Configuration Example

1
Configuration Example

• Enterprise Structure

2
Organizational Structure

• The first task in configuring SAP is to define
  the structure of the organization
• SAP provides numerous structures that can be used
  to organize data primarily for reporting purposes

3
Organizational Elements

• Client
• Highest level of organization
• Company
• Consolidated financial statements are created at
  the company level
• Client can contain one or more companies

4
Organizational Elements

• Company Code
• A stand-alone legal entity that requires its own
  set of accounting records
• A company can contain one or more company codes
• Business Area
• Used to produce internal financial statements
• For example, Dell might create business areas for
  computer (PCs, laptops, etc.) and consumer
  products (TVs, MP3 players, etc.)

5
Organizational Elements

• Purchasing Organization
• Unit that negotiates with vendors and handles
  purchasing activities
• Can have one or more purchasing organizations
• Centralized Assign all plants to one PO
• Decentralized A different PO for each company
  code or a different PO for each plant
• Purchasing Groups
• Unit to organize buyers into groups
• Usually based on materials
• PO can contain multiple purchasing groups

6
Organizational Elements

• Plant
• Unit that corresponds to a facility involved in
  producing a product or service
• At least one plant must be defined
• Plant is assigned to only one company code
• A single facility can have multiple plants, for
  example, an automobile facility may have multiple
  assembly lines that are treated as separate
  plants
• Doesnt have to be a factory. Could be a single
  plane for an airline or a distribution center for
  a shipping company.
• Storage location
• Used to distinguish locations for inventory
• A plant can have one or more storage locations

7
Organizational Elements

• Sales organization
• Unit responsible for negotiating with customers
  and distributing goods and services
• Top level at which you can aggregate sales
  figures
• A company code can have one or more sales
  organizations
• Distribution channel
• Determines how materials reach customers (eg.
  Retail, wholesale)

8
Organizational Elements

• Division
• Used to represent product lines
• At least one division must be defined
• Divisions can be assigned to more than one sales
  organization
• Divisions restrict access to materials

9
Organizational Elements

• Sales area
• A sales area is a valid combination of sales
  organization, distribution channel and division

Sales Org 1
Sales Org 2
Distribution Channel 1
Distribution Channel 2
Distribution Channel 1
Division 2
Division 1
Division 2
Division 1
Division 1
10
Organizational Elements

• Sales office
• reflects the geographical aspects of an
  organization
• It is assigned to a sales organization

11
Organizational Elements

• Shipping point
• A fixed location that carries out shipping
  activities
• A loading dock, mail room or shipping department
• One plant can have multiple shipping points
• A shipping point can serve multiple plants
• Credit control area
• Unit responsible for customer credit limits (eg.
  GMAC)
• Company code is assigned to one and only one
  credit control area
• Multiple company codes can be assigned to one
  credit control area

12
Configuration Example
Fitter Snacker is a company that sells healthy
snack foods. The company hashistorically sold
only in the United States but has recently
purchased aCanadian based snack food company.
The US company produces snack foodsin two
facilities one in Orlando and one in Kalamazoo,
MI. All Canadianproduction occurs in the
Toronto facility. Purchasing is centralized
within the US and Canadian companies. The
company sales through both retail and wholesale
channels and the company wants to be able to keep
track of sales in the southeast, northeast, west
and northwest regions in the US, the east and
west in Canada. The company maintains two
product lines the snack bar product line in all
US facilities and the muesli product line in
Canada.All products are shipped directly from
the plants to customers. At each facilitythere
are three storage areas raw materials,
semi-finished goods and finished goods.