CRM 70 Rollout Detailed View Contract Management

8/10/2019 CRM 70 Rollout Detailed View Contract Management

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SAP CRM 7.0Detailed View

SAP CRM 7.0 – SFA

Contract Management



Table of Contents

1. Contract Management

2. Current Solution

3. Applicable Industries

4. Further Information

© SAP 2008 /



Contract Management in SAP CRM 7.0

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Industry Challenges

Customer Loyalty Customers have ready access to information and other suppliers. How do you

ensure they stay loyal to you?

Customer Retention

How do you guarantee that customer return to you for repeat purchases?

Customer Awareness

How can you ensure that you are constantly aware of customer needs?

Customer Behavior

What is the best way to plan and monitor your customers’ buying habits? How canyou provide more accurate sales forecasts?

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Contract Management in SAP CRM

Sales representativewins opportunity

Sales representative

creates contract withfavorable conditions

Customer releasesproducts against contract

at regular intervals

Customer agreesto continue

buying product

Customer negotiates terms andconditions for buying product

Customeracceptscontract

6

5

4

3

2

1

8

7

Near contract completion date,sales representative contactscustomer to renew contract

Sales manager

releases contract

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Business Scenario

Sales representative wins opportunity to sell customer a

target value of products over a certain period of time.

Customer negotiates terms and conditions of contract,

including pricing agreements, validity periods and notice

of cancellation.

Sales representative creates a value contract with details of

the terms and conditions.3

2

1

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Business Scenario

Sales manager checks the contract details as well ascustomer standing, and approves the contract.

Over the following months, customer releases products

against the contract by ordering the relevant items.

Customer would like to continue buying the product and

contract is renewed.

Towards the end of the contract validity period, or when the

target value of the contract is nearing completion, the sales

representative contacts the customer.

6

5

4

7

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Contract Management – Features

Contracts are long-term agreements with customers thatallow them to buy products at special conditions, such aslower prices or favorable terms of delivery.

Contracts contain information about:

Pricing agreements

Releasable products

Authorized partners

Validity dates and date rules

Cancellation dates and rules

Completion rules

Actions for tailored follow-up activities

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Contract Management – Benefits

Create long-term agreements that contain information about price and productagreements for a particular customer

Monitor the sales process from quotation through contract completion

Keep track of whether your customer has been buying products as arranged

Act quickly when a customer appears to be dissatisfied Guide sales personnel through required follow-up activities

Use integrated reporting for analyzing contract-related sales figures

Spend less time and resources on new customer acquisition

Improve communication between you and your customer

Contract management enables you to:

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Table of Contents


2. Current Solution



© SAP 2008 /



Current Solution

Contract Management includes:Sales Agreements

Value and Quantity Contracts

Release Order Processing

Follow-Up Sales Processing

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Sales Agreements

They act as master documents from which target quantity or value contracts, or releaseorders, can be created for the relevant customers.

Examples of sales agreements are franchise agreements or pricing and terms agreements.

Customer: ABC Group

Valid:

Product price

PC100 10% discount LTP20 5% discountDISKS 7% discount

ContractSold-to: Customer A

Valid: – Product: PC100

Price: 10% discount

Sales agreements are contractual documents with products, terms, and

conditions created for a customer or group of customers.

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Sales Agreements

Sales Agreements should not be mistaken for Sales Contracts

Sales Agreements and Sales Contracts define a relationship betweencustomers or customer groups and products for a certain period of time

Unlike Sales Contracts, Sales Agreements do not predefine quantities or valuesthe customer plans to order within the assigned period of time

Moreover, each time a release order is created, the quantity/value of a SalesContract is updated

However, Sales Agreements can be used to create Sales Contracts as follow ondocuments

Integration of Sales Agreements into the Sales Scenario

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Sales Agreements

Partner Type: A

Sales AgreementCreate followUp document

Customer: ABC Inc.

Sales Contract

Check Product elegibility Copy Pricing Copy Payment Conditions

Update value and quantity Check product eligibility Copy pricing Copy Payment Conditions

Header Partner, Org Data, Validity

Item Product, Conditions

Item: Target Quantity

10 1000 PCItem Discount

10 %20 %

Select or enter theproducts you want torelease.

If no Sales Agreementexists, the productcannot be ordered

Customer: ABC Inc.

Sales Order

Select or enter theproducts you want torelease.

Customer: ABC Inc.Sales Order

S a l e s A g r

e e m e n t D e t e r m i n

a t i o n

S a l e s C o

n t r a c t D e t e r m i n a t i o n

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Sales Agreements – Authorized Partners

Authorized partners to release products from a Sales Agreement are determinedusing Business Partner Types

Business Partner Types are maintained in customizing

Business Partners can be classified by the Business Partner Type in the controldata of the general role

The Business Partner Type can be used as a classification of customers by theirdistribution channels, franchise or the type of business they conduct

In Sales Agreements, the allowed Business Partner Types are assigned on headerlevel

Sold-To PartyAuth. Partner Sold-to PartyPartner Type Medium Retailer

Sales Agreement Header

Authorized partners for Release Orders

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Sales Agreements – Default Sales Agreement

Sales Agreements are assigned automatically to all Business Partners of the chosenBusiness Partner Type

For each Business Partner, the Default Sales Agreement can be selected in the sales

data of the sales area

Default Sales Agreement of the Business Partner

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A value contract is an agreement that a customer will buy a certain

value of a product during a specified period.

