SAP Event Management Use Cases and Order to Cash Process

SAP Event Management
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a member of The Business Maturity Group
SAP EM Use Cases

What is SAP Event Management?
notify
 SAP’s implementation of “Supply Chain Event Management”
 A SAP standard tool to:
• Track & Trace / monitor
the status of processes
• measure compliance with process
plans - Automatically uncover &
report exceptions
• give visibility of your processes,
assets and performance to all
involved
monitor
adjust
analyze
SAP EM

Business drivers for SAP EM
• Real-time exception notification – Proactive notification &
 Desire for continuous process improvement
 Risk mitigation
• Increased regulations
 Track and Trace with authentication
resolution
 Lack of Process Visibility
• Increase customer satisfaction
• Reduce costs
 Minimize uncertainties
• Reduce time to action
• Transparency across dispersed supply chain
• Analytics / KPI
• Partner performance

A little more detail
 Each relevant business process is represented in SAP EM as
Customers
an Event Handler (EH) – A Trackable Object
• Includes attributes
Visibility
Process
Suppliers
Internal Ops
Management
 Tracking IDs
 Parameters
• Planned milestones and measurements
 “The Plan”
 Actual events posted against
the EH
• Measurements
• Attachments (digital signature)
• Changes to the plan
• “The actual”
“The
Plan”
“The
Actual”
Exception

 BPM is more aligned with ccBPM and SAP Business
Workflow
• SAP Business Workflow  Automation of business processes within
• ccBPM  Automation of business processes spanning several SAP
• BPM  Automation of business processes spanning several
• Tight integration to extract events from SAP systems
• Tight integration with SAP NW BW for analytics
• Provides Web Services to add or query data
• Provides configurable Web UI for Status Reporting / Visibility
SAP EM vs. BPM
1 SAP systems
systems
disparate systems
 SAP EM monitors any business process

• How can I increase transparency and reduce risk?
• How can I reduce my supply chain operational costs?
• Can I respond quickly to unexpected supply chain events and ensure
• Are we compliant with regulations and compliance policies?
SAP EM and TM
 TM Challenges
customer SLA is maintained?
 Order Management
• Receive and create transportation
requirements
 Freight Planning & Tendering
• Load, mode, schedule, route
• Select carrier
 Freight execution / monitoring
• Documents, transport
• Track & Manage
 Freight Settlement
• Charges, Pay, Invoice
 Integrated SAP EM
 Freight execution tracking
• Freight units, orders, bookings
• Events: Loading  POD
• Pre-defined shipper, carrier, consignee views
 Event Notification
• WebUI, Mobile, RFID
• Rules-based follow on activities
• Alert triggering – Email, SMS, Fax, B2B
• Overdue event monitoring
• Analytics  SAP BW
 Integrated Exception status in SAP TM
cockpit

SAP TM – Ocean Carrier Booking
 Book capacity on a ship for sea transportation
• use SAP EM to track the individual
process steps
• Available exclusively for Transportation
Management in Extended Warehouse
Management (EWM).
 Tracks the following events
• Container loaded on vessel, Departure of
vessel, Arrival of vessel, Container
unloaded from vessel
• Release booking order or shipping
instruction, changes to booking order or
shipping instruction
 Visibility
• View booking requests and shipments by
status
• Track transportation events
 Container level
 Communication with external
partner
• Track receipts, confirmations, rejects
from partners
• Track unexpected events
 Change to booking order
 Change to shipping instructions

SAP EM and SNC
 SNC Challenges
• How well are my suppliers
performing?
 Delivery
 PO management
 All suppliers are not
equal…
• Automation
• Low performance
• Are we collaborating with
our suppliers?
 Exception messaging
 Integration with SAP EM
• Exception management
 Alert framework
• Direct to supplier
• Performance management
 On time delivery
• Visibility Processes
 Responsive Replenishment
 PO Process

SAP Object Event Repository (SAP OER)
SAP OER is designed to become a global database for
Serialized Product Ids.
Any Factories, or Distribution Centres (own or from
outsourcing partners , e.g. DHL) will be scanning and
reporting Product IDs to SAP OER.
SAP OER

SAP EM and GTS
 Business Drivers
• New regulations, increased complexity and
heightened scrutiny by government
• Lack of visibility into international trade
activities
 Cost
• Duty exposure, 3rd party filing and
expedition costs
 Time
• Cycle time, custom clearance, late
deliveries
 Risk
• Security filings, customs valuation,
customs audits and permit
requirements
• “Where is my shipment?”
• “Why are my goods stuck in customs?”
• “When will my goods be released?”
• “What is the customs status of my shipment?”
• “Which pending customs declarations need my
attention?”
 Integration
• Visibility
 Customs operations
• Exception management
 Early warnings allow for mitigating
international trade activities
performing outside the plan
 Benefits
 Cost
• Reduced duty exposure,
reduced filing costs,
elimination of buffer stock
 Time
• Faster custom clearance
 Risk
• Automated compliance,
demonstrable reasonable care

