Collections Management is the most popular and most simple module to implement. However, to fully see the benefits of Collections Management the other 3 modules should be implemented as well.
When asked the question, I normally turn this around and try to align the customer’s strategic objectives from the implementation to decide the scope of the implementation. Customers who have high volumes of customer invoice disputes will obviously look towards Dispute Management – however aligning this with Collections Management joins the gaps between disputes and credit collections. Where a customer has bad debt issues and pays significant attention to Credit Limits and Credit Exposure, Credit Management will be more appealing – however the Credit Risk Class and Credit Exposure can be used to influence the Collections Work list.
As with most new SAP functionality, reporting in core ERP is limited within SAP FSCM. Implementing just the core SAP FSCM modules alone will leave a gap in terms of business reporting. Within SAP BW there is some good business content which is simple to implement. Reporting should be part of the initial build within the project. Some customers who do not use SAP BW (see SAP BW training overview) will design their own ABAP reports which is must better than using the standard content. Any project that does not consider reporting will find it almost impossible to measure the performance of the various teams.
There are two facets of the comparison that are particularly pertinent. First, there is no doubt that one of the keys to successful cash management is accurate information on what the future outgoing cash requirements will be and of incoming cash. Second, the enabling technology base is now in place. In the last three years, the Internet has become a truly cost effective solution for interorganizational communications and a trusted infrastructure for business processes, secure enough to carry forward the technical advances being made in e-payment systems.
The heavy investment in e-procurement in recent years has not fed through into automation of the payment process and there remains currently a lack of progress in the automation of payment systems. Problems include:
But the biggest impediment most solutions fail to address is that 80 percent of the processes today are still paper driven. So automation solutions have to start by:
Some visionary companies are building systems to address these issues, automating the entire billing and payments process and enabling contact down the supply chain with resultant benefits in:
If you are using SAP ERP 6 then the core processes and functionality can be accessed. However, it should not be overlooked that new functionality has been released in the latest Enhancement Packages. Some customers can see the benefit of implementing SAP FSCM immediately and will work with their existing Enhancement Package version. Others will recognize some of the new functionality and wait until their ERP system is on the relevant Enhancement Package.
Before designing the processes to support the Credit Collections team, the organizational units need to be defined. Collections and Credit Management have separate organizational units to represent the various levels within a Company. Where measure are to be common, organizational units can be shared, and where differences are required unique values are required. Breaking out the full implementation into smaller chunks enables the solution to be rolled out and enabling quick wins.
As I mentioned before if you currently manage your Credit Collections process utilizing the SAP FI-AR module then you can use SAP FSCM. The size of your business should not be seen as a blocker to move to SAP FSCM. In some cases, having large volumes of customers or large volumes of invoices increases the potential benefits. The real measure is to look at the potential process improvements. If you want to perform credit checking and scoring in a more efficient manner SAP FSCM will improve your existing process.
SAP has recently released an RDS to provide an efficient process to implement SAP FSCM, reducing the cost of implementation. This is targeted at smaller customers wanting an accelerated implementation. Please note this is only available for customers on Enhancement Package 5 and beyond.
It is really important to note that a SAP FSCM project is 80% process re-design and 20% software implementation. It is therefore imperative that any business implementation of SAP FSCM aligns to these percentages. An implementation team cannot work in isolation from the business as the screens, terminology and processes are considerable different to core SAP FI-AR.
A business cannot input into any solution unless they understand the full capability of a system, otherwise they are over reliant on the implementation partner to make decisions for them. With this in mind, running business workshops on a proof of concept within the customer’s landscape enables the customer to make decisions with a better understanding. In turn this will reduce the subsequent phases including, build, test and training.
The simple answer here is no if you have Enhancement Package @However you need to implement WS-RM to replace the job PI does. If you have a PI server it does not make sense to look at the WS-RM option. If you do not have PI and want Credit Management it is worth considering WS-RM (if you have Enhancement Pack 5). To be fair this is more of technology question for your SAP BASIS team to decide the landscape approach they plan to adopt.
The implementation can be seen in four stages:
If you are using standard FI-AR to manage your credit collections process, SAP FSCM provides tools to enhance your process. The tools in isolation will not solve any problems or add any direct benefit. However, the various modules will improve control and visibility, and enable the team to process more customers with a common process.