materials Management - Warehouse
Definition
A Warehouse represents a complex physical or logical warehouse structure within the Warehouse Management
System.
Overview
• A Warehouse is allocated to a Plant and Storage Location.
• Multiple Warehouses can be tied to a single Plant.
• Warehouse specific data is defined in the Material Master Data.
• All Inventory Movements within a Warehouse require specific bin indications to pick and replace inventories.
General Rules:
Conditional
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area

20. Materials Management - Shipping Point
Definition
A Shipping Point represents a fixed location that carries out shipping activities.
Overview
• A Shipping Point is the top level in the organization for shipping and can be allocated to several plants.
• A Shipping Point can be divided into several Loading Points (not shown).
• A delivery is created with exactly one Shipping Point. Thus, all items of a delivery belong to one Shipping Point.
Groups of deliveries also belong to exactly one Shipping Point.
• Shipping Points can influence Available to Promise (ATP) scheduling via picking, packing, and transportation lead
times.
• The Shipping Point can be proposed automatically during order processing depending on the Plant, Loading Group
and Shipping Condition.
General Rules:
Limit the number of Shipping
Points to minimize delivery
fragmentation.
Chart of Accounts
Company Code
Controlling Area Company
Credit Control Area
Shipping Point
Plant
Purchasing Organization
Storage Location
Warehouse
Sales
and
Distribution
Finance
/
Controlling
Application Level Client
Sales Organization
Distribution Channel
Division
Sales
Area

21. Example Organizational Structure

22. Example SAP Organization Structure
SAP Implementation Key Considerations
• Flexible Structure enabling quick response to new business models (e.g.,
contract manufacturing, internal reorganization, etc.)
• Minimize Data Maintenance.
• Minimize Periodic Processing.
• Standardize Basic Business Functions (e.g., Chart of Account, Pricing, etc.)
• Global Reporting Capabilities.
• System should not drive processes, processes should drive the system.

23. Example SAP Organization Structure
Company Code
Sales Organization
Purchasing Organization
US12
IE12 IE11
Credit Control Area CCA1
World Wide Chart of Accounts 0100
Controlling Area 0100
US12 IE12
Purchasing Org 1000
0100 0200 2200
Plants / Dist. Center
US11
US11
2100
0100 0200 2200
Shipping Points
2100
0100 0100 0100

24. Example SAP Organization Structure
Highlights
• Single Chart of Accounts enabling easy translation across legal entities.
• Single Credit Control Area enabling global credit management for customers.
• Single Controlling Area enabling management reporting across legal entities.
• Company Code for each legal entity.
• Single Sales Organization per selling Company Code, simplifying master data
maintenance and order management.
• Single Purchasing Organization enabling global procurement and simplifying
master data maintenance.
• Utilizing Controlling module (Cost Center and Profit Center Accounting) for
management reporting, rather than General Ledger.

25. Organizational Structure Options

26. Organizational Structure Options
Simplified Organization Structure
• Dynamic Industry.
• Frequent Corporate restructuring to respond to the
market.
• Global customer Base.
• Centralized Call Center / Order Administration
• Use Controlling Profitability Analysis or Profit Center
Accounting for product and regional reporting, not the
General Ledger.
• Simplified Master Data set-up and maintenance.
• Simplified Financial Consolidations, Credit Management,
etc.
Complex Organization Structure
• Mature Industry.
• Few Corporate Reorganization.
• Autonomous Regional Operations or Divisions.
• Established / Regional Customer Base.
• Regional Order Entry
• Complex Master Data set-up and maintenance, but
allows detailed default information.
There are several factors that drive a specific organizational structure decision:

27. Organizational Structure Options
Simple

28. Complex Organizational Simple
Company Code
Sales Organization
Plants / Dist. Center
Shipping Points
Purchasing Org.
Credit Control Area
Controlling Area
Chart of Accounts

29. Simple Overview
Highlights
• Single Chart of Accounts enabling easy translation across legal entities.
• Single Credit Control Area enabling global credit management for customers.
• Single Controlling Area enabling management reporting across all legal
entities.
• Company Code for each Nortel Networks legal entity.
• Single Sales Organization per Company Code, simplifying master data
maintenance and order management.
• Common Distribution Channel and Division for enabling shared master data.
• Single Purchasing Organization enabling global procurement and simplifying
master data maintenance.

