Make-to-Order Production w/o Variant Configuration

1. Make-to-Order Production w/o Variant Configuration SAP Best Practices

2. Purpose, Benefits, and Key Process Steps • Purpose • The business process encompasses all steps from the customer quotation to the delivery and billing of the finished good and all dependent components in make-to-order production (MTO). • Furthermore, the scenario is supported by the main cost object controlling functions required, such as preliminary costing and period-end closing. • Benefits • Quotation history • Billing plan including down payment • Change management in production • Key Process Steps • Creation of the quotation header • Creation of follow on quotation with reference to first quotation • Customer’s request to change the quotation • Create sales order with reference to accepted follow on quotation • Customers credit limit is checked • Order confirmation is sent to the customer and the production process is started • Milestone Billing – down payment after order confirmation • Customer requests a technical change • Sales order and bill of material are recalculated • Delivery and billing of the finished good

3. Required SAP Applications and Company Roles • Required SAP Applications • Enhancement package 5 for SAP ERP 6.0 • Company Roles • Engineering Specialist • Production Planner • Sales Administrator • Billing Administrator • Accounts Receivable Accountant • Production Supervisor • Warehouse Clerk • Shop Floor Specialist • Product Cost Controller • Excise Clerk

4. Detailed Process Description • Make-to-Order Production w/o Variant Configuration • This scenario describes the entire process sequence for a standard sales process (Make-to-Order) with a customer. The business process encompasses all steps from the customer quotation to the clearing of a customer account after payment is received. • Quotation processing is the first stage of the production process. The scenario starts with an incoming request for quotation. A quotation is then created in the SAP system in response to the customer's RFQ. The customer requests a change to the quotation and a follow-on quotation is created. Finally, the customer accepts the second quotation and a referenced sales order is created. An order confirmation is send to the customer and production process is started. Now, the customer requests a technical change. Sales order and bill of material are therefore recalculated. The process ends with the delivery and the billing of the produced goods. • The process can be enhanced individually by executing optional steps, like serial number creation, subcontracting, QM in production, credit management and plant- and company closing.

5. No Yes Process Flow Diagram Make-to-Order Production w/o Variant Configuration: Quotation Processing MTO Event Request for MTO Quotation Sales Administrator Plan Forecast for Finished Good (144) Quotation Processing MTO Quotation accepted? Print Order Confirmation Create Follow-On Quotation and Send to Customer Create, Print and Send Sales Quotation to Customer Optional: Use Easy DMS to Assign Customer Specification to Quotation Reject First Quotation MTO = Make-to-Order; DMS = Document Management System

6. Process Flow Diagram Make-to-Order Production w/o Variant Configuration: Parts Production for Subassembly Event Need of Raw Material for Subassembly Sales Administrator Create Sales Order with Reference to Follow-on Quotation and Print Order Confirmation Credit Issues Have to be Solved (108) Billing Administrator Create Invoice, Print Down Payment Request and Send to Customer Accounts Receivable Accountant Post Customer Down Payment Production Planner Procurement of Components Using Purchasing Processing (130) Evaluate Stock Requirements Situation

7. Process Flow Diagram Make-to-Order Production w/o Variant Configuration: Parts Production for Subassembly; Technical Change for Finished Good, Procurement of Stock for Final Assembly Event Planned Order Has to be Converted to Production Order Request for Technical Change (Finished Good) Production Planner Create Production Order (Subassembly) Release Production Orders Confirm Production Order Evaluate Stock / Requirements Situation after Technical Change Manu-facturing Material Staging Production Supervisor Review Order Confirmations Shop Floor Specialist Procurement of Components Using Purchasing Processing Post Goods Receipt manually Engineering Specialist Customer Change Request is Considered Product Cost Controller Recalculate Customer BOM Sales Adminis-tration Change Order, Print Order Confirmation and Send to Customer (after Adding Material) Buyer Procurement of Stock Material w/o QM (130) Procurement of Stock Material with QM (127) Procurement & Consumption of Consigned Inventory (139) MM Subcontracting (138) Repetitive Manufacturing (149)

8. Process Flow Diagram Make-to-Order Production w/o Variant Configuration: Final Assembly; Delivery Processing; Billing Processing Event Planned Order Has to be Converted to Production Order Production Planner Optional: Printing Shop Floor Papers Convert Planned Order to Production Order Release Production Orders Evaluate Stock / Requirements Situation Optional: Checking Serial Numbers in Production Order Confirm Assembly Activities Manu facturing Material Staging for Assembly Pick Components (Picking List) Shop Floor Specialist Issue Goods Manually Instead of Picking List Post Goods Receipt for Production Order with Serial Number Assignment Sales Administrator Sales Order Processing: Sales from Stock (109) Delete Billing Blocks Billing Adminsitr. Create Invoice, Print Closing Payment Request and Send to Customer Excise Posting for Order Related Billing Create Invoice, Print Payment Request and Send to Customer Accounts Receivable Acc. Post Milestone Invoice Post Closing Invoice End Process

9. Diagram Connection Legend <Function> Hardcopy / Document External to SAP Financial Actuals Business Activity / Event Budget Planning Unit Process Manual Process Process Reference Existing Version / Data Sub-Process Reference Process Decision System Pass/Fail Decision