sap credit-and-collection-management

SAP Credit and Collection

Management

Vidar Greve Johannesson

[email protected]

© 2011 SAP AG. All rights reserved. 2 www.scensum.com.

Agenda

1.SAP Financial Supply Management – Business Issues and value

proposition

2.SAP Credit Management

3.SAP Collection Management

4.Summary


Does this Sound Familiar?

Copyright 2002 by Randy Glasbergen

www.glasbergen.com


Cash Flow Cycle

Cash Flow Cycle

Days In Receivables (average customer payment time)

Days In

Payables (average time to

payment of supplier)

Days In Inventory Days Sales Outstanding

time

Sale +

Delivery +

Invoice

Cash

payment

for inventory

Actual

payment

date

Order

placed

Delivery +

invoice

Expected

payment date


Free Up Cash with SAP FSCM

With SAP Financial Supply Chain Management customers were able to

• Reduce the number of bad debt using SAP Credit Management

• Reduce efforts and costs for invoicing using SAP Biller Direct

• Reduce DSO through improved discrepancy resolution with SAP Dispute Management and

SAP Collections Management

Cash application

Accessing information

Payment reconciliation

Managing customer behavior

Invoice presentment

Discrepancy resolution

18 %

18 %

26 %

28 %

29 %

47 %

Source: Paystream Advisors, 2007

(percentage of highest pain scores)

Painpoints in Order to Cash Cycle Companies have big potential to free up working capital by applying best practices

Current

Working

Capital

Payables Receivables Inventory Best Practice

Working

Capital

321

bn $

91

bn $

49

bn $

110

bn $

Source: McKinsey (sample of 24 corporate clients)

Cash NPV released from best practice: 211 bn USD

71

bn $


Fragmented stand-alone

systems

No workflow or data

management

No integration with GL or

AR systems

Poor insight into

customer Credit risk

No insight into process

bottle necks

Lack control over processes,

workflow or prioritization

Independent functions

No coordination in collections/

dispute resolution

Inconsistent credit

policies across divisions

Fragmented and inefficient

Paper-based and labor-

intensive

Lack of standardization

Typical Barriers of the Order-to-Cash Cycle

High Cost of

Finance Operations

High Bad Debt Risk

High DSOs


Op

tim

izin

g t

he O

rder-

to-C

ash

Cycle

Overcome Your Barriers by Optimizing the

Order-to-Cash Cycle with SAP

Enterprise Service Bundles

SAP Biller Direct

SAP ERP Financials

SAP NetWeaver/SWIFT integration

SAP Solutions

Organization

SAP ERP Financials

SAP Credit Management

SAP Dispute Management

SAP Collections & Dispute Mgmt

SAP Biller Direct

SAP Accounts Receivable

Insight &

Control

SAP CPM

SAP GRC


IT Systems

Processes

Establish greater cross-functional coordination

Define global customer credit policies

Establish clear lines of ownership and

escalation policies

Organize unstructured data and collaborate

via workflows

Streamline labor-intensive processes via

standardization and automation

Straight-through payment processing

Monitor performance of financial processes

Implement financial controls and fraud

detection mechanism

Control global credit risk

Utilize open standards to connect financial

systems with customers, suppliers and banks

Integrate collections / dispute systems with

accounting and AR systems

Finance Strategies Barriers


Agenda

1.SAP Financial Supply Management - Introduction



4.Summary


Agenda

1.SAP Credit Management – Introduction

2.User Interface of the Credit Manager

3.Master Data

4.Credit Rules Engine

5.Reporting & Mass Change


Financial Supply Chain Management with SAP

Issue Invoice

Forecast Cash

Finance Working

Capital

Resolve Disputes

Collect Cash

Check Credit

Worthiness

Settle & Pay

Reconcile




SAP Biller Direct (Electronic Bill Present-

ment and Payment)

Order-to-Cash


Credit Management – Business Facts

Year 2007: approximately 129,822 corporate bankruptcies

in Western Europe*

Average delay in payments for Western Europe between

8 days and 21 days*

Ineffective credit management in distributed sales

systems

Information needed for credit decisions is spread out all

over the company

No credit history available when doing business with

new customers

Communication between sales, credit, and finance

departments is very time-consuming

A customer is treated differently in different business units

within the same company

* Source: Creditreform


SAP Credit Management – Focus

System to implement a company wide credit policy

Central credit management in a distributed system landscape

Monitor a customer‟s credit exposure in one central system

Customer scoring using own scoring rules creating new

reports and queries

Automatically calculate and assign a customer-specific

credit limit

Interface to external credit agencies

Web-based access to credit information for sales people

Distribute customer master data via Master Data Management

(MDM)

Strategic credit analysis with predefined reports

Credit Manager Portal to speed up credit decisions

Improves productivity by automating credit decision process

and focusing on the processing of exceptions


How to Manage the Credit Risk ?

