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0OPSO006

Template for KPIMaterial Acquisition Costs

Mat. Acquisit. Costs (0OPSO006)

The objective of this document is to collect all thedocumentation related to the KPI shown above.

The document is structured into four sections:

Section A): Basic KPI Information

Section B): KPI Analysis

Section C): KPI Implementation

Section D): KPI Improvement

For many KPIs, certain sections of this documenthave been pre-filled by SAP. Other sections areempty. It is your task during the implementationproject to verify the delivered information and toelaborate the missing information.

When working through the ASAP roadmap, youwill be guided in performing these tasks.

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A) Basic KPI Information

A1) Strategy and Objective

For more information please look at Business Strategy in the SAP Reference Structure in theQAdb.

A2) Reason for using this KPIPlease describe here the priority of the KPI, and why and how this KPI is used in your company.

. . .

A3) Definition of the KPI (Industry Standard)The definition of the KPI is described here.

Material Acquisition Costs (0OPSO006)

Material acquisition costs include costs incurred for production materials: sum of materials management and planning, supplier quality engineering, inbound freight andduties, receiving and material storage, incoming inspection, material processengineering and tooling costs.

A4) KPI FormulaEnter the formula for calculation of the KPI.

Materials management and planning costs + supplier quality engineering costs +inbound freight and duties costs + receiving and material storage costs + incominginspection costs + material process engineering and tooling costs

A5) Value Flag and Unit of MeasurementDescribe here the common used unit of measurement, and if the KPI is expressed as value or as amount.

CurrencyAmount

A6) KPI direction for improvementIf you want to improve the KPI, its value must : (increase or decrease)

decrease

A7) Definition of the KPI (SAP-terminology)

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Please describe here textually the definition of the KPI in SAP terminology if necessary. TheStandard Definition may sometimes be ambiguous when mapping it to SAP terms.(E.g. company is defined as BUKR or COMP etc., plant Lisboa means plant 0015 etc.)

. . .

A8) BenchmarksInformation regarding benchmarks can be found on the internet. A sample link is shown in thepreferences list of the QAdb.

Type Value Source Comments

Industry average ... e.g.:PMG

...

Best of class ... ... ...

Median ... ... ...

Customer ACTUAL

... ... Date: . . . . . Calculationmethod x

Customer PLAN

... ... Date: e.g. 1 year after goinglife

A9) Ownership / User rolesEnd User Roles

After going live, who is responsible in the company for this KPI ?(e.g. head of production, finance, calculation, logistics, ...)

. . .

Project Team owner During implementation, who from the project team members is responsible for this KPI ?

(e.g. customer project manager, business process team lead, ...). . .

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B) KPI Analysis

B1) Hierarchy

Please insert here the graphical explosion (so called Measure Driver Tree) of the KPI (seepredefined KPI examples for details).

. . .

B2) Conflicting KPIsPlease describe here the conflicting (K)PIs to be checked: within the KPI hierarchy and byanalyzing other (K)PIs. (e.g. the reduction of the KPI Stock Inventory Costs may have anegative impact on the KPI Customer Satisfaction, as potentially, not all customer orders maybe shipped completely.)

. . .

B3) List of processes which influence the KPIThe list of processes that influence the KPI can be obtained from the QAdb. Position the cursor on the KPIand click the right mouse button. The list which is then generated could be attached to the present documentas an appendix.

No manual input is necessary at this point.

B4) List of KPIs that are influenced by a certain processThe list of the KPIs that are influenced by a selected process can be obtained in the process section of theQAdb. Position the cursor on the process and click the right mouse button.

No manual input is necessary at this point.

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C) KPI Implementation

C1) SAP Applications

Please describe here the installed / planned SAP applications which you will use to calculate the KPI. Theremay be several alternatives which may have advantages and disadvantages.

(e.g. a KPI may be calculated and reported by programming a customer specific ABAP, using the LIS, or maybe the COPA or FI-SL or EC modules could be used. To save work, please check if the KPI is already

part of the BW (see C2)).. . .

C2) Usage of the Business Information Warehouse (BW)In case the present KPI is already part of the BW, please find out the following information:

Query name: . . . . .

InfoCube name: . . . . .

C3) InterfacesIf the (K)PI or part of its calculation factors will be transferred from legacy systems, theinterface(s) should be described / listed here.

. . .

C4) Reporting for the KPI, Org. Units and Master DataDescribe here the refinement/ structuring of the KPI e.g. by company codes, material groups, plants,accounts, etc. for the reporting purposes . . .

C4) Report DescriptionIdentify and describe the reports which are necessary in order to do a follow-up of the KPI performance.Please insert a sample layout of the report.. . .

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D) KPI Improvement

D1) Business Process Re-engineering (BPR) Tips & Guidelines

Please describe here steps, experiences, suggestions, etc. on how to support the improvement of the KPI. If this section only contains pre-delivered suggestions, please review them and enhance them with projectspecific information.(e.g. to decrease ICC (Inventory Carrying Costs) optimize storage location facilityto decrease OMC (Order Management Costs) use B2B order entry or EDI (R/3)to decrease MAC (Material Acquisition Costs) please check using of interface to CAD within R/3-System).. . .

D2) R/3 Tips & GuidelinesPlease describe here the options and alternatives that you may have within SAP (Products, Applications &Services) to implement and optimize a process and thus improve the KPI. If this section only contains pre-delivered suggestions, please review them and enhance them with project specific information.(e.g.: to implement an invoice verification process, you may use the workflow functionality, the standard invoice verification or maybe the park & post functionality)

The usage of mySAP.com marketplace and workplace which includes the B2B(Business to Business) procurement can help you to reduce your receiving and materialmanagement costs tremendously.

In order to reduce your inbound freight cost you should consider the usage of transportation functionality out of the LES (Logistic Execution System). Thesetransportation functions can handle planning and processing for both inbound andoutbound shipments. You can control and monitor the entire transportation process

including shipment costs calculation from the planning stage to goods issue at your shipping point (for outbound shipments) or vendor location (for inbound shipments),through to goods receipt at the customer location or your plant.

As a planning tool to optimise your supply chain process and the supply sourcedetermination we recommend the usage of APO (Advanced Planner and Optimiser).

WM (Warehouse Management) supports warehousing processes by making it possiblefor you to:

Define and manage complex warehousing structuresOptimize material flow using advanced putaway and picking techniquesProcess goods receipts, goods issues and stock transfers quickly and easily

A standard SAP interface makes it possible for you to collect data using remote input(for example, via bar-code scanning devices or remote keying) and post it to thedatabase in the SAP system. The SAP system supports the following functions:

Entry of data to post goods issues or receiptsEntry of physical inventory count results (for posting in WM)Entry of packaging data into delivery documentsTransmission of delivery documents to an external systemEntry of picking quantities in delivery documents in shipping (when WM is not inuse)Entry of data for general movements in the warehouse (creating transfer orders)

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D3) Improvement Time tablePlease create a time & budget plan for the implementation of the changes that you have identified in thesections D1 & D2.. . .

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