FSCM - Credit Management (Light Implementation Solution) Manage and Collect Credits

Application Development
FSCM – Credit Management

(Light implementation solution)
Manage and collect credits
Blue Print Workshop
Confidential information to be used by Sara Lee Corporation

Workshop participant:
FSSC NL: Stefan Haring; Klaas Hulzebos

MSU DECS NL: Steven van de Heuvel; Mirjam Bus Pakker
FSSC BE: Luc Claessens
Supply Chain: Erik Tonen??
IBM: Giovanni Pantano; Ortwyn de Vos
3
Customer Revenue Cycle
• The following cash2cash applies to both the SL customer base

- New prospects (mainly Food Service)
- Existing customer base (both Food Service and Retail)
Process Grant
Prospect* Activate*
Activate* Transact*
Order Credit* Bill*
Customer Revenue Cycle

Manage
Exposure Handle Collect*
Apply Disputes/
Payments Deductions*
4
FSCM – Functional workshops - Agenda
• Wrap up Workshop 1: Master data

- Collection strategy for SL
• Activate / Transact
- Credit master display / screens [user interface]
• Collect
- Dunning
- In- outbound action registration
- Work list functionality
- Clerk Monitoring
• Reporting
- KPI reporting
- Cash Flow reporting
5
Collection organisation and strategy for SL :
Collection strategy 0079 – DE NL DECS (1)
• Worklist functionality
- Distribution of worklist items for DE NL to be by
- SD ‘Sales Office’
- FI accounting clerk
- Document type
6
Business partners Trade Coll. specialist F001

Business partners Trade Segment
Business partners Trade
Business partners Trade
Business partners Trade SL_Trade Substitute A
Profile SL_Trade Coll. group SL_Trade
Collection Strategy SL_Trade 0079 – DE NL DECS
Business partners Horeca Coll. specialist F010

Business partners Horeca Segment
Business partners Horeca
Business partners Horeca Substitute B
Business partners Horeca SL_Horeca
Profile SL_Horeca Coll. specialist F011,
F012, F013, F014
Collection strategy SL_Horeca Substitute B
Coll. group SL_Horeca

0079 – DE NL DECS
7
Business partners Large Coll. specialist F007

Business partners Large Segment
Business partners Large
Business partners Large
Business partners Large SL_Large Substitute C
Profile SL_Large Coll. group SL_Large
Collection Strategy SL_Large 0079 – DE NL DECS
Business partners Medium Coll. specialist F006

Business partners Medium Segment
Business partners Medium
Business partners Medium Substitute D
Business partners Medium SL_Medium
Profile SL_Medium Coll. Specialist F008 &
F009
Collection strategy SL_Medium Substitute D
Coll. group SL_Medium

0079 – DE NL DECS
8
Business partners SL_DCC Coll. specialist

Business partners SL_DCC Segment
Business partners SL_DCC F004_1
Profile SL_DCC SL_DCC Substitute E
Coll. specialist
F004_2
Substitute F
Coll. specialist
F004_3
Substitute F
Coll. specialist
F004_4
Substitute G
Coll. group SL_DCC
Collection Strategy SL_DCC 0079 - DE NL DECS

9
Collection strategy other SL entities (1)
Business partners H&BC Coll. specialist A

Business partners H&BC Segment
Business partners H&BC
Profile SL_H&BC SL_H&BC Substitute A

Coll. group SL_H&BC
Collection Strategy SL_H&BC 0128 - Sara Lee NL H&BC M&S
Business partners Global Coll. specialist B

Business partners Global Segment
Business partners Global
Profile SL_Global SL_Global Substitute B

Coll. group SL_Global
Collection Strategy SL_Global 0156 - DECS Global Network
10
Business partners NL Retail Coll. specialist C

Business partners NL Retail Segment
Business partners NL Retail
Profile SL_NL_Ret SL_NL_Ret Substitute C