Collect internal and external information about the

customer

Evaluate and classify the customer according to

this information

Assign a credit limit according to the risk assessment of

the customer

Collect information about the credit exposure of business

transactions with this customer

Ongoing monitoring of the credit limit usage

Hedge business transactions for high risk customers

Monitor early warning signs

Plan sales and marketing activities for low risk customers

Compare credit portfolio with companies‟ strategic goals

Share credit information with sales


Invoice Risk Class I

Check by ext.

Credit Agency

Risk Class II

Cash on delivery

Letter of credit

Advance Payment

Risk Class III

Default Probability Sets Risk Hedging

Score

Default Probability

Very Good Very Bad

10 %

20 %

30 %

= Customer


Treatment of Clients Depending on Sales and Default Risk

Sales with client

Risk of default

High

Sales

Low

Sales

High Risk Low Risk

Customer C

Customer D

Best Case Client:

Intensify Customer

Relationship

Possible Actions:

Increase sales prices

Increase use of hedging

instruments

…

Customer B Customer A

Possible Actions:

Lower sales prices

Reduce use of hedging

instruments

…

Possible Actions:

Reduce business with

this customer

Change dunning procedure

Permanent credit

risk monitoring


Functional Overview

Credit Limit Management

Implement a company wide credit policy

Manage a customer credit profile

Central credit management in a distributed system landscape

Credit Case

Credit case for structured processing of credit limit applications

Track status and result of credit limit applications

Credit Rules Engine

Categorize customers by scoring rules

Automatically calculate and assign a customer-specific credit limit

Credit check rules

Model and implement own customer credit score cards

Credit Information

Interface to external credit agencies

Input parameters for scoring rules

BW Content

Credit Manager Portal

Role-based access to credit management information and analysis


Credit Limit Management

Functions

Manages the credit profile of a customer

Monitor credit exposure / limit in a

central system

Web-Based access to customer„s

credit profile

Rules Engine for implementing own scoring

and limit rules

Scalable platform to use in B2B and

B2C Scenarios

Score customers and vendors

Business Benefit

Imlement company wide credit policy

Early identification of default risk

Reduce processing costs by automating credit decisions

Credit

Limit

January February

March April

Credit

Exposure

Alert Alert


Credit Case

Functions

Virtual Folder to track credit applications

A credit case contains

Major customer master data & credit profile

Status

Organizational data

Documents

Orders

Notes

Inbox

A credit case can be sent from user to user

It is linked to the customer credit data

SAP Workflow Integration

Business Benefit

Sales people can enter an application for credit limit change

Track status of the application

Inform sales when decision is made


Create Limit Application (Example)

Sales assistant enters credit

limit application (credit case)

Need more

information?

Send back credit case

with financial data

Approve / reject

credit limit application

no

yes

Assign credit manager

manually / automatically

Send workflow item to

credit manager

Send credit case to

financial analyst

Change limit in

master data (manually)

Customer exceeds

credit limit frequently

Send workflow item to

financial analyst

Close credit

limit application

Send notification to

sales assistant (workflow)


Creating Credit Limit Request

Select Business Partner

Add Attachments

Define details

Confirmation

Add note

Review and save


Integration

Functions

Central credit management in a heterogeneous

system landscape

Import exposure information from various systems

Perform credit limit check in real-time

Integrate services from external credit agencies into

the credit decision process

Distribution of customer master data by MDM

Business Benefits

Minimal effort for connecting SAP and non-SAP Systems and low TCO due to XI

Seamless integration of external services increases user productivity

Real-time credit limit check guarantees consistent credit decisions

Provide customer credit profile to other applications (e.g. CRM)