Value Contracts

For example, customer ABC agrees to buy at least $10,000 of products from the high-techcategory and therefore receives a discount for these products.

Item: Target value- discount

Customer: ABC Inc.Valid: 05/01 –

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Quantity Contracts

For example, customer ABC agrees to buy at least handheld devices and therefore receivesa discount on all devices.

Item: Target quantitypieces

- $5 discount

Customer: ABC Inc.Valid: 05/01 –

A quantity contract is an agreement that a customer will buy a certain

quantity of a product during a specified period.

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Information in Contracts: Products

At the item level, you can define the products that a customercan release from a contract.

You can: Enter the products manually

Select a product category Use a combination of the above

Products: S12, T14, T18

Product category: 1233455Computer Accessor ies

Product: S12 &

Product category: 1233455

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Information in Contracts: Expected Value

Both quantity and value contracts contain an expected value: In value contracts, the information is taken from the target value.

In quantity contracts, the user can enter an expected value manually.

For example:

Target quantity =

Expected value = $500,000,000

This information is important for reportingpurposes, particularly expected sales revenue or

sales pipeline figures.

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Information in Contracts: Authorized Partners

Create a list of individual authorized sold-to or ship-to parties

Enter one or more group hierarchies

Use a combination of the above

Sold-to party ABC

Ship-to party ABC

Authorized parties A1

B2

C3

Manual list

Based on

group hierarchy

Sold-to party ABC

A1 B2 C3

Authorized partners are parties, other than the originalsold-to or ship-to party, that may release products from acontract.

You can:

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Information in Contracts: Authorized Partners

ContractCustomer: ABC Inc

Authorized SPs

A1

B2

C3

Release order 1

Sold-to party A1

Item: ValueM328 $7,000

Release order 2


Sold-to party B2

Sold-to party XY

Item: Value

M328 $2,000

No link to contractbecause the partneris not authorized.

For Example, main sales office ABC signs a contract that is valid for all its

branches across the country. Each branch is also a sold-to party and isauthorized to release products from the contract. When branch B ordersproducts, the system checks that this sold-to party is authorized to release fromthe contract.

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Information in Contracts: Pricing Agreements

Header level:The customer receives a general discount for all products releasedfrom this contract:

Discount: -

Item level:The customer receives a special price for product M201:

Price for M201: $222

You can define special price agreements at either theheader or the item level

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Information in Contracts: Condition Groups

Contract type

Condition group

Condition group: 3400

Permitted condition types: 0K07

Item category

Condition group

Condition group: 1400

Permitted condition types: 0PR0

0K04

The Condition group determines the conditions that canbe used for price agreements in the contracts.

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Information in Contracts: Dates

Contract start: 05/01/01Validity period: 12 months

Contract end: 04/30/02

Dates and validity periods are essential information in the contract.

The most commonly used dates are:

Contract start

Contract end

Contract validity period or term

To help sales reps during contract creation, you can predefine date rules to calculate the contract’s validity period. For example:

Contract term = months

Contract end date = Start date + term

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Information in Contracts: Cancellation

Cancellation party: Sold-to party

Cancellation datesNotification of cancellation: 14 May 2007 Requested cancellation date: 31 May 2007 Actual cancellation date: 31 June 2007

Cancellation reason: Better offer

In order to determine who, when, and why a contract needs to

be cancelled, you can define:

Cancellation parties: Who has authorization to cancel?

Cancellation dates: How long should notice periods be?

Cancellation reasons: Why was the contract cancelled?

This is particularly interesting for reporting and analyses This information is combined in a cancellation procedure that can be applied to different

contract types.

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Actions

What?

Create “phone call” as follow-up activity

If?

If released value < 90% of target value

When?

One week before contract end date

Action

Schedulecondition

Startcondition

You want thesales rep to

call thecustomer if

the contract

has not beenreleased

completely.

To ensure that you retain an existing customer and maintain an excellent customer

relationship, you can define creation activities that need to take place during the contractterm.

To help the sales rep keep track of the contract, these actions are automaticallytriggered by the system once certain conditions are met.

For example:

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Action Profile

You can create a set of actions that are valid for: A specific contract type A particular item category

And that are triggered depending on certain conditions: Scheduled for when a condition is met

Started at a particular date

Transaction type Item category

Action profile

Define actions

Assign to transaction type

Schedule conditions

Start conditions

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Information in Contracts: Completion Rules

For each contract item, you can customize whether: The system should change the contract status

to “completed” once the target quantity or value

has been reached.

The customer may exceed the target quantity or value.

For example: Target value or quantity can be exceeded.

Target value or quantity cannot be exceeded.

Target value or quantity can only be exceeded once.