30. Organizational Structure Options
Complex

31. Complex Organizational Structure
Company Code
Sales Organization
Plants / Dist. Center
Shipping Points
Company
Purchasing Org.
Credit Control Area
Controlling Area
Chart of Accounts

32. Complex Overview
Highlights
• Multiple Charts of Accounts based on geographical locations.
• Multiple Companies enabling Legal Consolidations across legal entities.
• Multiple Credit Control Area enabling regional credit management for
customers.
• Multiple Controlling Area enabling management reporting across legal
entities in specified region. Management reporting defined regionally
allowing autonomy.
• Multiple Company Codes for each Nortel Networks Legal Entity enabling sub-
entity reporting.
• Single Sales Organization per Company Code, simplifying master data
maintenance and order management.
• Multiple Purchasing Organization enabling regional/plant level procurement.

33. Reporting Implications

34. Reporting
As the organizational structure becomes less complex, design agility and custom
reporting requirements increase.
Option 1: Highly Complex Organizational
Structure Configured in SAP.
Option 2: Simple Organizational Structure
Configured in SAP
Rigid
Custom Reports
Flexible
Standard Reports
Design Agility / Flexibility
Reporting
Requirements


Industry best practice
within high tech companies

35. Master Data Implications

36. Master Data
Define Master Data
Master Data in SAP are database objects that store static data used during
transaction processing. Master Data includes: materials, customer,vendors, pricing,
etc. The intent of Master Data in SAP:
1. Reduce transaction processing steps
2. Reduce redundant data entity
3. Increase data integrity
4. Central repository for tracking static data
Most SAP Master Data is defined relative to one or more Organizational Structure
Element previously discussed.

37. Master Data Keys
Client
All Master Data
Chart of Accounts
General Ledger Account
Company Code
General Ledger Account
Customer
Vendor
Material
Controlling Area
Cost Element
Profit Center
Cost Center
Credit Control Area
Credit Profile
Sales Organization
Customer
Material
Sales Pricing
Output
Material Determination
Listing/Exclusion
Customer-Material Information Records
Distribution Channel
Material
Customer
Sales Pricing
Output
Division
Material
Customer
Sales Pricing
Shipping Point
Output
Routes
Plant
Material
Bill of Material
Work Center
Routing
Purchasing Info Records
Purchasing Source List
Storage Location
Material
Purchasing Organization
Vendor
Purchasing Pricing
Purchasing Info Records

38. Master Data Maintenance
Complexity of Organizational Structure
Amount
of
Master
Data
As the an Organizational Structure in SAP becomes more complex, the
requirements for master data maintenance increase.

39. Master Data Maintenance - Example
Company Code
Sales Organization
Distribution Channel
Division
Company Code
Sales Organization
Distribution Channel
Division
Client
General
• Address
• Communication
• Control Data
Company Code
• Account Management
• Payment Transactions
• Correspondence
Sales Area
• Sales Data
• Shipping Data
• Billing Data
Company Code
• Account Management
• Payment Transactions
• Correspondence
Sales Area
• Sales Data
• Shipping Data
• Billing Data
The creation of additional Company Codes and/or Sales Organizations has the
following impact on global customer maintenance:

40. Master Data Maintenance - Example
Global Customer Definition
Simplified Organization Structure
• 1 Client
• 6 Company Codes
• 6 Sales Organizations
• 1 Distribution Channel
• 1 Shared Division
Complex Organization Structure
• 1 Client
• 20 Company Codes
• 24 Sales Organizations
• 4 Distribution Channel
• 1 Shared Division
General Data
Company Code Data
Sale Area Data
Data Views
Data Views
Data Views
General Data
Company Code Data
Sale Area Data
Data Views
Data Views
Data Views
1
1
20
96
6
6
Global Customer Definition

41. Organizational Structure Decision Tree

42. Client
Decentralized Organization
Different Processes/Customer Base Single Client SAP
Multiple SAP Clients w/o ALE
Multiple SAP Instances
Best Practice
One Client enabling Shared Master Data and Transaction
Reporting without ALE processing.
Shared Processes / Customer Base Single Client SAP
Shared Processes /
Different Customer Base
Centralized Organization
Single Client SAP
Different Processes /
Shared Customer Base
Single Client SAP
Multiple SAP Clients w/ ALE
Decisions Options

43. Current Design Approach - Client
Highlights
• The Current SAP implementation uses one Client for all operational activities.
Key Decision Points
• Common processes globally.
• Shared Product and Customer base.

44. Chart of Accounts
Global Statutory Reporting Global Management Reporting Global Chart of Accounts
Global Chart of Accounts
Regional Chart of Accounts
Best Practice
One Global Chart of Accounts.
Decisions Options
Regional Statutory Reporting
Global Management Reporting
Regional Management Reporting
Global Chart of Accounts
Global Chart of Accounts w/ Regional
Alternative Chart of Accounts
Global Chart of Accounts w/ Regional
Alternative Chart of Accounts
Regional Management Reporting Global Chart of Accounts

45. Current Design Approach - Chart Of Accounts
Highlights
• The current SAP implementation is setup with one global Chart of Accounts.
Key Decision Points
• Simplified accounting structure with one common Chart of Accounts.
• Enables common Financial and Management reporting across entities.

