This flowchart illustrates the end-to-end (E2E) Services Sales process in SAP Order to Cash (O2C) Cycle, designed for a metal fabrication and manufacturing company offering specialized services such as machining, bending, drilling, cutting, and painting.
The flowchart is structured by organizational roles, demonstrating how responsibilities and tasks flow between different departments throughout the service sales lifecycle in SAP.
A detailed explanation of the process shown in the flowchart:
- 📞 Customer Inquiry: The process begins when a customer or prospect sends an inquiry with technical specifications for services. This inquiry is entered into the SAP system, capturing:
- Customer or prospect number
- Material number for the service
- Quantity for each item
- Expected date of response The Document Controller checks if the customer exists in the system, while the Sales Manager approves new customer requests.
- 💼 Quotations: Once the inquiry is processed, a quotation is created in the system. Important data captured in the quotation includes:
- Sales Area details
- Customer information and validity period
- Material number for the service and quantity
- Unit costing details (operations with units of measurement, components to be issued if required)
- Pricing information based on the pricing procedure
- Payment Terms and Incoterms
- Partner functions The Sales team prepares the quotation, which then undergoes approvals from the Finance Manager and General Manager or CFO/GGM, depending on the value.
- 📋 Sales Order Creation: Upon customer confirmation, a sales order is created, either independently or with reference to the quotation. Key details include:
- Sales Area information
- Customer number and PO details
- Material number for the service
- Quantities with Unit of Measurement (AU – Activity)
- Pricing details
- Payment Terms and Incoterms
- Partner functions The Finance Manager reviews the order, and the General Manager provides final sign-off.
- 🛠️ Service Execution: Unlike product sales, there’s no production order. Instead, the Production Team performs the requested service, such as machining or painting. The Store department handles the goods receipt of customer material if required.
- 📊 Billing: The sales order item will have a billing block that is released upon completion of the service. The Finance team creates the invoice based on the sales document data. Accounting updates occur in the background: Dr Customer Account Cr Revenue
- 💰 Settlement: The fully executed sales order item is settled to Controlling – Profitability Analysis. This final stage ensures proper revenue recognition and provides insights into service profitability.
This process demonstrates how the company manages its service sales efficiently through SAP, integrating various modules like Sales & Distribution (SD) and Finance (FI-CO) to streamline operations from inquiry to settlement. The process is tailored to handle service-specific aspects, such as using activity units (AU) for measurement and managing customer-provided materials when necessary.