© SAP 2008 /



Releasing Products from Contracts

You create a sales

order either as a

Follow-up document New sales order

Type TA

System checks

Products Validity period Partners

Where there is amatch, the sales

order is linked to thesales contract.

System updates

Released values Released quantities

in relevant contract

Once the contract has been created and approved (status

of items changed to released), the customers can order(release) products.

© SAP 2008 /



Release Order as a Follow-Up Document

Item: Target value$10,000

Customer: ABC, Inc.

Contract:Create follow-up

document

Customer: ABC, Inc.

Standard order:

Select or enter theproducts you wantto release.

If you know the contract number, you can create a release

order as a follow up document to the contract.

© SAP 2008 /



Sales Order with Reference to a Contract

Choose acontract

Item: Quantity

M03 pieces

Customer: ABC, Inc.

Sales order

Several contracts exist for thiscustomer

Contract Product

123456 M03

789650 LPT001

129865 PC250

You create a new sales order and the system checks whether validcontracts for the customer and the products exist.

If so, you assign the sales order to one of the contracts proposed bythe system.

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S f S O



Product Selection for Follow-Up Sales Order

Product Selection:

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A i i C t t t S l O d



Assigning Contracts to a Sales Order

based on Items

When a product is entered possible Sales Contracts

are suggested:

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A th i d P t S l ti



Authorized Partner Selection

Enter the authorized sold-to parties in the partner tabof the contract.

Create a sales order as follow-up and choose the correctsold-to party.

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U d ti th C t t



Updating the Contract

Once you have saved the release order, the systemupdates the released quantity or value and records it inthe contract

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It l l Vi f C t t



Release Order List

The Release History assignment block on the item leveldisplays all release orders for a particular item.

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R l O d P i C l ti



Release Order Processing: Completion

Item: Target value$10,000

Customer:ABC Inc.

Contract alreadyfulfilled

Contract:


Customer:ABC Inc.

Release order:


Customer:ABC Inc.

If target value or quantity has beenmet, you can either continue or beginthe contract creation process again.

You can continue to release orders against the contract

until it has been completed.

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Operative Reporting in SAP CRM 7 0



Operative Reporting in SAP CRM 7.0

Find contracts according to different criteria

Save contracts as favorites

Save search results as favorite contract lists

Use an advanced search to define your own searches

In SAP CRM 7.0 you can:

© SAP 2008 /

Contract Management Analytics



Contract Management Analytics

Open sales contracts

Rejected sales contracts

Completed sales contracts

Best-selling products in contracts

Sales contract pipeline Open sales and contract volume

You can use mySAP Business Information Warehouse

to analyze contract information, such as:

© SAP 2008 /

Contract Management in Different



Contract Management in Different

Sales Channels

You can work with sales contracts in: Internet sales

Collaborative contract negotiation enables you and your customer todiscuss the terms and conditions of the contract across the Internet.

Mobile sales

Your sales representatives can display sales contracts

on their laptops and create appropriate sales orders.

© SAP 2008 /



Sales Contracts in Mobile Sales



Sales Contracts in Mobile Sales

You can view CRM contracts from laptops and create

sales orders in Mobile Sales.

When the information is downloaded from Mobile Sales tothe CRM system, the sales order is then linked to therelevant contract.

© SAP 2008 /

Integration of Contracts between



Integration of Contracts between

ERP and CRM

You can run an initial download to replicate all existing ERP contracts to CRM.

New or changed contracts are then downloaded automatically from ERP to CRM.

You can then display ERP contracts and release products against them from the CRMsystem.

Contracts are continually updated with the correct released quantities or values in bothsystems.

Contracts have a long shelf life, so for customers whowish to use CRM as the leading system for contractmanagement, it is possible to download ERP contracts tothe CRM system.

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T bl f C



Target Industries of mySAP Contract

Management

Contract management in enterprise sales is appropriate for all industries and

customers. Contracts are also available in CRM service and in the leasing and IPM scenarios.

The following industries are able to adapt contract

management to suit their exact requirements: Oil and Gas

Automotive

Utilities

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T bl f C t t



Further Information

SAP CRM - Roll-Out Map

https://portal.wdf.sap.corp/go/crm-rollout-map

SAP CRM - Ramp-Up Knowledge Transfer (RKT)http://service.sap.com/rkt-crm

SAP CRM – Demo Portalhttp://crmportal.wdf.sap.corp:1080

SAP CRM – WiKihttps://wiki.wdf.sap.corp/display/SAPCRMHub/Home

SAP CRM - Help Portalhttp://help.sap.com/crm

SAP Public Webhttp://www.sap.com/crm

© SAP 2008 /

Copyright 2008 SAP AG


http://service.sap.com/rkt-crm

http://crmportal.wdf.sap.corp:1080/

https://wiki.wdf.sap.corp/display/SAPCRMHub/Home







https://wiki.wdf.sap.corp/display/SAPCRMHub/Home

http://crmportal.wdf.sap.corp:1080/











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CRM 70 Rollout Detailed View Contract Management

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