SAP EM and GTS 10.0
• Integrated status display within the customs declaration
• End-to-End supply chain visibility for international shipments
 Documents tightly integrated with SAP EM
• Customs documents, Customs Shipments, Presentation Documents, Inbound
Customs Delivery Documents, Pre-Declarations, Customs Declaration
 2 New features
 Visibility to customs events
 Including export / import events

Customer Implementation: Order
to Cash Process
 Require and manage minimal rep involvement in order management
 Provide relevant, timely information regarding the status of the client
orders for the purpose of managing client expectations
Keep the sales reps out of the back office
processing - They need to sell and not chase
deliveries or POs… - They need a solution to give
them the up to date status of the order whenever
needed.
 The Challenge
• Keep sales selling and out of order fulfillment
• Improve back office execution
 Part of an end-to-end process
• Needed factors for success:

The Solution - OTC Template
Application Object Type
AOT Relevance: /saptrx/zra*
BO Extractor: /saptrx/xbo*
Tracking ID Extractor: /saptrx/xti*
Control Param Extractor: /saptrx/xcp*
Info Param Extractor: /saptrx/xip*
Expected Event Extractor: /saptrx/xet*
Query ID Extractor: /saptrx/xqi*
Event Type - SO_CANCEL
Event Type – SO_CREATE
Event Relevance: /saptrx/xre*
Event Extractor: /saptrx/xet*
INV_BILLBLOCK_ON
INV_BILLBLOCK_OFF
Incomplete
/saptrx/sd_salesord
save_document
/saptrx/le_shipping
Save_and_publish_document
/saptrx/sd_invoice
Invoice_document_add
Event Type – SO_DELBLK_ON
Event Type – SO_CRBLK_ON
 Q Data OTC Design Template
• Design template covering all
aspects of the OTC process
 Events
 Parameters
 Status profile
 IDs
 Alerts
 Reporting
• Increases the pace of design
• Quickly ramp up to show POC
• Leverage existing code
Sales Order Process
SAP EM Config
Sales Order
Delivery
Billing Doc
Status Profile
Order Process
- Order Created
- Cancelled
- Order Ready
- Order Ready Late
Overdue Check
SO_CREATE
SO_CANCEL
Status Profile DEL_CREATE
Delivery Status
- Delivery Created
- Cancelled
- Shipped
DEL_PGI
Status Profile
Billing Status
- Invoice Created
- Cancelled
INV_CREATE
DEL_CANCEL
Expected Events
Unexpected Events
SO_READY
SO_DELBLK_ON
SO_DELBLK_OFF
INV_CANCEL
SO_COMPLETE
SO_INCOMPLETE
SO_CRBLOCK_ON
SO_CRBLOCK_OFF
Delivery Block
Billing Block
Credit Block
PGI
Status Profile
Completion Status
- Order Complete
- Order Incomplete
Status Profile
Blocked Status
- No blocks
- Delivery block
- CR block
- Delivery & CR block
Status Profile
Delivery Status
- No Delivery
- Delivery Created
- Delivery Created Late
- Delivery Shipped
- Delivery Shipped Late
Status Profile
Billing Status
- No Invoice
- Invoice Created
- Cancelled
Stage 1: Order
Process
Stage 2: Delivery
Process
Stage 3: Billing
Process
Event Type - SO_INCOMPLETE
Event Type - SO_DELBLK_OFF
Event Type – SO_CREATE
Event Type – SO_BILLBLOCK_OFF
Event Type – SO_BILLBLOCK_ON
Event Type - SO_CRBLK_OFF
Event Type - DEL_CANCEL
Event Type – DEL_CREATE
Event Type – DEL_PGI
Event Type - INV_CANCEL
Event Type – INV_CREATE
Event Handler
Status Profile
Expected Event Profile
Parameter Mapping
BW Profile
Authorization Profile
Extension Table
Rule Set
Event Message
Execute rule actions
- Update status
- Update Exp. Events
- Update par. changes
EH Condition
Rule
Condition
Overdue Monitor
Check overdue events
- Update status
- Send alerts
- Overdue Rule Set
Reporting
- BI Extraction
- BI reports
A
A 1
2
4
4
5
1
2
3
SLA – Order to Ready – Time taken to get an order to a
point where it can be fulfilled (2hrs)
SLA – Order Ready to Delivery create – Time taken to create
the delivery once it is ready to be delivered (Material
Available Date – VBEP-MBDAT)
SLA – Delivery Create to Delivery PGI - Time taken from
Delivery Create to Post Goods Issue (Warehouse processing
time)
5
SLA – Order to Cash – Time taken to get an order through to
Billing
3 + 4 = Warehouse Time
4
SLA – Delivery PGI to Invoice Create – Time taken from
Post Goods Issue to Invoice Create (9PM on the day of PGI)

