1.

Picking, Packing (if relevant), Posting Goods issue & creating subsequent Shipping
documents (if applicable) <VL02N>

Once PGI is executed, Goods movement status is complete. The Delivery doc no and a Material doc no
will show up within Document flow section in Sales Order.
If you check the material document in <MB03>, you will find that a movement with movement type 601
has been executed. Stock account would be credited (-) for the outgoing material.

2. Creation of a standard Invoice document and posting of Invoice <VF01/VF02>

After Posting the Invoice, it is released to Accounting. Finally the Sales Order document flow would be
as below:
 3. Customer Equipment is created as a Serialized version of the material sold
Transaction: Create Serial No (with Equipment view) <IQ01>.

- Sale of Accessories/Spare parts on receiving a Customer Request Notification. The parts

maybe under guarantee in which case the supplier may charge the customer nothing or certain
charges as per guarantee norms. This is very similar to the Sales scenario, difference being it’s
based on a Customer Notification post sales usually. Brief steps highlighted below:

Please Note: Apart from standard Sales & Distribution configuration, it will involve Notification
configuration on PM side which has been detailed in later sections of this document under Post
Sales Scenario.
1. Service Notification created
Transaction code: <IW51> (Create)/ IW52 (Change)
Notification type: S1
2. Sales Order created from the Notification by Clicking on Sales Order tab
Transaction code: IW52 (Display)
Order type: I have used the Standard Order type “OR” but it is again Business
specific choice. SD configurations should accordingly be done to support the
process.

3. Outbound Delivery creation and processing (same as previous scenario)

Transaction code: Create <VL01N>/Change <VL02N>/ Display <VL03N>
Delivery Type: LF
4. Invoice creation and processing (same as previous scenario)
Transaction code: Create <VF01>/ Change <VF02>/ Display <VF03>

5. Check the Complete Document Flow in Notification or Sales Order

Transaction code: Display Sales Order <VA04>/ Display Notification <IW53>
 - Creation of Service/Maintenance Contract for rendering Long term Planned Services such as
yearly services of Air conditioner with coolant change

This will be detailed in Post Sales Scenario -> Service Order processing – Contractual Services

4.3 Post Sales Scenario

Process Background: Post sales scenarios are the actual Customer Service scenarios, with the most
critical ones being:

- Service Order processing – Non contractual Services

- Service Order processing – Contractual Services – Unplanned (Fixed Billing)
- Service Order processing – Contractual Services – Unplanned (T&M Billing)
- Service Order processing – Contractual Services – Planned (Fixed Billing)
- Service Order processing – Contractual Services – Planned (T&M Billing)
- Returns & Repair processing

Service Order processing can again be based on T&M billing (Based on actual costs incurred) or Fixed
rate billing. The above can also be subject to Warranty is and as applicable or configurable services
based on certain conditions. As mentioned earlier, the CS module scenarios can get very complex and
conditional based on the services rendered by the organization. This document would however only
highlight the base scenarios which are the building blocks for further scenarios.

4.3.1 Service Order Processing – Non Contractual services

Process Background: A Customer already dealing with a Service organization or a new customer
gives a call and requests a Service action, without going into a Quotation process i.e. they agree to pay
on whatever is the actual work that would be performed or a Fixed rate applied post the services have
been delivered. This is a one-time service work not bound by any contractual norms. This kind of work
are usually billed on a T&M (Time & Material) basis. In most cases it’s an existing customer. Just in case
it’s a new customer, Customer master records would be set up first and then the work processed further.

Configuration Pre-requisites:

SD settings (Only the critical nodes highlighted)

1. SPRO -> Sales & Distribution -> Basic Functions -> Pricing -> Settings for “DR” Debit memo request
We have created a Document pricing procedure “S” which is assigned to DR. Also the Customer that
we are using in this prototype document is assigned a Customer pricing procedure “S”. So system
determines the pricing procedure for the combination “Sales Area -> Doc pricing procedure ->
Customer pricing procedure -> Default pricing condition”

2. SPRO -> Sales & Distribution -> Sales -> Sales document item -> Assign Item Categories
This is a critical configuration setting for this process. As we use standard SAP SD document type
“DR” for Debit Memo request and standard Item categories associated to it, I have not detailed the
initial settings which is usually already done in standard system.