Credit Manager Portal

Functions

Role based application providing analytical

tools

needed for quick credit decisions

Single point of access for all relevant

credit information

Work lists inform the user about to-do‟s

Platform to make credit information available

for sales people

Business Benefits

Improves user efficiency due to consolidation

of various information sources

Improves communication between sales,

credit

and accounting department

Sales people can access credit information

from customer site


Credit Analysis

Functions

Company-wide monitoring of credit risk

Analysis of customer payment and order

behavior

Alert on high risk customers

Risk structure analysis of the customer base

by country / business unit / customer group

Business Benefits

Proactive credit management

Identification of risks before customer

gets insolvent

Hedging of high risk customers reduces

unexpected losses

Aim marketing and sales activities to low-

risk customers

Drive price policy by a customer risk

category


Integration with External Credit Agencies

....... Credit-

reform SCHUFA

D+B

XML

Original XML Document is stored in the

document management system that is

used by the SAP Business Partner

Real Time

SAP

Enterprise Portal

Credit

Manager Portal

SAP

Credit

Management

Real Time

D&B

Creditreform

External Credit

Information System

Credit-

reform D+B

Comparison R/3 Credit Management

with SAP Credit Management

Master Data FI-AR Account SAP Business Partner

FI Data SAP Business Partner FI-AR, FI-CA, others

Monitor Credit Exposure Only for simple system-

landscape (1xFI, 1xSD)

Distributed system-landscape

(multiple FI, SD and CRM

systems)

Customer Scoring/Rating Not available Credit Rules Engine

External Credit Information

(e.g. D&B)

Only through partner products any XML based credit

information service

Rule based definition of

credit limits

Not available Credit Rules Engine

Workflow Only in SD Create Workflow for any

Credit Event

Analysis Customer fact sheet Credit Manager Portal (incl.

BW Content) and OLTP

reporting

Connectivity for non

SAP-systems

Not available PI Server

R/3 Credit Management SAP Credit Management


Agenda



3.Master Data




Work Center for SAP Credit Management – Modeling the

Role of the Credit Manager

Each Work Center

represents a certain

area of activity:

Worklist

Processing of credit

limit requests

Processing of blocked

sales orders

Processing of blocked

customers

Each work center provides access to a range of work lists, pre-filled reports and

services appropriate to the tasks performed by the user.


Worklist

User receives

notifications on

credit events

(e.g. changes in

risk class, score etc.)

User can view details

and access directly the

dialogue processing

of business partner

maintenance

Detailed Navigation =

View Switch

Links launch

applications in

Activity Window

(user can also

start applications

related to master

data and mass

data processing here)


Credit Limit Requests Overview

Links launch

applications in

Activity Window

Pre-delivered

default queries with

customized values


View Switch

User can access

directly the dialogue

processing of the

respective request.


Blocked Customers


View Switch

Links launch

applications in

Activity Window

Pre-delivered

default queries with

customized values

Action button leads

the user directly to

the exact location of

the block information

in the business

partner master data


Agenda



3.Master Data


5.Integration with External Information Providers



Master Data in SAP Credit Management

Credit data is a component of SAP Credit Management

and is stored in SAP Business Partner. It consists of the

credit profile data and credit segment data.

The credit profile is used for the central storage of

customer data relevant for risk assessment (scoring, risk

class, external rating, credit check rule).

Credit segments can map various areas of a company

(such as sales area, countries, company codes). They

are used for area-specific administration of credit limits

(and their utilization) and to store information on the

payment behavior of the customer. The corresponding

credit segment data is used for credit checking when the

order is created or on delivery within a company area.

By using relationships you have the possibility of

creating customer hierarchy.


Business Partner in SAP Credit Management

Scoring Rule:

Rules that define how

a customer is scored

(e.g. industry, D&B,

legal form, country)

Credit Check Rule:

Rules that define how a

customer is credit checked

(e.g. static / dynamic check,

oldest open item …)

External Rating from D&B


Total Credit Exposure:

2.100.000 €


700.000 €


3.100.000 €

Relationship

Higher-level credit management account of …

Business Partner 4711 Segment 0000

Credit Exp.: 1.000.000 €


Credit Exp.: 700.000 €

Is the higher

level credit

management

account of …

Is the higher

level credit

management

account of …


Credit Exp.: 1.500.000 €


Agenda



3.Master Data




Credit Rules Engine

Create scoring formula and credit limit formula by

using the formula editor. Parameters (for example

business partner data) and functions are used as input

parameter.

One scoring formula and several credit limit formulas (for

each credit segment) are assigned to the rule for scoring

and credit limit calculation, which is assigned to each

customer in the credit profile. The risk class is determined

directly from the score.