Coll. group SL_NL_Ret
Collection Strategy SL_NL_Ret 0179 - DE NL Retail
Business partners Asia Retail Coll. specialist D

Business partners Asia Retail Segment
Business partners Asia Retail
Profile SL_AS_Ret SL_AS_Ret Substitute D

Coll. group SL_AS Ret
Collection Strategy SL_AS_Ret 0366 - Sara Lee C&T Asia Retail
11
Business partners NL OOH Coll. specialist E

Business partners NL OOH Segment
Business partners NL OOH
Profile SL_AS_OOH SL_AS_OOH Substitute E

Coll. group SL_NL_OOH
Collection Strategy SL_AS_OOH 0367 - Sara Lee C&T Asia OOH
12

• Collect
- Dunning
- Clerk Monitoring
• Reporting
- KPI reporting
13
Activate / Transact
• Functional requirements
- Overall block of all transactions, including:
- CRM service
- Sales order entry
 Proposed approach :
 Supported in FI-AR through credit / customer block, but manual

process
14
Activate / Transact
- No block on deliveries for disputed items
- Disputed items should not be considered in the credit limit
 Proposed approach : Not supported
Blocking strategy in Sales and Distribution

module.
Items need to be released using a standard
transaction
15
Activate / Transact
- Better information flow in case of credit limit exceeded
- In case of a credit limit exceeded in the order process, account
manager as well as credit manager need to be informed
automatically
 Standard SD configuration allows emails to be sent to the credit

manager / credit representative when the credit limit is exceeded
16

• Collect
- Dunning
- Clerk Monitoring
• Reporting
- KPI reporting
17
Collect – Dunning (1)
- Scalable dunning procedures
- Must support multi-tiered dunning procedures that trigger
automated dunning correspondence based on customer
segmentation and number of days in arrears.
 Multi-tiered dunning procedures supported in FI-AR / FSCM-COL,

including dunning level-specific correspondence
- Must support handling of dunning charges

 Dunning charges and interest charges supported in standard FI-AR
(as-is)
18
- Scalable dunning procedures
- Must be able to flexibly change the dunning procedures for work list
items
 Work list-related procedure can easily be changed by end users in
FSCM-COL
 Dunning procedure in FI-AR can only be changed by RfC (as-is)
19
- Scalable dunning correspondence
- Ability to send dunning correspondence via paper and e-mail /
pdf.
- Ability to flexibly define dunning note texts
 Manual correspondence trigger supported in FSCM-COL.

Additional recipients supported
 Attachments supported as well as ability to add manual texts if sent
by e-mail, customer statement can be attached as PDF
20
- Scalable dunning correspondence
- Ability to trigger individual customer statement correspondence as
well as periodic customer statement correspondence
 Incidental account statement correspondence in English is already
supported in the template, must be extended for periodic account

statement correspondence and correspondence via e-mail
 Required development of a new form for Dutch language support
for account statements.
 Regular dunning correspondence can be sent via paper as
supported in standard FI-AR
 Possible to change the dunning note texts through the standard
texts (as-is situation), no other functionality available in SAP
21
- Dunning runtime improvement
- Dunning runtime must be reduced by preventing paper-based
checks (e.g. not including customers with promise-to-pays, blocking
specific customers)
 Created promise to pay will automatically set dunning blocks

 Broken promise to pay will automatically release dunning block
 Created dispute will automatically set dunning block
 Released dispute will automatically release dunning block, this will
prevent incorrectly dunning customers.
22
- Integration with Dunning agencies
- Automatic file transfer to dunning agencies should be supported
- When an item is transferred to a dunning agency, all transactions
must be blocked in the system
 Proposed approach : Supported, solution needs to be developed
23
Collect – Printing
- Printer hardware problems
 Printer hardware problems to be dealt with separately via HP
24
• Collect
- Dunning