We have set DR (document type) -> LEIS (Item cat group) -> Usage SEIN -> Blank/L2W (Higher
Item categories) -> L2W (Default Item category). This will allow item category determination for DR
during Dynamic Item processing in DP90.
3. SPRO -> Sales & Distribution -> Sales -> Customer Service -> Profiles for Resource Related Billing

This is again a very critical configuration. Profile created with Usage Billing and Result Analysis. Sales
document “DR” set for Billing request generated through this DIP profile, CR set for Credit Memo
request.

Characteristics included are Product (For service product inclusions), Cost Element (Primary selection
criteria for Cost sources), Activity Type/Cost centre/Material (Optional as Cost elements drive selection)
Sources are Actual Cost – Line item driven here with 100% cost relevance.
Sources in this prototype are driven on Cost element based sets. This is the case where cost elements
pertaining to Labour, Material, Services etc are clearly available/identified to the Logistics team. If this
isn’t the case, then the Source selection may be driven on sets of other characteristics which the
Logistics team is aware of like Material ID sets, Activity type/Cost centre sets etc.
Material Determination – this is the set of Dynamic items which will get picked up to be placed into the
Debit Memo request as request items (L2W category) based on source criteria. The Materials used here
has been set up in SAP MM module as “DIEN” material with Item category Groups set as LEIS, and in
Costing 1 tab, “Material origin”, “With Quantity Structure” have been set.

You would notice in configuration step that there are 2 critical parameters Material Direct and Individual.
Material Direct means that if an actual material no. is there (say a spare part used), then that will be
transferred to the Billing request instead of the Dynamic material. In this case Material should have been
set as a Characteristic. Individual refers to second level of summarization. It’s better to tick all as
Individual Expense Item else during DP90 transaction it often causes issue in determining Expenditure
Items. If it has been set then each individual line will be posted separately to billing request instead of
summarizing under the Dynamic material ID.
Each of this Dynamic material is then mapped to a Selection criterion, which has been kept on a set for
identification of Source cost element.

4. SPRO -> Sales & Distribution -> Sales -> Customer Service -> Assign conditions to Sales Document
type

DR is assigned to Condition type EK01 (Actual costs)

5. SPRO -> Sales & Distribution -> Sales -> Billing -> Maintain Copy control for billing documents ->
Sales Document to Billing document

Sales Document “DR” -> Billing document “L2” with Header, Item mapping to include L2W item
category (for this scenario as per previous configurations)
PM settings (Only the critical nodes highlighted)

1. Basic settings: SPRO -> PM & CS -> Maintenance & Service Processing ->
- Settings for Display of Costs -> Defined Value categories for Costs and Revenues (as Service
Order is Revenue bearing) and assigned them to corresponding Cost elements/Cost element
groups can also be assigned.
- Defined a Settlement profile & its corresponding allocation structure
For a Revenue bearing Service Order, Settlement profile usually should allow settlement to a
Profitability Segment and Revenues should also be accounted as Source in Allocation structure.
2. Notification settings: SPRO -> PM & CS -> Maintenance & Service Processing -> PM & CS
Notifications -> Notification creation -> Notification Type/Notification Content/Partners/Notification
processing
- Notification type”S3” re used: General Service Notification type.
- Define Screen Templates, Assign Number range, Long Text control
- Assign Notification Type to Order type: S3 linked to PM/SM order type SM02 detailed later
- Define Order Types and Special Notification parameters – as in this scenario we will just be
associating the Notification to a Revenue Bearing Service Order, no Sales Order/Contract type
need be associated
- Catalog profile: A standard/customized CS profile can be used for defining Task/Activity codes
- Partner Determination Procedure: PDP “SV” assigned to the Notification type S3
- Notification processing -> Additional Functions -> Define Action box -> Follow up functions
In this node, I have kept the action boxes defined by standard SAP as it is. However from the
actions configured in the action boxes only a couple of specific actions (highlighted ones) will be
used in the process steps as you would notice. If required, these action boxes can be de
assigned in configuration as well.
3. Order settings: SPRO -> PM & CS -> Maintenance & Service Processing -> PM &CS Orders ->
- Function and setting for Order type “SM02” – Order type should be revenue bearing and linked
to Settlement profile as created in steps above

- Check credit Limits, Sales doc types for Service Orders – This node defines a PM Order as a
Service Order and associates it to a DIP Profile (as configured earlier) and a Debit Memo
request document
- Configure Number range fort Order type
- Assign Order type to Maintenance Plant(s)
- Settlement rule : Define Time and Creation of Distribution rule – has been set as Mandatory for
Completion
- Define Notification and Order Integration: SM02 is linked to S3 Notification
- Costing data for Maintenance and Service Orders -> Assign Costing Parameters and RA key
Standard Costing parameters and RA key used

