SAP Sales Order Management

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Gaining Control of

Order Management

Processes

What happens once a customer signs a deal

with your organization? Even with SAP, sales

order management often still includes manual

or inefficient processes that are prone to

prob-lems, leading to inefficiencies or—even worse—

unhappy customers. In this e-book, which is

designed for business and IT professionals, find

out more about using technology to gain control

of sales order management processes.

Why analysts praise SAP Sales Order Management

for taming complicated processes

Why data consistency is regarded as the most

important aspect of sales order management

Tips for making better use of SAP Sales Order

Management

How mobile is transforming sales order

management processes

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home SAP SAleS order mAnAgement A Behemoth thAt WorkS ConSiStent dAtA key for oPtimAl SAP SAleS order mAnAgement PitfAllS in SAP SAleS order mAnAgement Common to mAny moBile, loCAtion dAtA CentrAl to SAleS order mAnAgement’S future anaging sales orders in SAP can be a com-plicated and cumbersome process, but that’s simply a reflection of the complicated nature of business.

It’s also one of SAP’s greatest strengths, according to some.

SAP has tried to address the long list of challenges and inefficiencies throughout the sales order chain by of-fering an end-to-end system that en-compasses every step along the way. Other vendors specialize in one part of the process in a “scope beats focus” kind of approach, according to analyst Craig Le Clair of Forrester Research Inc. in Cambridge, Mass.

“Their approach is to be an all-en-compassing infrastructure solution,” he said. “They’re trying to bring in the ERP

financials; they’re trying to provide, in certain industries, manufacturing and supply chain management.”

getting the Right Fit

Sales order management is an “un-tamed process,” according to Forrester. Order management isn’t something contained within any one application, but can span eight or nine different departments and 15 or 20 integration points, according to Le Clair.

With SAP sales order management, the customer data, including leads and other marketing information, resides in the CRM system. The order moves to the ERP side for tasks ranging from order fulfillment to billing. Order man-agement is integrated with the supply chain management (SCM) component for more sophisticated products.

SAP Sales Order Management

a Behemoth That Works

SAP’s strategy of offering customers an end-to-end sales

order management system gets high marks, according to analysts. by todd morriSon

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home SAP SAleS order mAnAgement A Behemoth thAt WorkS ConSiStent dAtA key for oPtimAl SAP SAleS order mAnAgement PitfAllS in SAP SAleS order mAnAgement Common to mAny moBile, loCAtion dAtA CentrAl to SAleS order mAnAgement’S future

SAP sales order management comes as a set of core capabilities, ranging from inquiries and processing to con-tract negotiation and billing, while additional capabilities can be added depending on the industry and how the business is run.

A manufacturer that’s shipping a product that’s been prebuilt, for ex-ample, won’t need the configuration component that would be needed if the product was being made to order.

Another example can be found with SAP Apparel and Footwear Solution, which allows a manufacturer to assign one number in the database for each size and color associated with a partic-ular style, rather than a separate num-ber based on style.

Selecting an industry-specific ver-sion of SAP’s sales order manage-ment application can give a company roughly 90% of what it needs, right out of the box, according to Jeanne Hedman, lead SAP consultant with Panorama Consulting Group LLC in Denver.

“It’s very important,” she said. “It comes down to needing less detailed configuration.”

StRengthS and WeakneSSeS

While SAP sales order management’s biggest asset is its breadth of scope, according to Le Clair and other ana-lysts, SAP gets credit for the strength of its CRM, according to Holger Kisker, another analyst with Forrester.

That includes its support for the full range of inbound sales order channels, including online, telephone and now mobile sales, Kisker said.

SAP also provides customers with a number of other sales order manage-ment features, said Panorama’s Hed-man. For example, SAP’s “document flow” system allows detailed informa-tion to be recorded for each product at every step in the order management process. That information can help re-solve any problems a customer has, before or after the product is shipped. That’s something that other vendors don’t have, Hedman said.

SAP also gives its users the ability to handle more than one “ship-to” on one label. That allows companies to send inventory to a specific customer ware-house, but at the same time indicate that the goods will then be sent on to a specific store.

On the other hand, one weakness with SAP’s sales order management software has been that it has tradi-tionally only been able to tell a cus-tomer when a product was going to be shipped, not when it was going to be delivered, as most customers want to know, Hedman added.

Yet SAP’s do-it-all approach also works against the company in many ways, according to Michael Dunne, an analyst with Gartner Inc. Users aren’t always sure what they have and how it all fits together.

“People are confused as to what’s in there,” he said. “It’s pretty broad.” p

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FFective use of SAP sales order manage-ment requires close attention to the rap-idly evolving sales channels available—and integrating those channels across the SAP land-scape, according to analysts and SAP representatives alike.

For example, a customer who orders a product online needs to be able to re-turn an order in the store if needed.

Yet, while that kind of versatility is great for the customer, it adds com-plexity to the order management pro-cess. It can also add up to headaches for the company if the various records aren’t consistent across the entire sales order management system.

There could be different records for a customer who ordered online, or using a mobile device, or even through a call

center, said Prashant Dube, product manager for SAP CRM.

