sapb1 white paper for engineering vertical

SAP Business One for Engineering

`A Collaborative ERP for your Organisation SAP Business One is now fully equipped and geared-up to serve specific needs of Indian Engineering Industry.

A separate vertical has been developed within SAP Business One for Engineering Organisations with Best Business Practices of the industry. Some of our valued customers from this industry have already identified SAP Business One as a Value Addition Tool for their entire business activities including Production Planning and Execution, Quality Control, Supply Chain Management, Sales & Marketing, Export Documentation etc.

The business process in an Engineering organization is challenged by multifaceted

functionalities. These challenges are tackled in SAP Business One very efficiently. The specific functionalities, which are supported by this role-based, modular system, are:

Sales Management: Sales Enquiry Tracking, Sales Offer to Order, Sales Forecast based on historical data etc.

Production Planning: Based on Sales Order/ Forecast - Material

Requirement Planning, Operation wise Daily Production Planning

Purchase Management: Material Indent - Enquiry - Purchase Order

Including Sub-Contracting Purchase Order

Quality Management: Quality Control - Incoming Material, In Process Material and Final Product

Production Management:Operation wise Production Reporting,

Rejection reporting on each stage of production

Material Management: Multi Location wise and Multi Warehouse wise Inventory Management (Raw material / Packing material, Stores & Consumables, Semi finished material & Finished Material).

Designed & Prepared by KSE Enterprise Solutions Pvt. Ltd. Document Management Group Page 1


Minimum Stock Management, Re-Order Quantity Management, Stock Ageing, Stock Valuation, Stock Revaluation, Landed Cost Calculation and Cycle Counting of Inventory

Costing: Raw Material Costing, Semi Finished Material & Operation Costing, Finish Goods Material & Operation Costing

Taxes and Duties: Excise Duty, CENVAT, VAT, Sales tax, Service Tax, Income Tax at par with the Indian rules

Financial Management: General Ledger, Accounts Payable, Accounts Receivable, Multi Currency, Budgetary control and many more.

Export Documentation Detail Export documentation Reports & Alerts Number of standard reports in each module.

Crystal Report is an integral part of SAP Business One, any customized report can be developed with Crystal reportStandard and customized alerts on exceptional transactions can be generated in the system.

For efficient running of an Engineering organisation, a good knowledge base on Production planning, Shop floor control, Product costing, Cost allocation and tracking, Scrap handling, Ongoing relation with customers, suppliers, transporters etc integrated with Financials and other management modules is essential.

These were handled as:

1. Marketing Management: The critical problem faced by a Marketing executive is to predict a delivery date to customers due to non-availability of correct stock status or resource loading. The Production executive is also not aware of the exact order booking position or sales target to plan the production due to the lack of integration between the Sales and Production Plan. At any point of t ime SAP Business One provides warehouse wise/material wise inventory balance, quantity available to promise, production plan, production at shop floor which is relevant to marketing people. SAP Business One also provides the order status at any point of time. SAP Business One also provides the



tools that allow manufacturers to capture Product, Service and business knowledge increasing overall productivity. This increases sales effectiveness and profitability m aking it easier and less costly.

2. Production Planning: From Sales order and Sales forecast, Production for a period is planned normally on a thumb rule basis where the material requirement is not exactly available; as a result the planned production is seldom achieved. SAP Business One provides effective solutions to optimize the production plan through:

Bill of Material (BOM) of all manufactured material (Finish goods and semi finished goods).

Material requirement planning(MRP) considers availability of input materials, Components, Semi finished goods and Finished Goods

MRP will also consider pending purchase order and pending production order/s

MRP will suggest Manufacturing order/s for manufactured type items and Purchase order/s for purchase type items

Based on MRP recommendation, production order may be created from the system or can be created manually

The production order will be scheduled day wise and operation wise based on availability of resources and manpower

Subcontracting may be done from any stage of production

Purchase order/s may be generated from MRP recommendation or can be created through manual indent

3. Purchase Management: Raw material procurement plan has a very important role to make production plan successful. For any procurement, the selection of right supplier, procurement at right time for right quantity in right price is the most important factor. SAP Business One handles all these areas effectively using following tools:

Material requirement planningPurchase Indent, Tendering ProcedurePurchase OrderSubcontracting Order

4. Quality Management: Stringent quality control with proper documentation is the most essential part of Engineering Industry. Raw material as well as Semi-Finished/Finished items at different stage of production will go through following quality

checking:Incoming raw material quality control



Operation wise quality reportingFinish product quality reporting

5. Production Reporting: Effective production reporting system specifically developed for Engineering Industry has the following features:

Department wise, operation wise, employee wise, item wise production reportDay wise, shift wise production reporting along with rejection reporting with reason of rejectionScrap reportingSubcontracting job issue and receipt reportingRejection analysis

6. Material Management: This gives a pain to the material managers as most of the time the physical stock of the materials are not matched with the BIN balance and the right materials are not available in required quantity at right time in right place. Also sometime bulk quantities of material are kept unused for a long time resulting in unnecessary increase of inventory. So, proper material management plays a key role with the other modules. SAP Business One provides following functionalities for effective inventory management:

Initial stock updateRecording of stock movement with cost of each transactionBatch control or serial number control of stockStock adjustment/Physical verification of stock Revaluation of StockABC analysis of stockSlow/Fast/Non-moving analysis of stock

7. Export & MIS Reports

Export RegisterMonthly Export ReturnForward Exchange BookingMonthly Declaration of ShipmentCalculation Sheet for Rebate ClaimBank Certificate for Export and RealizationCustoms InvoiceCustomer Order wise Production Status ReportMaterial costing reportMaterial wise profitability analysisMaterial wise , customer wise sales analysisMaterial wise , supplier wise purchase analysisDate wise material consumption report



Rejection Analysis ReportProduction Yield Report and many more ..


sapb1 white paper for engineering vertical

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