In customizing, specific score ranges which do not

overlap are assigned to each risk class. For the check

rule, the system determines the steps which are taken to

check the creditworthiness of a customer when a sales

order is created. This may include the static check of the

credit limit or the check of the highest dunning level.

Customer-specific process chains in SAP Credit

Management can be defined through events which

trigger follow-up actions


Credit Rules Engine

IF (Black List Entry exists):

S = 0

ELSE

S = (2*A + 3*B + 5*C) / 10

Customer

Address

Mapped Score B:

B+ = 30

Mapped Score A:

AAA = 50

Birth Date Profession

Region Age GroupProfession Score

...

ATL <20 Student 17

NYC 20-30 Student 18

... Score C: 17

Black List Int. Scoring S = 27.5

Calculate Internal Credit Scoring

(Existing Customer)

Credit Agency I

AAA

Credit Agency II

B+

Sales

Volume Dunning Payments

Score D: 3

Int. Scoring S = 19.3

Credit Rules Engine

IF (Black List Entry exists):

S = 0

ELSE

S = (2*A + 3*B + 5*C + 5*D) / 15

Sales Volume Score SV

0 – 100 0

101 – 300 5

301 – 1000 10

...

Dunning Score DU

0 0

1 3

...

Paym. (days after Due) Score PY

0 0

<5 4

<10 8

<20 15

...

Score D = SV – DU – PY = 3

Credit Information


Agenda



3.Master Data




Reporting

Ad hoc reporting in SAP Credit Management

Various reporting and analysis options are available in SAP Credit Management,

such as creating warning lists, analyzing liability data for one or more customers, or

logging the last order-related credit check for a customer

Various mass changes are available in SAP Credit Management, such as

calculating the creditworthiness, risk class, or credit limit for the first time for a

number of customers


Report UKM_MASS_DSP2

UKM_MASS_DSP2 – Report for Credit Segment Data:

Credit Limit (current /calculated) + validity date

Blocked Customers in SAP Credit Management

Customers to monitor

Resubmission Date

Assigned Credit Analyst

Plus all UKM_MASS_DSP1 Fields e.g. 80% for early warning list


Report UKM_MALUS_DSP

UKM_MALUS_DSP – Report for Credit Limit Utilization

Credit Exposure (%)

Credit Limit Still Available / Amount by which credit limit exceeded (absolute)

Customer Credit Group

Credit Analyst or Group

Resubmission Date

Blocked Customer in SAP Credit Management


Report UKM_VECTORS

UKM_VECTORS – Payment Behavior KPIs

Total Sales Volume in last 12 months

Gross Total of Cleared Items with Cash Discount Not Taken

Gross Total of Cleared Items without Cash Discount Loss

Av. Arrears with cash discount payments

Av. Arrears without cash discount payments


Report UKM_COMMITMENTS

UKM_COMMITMENTS – Display / Correction of Commitment Data

(Credit Exposure)

Display of commitments, for example, by commitment type or credit horizon

Detail view of commitment items (e.g. open items, open orders )

Due date of open items and open orders

Navigation


Agenda




4.Summary


Agenda

1.SAP Collections Management – Introduction

2.Process „Collection of Receivables‟

3.Process „Control Collections of Receivables‟

4.Process „Data Synchronization and Creation of Worklist‟

5.Analytics

Financial Supply Chain Management with SAP

Issue Invoice

Forecast Cash

Finance Working Capital

Resolve Disputes

Collect Cash

Check Credit Worthiness

Settle & Pay

Reconcile




SAP Biller Direct (Electronic Bill Present- ment and Payment)

Order-to-Cash


Collections Management – Important Business Issue

Increasingly bad payment behavior

Increasing Days Sales Outstanding (DSO)

No reaction on automatic correspondence like dunning

Financial situation influences customer relationship

Collections Management today is mostly a time-consuming, costly and

cumbersome process

Select and prioritize customers to be collected

Search for account information

High volumes


What Are the Business Objectives?

Increase share of collected receivables

Reduce Days Sales Outstanding (DSO)

Avoid write-offs

Increase payments on time

Decrease cost of cash collection

Improve Customer Relationship Management

Retain valuable customers and convert difficult

customers by providing the right interaction in delicate

scenarios

Provide complete picture of customer history

Increase customer satisfaction


How Does SAP Collections Management Help?

