Very basics of SAP External Service Management

By Willem Hoek
These notes are based on SAP ERP Central Component (ECC) 5.0 

Firstly -- SAP External Service Management (ESM) must not be confused with SAP
Service Management (SM). ESM is the procurement of services. SM is to provide
services to a client. 

With External Services, you have a PO for services with Goods Receipt taking place.
The Goods Receipt is called Service Entries. In contrast with goods (stock or non
stock) where receiving is typically done by the inventory management group, the
Service Entries are done by business themselves. The logic is that the business
generated the request for the service, that is where it was done, it will be best if they
do confirmation that service took place. 

Lets look at the traditional SAP purchasing cycle vs SAP purchasing cycle for
External Services. 

The big difference is that the item category is D (services) is used. For the item, detail
Service to be performed can be specified. The receiving is a 2 step process. Create and
then Accept Service Entry Sheet 

Lets step through the process and look at the documents. The steps are 

Step 1 - Create Purchase Requisition 

Step 2 - Convert to Purchase Order 
Step 3a - Service Entry Sheet 
Step 3b - Acceptance of Service Entry Sheet 
Step 4 - Invoice and payment (not shown here) 

----------------- DETAIL ------------------- 

Step 1 - Create Purchase Requisition 

What makes the PR a ESM PR is the Item category. For goods it is blank. For ESM it
is D (Service). if the item category D is selected, it is mandatory to provide the
account assignment. 

Step 2 - Convert to Purchase Order 

The PR is converted to a PO. If me59 (automatic creation of PO) is used, the Material
Group must also be entered in the selection criteria, otherwise it doesn't work. 

Step 3a - Service Entry Sheet 

When creating a SES, the planned services can be copied from the original Purchase
Order. 

 
Where: 
- P Plan - Items copied from Purchase Order 
- C Unplanned from Contract - Items copied from Contract (was not in PO) 
- U Unplanned - Items was not in PO 

Step 3b - Acceptance of Service Entry Sheet 

This is the equivalent of a Goods Receipt. The result of accepting a SES will be a
material document with movement type 101 (GR against PO). Depending of process
the SES can be created and Accepted by different people. Typically the acceptance is
done by a more senior person. 

A traffic light indicate the status of the SES 

- Red = Not yet accepted -- only SES 
- Yellow = Accepted but still to be saved 
- Green = accepted and saved 

Additional notes on External Service Management 

Release procedure and SES 

Release procedures can be build in PR, PO and Service Entry Sheets. (Also possible
on Outline Agreements and RFQ's) 

Service Outlines 
The services in the PR / PO can be specified in a hierarchy. See this
post [sap123.com] for more information on this. 

Outline Agreement (Contracts) 

Services specified in PR / PO as well as Unplanned Services entered in SES can be
pulled from a contract (Outline Agreement). 
Service masters & Service Conditions 
The services can either be free text or Services Masters (similar to material masters
for goods). The prices for these services are stored in Service Conditions. Lots of SAP
customers start using ESM without Service Masters. And even if Service Masters are
used, one do not need to use Service Conditions. 

Lets look at a simple Service Master 

Account Assignment U 
Under special cases (if allowed), an account assignment U (Unknown) can be selected
when creating the PR / PO. In this case the correct account assignment category must
be provided when the service entry sheet is created. 

Configuration 
The focus on this post is to introduce the concept, so no configuration options are
discussed. See below for config options related to this functionality. Config
Menu: IMG > Materials Management > External Services Management 

Transactions 
The following transactions were used for above screens: 

ME51N - Create PR 

ME21N - Display PO 
ML81N - Create Service Entry Sheet 
ML82N - Change Service Entry Sheet (Acceptance) 
AC03 - Maintain Service Master 

Very basics of SAP External Service Management

By Willem Hoek
These notes are based on SAP ERP Central Component (ECC) 5.0 
Firstly -- SAP External Service Management (ESM) must not be confused with SAP
Service Management (SM). ESM is the procurement of services. SM is to provide
services to a client. 

With External Services, you have a PO for services with Goods Receipt taking place.
The Goods Receipt is called Service Entries. In contrast with goods (stock or non
stock) where receiving is typically done by the inventory management group, the
Service Entries are done by business themselves. The logic is that the business
generated the request for the service, that is where it was done, it will be best if they
do confirmation that service took place. 

Lets look at the traditional SAP purchasing cycle vs SAP purchasing cycle for
External Services. 

The big difference is that the item category is D (services) is used. For the item, detail
Service to be performed can be specified. The receiving is a 2 step process. Create and
then Accept Service Entry Sheet 

Lets step through the process and look at the documents. The steps are 

Step 1 - Create Purchase Requisition 

Step 2 - Convert to Purchase Order 
Step 3a - Service Entry Sheet 
Step 3b - Acceptance of Service Entry Sheet 
Step 4 - Invoice and payment (not shown here) 

----------------- DETAIL ------------------- 

Step 1 - Create Purchase Requisition 

What makes the PR a ESM PR is the Item category. For goods it is blank. For ESM it
is D (Service). if the item category D is selected, it is mandatory to provide the
account assignment. 

 
  

Step 2 - Convert to Purchase Order 

The PR is converted to a PO. If me59 (automatic creation of PO) is used, the Material
Group must also be entered in the selection criteria, otherwise it doesn't work. 

Step 3a - Service Entry Sheet 

When creating a SES, the planned services can be copied from the original Purchase
Order. 

Where: 
- P Plan - Items copied from Purchase Order 
- C Unplanned from Contract - Items copied from Contract (was not in PO) 
- U Unplanned - Items was not in PO 

 
Step 3b - Acceptance of Service Entry Sheet 

This is the equivalent of a Goods Receipt. The result of accepting a SES will be a
material document with movement type 101 (GR against PO). Depending of process
the SES can be created and Accepted by different people. Typically the acceptance is
done by a more senior person. 

A traffic light indicate the status of the SES 

- Red = Not yet accepted -- only SES 
- Yellow = Accepted but still to be saved 
- Green = accepted and saved 

Additional notes on External Service Management 

Release procedure and SES 

Release procedures can be build in PR, PO and Service Entry Sheets. (Also possible
on Outline Agreements and RFQ's) 

Service Outlines 
The services in the PR / PO can be specified in a hierarchy. See this
post [sap123.com] for more information on this. 

Outline Agreement (Contracts) 

Services specified in PR / PO as well as Unplanned Services entered in SES can be
pulled from a contract (Outline Agreement). 

Service masters & Service Conditions 

The services can either be free text or Services Masters (similar to material masters
for goods). The prices for these services are stored in Service Conditions. Lots of SAP
customers start using ESM without Service Masters. And even if Service Masters are
used, one do not need to use Service Conditions. 

Lets look at a simple Service Master 

  

Account Assignment U 
Under special cases (if allowed), an account assignment U (Unknown) can be selected
when creating the PR / PO. In this case the correct account assignment category must
be provided when the service entry sheet is created. 

Configuration 
The focus on this post is to introduce the concept, so no configuration options are
discussed. See below for config options related to this functionality. Config
Menu: IMG > Materials Management > External Services Management 

Transactions 
The following transactions were used for above screens: 

ME51N - Create PR 

ME21N - Display PO 
ML81N - Create Service Entry Sheet 
ML82N - Change Service Entry Sheet (Acceptance) 
AC03 - Maintain Service Master