- Partner -> Define PDP and Partner function -> Assign to Order type -> PDP “SV” assigned to
SM02
- Scheduling -> Set scheduling parameters -> Forward scheduling set for Plant, Order type
combination
- Completion confirmations -> Define Control Parameters for Completion Confirmations - set as per
standard for Plant + Order type SM02 combination

Process Steps:

1. Customer call is recorded in a Service Notification of type “S3” as per configuration

Transaction: <IW51>
The Relevant Details are filled in the Notification, Tasks (To do) /Activities (As done) etc are logged into
respective sections and Notification is set into processing by releasing it.

Notification “……” saved.

2. Service Order of type “SM02” is created as a follow on function from the Notification. All
relevant costs such as Expected Service hours, Spare parts if any will be planned in the
Service Order and the same will be released for actual processing. Please Note that in this
case “No sales order” would be associated.

Transaction: <IW52>
As this is a Pure T&M Service Order, Service Product may/may not be associated. We will simply plan
the Labour hours, Material (if any), Service (if any) and release the Order
Planned costs will be displayed on executing the Costing or on saving the order

The Order is planned and released.

3. Time Confirmation against the work performed for the Service Order
Transaction: <IW41>
4. Entering Goods Movement against the Service Order – for components/spare parts
consumed
Transaction: <MB11>

5. Resource Related Billing for Service Order

Transaction: <DP90>
Expenses View

Using Account Indicator against the Lines, you can actually control whether an expense line is actually
relevant for billing or not or Partial billing, for example, a Goodwill or a Warranty item. But that involves a
further level of advanced configuration which has been kept out of scope here. Alternatively, if the case
is to completely ignore an item (say 100 % Goodwill or something like that) simply Lock the Item and it
will not be processed in billing later.

Also % to be billed can be the easy option for telling the system how much of the Line item is to be
billed. By default its 100%. To accommodate a warranty/goodwill item just change the % to be billed to
0.
Check the items, unlock the items you want to process further and click on Billing Request. You will
observe that the Billing request “DR” Line items will bear an Item category “L2W” as per Item category
assignment configuration.
 6. Create Billing Document for the Billing Request
Transaction: <VF01 >

Please Note: If the items in the Debit Memo request had not been unlocked, there may be a Header
Block which may not allow processing of the Billing document further. A header level block can be
removed by going into transaction <VA02> ->Debit Memo Request No -> Goto -> Header -> Billing
Ensure that the field Billing Block is empty

On executing <VF01>, Invoice doc as below would be generated and on saving the save,
updated in Sales Order document flow.
Release the document to Accounting in Transaction <VF02> if the Billing document type requires it to be
done separately.

It would create the following Accounts level postings at the simplest level
Customer A/c Dr,
Revenue A/c Cr,
Tax A/c Cr
4.3.2 Service Order Processing – Contractual Services

Process Background: Basically there may be 2 primary sub-scenarios for Contractual Service
Procession. It would include
- Processing Service Contracts with Periodic billing: Fixed periodic billing straight from the
Contract. This would be based on a Billing Plan set against the Service item in the contract.
Usually an “FV” type of billing request is generated out of contract line followed by actual billing.

- Processing Service Contracts with Resource Related Billing: Billing would be on basis of
actual costs accrued on an associated Service Order (Non-revenue bearing) followed by a billing
request. Service Order charges will be billed at actual costs through a Debit Memo request
followed by a Billing document.

In the above processes, Maintenance Plans can also be brought into action for generating Service
Notifications/Service Orders on a periodic basis based on a Service Plan created on a Contract Line
item defined as a Service Product. Service contracts may also have price agreements for certain
material and standard monthly billable charge for certain services.

Service Contracts usually come into effect Post sales of a Customer product to the Customer or post
acceptance of a Quotation on behalf of a customer to execute a Contractual service agreement for a
relevant term post acceptance. Costs and services posted to a Service Contracts are finally settled to
Profitability analysis where it can be further analysed.

In the process scenario described below, we would use a single Contract with 2 line items – one with a
billing plan for Fixed Billing and the other to be driven through a Planned Service Order (generated from
a Maintenance Plan) costs settled to it. There may be another sub scenario where a Customer calls to
request a Service (Service Notification) work based on an existing Contract (Auto contract
determination) leading to a Non-revenue bearing service order that is processed further through
Resources Related Billing and costs settled to the Contract line item. This scenario being a little bit
similar to Repair and Maintenance scenario in next section is not detailed further her
Configuration Pre-requisites:

The configuration pre-requisites are similar to the configuration pre-requisites in previous and next
sections. Hence they are only briefly mentioned in this section to avoid repetition wherever possible.

