Sourcing and Procurement as a concept in any industry has evolved with time. It is no longer being looked at as only a cost center, but it can add value to your supply chain. Vendors are business partners and part of your extended value chain. Their growth is your growth. When we deal with business partners, it generates lot of purchasing documents in system e.g., Long term contracts, Purchase Orders etc. Each of these documents are binding on both vendor & buyer. It involves an agreement to purchase a certain SKU at a certain price for a particular period for certain quantity. There are also other kind of purchasing which are not long term in nature but ad-hoc purchases to deal with overall operations which are sometime called Indirect Procurements. In those scenarios, a group of buyer raises an internal request within the organization to request the goods which may be charged to a cost center or a project.
All these kinds of procurement processes need approvals e.g., depending on a value of a purchase contract OR purchase order, it can either go for a single level or multi-level approval. For indirect procurement scenarios, internal request (sometimes called purchase requisition) need approval from owners of cost centers or projects.
In a consumer industry this approval process is prevalent like any other. Number of SKUs are quite large there. Almost all kinds of procurement occur. And for a big organization, approval matrix can be quite complex leading up to CEO or Senior VP. SAP has taken a note of this and have been trying to simplify this approval process of purchasing documents. Earlier, solution used to be “release procedures” in ECC world where an approver had to approve by using an SAP GUI transaction which were not end user friendly. They had to navigate thru config jargons to do that. Other option is to create a custom business workflow to deal with it but that has higher cost as it involves development.
In S4 HANA, SAP has come up with flexible workflow concept for purchasing document workflows. The whole idea here is to simplify the set up and make the approval process user friendly. Almost everything is configurable in this. SAP has provided step by step guidelines for configuration to set up these workflows in their help website. Following links are very useful: –
Purchase requisition Workflow: –