“You could have the same cus-tomer in five different channels,” Dube said. “And they could all be treated differently.”

To avoid those problems, organi-zations using SAP sales order man-agement need to make sure they’re creating single records—“single ver-sions of the truth”—for their products, customers and orders via a centralized database.

One way to do this is by using the single order management application within the sales order management system. That way, the data stays con-sistent, irrespective of channels, ac-cording to SAP.

“If there’s no central repository,” Dube said, “it’s a big problem for the order and the consumer.”

Consistent Data Key for Optimal

SAP Sales Order Management

the range of purchasing channels today makes life easy for the consumer, but it can mean headaches for companies that don’t do enough to make sure data is consistent across those channels. by todd morriSon

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Start small and plan for testing the sales order management system

Companies implementing SAP sales order management need to include at least a week of testing before it’s ac-tually deployed, according to Jeanne Hedman, lead SAP consultant with Panorama Consulting Group LLC based in Denver.

Companies need to ensure the new sales order management system re-corded the same number of orders, and the same number of shipments, as the existing system.

Additionally, companies using order entry systems like electronic data in-terchanges need to be certain the new system is “talking” to their partners’ systems, according to Hedman.

“You do have to work with your cus-tomers,” she said.

Organizations starting with a new sales order management system should use it only for a relatively sim-ple product at first and gradually add other products to the system, accord-ing to Michael Dunne, an analyst with Gartner Research Inc. in Stamford, Conn.

“Don’t cut your teeth on the most difficult thing,” he said.

Make SuRe the veRSion FitS

It’s important that companies deploy-ing SAP sales order management make a thorough assessment of their busi-ness needs and processes and use that

information in getting the version that most closely matches their business model, according to Dube.

After all, there are big differences in how companies operate, even when it comes to contracts. Whereas a chemi-cal company might use contracts to supply a customer on an as-needed basis, a telecommunications firm re-lies on more long-term contracts with its customers that can last years. “And there are some cases when the con-tract itself might not be applicable,” Dube said.

end-to-end MetRicS

It’s a mistake to apply metrics to in-dividual departments and processes within the sales order management system—at the “silo level”—warned Craig Le Clair, analyst with Forrester Research Inc. in Cambridge, Mass.

The advantage of SAP’s sales order management system is that it spans the entire order management process, he said. That means that companies should see to it that the metric they’re using for order execution is applied to the entire system—giving them a “sin-gle version of the truth,” once again.

“What’s needed is to look at more end-to-end order metrics,” Le Clair said.

Those overarching metrics include the percentage of orders fulfilled on time to the percentage of accurate or-ders captured, according to Le Clair. p

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home SAP SAleS order mAnAgement A Behemoth thAt WorkS ConSiStent dAtA key for oPtimAl SAP SAleS order mAnAgement PitfAllS in SAP SAleS order mAnAgement Common to mAny moBile, loCAtion dAtA CentrAl to SAleS order mAnAgement’S future hile no one in business wants to make mis-takes, when it comes to manag-ing sales orders with SAP, companies can rest assured that others are likely grappling with similar problems.

“The mistakes you’re making are the mistakes every other company is making,” said Gil Magana, founder and president of CRMintel LLC, a Dallas-based consulting firm.

inadequate tRaining

With technology changing at a light-ning pace, companies are rapidly try-ing to keep up with and implement the latest software. But sometimes in the race to put in a new process, salespeo-ple aren’t properly trained on how to

use it, resulting in a breakdown in the system.

“The training is not done adequately or efficiently,” said Joshua Greenbaum, principal consultant at Enterprise Ap-plications Consulting in Berkeley, Ca-lif. “So there’s a lot of people who are staring at a screen not completely un-derstanding it.”

The best solution, Greenbaum said, is to make sure all stakeholders are on the same page when SAP is imple-mented and that users are shown the proper way to manage not just their contacts, prospects and leads, but the sales order itself. Companies should in-vest in high quality, one-time training seminars so that users learn the most effective way to handle the system and don’t need to relearn the basics later on.

“The most common mistakes are

Pitfalls in SAP Sales Order

Management Common to Many

Struggling with SAP sales order management? you’re probably not alone. it’s a complicated system, but some careful planning can help avoid mistakes. by KAtie ZeZimA

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going to be related to poor train-ing more than anythtrain-ing,” Greenbaum said. “The software is pretty effective software.”

PRoceSS oveR technology

Companies often make the mistake of implementing a business strategy based purely on technology rather than trying to define the sales process and tailor their software to it, said Greg Langston, vice president of sales at the Harris Products Group, a subsidiary of the Lincoln Electric Company, in Ma-son, Ohio.

“If you do that, you just automate a dysfunctional process,” Langston said. “The key is to make sure it works on paper first. Once it works on paper, even though it’s tedious, it guarantees a better result.”

When Harris Products launched SAP CRM, Langston first clarified expecta-tions and weekly metrics for his sales-people—like entering itineraries and sales calls—and worked them into his SAP system.

“You need to be very specific in terms of your expectation,” Langston said.

To be effective, you must be pre-pared to stick to your guns when it comes to convincing superiors and subordinates that streamlining does help business.

