SAP S/4HANA Procurement
Fig. S/4HANA Procurement starting page
SAP® S/4HANA is the successor to SAP® R/3 ERP. The S/4 stands for the new release and HANA for the database. With SAP® S/4HANA, you have the choice between an OnPremise (software installed and configured exclusively for your company) or Cloud solution. The HANA database is a prerequisite.
There are two important modules for purchasing: S/4HANA Sourcing & Procurement and S/4HANA Central Procurement.
For purchasing, there is the Sourcing & Procurement (S&P) module, which is the successor to SAP ERP MM. New here are the user-friendly Fioriapps, which largely replace the SAP GUI. In addition, there are more very useful analysis functions for purchasing via Fioriapps.
In addition, there is the Central Procurement module, which enables the function of central purchasing. Purchasing can use it to centrally manage requisitions, purchase orders and contracts across multiple SAP ERP systems. In addition, Central Procurement offers central analysis functions for several connected SAP ERP systems. This makes Central Procurement, along with SAP Ariba, a possible successor to SAP SRM for multiple SAP ERP systems in the company.
Another important feature of Central Procurement is the ability to connect one SAP Ariba system to multiple SAP ERP systems.
Fig. S/4HANA Procurement overview
Why S/4HANA for Sourcing & Procurement?
The Sourcing & Procurement (S&P) part is the successor module to SAP® ERP MM. This was primarily enhanced with user-friendly Fiori Apps. It offers functions for purchasing, such as operative procurement, approval and ordering.
For this purpose, some functions from SAP® SLC (supplier management) were transferred to S/4HANA. This is, among others, the supplier evaluation.
SAP® Ariba Buying & Invoicing and SAP® Ariba Sourcing can be well integrated into S/4HANA S&P.
We support you in the implementation & optimization of SAP® S/4 HANA Sourcing & Procurement with our technical expertise, as well as with SAP® trainings for better handling. Contact us for further questions.
What makes S&P different compared to SRM?
What are the implementation options?
How to configure the interaction between Ariba Buying & Invoicing or SAP Ariba Sourcing and S/4HANA S&P?
Why S/4HANA for Central Procurement?
S/4HANA for Central Procurement (CP) supports the centralization of purchasing functions and processes, across multiple independent companies and thus usually across multiple ERP systems. The role of a hub (central point) is in the foreground.
Central Procurement is subordinate to Sourcing & Procurement in the hierarchy.
CP offers the possibility of merging several backend systems for purchasing processes. A central application for the procurement processes is created. SRM was already able to perform this role - but S&P was not.
The integration between CP and multiple backend systems supports the centralization of purchasing processes across multiple backend systems. For example, shared services scenarios can be mapped. In CP, purchasing processes are brought together and can thus be controlled and standardized across the board. For example, an approval process for purchase requisitions from different backend systems can be implemented in CP.
What makes CP different from SRM?
SAP has learned from about 20 years of SRM that trying to harmonize master data (e.g., suppliers, account assignments, organizational data) from different ERP systems in a central purchasing application is a challenge. In the case of a very heterogeneous ERP landscape, it can also be a showstopper.
In the centralized purchasing process under CP, the business logic of the associated ERP system is applied directly. The documents (e.g. purchase requisition, purchase order) are created in the respective ERP system as a leading document. The documents are subjected to the check logic of the ERP system without any detour. The effort for harmonization and mapping can thus be reduced to a minimum.
What are the implementation options?
The S/4HANA for Central Procurement product was first delivered with S/4HANA version 1809 OnPremise (currently 1909) and can also be used in the cloud version.
- If an S/4HANA system exists, the CP solution can be activated in that system.
- If not, an existing SAP ERP system can be transformed to S/4HANA and the CP functions can be activated afterwards.
- A new S/4HANA system can be built and the CP functions activated.
In this context, it is important to note that in an SAP S/4HANA instance in which the CP functions have been activated, the already existing business processes (e.g. financial accounting, cost accounting) can run in parallel. The CP acts as if this is one of several ERP systems.
It is also important to note that SAP will always apply additional license fees when using CP.
When using CP, the Ariba Guided Buying user interface can be implemented if the focus is on user-friendliness for the self-service processes.