- Clerk Monitoring
• Reporting
- KPI reporting
25
Collect – Call registration
- In- outbound call registration
- Based on incoming phone number, calls should be
automatically routed to the correct employee based on
customer portfolio segmentation
26
• Collect
- Master data synchronisation (customer/business partner)
- Dunning

- Clerk Monitoring
• Reporting
- KPI reporting
27
Collect : Integration with Dispute management
28
Collect – Work lists (1)
- Action list functionality that gives an overview of daily tasks per
AR clerk, such as pre-due calls, dunning level / overdue invoice,
broken promise-to-pay, follow-up on complaints etc.
 Standard FSCM-CM supports action system with work lists,

customer contact registration
 Queuing supported
29
30
- Task assignment
- Automatic assignment to correct employee responsible based on
customer portfolio segmentation
- Possibility to assign temporary employee in case of holidays or illness
- Possibility to take over work list items of other people
 Distribution of work in the department by automatic assignments to
employees based on customer segmentation
 Ability to temporarily distribute items of employees that are ill or out
of the office
31
• Collect
- Dunning

- Clerk Monitoring
• Reporting
- KPI reporting
32
Collect – Clerk monitoring for management
- Number of action items overdue
- Receivables of customers assigned to the employee
- Number of phone calls made
- Telephone call response time
 SAP BW standard collection management business content to be

activated for this reporting. No expected changes toward the
standard BW content
 Limited managerial reporting directly available in ECC 6
33
Collect – Sunchronisation, transaction data
- Open items
- Latest payments
- Open items with dispute cases
 proposed approach : standard functionality
34
• Collect
- Dunning

- Clerk Monitoring
• Reporting
- KPI reporting
35
Collect – KPI reporting
- Real-time reporting
 Reporting related to collections can be visible from a single screen,
enhanced usability
- Days sales outstanding (DSO) reporting is key performance indicator of

this process and must be supported.
- Payment history. Payment history information is important information
when contacting the customer
 Proposed approach : (as-is is continued)
 Payment history can be run with standard SAP FI-AR report
S_ALR_87012177 - Customer Payment History
 Customer open items can be displayed with standard SAP report
FBL5N
36
Collect – KPI Reporting
• S_ALR_87012177 – Customer payment history

37
• FBL5n – Customer open and cleared items

38
Collect – KPI reporting
- Open item information. Open item information is important information
when contacting the customer. This should also display actual aging.
- Open invoices at collection agencies.
 Open item at collection agencies is visible through reporting via
dunning level and special dunning block reason (as-is)

 Accounts receivable history can be run with SAP report S_ALR_87012176
- Customer Evaluation with OI Sorted List
 Standard business content of FSCM Collection Management in BW also
provides more flexible DSO reporting, as well as integration with work
items
39
• S_ALR_87012176 - Customer Evaluation with OI Sorted List

40
41
• Collect
- Dunning

- Clerk Monitoring
• Reporting
- KPI reporting
42
Collect – Cash flow reporting
- Cash flow reporting – actual and plan
- Actual: AR opening balance, in / out, AR closing balance
- Plan: Cash flow forecast, preferably based on average DSO
 Actual cash flow report is supported in standard FI-AR (as-is)
 Plan cash flow report based on average DSO is not supported in

standard FSCM or BW. Continue workaround report through Excel using
AR and Sales Order position combined with average DSO figures.
43
Collect – Additional Cash flow reports
• Additional AR KPI / Cash Flow

reports may be configured
- Generate standard evaluations,
e.g. DSO, Due date, etc.
- Standard evaluations need to
be regenerated on a daily basis

(define batch job)
44
Collect – AR standard evaluation reports
• Standard AR evaluations: DSO, drill-down functionality

45
Collect – AR standard evaluation reports
• DSO : drill-down to the customer line item display

46
Collect – AR drill down reports
• SAP standard drill-down reports are available that can

be enhanced
47
Collect – Drill down reports: Due date analysis
48
• Drill-down to customer open items