“It’s like walking through glass to get it implemented,” he said. “You’re changing the status quo.”

cuStoMization oveRload

One benefit of SAP is that organiza-tions can build out their own applica-tions onto its stable base. But some companies tend to go overboard with the extras, leading to confusion among users, data that is difficult to access because of additional layers and re-peated processes.

“Something I’ve been saying lately, especially when doing consulting, is try and stay as vanilla as possible when it comes to SAP applications,” said Tom Leddy, the principal engineer for SAP CRM at OfficeMax in Naperville, Ill.

For example, in his prior work as a consultant, Leddy had a client com-pany that customized its system to hide fields and menu options in an at-tempt to streamline business. In the end, the business would have ben-efited from the hidden fields: It had to spend time undoing the customization, he said

data duPlication and data quality

With orders constantly pouring into the centralized SAP system, there is potential for signals to get crossed, creating data duplications that go un-noticed and hurt recordkeeping.

The biggest potential for duplicated data comes when the data is frag-mented—for example, if someone in marketing enters a sales client’s name into the system without checking to see if it is there already. Magana said

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some employees sometimes want to keep their client lists to themselves, for fear others could see them and the customer relationship they’ve built up could be altered, and do not enter it into the system.

However, by not having the data in a centralized system, it can negatively affect data quality, leading to problems for both company and client.

“If data is centralized,” Magana said, “everybody has access to the same in-formation. It’s transparent across the organization, and you’re able to make the types of decisions you need to de-liver on the requirement that are nec-essary to provide value.”

But those decisions must be based on accurate data.

“If they feel they can’t trust the data they’re getting from the system, they feel like they’re not going to be very ef-ficient to do the jobs they have to do,” Magana said.

Changing the entire system can take time, he said, and he recommends that users at the “grass-roots” level speak

to managers and executives about the issues surrounding data duplication and management. While SAP has an application that can help, Magana sug-gests companies also take proactive

measures to prevent duplication. “There needs to be an organiza-tion, whether through business pro-cesses or systems reengineering, to design something that tries to keep the data as clean as possible at all times,” Magana said. “It ensures data is not always at 100%, but 90% to 100% is better than most organizations have, anyway. It’s just not a priority.” p

By not having the data

in a centralized system,

it can negatively affect

data quality, leading

to problems for both

company and client.

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home SAP SAleS order mAnAgement A Behemoth thAt WorkS ConSiStent dAtA key for oPtimAl SAP SAleS order mAnAgement PitfAllS in SAP SAleS order mAnAgement Common to mAny moBile, loCAtion dAtA CentrAl to SAleS order mAnAgement’S future ith so much of business done on the go and salespeople liv-ing and workliv-ing across the globe, it’s only natural that the future of sales management tech-nology lies in most people’s pockets or purses.

There are a wide variety of mobile applications to show what is going on through the supply chain that can be run through mobile business intel-ligence apps, said Kevin Benedict, an analyst, blogger, consultant and SAP Mentor volunteer in Boise, Idaho.

“Once the products are in produc-tion, you have the ability to feed track-ing information to clients,” he said.

GPS is also coming to the forefront of order management, Benedict said. Based on data that has been put into

the system post-sale, someone in sales or delivery can prepare a customer profile and download it while driving toward the customer’s location.

It has also eliminated the need for delivery personnel to get a signature, since GPS and proof of delivery app can time-stamp an order. When a sig-nature is requested, it can be seen immediately.

“It’s associated with the database record and synced back to headquar-ters,” he said. “Within seconds of de-livering the package, a customer can go in and see who signed the por-tal, the date and time and GPS of the signature.”

Most of the mobile technology has been focused on smartphones, but one brand-new area for mobile sales man-agement technology is tablets like the iPad and Motorola Xoom. They are

eas-Mobile, Location Data

Central to Sales Order

Management’s Future

GPS, mobile devices and collaboration promise to transform sales order management, according to experts. by KAtie ZeZimA

W

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ily portable and less bulky than laptops, but have a larger screen than a phone, allowing more data to be displayed.

“Everybody is looking at tablets to-day, and they’re looking at tablets because they really open up a new market,” Benedict said.

Sales management software is also tapping into social media as a way to do business.

SAP’s competitor in the CRM mar-ket, Salesforce.com, has launched Chatter, a collaboration tool that gives users a secure, personal social network on which they can share confidential data, compile groups and follow oth-ers. It is useful after the order is com-pleted, so everyone is in the loop as to how the sale ended up.

SAP has also released a collabora-tion tool, called StreamWork, that it has begun integrating with SAP CRM, product lifecycle management and governance risk and compliance.

“It gives you the ability, basically, to have a social group of individuals all talk about the same sales account so that everybody who is touching that account can collaborate more closely,” Benedict said.

For example, a salesperson on a soap account can talk to people in customer service, advertising, a sales manager and an engineer and add them to a group.

“All the conversations in that group would be shared with everybody who is added and work together,” Bene-dict said. “It sounds simple, but people haven’t done that before.” p

Gaining Control of Order Management Processes is a SearchSAP.com e-publication.

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executive editor

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