SD side of configuration (All would be under IMG -> Sales & Distribution -> Sales/Billing)
- Document Pricing procedure set for Contract document type “WV”
- Standard Sales document type “WV” for Service and Maintenance Contract activated
- Standard Sales item category ‘WVN” is checked
- Assignment of Sales item category
Doc type WV -> Item category group LEIS -> Usage “Blank” -> Default Item category “WVN
Doc type DR/LV (whichever used as Billing request from Service order) -> Item category group
LEIS -> Usage SEIN -> Default Item category L2W

- Copy control Sales document -> Billing document

Sales doc WV/Item category WVN -> Billing doc FV
Sales doc DR/Item category L2W -> Billing doc F2

- Billing Plan type for Periodic Billing

- Define and Assign Date Categories

- Assign Billing Plan Types to Sales Document Type WV

- Assign Billing Plan Types to Sales Item Category WVN

 - Customer Service -> Profile for Resource Related Billing
Same as in previous process section with usage “Billing request and Result Analysis”

PM side of configuration (Mostly would be under IMG -> PM & CS -> Maintenance
Planning/Maintenance Processing)

- Maintenance processing -> Basic settings -> Value categories should capture all ranges of costs
per Cost element/Cost element group assignment. Revenue value category not required in this
case.
- Maintenance processing -> Basic settings -> Settlement -> Settlement profile -> should allow
settlement to Sales Order
- Maintenance processing ->Basic settings -> Settlement -> Allocation structure -> associated with
above settlement profile should capture Sources for all costs and allow settlement further to
receiver SDI (sales document item)
- Maintenance Plan Category created with Outline Agreement as reference
- No. range assigned to Maintenance Plan category
- Maintenance Order type “SM04” created as a Non-revenue bearing order, settlement profile
allowing settlement to Sales Order assigned
Please Note: You have your own choice of Order type. Just set it up as a Non-revenue bearing
Order and allowing settlement to Sales Order.

- Maintenance Order is marked as a Service Order, linked to sales doc type WV

- Maintenance Order type assigned to relevant Maintenance Plant

- Number range set for Maintenance Order type
- Costing variant (standard PM01/ or custom) assigned to Order type
You can use your own costing variant with/without costing sheet as well, depending on
requirement
 - Scheduling parameters set for Order Type + Maintenance Plant combination
- Completion confirmation parameter set for Order type + Plant combination

Process Steps:
1. Define Service Product for Maintenance Plans
Transaction code: <OISF>

Prior to this, create a Service Item (Type DIEN) in MM01/MMS1.Then define it as a Service
Product for Maintenance Plan. Also a Maintenance Task List should have being created defining
the Operation(s), Planned spares/services if any of the work. This is a pre-requisite to create a
Service Based Maintenance Plan to generate a Service Order.

2. Creation of Service Contract:

Transaction code: Create <VA41>/ Change <VA42>/ Display <VA43>
Document Type: WV
Assigning 2 Service items to the Contract – one (D120) with a Fixed bill as per a Billing Plan, every
month (say $50 per month for 1 year – Ex. an instalment payment contract), other (D125) with a Service
Product assigned which will be cater to actual costs incurred on a Service Order through Resource
Related billing on periodic special services.
A Billing plan is assigned to the first item (item 10)

The item 20 – Actual cost service product may have a base charge to cover some admin costs or may
not have any base charge. In this scenario, we are assuming that all planned service related charges
will come through the Service Order.

Customer Equipment can be assigned to the Contract Line item by selecting line item -> Extras ->
Technical Objects
Save the Contract - Service and Maint. 40005498 has been saved

3. Fixed periodic billing for Contractual Line item based on Billing Plan
Transaction: <VF04> Process Billing Due List, <VF01>
Select the due item in the list, choose Individual Billing Document and save. This will post the Fixed
monthly due bill and the status of the Line item in the Billing Plan will change from Status A (Not billed)
to status C (Completely processed).This would result in revenue being realised against the Contract
Line item.

4. Creation a Maintenance Plan with reference to item 20 of the Contract

Transaction code: <IP50>
Plan category: CS (configured for this scenario)
In configuration this Plan category has been set to be defined w.r.t an Outline Agreement
(Contract)