Scenario Overview:
ETO - Project Manuf. - Sales
Order Processing with ProMan
Engineer-to-Order (ETO): Environment
Engineer-to-order (ETO) activities involve customer-specific manufacturing of
a product, such as the construction of a plant. Both complexity and uniqueness characterize
the product. The products require large order-specific project and engineering services that
carry considerable risk for technical solutions, costs,
and deadlines. A project therefore processes a customer order.
The following features characterize engineer-to-order activities:
Extensive quotation phase (over several month)
Order-Specific Engineering Services
Complex and Dynamic Product Structures
Internal and External Procurement
Complex Information and Communication Structure
Long Lead-Times
Calculation and Cost Control
Milestone Billing
Assembly, Start-up and Warranty
SAP AG 2005
Engineer-to-Order (ETO): Environment
- Order probability is not very high
- Very extensive order processing phase (over several years)
- Very expensive unique products Joint Ventures are necessary
Milestone billing
Billing, results analysis and costing
Complex and dynamic product structures
Risk analysis – technical and commercial evaluation is necessary
Order-specific engineering services
Engineering Change Management/ Claim Management
Make or Buy decisions have to be made
Long lead-times procurement
Contractual negotiations have to be documented
Installation and Assembly on site
SAP AG 2005
ETO - Project Manuf. - Sales Order Processing with
ProMan
Industrial Machinery
Machinery & Components
and Equipment Value Chain 4
E84 O v eSummary
r v i e w Content
Content
ETO - Project Manuf. –
Order Proc. with ProMan
ETO - Project Manuf. - Sales Order Processing with
ProMan
- Sales order creation
- Linkage set between project and SD order
- Material procurement through PRO-MAN
- Milestone transferring from project to SD order
- Progressive billing with milestones
- Component planning and production in PRO-MAN
- Re-work processing with claim and debit memo
- Delivery through project
- Assembly and acceptance test at customer controlled by
netwok activities
- Cost/revenue analysis through project infomation system
SAP AG 2005
ETO - Project Manuf. - Sales Order Processing with
ProMan: Component View
Customer Manufacturer
SAP R/3
The step before is the acceptence of a customer quotation.
This is subject of E83 – ETO Quotation Processing with BOM-PS and Record Management
Create customer order copying the 2nd quotation created in ETO quotation processing,
and adopt the variant configuration result.
Project tuning bases on the detail business situation, and confirm the project start with the 1 st milestone.
Execute long-lead time procurement by Pro-MAN, create the purchase order.Release the purchase order.
Milestone transferring from the project to the SD order.
Invoice the down payment billing since the first milestone reached.
Down payment.
Process R&D work of the project by release the related WBS element, then confirm the related activities.
2nd advance payment. Release 2nd milestone then settle the 2nd invoice.
Start Production work of the project by release the related WBS element.
GR for long-lead time procurement component to the project stock.
Initial stock for the raw materials, and some of them need to be posted to project stock.
Production processing using Pro-MAN, for all the semi-finish goods.
Customer specification change to change the component of BOM.
Scrap one component from the project stock.
Re-work of the component using Pro-MAN.
Create debit request to customer to charge the special cost for the re-work.
Create claim document to record the cost of re-work, and link the claim to production WBS element.
Finish the production part of project by confirm the related activities.
2nd advance payment. Release 3rd milestone then settle the 3rd invoice.
Start delivery work of project and delivery creation from the project.
Delivery process and GI.
final payment. Finish the Delivery work and release the last milestone.
Cost and revenue analysis by PS reports.
Link related business documents to record management model.
SAP AG 2005
Business Benefits
Project structuring/execution via project system
Clear definition of deliverables and responsibilities
Clear definition and milestones to break down the work by project phases
Centralized control for project costing and revenue
Milestone billing
Determines the percentage of completion (milestone technique for
earned value analysis)
Determines dates in the billing plan for sales orders (cost control)
PRO-MAN
Centralized control of components consumed during the project
Control and monitor MRP, procurement, production through a single interface
Change Management in Project
Control the material scraping and re-work through PRO-MAN
Control the cost of re-work by claim
Charge the cost of re-work to customer by debit request
Delivery through Project/Final Assembly on Customer Site
Deliver the main items to customer through project
Control the assembly work and customer acceptance test by network
activities
SAP AG 2005
BoM Structure
E84
E84 Engineer-to-Order
Order Processing
SD BOM
E83-1000 (Variant Configurable)
Robot Route
E83-1100
Switchgear Cabinet
E83-1200
Robot
PP BOM PP BOM
E83-1210 E83-1220-XXX E83-1230
Basis System Control Cabinet Enhancements
E83-1211 E83-1212 E83-1231 E83-1233
Base Frame Rotating Column Picker Arm Tox Pliers
E83-1212-HALB E83-1232
Rotating Column Spot Welding Gun
- Raw Material
SAP AG 2005
Material Master Data
E83-1000 Robot Route
E83-1100 Switchgear cabinet
E83-1200 Robot
E83-1210 Basis system
E83-1211 Base frame
E83-1212 Routing column
E83-1212-HALB Routing column - Raw
E83-1220-110 Power supply 110V
E83-1220-230 Power supply 230V
E83-1220-380 Power supply 380V
E83-1230 Enhancements
E83-1231 Picker arm
E83-1232 Spot welding gun
E83-1233 Tox pliers
SAP AG 2005
Project Structure
SD Order
Item
Billing WBS linked to
the SD Order item
to handle the revenue
of the project
Activities in central WBS
element linked to
different WBS elements
to control the project
phases centrally
SAP AG 2005
Milestone with Progressive Billing
Milestones linked to
SD order item to
control the progressive
billing
SAP AG 2005
PRO-MAN
Centralized control of
components consumed
during the project
Control and monitor MRP,
procurement, production
through a single interface
SAP AG 2005
Change Management in Project
PRO-MAN to
Project Handle the change
In logistic side
Cost Charge
of the change of the change
Claim is built, and the Debit Memo Request is
assignment goes to built, and assignment also
related WBS in goes to related WBS in
the project the project
SAP AG 2005
Delivery through Project/Final Assembly on Customer Site
Item Category DLP
stands for the delivery
items generated from
a project
Deliver the main items
to customer through
project
SAP AG 2005