49
• Drill down reports may be enhanced by adding

characteristics
50
Collect – Promise to Pay : Status management
Status profile description

for Promise
to Pay
51
Collect – Promise to Pay : Text IDs
Text IDs description

52
Collect – Promise to Pay : Customer contacts
• Define results of customer

contact
Result description
53
Collect – Promise to Pay : Resubmission reason
Resubmission reason description

54
FSCM Workshop 2 : Manage and collect credit ?
Questions Comment
How to manage customer Strategy is to be planned : either discard old items from the worklist
history or assign to specific collection specialist (interim)
Can the triggers manually be
changed (amount limit,
condition, etc) or is this a
configuration change ?
How do you split the SL AR clerks Items that have reached a high dunning level are sent to the
and IBM FSCM clerks dunning agency and must be followed
(outsourcing)
55
FSCM Workshop 2 : conclusions
Thank you !
56

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Application Development

FSCM – Credit Management

Confidential information to be used by Sara Lee Corporation

FSSC NL: Stefan Haring; Klaas Hulzebos

• The following cash2cash applies to both the SL customer base

Customer Revenue Cycle

• Wrap up Workshop 1: Master data

Business partners Trade Coll. specialist F001

Collection Strategy SL_Trade 0079 – DE NL DECS

Business partners Horeca Coll. specialist F010

Collection strategy SL_Horeca Substitute B

Coll. group SL_Horeca

Business partners Large Coll. specialist F007

Collection Strategy SL_Large 0079 – DE NL DECS

Business partners Medium Coll. specialist F006

Collection strategy SL_Medium Substitute D

Coll. group SL_Medium

Business partners SL_DCC Coll. specialist

Profile SL_DCC SL_DCC Substitute E

Coll. group SL_DCC

Collection Strategy SL_DCC 0079 - DE NL DECS

Business partners H&BC Coll. specialist A

Profile SL_H&BC SL_H&BC Substitute A

Collection Strategy SL_H&BC 0128 - Sara Lee NL H&BC M&S

Business partners Global Coll. specialist B

Profile SL_Global SL_Global Substitute B

Collection Strategy SL_Global 0156 - DECS Global Network

Business partners NL Retail Coll. specialist C

Profile SL_NL_Ret SL_NL_Ret Substitute C

Collection Strategy SL_NL_Ret 0179 - DE NL Retail

Business partners Asia Retail Coll. specialist D

Profile SL_AS_Ret SL_AS_Ret Substitute D

Collection Strategy SL_AS_Ret 0366 - Sara Lee C&T Asia Retail

Business partners NL OOH Coll. specialist E

Profile SL_AS_OOH SL_AS_OOH Substitute E

Collection Strategy SL_AS_OOH 0367 - Sara Lee C&T Asia OOH

• Wrap up Workshop 1: Master data

 Supported in FI-AR through credit / customer block, but manual

Blocking strategy in Sales and Distribution

 Standard SD configuration allows emails to be sent to the credit

• Wrap up Workshop 1: Master data

 Multi-tiered dunning procedures supported in FI-AR / FSCM-COL,

- Must support handling of dunning charges

 Manual correspondence trigger supported in FSCM-COL.

supported in the template, must be extended for periodic account

 Created promise to pay will automatically set dunning blocks

- Work list functionality

 Proposed approach : Not supported

- In- outbound action registration

 Standard FSCM-CM supports action system with work lists,

- In- outbound action registration

 SAP BW standard collection management business content to be

- In- outbound action registration

- Days sales outstanding (DSO) reporting is key performance indicator of

• S_ALR_87012177 – Customer payment history

• FBL5n – Customer open and cleared items

dunning level and special dunning block reason (as-is)

• S_ALR_87012176 - Customer Evaluation with OI Sorted List

- In- outbound action registration

 Plan cash flow report based on average DSO is not supported in

• Additional AR KPI / Cash Flow

be regenerated on a daily basis

• Standard AR evaluations: DSO, drill-down functionality