SAP Collections Management provides collection strategies that allow to select and

prioritize customers for the collection of receivables

Collection strategies are the basis for the automatic creation of daily worklists for collection

specialists.

Worklists ensure evaluation, identification, stratification and prioritization of customers according to

collection strategy

Daily worklists improve user productivity and efficiency

SAP Collections Management offers special collection procedures to document and react

on customer contacts

Promise to pay agreements

Dispute cases (via integration with SAP Dispute Management)

Resubmissions

Customer contacts

Collection managers will find a variety of options to control the collection of receivables

Define and adapt strategies

Maintain collection groups

Workforce management by reassigning worklist items and monitoring degree of worklist processing


Agenda


2.Process ‘Collection of Receivables’



5.Analytics


Two Roles: Collection Manager and Collection Specialist

Collection Group

Collection Manager

Main Tasks:

Define or adapt collection strategies

Keep collection groups up-to-date

Adjust business partners

Supervise collection process

Main Tasks (are all about

processing the daily worklist):

Prepare customer contact

Contact customer

Document customer contact

Collection Specialist




‘Data Synchronization and Creation of Worklist’ Process

Create

Worklists Monitoring

Replicate

Customer

Master

Data

Transfer

Data from

Accounts

Receivable

Master data

synchronization

Contact persons

Collections

Management

specific data

Monitor master

data

synchronization

Monitor parallel

runs

Create worklist

items

Distribute

unassigned items

Initial transfer

Periodic transfer

Selected transfer


Functionality Supporting the

‘Collection of Receivables’ Process


Automatically created

Personalization

Search function

Statistics

Key figures per worklist item

Valuation detail

Due date grid

Invoice overview

Overview of customer account

Overview of past payments

Overview of past contacts

Check resubmissions

Promises to pay

Dispute cases

Resubmissions

Customer contact

Access

Worklist

Prepare

Customer

Contact

Contact

Customer


Collection Worklist

Aging of receivables per

selected customer

Link to business partner

Each collection specialist gets a daily worklist containing all customers who should be contacted.

Customers are valuated and prioritized according to collection rules in a collection strategy.

Summarizes information concerning Customer account in Accounts Receivable

Past collection activities

Credit Management

Detail valuation of customer

per collection rule

Assign items

Refresh worklist

Display completed items

Search for other business partner


Main Features of the Collection Worklist

Automatic creation of worklists based on collection

strategies

Summarized information per customer regarding

Customer account in Accounts Receivable

Past collection activities

Credit Management data

Detailed information per customer about

Valuation according to collection strategy

Aging of the customer‟s receivables (due date grid)

Personalize worklist by setting as default

Search function (view other customer account or

other worklist)

Navigation to business partner master from the worklist

Statistics about degree of worklist processing


View aging of customer’s receivables

Worklist as Starting Point for Customer Contact

Select worklist item and view data

View valuation of customer according to collection strategy

Maximum amount

to be collected

1

2

3


‘Process Receivables’ Function – Main Area During

Contact

Navigation

To contact the customer, the collection specialist navigates from the selected worklist item to the

„Process Receivables‟ function. This function offers detailed customer information and supports

various collection activities.


Process Receivables – Invoices (Open)

On the „Invoices‟ tab page the collection specialist gets an overview of all open invoices of a

customer in a collection segment. Per invoice the status is displayed including the amount

invoiced, open amount, disputed amount, amount promised to pay, state of promise etc.

View dispute case(s)

per selected invoice

View promises to pay

per selected invoice

View invoice history

of selected invoice Customer Data

Customer Contact Person

Display or print

billing document in

PDF format


Example – Printing Invoice in Worklists


Process Receivables – Past Payments

Payment History for selected payment

All documents related to the

payment are highlighted

The overview on past payments allows collection specialists to check past payments of the

customer he or she is contacting. The payment history lists all invoices that have been fully or

partially paid by the selected payment.


Process Receivables – Promise to Pay

The overview on promise to pay shows all promises to pay that were given for the open invoices

displayed on the „invoices‟ tab. You can navigate to the details of a selected promise to pay,

change or withdraw a promise to pay.

View promise

to pay

Change

promise to pay

Withdraw

promise to pay


Process Receivables – Dispute Case

The overview on dispute case shows all dispute cases that are related to the open invoices

listed on the „invoices‟ tab. You can navigate to a selected dispute case and – if you have the

authorization – process the dispute case. Furthermore, you can display which invoices are

assigned to the dispute case.

