Last week, we published the first part of our conversation with Christian van Helfteren, author of the SAP Press book "Configuring Sales in SAP S/4HANA.” In this second part, we examine how SAP S/4HANA users can leverage SAP Fiori apps to bolster their sales processes, and van Helfteren discusses how users can make use of automation.
ASUG: How can customers leverage automation as it applies to the evolution of sales contracts in SAP S/4HANA?
Chris: Traditional sales contracts have been around in SAP for a long time and are still available with no major changes, but SAP S/4HANA has a new feature called Sales Condition Contracts. These documents evaluate the business done with customers and allow you to automate actions. This is similar to what the sales rebate agreement used to do, but more powerful and flexible.
Although Condition Contracts are not just for rebates, the Sales Rebates Agreement functionality is gradually being phased out as of SAP S/4HANA version 2020, so companies are very interested in using Condition Contracts for sales rebates. For example, if the customer spends a certain amount of dollars with us in a month, we can make them eligible for a 10% discount, but only if they reach the target by the end of the month. You could have a condition contract looking back at all the purchases you made over the month, calculating the total amount, and then deciding how much of that sale—if any—the customer will get back.
Sales Condition Contracts are an evolution of both sales rebate agreements and contracts. They are based on Purchasing Condition Contracts, which have been around for some time. We can now use features that are unlike anything else on the sales module, such as business volume selection criteria, settlement calendar, delta accruals, and partial settlements. That's a big change from sales rebates, with great advantages. Since Sales Condition Contracts are dynamic, you don't have the impact on the original invoice pricing procedure. For retroactive rebates, you won't have to go back and interfere with how that original invoice was issued to dictate how much of that corresponds to the rebate.
ASUG: Let's move now to the SAP S/4HANA sales order management feature. Can you tell me a little bit about what it is and how it can effectively be used?
Chris: Every time you talk about order-to-cash, the first thing that comes to mind is how you enter your orders. You want to bring those customer requests into your system and manage the process as it may control your production, purchasing, and credit management. When using SAP S/4HANA, one of the main advantages of the solution is that you still have all the functionality that you used to have on SAP ECC. Now you can leverage new functionality like the SAP Fiori apps. They have a more forward-thinking design because they are more in line with the apps you have on your phone. The apps give you what you want right off the bat before we even asked for it. In other words, you see the total amount of orders that you have in place right on the app tile before you even opened the app.
ASUG: Can you give us an overview of what sort of functionalities SAP S/4HANA has for billing and invoicing?
Chris: Compared to the typical billing invoicing procedures in other systems, something that comes as a surprise to a lot of companies when implementing SAP S/4HANA is how much of the invoicing details are defined at the time of order entry. The invoice is a concern throughout the process, resolving issues before they ever manifest themselves. This reduces the time it takes to issue invoices and financial month-end closing processes.
There are also features like billing plan functionality that will issue invoices based on events or schedules. They're often used to implement down-payments, where you can charge the customer upfront, for instance, when selling a customizable product. If you're going to customize a product with the customer’s logo, you may want to have 100% or less of the total price of sale collected before applying the logo. That's something that can be enabled with a billing plan.
Something else billing-related that companies always have to consider nowadays is the revenue accounting recognition component (RAR). With SAP S/4HANA you have the RAR and you can start using more complex rules and automation, defining when you're going to recognize that that sale effectively took place and how it corresponds to revenue. This is important in order for you to report accurate numbers to your stakeholders. There are a number of observations you need to make before you can report revenue as such. This became a Generally Accepted Accounting Principles (GAAP) concern after some companies reported revenue in advance to inflate their sales results. Now, nobody wants to follow that path and auditors are there to make sure you don’t. With RAR you have the tools to do so in a more automated fashion. RAR automates the rules and once in place all we need to do is follow them.
ASUG: What are some ways users can use SAP S/4HANA to handle customer complaints and feedback?
Chris: SAP S/4HANA has an improved advanced returns feature. With previous versions, the customer service representative had a complex and limited range of options to address and capture customer feedback during the process of requesting a return, often resulting in inconsistencies. Should I do a return first? Should I wait for the product to come back before I take action?
With advanced returns, you can record the expected actions to be taken based on customer complaints in a single transaction with a lot more flexibility and traceability. In SAP S/4HANA, that's working quite well. Many companies making use of it are very happy with it.
ASUG: What are some of the reporting and sales analytics that SAP S/4HANA users have access to?
Chris: SAP Fiori provides out-of-the-box on-time analytical reports that are very appealing. For companies considering implementing SAP S/4HANA, this is one of the things that attracts them the most to the system. Still, a lot of companies are slow to adopt SAP Fiori, especially if they’ve been used to graphical user interface (GUI) for many years. It's not as simple as one would wish to just turn it on and start using it. You have to do some work to customize the launchpads to match what the users utilize the most and make it very accessible to them, it is more detailed than just security profiles. On-time, high-performance analytics are usually an important motivating factor to undertake this task.
ASUG: What do you want readers to be able to take away from your book?
Chris: This book was written to help companies that are implementing SAP S/4HANA in a greenfield-type environment. Greenfield is a term that we use when you have a company that is new to the SAP Suite or products. I did spend quite a bit of time in this book explaining all functionality keeping in mind that some companies are seeing SAP Suite for the first time.
At the same time, you can use the book as a reference in other types of environments, such as SAP ECC upgrades. Even though it's not a step-by-step guide for an upgrade, you would want to know how certain features work, for that you can certainly use the book. The upcoming second edition has even more details pertaining to Customer/Vendor Integration to Business Partner (CVI), which is only a concern for upgrade project environments (also known as brownfield).
The main goal for the information in the book is not only for fellow IT resources to learn configuration, but also to help out people in the business, in special key-users. Businesses want to know what's going on behind the scenes when they look at SAP transactions. By attaching configuration after each business transaction, we get a clear sense of how involved the process is and how flexible it can be. The book shows behind the scenes how to customize the user-facing transactions.
The second edition has over 100 additional pages of brand-new content. The business partner and settlement management (Condition Contract Management) chapters were expanded a lot, all screenshots were updated with both SAP GUI and SAP Fiori upgrades for SAP S/4HANA versions 1909 and 2020.