Motor Sports International

1. Enterprise Wide Information Systems Motor Sports InternationalCase Company BackgroundInstructor: Richard W. Vawter

2. Motor Sports International • Motor Sports International (MSI) has one sales organization in the United States responsible for negotiating sales and distributing products. • MSI Unites States sells two product lines: • Motorcycles they manufacture and related components. • Accessories such as apparel purchased for resale. • MSI distributes products through retail motorcycle dealers in the United States. • Two plants service the US sales organization. The plant in New York services and manufactures products; the plant in Seattle is a distribution center.

3. MSI - US Corporate Sales

4. Definitions • In the SAP R/3 System: • Organizational elements are structures that represent the legal and or organizational views of an enterprise. • You can design your company structure based on your business processes. • The organizational elements form a framework that supports all business activities.

5. Organizational Elements For example, MSI uses the following organizational elements in customer order management: • Company Code • Plant • Storage Location • Purchasing Organization • Purchasing Group

6. Company Codes • A company code represents an independent accounting unit, for example, a company within a corporate group. • Balance sheets and Profit & Loss statements, required by law, are created at the company code level. • MSI has a US and Canadian company in North America to keep two balanced sets of financial books. • United States # 3000 • Canada # 4000

7. Sales Organizations • A sales organization: • Is responsible for distributing goods and services. • Is responsible for negotiating sales conditions. • Carries out each business transaction. • Each sales organization is assigned to a company code and is responsible for sales in its country and sets its own distribution and pricing policies.

8. Distribution Channels • Distribution channels are the means through which sales material reach the customer. • Distribution channels can include: • Retail trade • Wholesale trade • Direct sales • MSI distributes its products through retailers in the US and through direct sales in Canada. • Tele-marketing • E-commerce • etc.

9. Division • A division can be used to segment a business into product lines. • In sales and distribution, the division allows you to make customer-specific agreements such as: • Partial deliveries • Pricing agreements • Special payment terms • MSI has 2 divisions in the US which allows MSI to run different promotions for motorcycles and accessories.

10. Sales Area: • A sales area is the combination of three elements: • Sales organizations • Distribution channels • Divisions (product-related) • The sales area is used for reporting and pricing. • MSI’s sales area structure for North America is:

11. Plant • A plant is an organizational element within a company. A plant produces goods, renders services, or makes goods available for distribution. • A plant can be one of the following types of locations: • Manufacturing facility • Warehouse distribution center • In the US, MSI has two plants that support the US sales organization. • Most of MSI’s products are manufactured and stored in plant 3000. Plant 3400 is available to meet demand for products in the area and serves other areas when needed. • Regional sales office • Corporate headquarters

12. Shipping Point • A shipping point is a fixed location that carries out shipping activities. Each delivery is processed by only one shipping point! • MSI has shipping points, one for each plant location. For example, in the US: