Welcome to the topic on automating the sales process in SAP Business One, we discuss ways to automate the sales process, especially in how we interact with warehouse management.
We see how automatic availability checking works in the sales process. We will also look at the functions provided by the Pick and Pack Manager and how they are integrated into the sales process. We discuss the advantage of using the Document Generation Wizard.
I/ Business Scenario
The company sets customer satisfaction as top priority. Therefore, they have chosen to automate steps in the sales process.
Automatic availability checks are performed in the sales order to ensure that sufficient quantities are available to fulfill customer orders in a timely manner.
If a product is unavailable in the local warehouse, you use the options available to ship that item or another acceptable item as quickly as possible. For high priority sales orders they may reschedule deliveries.
The company uses the pick and pack manager to automate the process of picking and delivering items in a timely manner.
Invoicing is automated using the document generation wizard.
II/ Automating the Sales Process
Let’s look at how automation can make the sales process more efficient.
When you enter items and quantities in a sales order, an automatic availability check is done.
When the items are confirmed as available, the quantity is committed in inventory.
Warehouse personnel access and filter open sales orders in the Pick and Pack Manager to create pick lists for sales orders due for delivery.
Pickers pick the items from warehouse shelves and enter the picked quantities into the system.
Pickers create packages for the items with packing lists and delivery documents generated via the pick and pack manager.
The delivery posts the reduction in inventory and reduces the committed quantity from the sales order.
After the items are shipped, A/R invoices are generated in batched billing runs through the document generation wizard.
1/ Automating Process Steps – Availability Check
Now we will look at the details behind each automation step.
First we will define item availability and discuss the two (2) options for availability checking.
2/ Purpose of Item Availability Check
An item availability check will determine if the item is available:
With a sufficient quantity for your sales order
In the particular warehouse associated with your sales order row
On the customer’s required delivery date
3/ Calculating Availability
How is availability calculated? The basic definition is this: Available quantity is calculated as the in-stock quantity minus the committed quantity plus the ordered quantity.
4/ Inventory Data in the Item Master
The system tracks the quantities for each item and displays the quantities for each warehouse in the item master.
The inventory data tab of the item master record shows us up-to-date information on stock levels and demand for the item for each warehouse. This information is updated dynamically so it shows a true picture at any time.
- You can view:
- The quantity in stock
- The committed quantity, which represents a reserved quantity such as the quantity ordered by customers, needed for components on a production order or the quantity set aside for transfer to another warehouse.
- The ordered quantity, which represents either quantity ordered for purchase by your company but not yet delivered or the quantity on production orders for an item produced in-house or a quantity requested from another warehouse
- Finally, it shows the available quantity, which is the quantity available for your sales orders.
5/ Two Options for Availability Checking
Two options exist for availability checking.
You can choose either the standard availability check for SAP Business One or an advanced availability to promise check.
The standard availability check automatically checks row quantities for sales documents. If there are insufficient quantities, this check gives you a pop up box with options to switch warehouses, choose alternative items, change requested quantities or view a report showing multiple warehouses.
The standard availability check is available on both SAP HANA and MS SQL databases.
The second option, the advanced availability to promise, provides additional functionality to create confirmed schedule lines with delivery dates for items checked and the ability to view schedule details for those items. If needed, you can reschedule deliveries for multiple documents. This option is only available if you are running on an SAP HANA database.
Business Example – Availability Check
Let’s look at how availability checking works with a business example.
A very important customer orders 7 scanners but unfortunately only 5 are currently available in the main warehouse.
As the sales person enters the item, a popup box appears showing the full quantity cannot be confirmed.
The sales person has choices about what actions he can to fulfill the customer requirements.
We will look at what actions are available for each availability check.
a) Option 1: Standard Availability Check
Let’s look at the first option: the standard SAP Business One availability check.
Whenever you create a sales order and enter a quantity for an item which is greater than the available quantity for this item minus the minimum inventory level on the delivery date, the Item Availability Check window comes up automatically.
The sales person has entered the scanner item with a quantity of 7, but only 5 are available.
The Item Availability Check window pops up. It displays the quantity of 7 ordered in the sales order and quantity available in inventory.
Several actions are offered in this window.
The first option is to continue. This allows you to accept the information and proceed without changing the sales order. In that case the item will be backordered.
The second option is to change the quantity in the sales order line item to match the Available Quantity. This reduces the order quantity to the available quantity.
If you need more information before deciding on a resolution, you can choose the option to display the Available-to-Promise Report. This provides you with an at-a-glance report on stock inflow and outflow including projections. This report is also available directly from the context menu.
You could also check quantities in other warehouses. From this report, you can check and possibly select the quantities from another warehouse.
Sometimes an item has been set up with alternate items. When you choose this option, you can check for any alternates and if one is available, you can select the quantities from an alternative item.
If the item is not available and no other options remain for on-time delivery, a customer may decide to not order that item. One of the actions available is to delete the item’s row from the sales order.
Sometimes, you may see an additional option, Change to Earliest Availability. This option only appears when the availability date can be calculated. It copies the earliest availability date to the row’s delivery date.
1. Availability to Promise Report
The available to promise report is available from the availability check, however, even when you have sufficient quantity in an order, you can check the availability to promise for an item.
In the context menu for a row, choose the option Available-to-Promise option. This opens a window with the inventory status report for the item in the row.
You can see any documents which affect the inflow or outflow of this item from the warehouse listed on the row. You use a dropdown to view an alternate warehouse.
For each document on the list, you can see the customer or vendor, order date, delivery date, the ordered or committed quantity.
The documents are listed in delivery date order and the projected availability for the item on that date is shown.
You can drill down into each document on the list.
2. Settings for Standard Available Check
Administration -> System Initialization -> Document Settings
To activate this option, go to the Per Document tab of the Document Settings window and choose Sales Order. Check the Activate Automatic Availability checkbox.
b) Option 2: Advanced Availability-to-Promise (ATP)
If you are running the SAP HANA database for your transactional database, you may wish to use the second option for additional functionality.
The SAP Business One, version for SAP HANA has a configuration option to turn on the advanced availability to promise.
As mentioned before, this option supports delivery schedule details for different types of documents that create demand and have a potential outflow.
The Advanced ATP confirms quantity for the delivery dates and reserves the information on availability.
The ATP check is performed for demand documents such as sales orders and A/R reserve invoices with positive quantities, inventory transfer request, purchase orders and A/P reserve invoices with negative quantities, and production orders.
Checking rules can be configured differently for items or item groups
1. Advanced ATP Check Process
When you create a document with demand, such as a sales order, the Advanced ATP check verifies there is enough quantity to deliver on the required date.
The check takes the item, warehouse, required quantity and required date from the document to calculate the base quantity.
Availability is the sum of “in stock” quantities plus planned receipts minus existing required or confirmed quantities. The check also takes into account temporarily assigned quantities currently being held by another user during their ATP check.
The output is the ATP check result. If the check determines there is insufficient quantity, the Delivery Schedule Details window opens with recommendations for quantity and delivery dates.
In our example, the customer ordered 7 scanners however only 5 can be delivered on time.
If there is not enough available quantity on the dates needed, you can choose a delivery strategy. Delivery strategies control whether an item is allowed multiple deliveries.
There are three delivery strategies:
- Delivery Proposal - splits the delivery to match your available quantity. With this option 5 scanners would be delivered to the customer on the first available date and the remaining 2 would be delivered at a later date.
- One time delivery – only delivers the items that can be sent on time. With this option only 5 scanners would be delivered. A customer who needs the scanners right away for a specific event might choose this option.
- Complete delivery - postpones the delivery so the entire quantity is delivered in full. This option might be chosen by a customer who wants to install all 7 scanners at once. They might be willing to wait to ensure the full quantity arrives on the same date.
You can reopen the Delivery Schedule Details window from the context menu of a document item row.
2. Check ATP without a document
In addition to the check availability from inside documents, you can also open a graphical view of availability from an icon in the toolbar.
Click the Available-to-Promise Check icon on the tool bar to open the view the availability for a particular item across warehouses.
Enter the item and the quantity required. Choose which warehouses’ inventory you wish to view.
In our business example, we want to see when 7 scanners will be available for our customer.
A graphical view displays an item’s availability. Red indicates the full quantity cannot be delivered on those dates.
Blue indicates when the full quantity is available in the time line.
Here we see that only 5 are available until June 6.
You can scroll right and left on a timeline to see when the item is available.
You also have the option to switch warehouses and view availability of alternative items.
3. Settings for Advanced ATP
To turn on the Advanced Availability Check, go to Document Settings, General tab.
Choose the checkbox to Enable Advanced Available to Promise.
Then choose the button to set up ATP checking rules. This opens the ATP Checking Rule List.
The default rule is AA.
Additional checking rules can be created. Give it a name and then define rule details.
Checking rules can be assigned to item groups or specific items.
The rules allow you to say whether to include past planned receipts, whether to do an automatic check, and whether to display schedule line details and allow delivery for unconfirmed or delayed quantities. You can also choose whether to allow multiple deliveries or not.
The assigned checking rule appears on the Planning Data tab for an item.
IV/ Delivery Rescheduling
Delivery Schedule Management is a tool for rescheduling deliveries. You can open this tool from an icon on the tool bar or from the Sales – A/R menu.
In our business example, a very important customer absolutely needs the 7 scanners on time and will not take a substitute.
Only authorized users can reschedule deliveries. In our business example, the sales manager and the warehouse manager are the only employees with access.
After talking with the sales manager, the warehouse manager opens the Delivery Schedule Management tool to view all open orders for the item.