46. Company Code
Best Practice
One Company Code per Legal Entity.
Decisions Options
Global Legal Entity Single Company Code
Regional Legal Entities
Global Management Reporting
Regional Management Reporting
Company Codes per Legal Entity
w/ Global Controlling Area
Multiple Company Codes
w/ Global Consolidation Company
Company Codes per Legal Entity
w/ Global Controlling Area
Company Codes per Legal Entity
w/ Regional Controlling Area
Multiple Company Codes per Legal
Entity w/ Regional Consolidation
Company and Controlling Area

47. Current Design Approach - Company Codes
Highlights
• The current SAP implementation
Key Decision Points
• ???

48. Controlling Area
Best Practice
One Controlling Area Providing Corporate-wide Management
Reporting.
Decisions Options
Global Mgmt. Reporting Single Controlling Area
Regional Mgmt. Reporting
Global Currency
Regional Currency
Common Reporting Req.
Independent Reporting Req.
Global Currency
Regional Currency
Single Controlling Area
Single Controlling Area
Report w/ Exchange Rate
Regional Controlling Area
Single Controlling Area
Regional Controlling Area
Single Controlling Area
Report w/ Exchange Rate
Regional Controlling Area

49. Current Design Approach - Controlling Area
Highlights
• The current SAP implementation supports one global Controlling Area. This
enables management reporting across all companies through the Cost Center
and Profit Center Account modules.
Key Decision Points
• Ability to report across companies.

50. Credit Control Area
Best Practice
One Credit Control Area enabling Globally Managed Customer Base.
Decisions Options
Global Credit Management Single Credit Control Area
Regional Credit Management
Global Customer Base
Regional Customer Base
Single Credit Control Area
in Single Currency
Multiple Credit Control Area
in Regional currency
Single Credit Control Area
in Single Currency

51. Current Design Approach - C.C.A
Highlights
• The current SAP implementation supports one global Credit Control Area. This
enables centralized Credit Management for global the global customer base.
Key Decision Points
• Effectively manage global customer base.
• Centralized credit/collections organization.

52. Sales Organization
Best Practice
Single Sales Organization per Company Code, when Applicable.
Decisions Options
Legal Entity without Sales No Sales Organization
Legal Entity with Sales
Shared Master Data
Channel Specific Master Data
Company
Code
Single Sales Organization
Single Sales Organization
Single Sales Organization using
Distribution Channel to Distinguish Data
Multiple Sales Organization

53. Current Design Approach - Sales Organization
Highlights
• The current SAP implementation supports four Sales Organization, one per
transacting Company Code.
Key Decision Points
• Simplifies transaction processing
• Simplifies data maintenance

54. Purchasing Organization
Best Practice
One Global Purchasing Organization, enabling Procurement and
Global Vendor Management.
Decisions Options
Centralized Procurement
Single Purchasing Organization
Decentralized Procurement
Common Vendor
Uncommon Vendors
Single Purchasing Organization
w/ Multiple Purchasing Groups
Multiple Purchasing Organization
w/ Redundant Data Maintenance
Regional Control
Plant Control
Single Purchasing Organization
w/ Multiple Purchasing Groups
Multiple Purchasing Organization
w/ Redundant Data Maintenance
Single Purchasing Organization
w/ Multiple Purchasing Groups
Multiple Purchasing Organization

55. Current Design Approach - Purchasing Org.
Highlights
• The current SAP implementation supports one global Purchasing Organization.
This enables global or regional procurement and vendor management activities.
Key Decision Points
• Common Procurement processes and global procurement presence.
• Common Vendor management processes and negotiations.
• Purchase Order Approvals

56. Plant
Best Practice
One Plant, Logical or Physical, Per Actively Managed Inventory Location.
Decisions Options
Valued Inventory
Same Company Code
Different Company Code
Unique MRP Process Separate Plant
Unique Material
Common Material
Separate Plant
Common MRP Process Separate Plant
Shared Plant
Separate Plant

57. Current Design Approach - Plants
Highlights
• The current SAP implementation supports four Plants for the purpose of tracking
inventories during production, at the finished goods level, at vendor locations,
and at distribution centers. One of the four plants supports each model
presented.
Key Decision Points
• Minimize SAP setup times.
• Minimize data maintenance and periodic processing time.
• Flexibility to incorporate vendors

58. Next Steps . . . .

59. Next Steps . . . .
Highlights
• Identify the Current Organization.
• Understand the Organization Vision.
• Participate in Organization Structure Workshop.
• Build your Organization with vision, system, and business processes in
mind.