The Solution
 WIMO – Where Is My
Order
• Single, simplified company
interface to status orders
throughout the order
lifecycle
• Inform AE of each order
status change
• Monitor service level
achievement – Back office
 Enablers
• SAP Event Management
• Business Information
Warehouse
 Stages of an order through
WIMO
• Stage 1 – Created
• Stage 2 – Internal Review
• Stage 3 – Being Processed
• Stage 4 – Shipment
Confirmed
• Stage 5 – Invoiced
• Stage 6 – POD
• Stage 7 – Send to BW and
Archive

Order Create – Check CR block, user status, incompleteness
Solution Demo
Order Complete
Begin Fulfillment – Delivery created
Complete Fulfillment – Delivery shipped (PGI)
Ready for billing – Billing Block removed
Customer billed – Invoice created
Proof of Delivery received
Extract to SAP NetWeaver BW

Custom SAP EM Report
 RFC to SCM to retrieve event handlers in a time period
 Overall Status of the EH: Shipped, Red, Green, Rescheduled

Analytics - SAP EM BI Report
 R/G/Y status adapted from SCM data (accounts for time
delay)
 Right click drilldown to item detail, alternative dashboards

Customer Implementation:
Procurement Process
• Track changes to Purchase Orders
• Track PO acknowledgements, Goods Receipts and Invoice Receipts
with changes
 React immediately to changes outside tolerances
• Track untimely or non-receipt of process events
 Have the visibility to non-compliance of the process by supplier
• Track supplier EDI success / failure
• Understand how the procurement process is performing
 Have the ability to set KPIs for the procurement process
We want to be able to track PO’s and any
subsequent discrepancies caused by suppliers
changing the PO requirements, and immediately
react to these in order to keep our PO plan on
track…
 The Challenge

The Solution
Enhanced the standard Procurement Visibility
Process
Expected events
• PO created
 PO transmitted
 PO mapped to 850 OK
 PO 850 received at vendor
• PO acknowledged
 PO created + 2days
• PO goods receipt (GR)
 Based on PO schedule
• PO invoice receipt (IR)
 PO GR date + 7days
Unexpected events
• PO delivery date or quantity change
 Based on tolerance
• PO acknowledged, GR, or IR amount,
quantity, or date change
 Based on tolerance

Visibility and Status Management
SAP EM Web UI

Exception Management
Alert Framework Integration
Overdue Monitor Report

Performance Monitoring KPIs
 Process cycle count
 Deviations as a % of
total count
• PO Acknowledgements
received with changes
• PO GR not matching PO
• PO IR not matching PO
 Average cycle duration
• Total cycle
• PO create  PO
Acknowledged
• PO GR  PO Invoice Receipt
 % on time vs. early vs. late
• PO acknowledged
• PO goods receipt
• PO invoice receipt
• Invoice received

Supplier Prompt Payment
• Allow me the ability to pay my vendors within the terms period so
that I can claim the discount, even when I have yet to receive the
goods…
• Ensure that the goods have been shipped by the supplier
• Limit our liability
• Increased PO payments made within terms period 
• More traditional transportation modes leveraged
 Cheaper modes of transport can be favored as they won’t affect
 Business Request
 Business Requirement
 Advantages
 Increased discount
 Improved CR rating
payment

Supplier Prompt Payment
 Payments for Logistics Invoice based off a match between:
• Logistics Invoice matching the PO
• Advanced Ship Notice received from the Supplier (EDI)
• Carrier notification of receipt of goods from the Supplier (EDI)
 Releases invoice for payment based on events received
 Enablers
• SAP Event Management
• Supplier
 EDI enabled ASN
• Carrier
 EDI enabled status notifications
 Benefits
• > 50% improvement in prompt payment
 +- 15% of supplier invoices are paid outside terms

Process Flow
Purchase Order (Any system)
Order product
Set Terms
Set Discount
Supplier ships Product
Transfer
goods to
carrier
Send ASN
Carrier pickup
Carrier takes
possession of
product
Send tracking
status
Invoice
Send Invoice
Match PO
Match ASN
with Carrier
status
Release

Components

Customer Implementation (POC) :
Production Order Process
 A plane was in one of several hangers
 The building of a plane was managed through production orders
A startup airplane manufacturer had
no way to show executives where a
specific plane was in the production
order process
 The challenge
• Where Is My Plane…
• 1 BOM = 1 Plane

 Implemented the standard Production Order Malfunction
visibility process
• Took 1 day to enable and demonstrate the capability
The solution
CO01 – Create Production Order
CO15 – Confirm Production Order
SAP EM Web UI - Delivered

Visibility from within the SAP
Production Order
 Transaction: CO03
SAP ECC – Imbedded Status

In conclusion - What value is
derived from EM?
 Exception management
 + Status management
 + Performance monitoring
 + Visibility
Process Improvement
Real Value!!!

Implementation Methodology and Change Management
Next Steps
Governance and Data Management
Ongoing Training and Education
Best Practices and Organizational Alignment
Assessment:
• High Level Process,
Org. Analysis
• GAP Analysis
• Risk / ROI
assessment
• Roadmap
• Resource, timing
and effort analysis

SAP Event Management Use Cases and Order to Cash Process

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