View assigned

invoices

Navigate to selected

dispute case


Collection Activities –

Documenting Customer Contact

The collection specialist has the following

possibilities to document his or her

collection activities

Create promises to pay

Create dispute cases

Create resubmissions

Document the customer contact itself


Promise to Pay Process

Hello Mrs. Brown, did you

recognize that invoice 4711 has

been overdue since 4 weeks? Hello Mr. McFee, thank

you for reminding me.

We will pay the full

amount by Wednesday

next week.

Promise to Pay

Promised amount

Promised to date

Promised by

Note

Invoice reference …

Tom McFee enters promise to pay

in the system

Accounts Payable Manager

Sue Brown


Tom McFee


Promise to Pay in


Customer promises to pay one or several invoices

Collection specialist creates promise to pay

Creation possible for one or several invoices

Promise is traced on single invoice level

Collection specialist renews promise to pay

Existing promises can be renewed

Renewed promises get higher promise level

Promises to pay are updated by incoming payments

State „kept‟ if incoming payment equals promised amount

State „partially broken‟ if payment amount is smaller than promised amount

Promises that are not kept get state ‘broken’

Customers with broken promises will automatically appear on the worklist if defined

so in the collection strategy


Create Promise to Pay

The collection specialist can create a promise to pay in the system for the selected invoices.

The total of all open amounts is proposed by the system as promised amount. If the promised

amount is less than the proposed amount, the promised amount can be distributed to the invoices.


Create Dispute Case

The collection specialist can create a dispute case for the selected invoices. The total of all open

amounts is proposed by the system as disputed amount. The collection specialist can enter all

necessary information such as dispute reason and a note.


Resubmission

Suppress customer from worklist

until resubmission date

Collection specialists can set a resubmission for a customer. They can enter a note and a

resubmission reason. The customer will re-appear on the worklist at the resubmission date.

It is also possible to suppress a customer from the worklist until the resubmission date.

Overview of existing resubmission

Create resubmission

First line of note


Create Customer Contact

The collection specialist can document the outcome of the whole customer contact. Dispute

cases, promises to pay and resubmissions created during the contact will be automatically

assigned. A default note is set by the system and can be enhanced by the specialist.

Controls if worklist item remains on

worklist or will be removed

Default note automatically

created by the system


Agenda


2.Roles and Processes


4.Process ‘Control Collections of Receivables’


6.Analytics


Functionality Supporting the

‘Control Collection of Receivables’ Process

Collection Manager

Collection rules

Collection strategy

Allocate worklist

items

Control statistics

Business partner

Collection profile

Collection group

Adjust

Business

Partner

Master Data

Supervise

Collection

Process

Define

Collection

Strategies

Maintain

Collection

Groups


Collection Strategies

Collection strategies comprise company-specific

rules for collecting receivables

Collection strategies have the following purpose

Determine which customers are to be contacted in

Collections Management (basis for automatic worklist

creation)

Prioritize customers on the collection worklist

Define the currency in which the amounts are to be

displayed on the worklist

Determine the time intervals of the aging of receivables

per customer in a segment (due date grid)

Define the type of integration with dunning in Accounts

Receivable Accounting

Determine the influence of the terms of payment on

Collections Management (consideration of cash

discounts)


Data Sources for Collection Rules

SAP Accounts

Receivable

SAP Dispute

Management

SAP Collections

Management

SAP Credit

Management

Dispute Case Data

Promise To PayData

Contact Data

Resubmission Data

Risk Class

Credit Limit Utilization

Open Item Data

Dunning Data

Payment Data

Customer Data


Maintain Collection Strategy

Determines structure of

Due Date Grid

The collection manager decides on the kinds of collection rules customers are to be contacted.

The corresponding collection rules are assigned to the strategy. Per rule the collection manager

enters the relevant parameters and the valuation points a customer receives when he fulfills the

rule.

Enter parameters

of collection rule


Allocation of Worklist Items to Collection Specialists

Worklist items of all collection groups

Reallocation only possible to other

specialists of the same collection group

The collection manager can view all worklist items assigned to his or her collection groups. The worklist items

are allocated automatically to the collection specialists. The collection manager can re-allocate worklist items

among specialist of one group. (Example: A collection specialist will not be able to finish his or her worklist

during the day.)


