External Services Management (MM-SRV)

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External Services Management (MM-SRV)

This section provides a general introduction to MM External Services Management.

It provides an overview of the functionality, shows how MM External Services Management is integrated into the Purchasing application within the Materials Management module, and indicates the interfaces to other applications.

Purpose

MM External Services Management (MM SRV) is an application component within the Materials Management (MM) module. It supports the complete cycle of bid invitation, award/order placement phase, and acceptance of services, as well as the invoice verification process.

Features

MM External Services Management provides a basic process for the procurement of externally performed services. This basic process comprises the following functionality:

·Service master records, in which descriptions of all services that may need to be procured can be stored. In addition, a standard service catalog and model service specifications are available.

·A separate set of service specifications can be created for each concrete procurement project in the desired document (e.g. PM maintenance plan or maintenance order; PS network; MM purchase requisition, RFQ, contract, purchase order, or service entry sheet).

–In the individual documents, you can enter items with materials in addition to those with external services (or complete sets of service specifications).

–When creating voluminous sets of service specifications, you need not laboriously enter each individual service manually. Instead, you can make use of the referencing technique and the selection function to copy quickly and simply from existing master data and documents.

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MM External Services Management offers two basic ways of specifying services:

–As planned services with description, quantity, and price.
By “planned services” we mean services whose nature and scope is known to you at the start of a procurement project or transaction.

At the time the services are requested, the individual specifications are entered either with the aid of a service master record or directly as short and long texts. Price and quantity are specified in both cases.

–As unplanned services with the setting of a value limit only.
By unplanned services, we mean services that cannot be specified in detail because their precise nature and scope are not initially known, or services which - for various reasons - you do not wish to plan. Unplanned services therefore have no descriptions.

They are entered in the form of maximum values in the relevant currency. Services may be performed up to a value not exceeding these value limits. This ensures an element of cost control.

·You can analyze data already available in the system in order to find suitable sources of supply for certain services.

·You can also carry out a bid invitation process and evaluate the bids submitted in response using the price comparison list function. You can then award a contract to (or place an order with) the desired vendor.

·During the phase of service performance (execution of work), various lists and totals displays enable you to retain an up-to-date overview of your service specifications, the progress of the work, and the costs being incurred.

·You can record the performance of services or work in service entry sheets.

·You can indicate your acceptance of the work set out in the entry sheets in various ways.

·Following acceptance, the vendor’s invoice can be verified and released for payment.

As an alternative to this basic process, various accelerated and simplified processes are made available to you for use if desired in connection with specific procurement transactions.

Integration

MM External Services Management is completely integrated into the Materials Management system.

The master data for the procurement of services can be stored in service master records, for example, which subsequently provide default data for the purchasing documents.

Service specifications for a concrete procurement project are not created and processed separately each time (e.g. as bid invitation or contract specifications), but entered directly in the purchasing documents (e.g. in a request for quotation, quotation, purchase order or contract).

The following graphic demonstrates the degree of integration of MM External Services Management:

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The External Services Management component is linked to the SAP modules PM Plant Maintenance and PS Project System.

As a result, it is possible to create purchase requisitions for external services within the framework of maintenance measures or a project and then transmit them to Purchasing without incurring additional data maintenance work.

The interaction of the R/3 modules MM, PS and PM, CO and FI saves time and effort and reduces the frequency of errors. This is because data need be entered once only, after which it is available for all follow-on activities within a business process.

An example of the integration of MM and CO is purchase order commitments. The expected value of unplanned services is forwarded to CO from within MM so that a commitment figure can be established and monitored.

This enables the relevant budget for procurement measures to be prepared in good time.

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Master Records from the ESM View

Definition

Master records are data records that are stored centrally in the database for longer periods of time and which are used and processed by multiple applications.

Use

Master records are suitable for certain combinations of services that are likely to be referenced again and again in various business transactions

Structure

The component MM-SRV External Services Management (ESM) provides the following types of master record:# Service Master Record

• # Master Conditions for Services
  
  # Standard Service Catalog (SSC)
  
  # Model Service Specifications
  
  

Integration

These master records can be used in the following components:

* Purchasing (MM -PUR)

For more information, refer to MM Purchasing.

* Project System (PS)

For more information, refer to PS Project System.

* Plant Maintenance (PM)

For more information, refer to Orders (PM-WOC-MO/CS-SE) and Maintenance
Planning.

* Customer Service (CS)

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Procurement of Services: Processes

In addition to their own workforce, many firms now employ external service providers to do work of various kinds. This may be due to a number of reasons: for example, their own staff may lack either the capacity or the qualifications to perform certain tasks.

This section describes the business processes available within the application component MM External Services Management for the efficient procurement of externally performed services:

# The basic process with all worksteps
# Accelerated and simplified processes

You can specify yourself the cases in which the basic process with all steps is to be used and the cases in which it makes sense to omit certain steps in order to save time.

Procurement of Services: Basic Process
Accelerated and Simplified Processes

Procurement via Maintenance Plans (PM Plant Maintenance)
Getting the Service Provider to Enter Services Actually Performed

Procurement via Invoicing Plans (Rental, Leasing, Part-Payments)
Procurement Using Blanket Orders (for Low-Value Items)