He checks to see if he can reschedule the committed quantity from a lower priority sales order to fulfill the important customer’s urgent order.
He has opened the Delivery Schedule Management window from inside the saved order by right-clicking on the row with the unconfirmed quantity. He can see all the open sales order rows for this item.
The other way to open the window is to use the Delivery Schedule Management icon on the tool bar then select the item.
Once the window is open, he can expand each sales order by clicking on the row to view the quantities to be delivered and the delivery dates.
Here we see the customer sales order is currently delayed by 4 days
2/ Move Quantities Between Orders
To make inventory available, choose the sales order you wish to reduce, click on the blue bar.
The bar turns gold and a slider button appears.
Drag to the left to reduce the quantity.
Here we see the user reducing the quantity of the sales order by 2.
3/ Confirm changes
The quantity moves from one sales order to the other.
You can see the full quantity is now available to be delivered on the first sales order.
The lower priority second sales order is now delayed by 3 days.
V/ Automating Process Steps - Pick and Pack
Now we take a high level look at the Pick and Pack Manager.
The Pick and Pack Manager topics for sales, inventory transfers and production are covered in detail in other course sessions.
1/ Business Example – Pick and Pack Manager
The warehouse manager opens the Pick and Pack Manager to generate pick lists. He sees this sales order’s rows and the rows of many other sales orders and creates pick lists to efficiently pick the items from all the orders due for delivery.
Pickers gather the items and prepare them for shipment
Deliveries are generated from the pick list by the pickers for the items
Then the packages are loaded on trucks to ship to customers.
2/ Pick and Pack Manager
Pick and Pack Manager allows you to view multiple sales order rows and group them into pick lists for maximum efficiency.
After picking, packing for deliveries can be done centrally.
Then delivery documents can be generated for all the picked and packed items.
In this way, you can more efficiently manage the logistics of picking and shipping sales orders.
This course topic introduces you to the concepts behind the Pick and Pack Manager. For more details on this subject, see the three course topics that focus solely on Pick and Pack.
3/ Create Pick List
In our business example, the warehouse manager opens the Pick and Pack Manager.
He sets the selection criteria to pull up all the upcoming deliveries for the week.
The Pick and Pack Manager displays 3 drawers: Open for items that are not yet on a pick list, Released for items that have been released to a pick list and Picked for all the items already picked.
In the Open drawer, he sees this sales order’s rows and the rows of many other sales orders.
He chooses the items to release to the pick list and prints our pick lists for all the pickers in the warehouse.
4/ Pick, Pack and Create Delivery
The pickers use a printout of the pick list to find all the items.
They prepare the shipments in the packing area.
They update the pick list with information on what was picked.
Then they generate deliveries from the pick list.
When each delivery is posted the committed quantity is reduced for the sales order when the stock quantity is issued for the delivery.
The deliveries are loaded on trucks to ship them to the customers.
VI/ Automating Process Steps – Document Generation Wizard
Typically, a company will generate a number of invoices at one time in a batch.
The Document Generation Wizard is a tool to run a batch of documents at one time.
1/ Document Generation Wizard
The wizard follows a simple process used for gathering rows from base documents to target documents, based on several user-defined parameters. Examples of the parameters that exist are target document type, posting date, document date, items or service and many more.
This wizard can be used for example, to produce a summarized A/R Invoice for a customer, containing all delivery notes that were created for the customer over the past week. It is a simple yet effective method of summarizing data to reduce data input. All deliveries for an individual customer can be consolidated into one invoice or set to create separate invoices.
2/ Business Example: Generating invoices
At the end of the day, the document generation wizard generates consolidated invoices for the recent customer deliveries.
In our case the billing department created a parameter set for creating invoices that they use each week to do the batch job of creating invoices.
The document run creates invoices with summary rows by delivery note.
They have specified what criteria they use regularly to consolidate invoices and how to handle issues automatically as they arise.
Here are some key points:
- An automatic availability check is done for sales orders as long as you have selected the configuration option.
- Available quantity is equal to the in stock quantity plus the order quantity minus the committed quantity.
- An availability check window appears when the sales order row quantity of an item exceeds available quantity minus the minimum inventory level on the delivery date. You also have the ability to do a manual availability check as needed.
- Two options exist for availability checking: the standard availability check or the advance availability to promise. Advanced ATP is only availability when you run SAP Business One on the SAP HANA database.
- The standard check gives you options to change item quantity, change delivery dates, view an ATP report, check other warehouses, choose alternate items, delete the item row or ignore the message. Advanced ATP gives additional functionality. Advanced ATP confirms quantities, creates delivery schedule detail lines and allows delivery rescheduling for demand documents.
- Committed quantity is increased by sales orders and reduced when the item is delivered. Delivery also reduces in-stock quantity.
- Pick and Pack Manager coordinates picking and packing activities and can automate delivery creations.
- The Document Generation Wizard performs batch processing of sales documents. For example, it can be automate invoice processing.