Supervise Progress of Worklists Processing

© SAP AG 2009. All rights reserved. / Page

97

Total number of

worklist items

No. of completed

worklist items

where the customer

was reached

Number of open

worklist items

The collection manager can view the worklist statistics of all collection groups he or she is responsible for.

The statistics show the total number of worklist items, the number of open worklist items, the number of

completed worklist items where the contact person was reached and the number of completed worklist items

with an unsuccessful contact.

No. of completed

worklist items

where the customer

was not reached


Agenda





5.Process ‘Data Synchronization and Creation of Worklist’

6.Analytics


Create worklist

items

Distribute worklist

items

Customer /Vendor

Integration

Create „Collections

Management‟ role

Change collection

segment data

Monitor master

data

synchronization

Monitor parallel

runs

Initial transfer

Periodic transfer

Selected transfer

Functionality Supporting the ‘Data Synchronization and Creation of

Worklist’ Process

Create

Worklists

Monitoring

Replicate

Customer

Master

Data

Transfer

Data from

Accounts

Receivable


Complete Business Partner Master Data

Create

‘Collections

Mgmt’

business

partner role

Assign

collection

profile

Assign

collection

group

different

to default

group

(optional)

Assign

collection

specialist

(optional)

Report: Assign/Change Business

Partner Collection Profile

Report: Change Business

Partner Segment Data


Agenda






6.Analytics


Analytics in SAP Collections Management

(as of SAP Enhancement Package 1)

Analytics for SAP Collections Management enable you to control and

optimize your collection activities

Analytics for SAP Collections Management comprises the following analysis

scenarios:

Analysis of worklists

Analysis of customer contacts

Analysis of invoices and promises to pay

Analysis of open items linked with organizational units of Collections

Management


Analysis of Worklists

Business value:

Measure performance and productivity of collection

groups/collections specialists

Measure effectiveness of collection strategies

Main key figures:

Number of worklist items

Number of completed worklist items

% Completed worklist items

Amount to be collected

Amount processed (including amount promised to pay

and amount disputed)

Main characteristics:

Collection specialist

Collection group

Collection segment

Collection strategy


Analysis of Worklists – Daily Collection


Analysis of Customer Contacts

Business value: Measure performance and productivity of

the collection specialists

Main key figures:

Number of customer contacts

Amount promised during the customer contact

Original disputed amount of dispute cases created during contact

Number of promises to pay created during contact

Number of dispute cases created during contact

Number of resubmissions


Contact date

Contact result

Contact type

Collection group


Collection segment

Collection strategy

Business partner


Analysis of Invoices and Promises to Pay

Business value: Measure effectiveness of collection

activities and volume of invoices managed in SAP

Collections Management

Main key figures:

Amount promised

Amount paid (referring to promise to pay)

Amount invoiced

Amount paid (of invoice)

Number of invoices

Number of promises to pay

% Kept / % Broken

True DSO

Days in arrears


Promise to pay level / Promise to pay state

Invoice number

Document date

Payment date (of invoice)

Customer


Analysis of Open Items Linked with Organizational Units of

Collections Management

Business value: Due date analysis for organizational units

of SAP Collections Management, ability to plan ahead

Main key figures:

Overdue for more than 90 days

Overdue from 61 to 90 days



Due within 30 days

Due within 30 to 61 days

Due within 61 to 90 days

Due within more than 90 days


Collection segment

Collection group


Business partner


Due Date Analysis


Agenda




4.Summary


SAP Credit Management – Summary

Customer Challenges

Takes too long to evaluate credit

Inconsistent methods and policies

No global view of exposure

Evaluations hold up sales orders

SAP Functionality

Analyze risk and set policy quickly

Consistent evaluation and policy

Global view of credit exposure

Automatically update exposure

throughout customer lifecycle

Benefits

Faster credit decisions

Lower costs and resource

demands

Reduce bad debt write-offs

Reduce sales order delays


SAP Collections Management – Summary

Challenges

Inconsistent account prioritization

Labor intensive and long cycle times

Inconsistent collection strategies

High costs of collections

Increase bad debt risk

Functionality

Rules-based collections strategies

Prioritization via worklists

All relevant information at a glance

Proactive targeting of “late pays”

Benefits

Improved collections rates

Reduced bad debt expense

Streamline collections and

reduce operating costs

Reduce DSOs

Thank you

Vidar Greve Johannesson

[email protected]

www.scensum.com

For more information feel free to contact:

mailto:[email protected]

http://www.scensum.com/

sap credit-and-collection-management

Career