9/24/2015 Warranty Claim Management in SAP | SCN

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Warranty Claim Management in SAP Version 1

created by Uttam Palui on Sep 2, 2014 11:11 AM, last modified by Uttam Palui on Sep 19, 2014 9:15 AM

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Introduction:
Warranty management in SAP plays a crucial role across industries since it allows automatic
tracking of product/services under warranty period and as well re-imbursement of claim
expenses with in validity. This document would provide brief about Warranty Management
features available in SAP and related technical configuration to implement Warranty
Management solution in SAP.
Scope of Warranty Management Solution in SAP:
SAP Warranty management considers following aspects:
It identifies the products/services under warranty
Validate the authenticity of warranty claims
Validates whether the product/service issue highlighted by customer falls under warranty
Define the effects of warranties on pricing & invoicing
Monitor expenses incurred under due to warranty issues
Warranty Process Flow:
For reference purpose, if we consider automotive industry, a warranty claim will occur when a
repair is being carried out on a vehicle or for a return of a defective part (from dealer stock
or sold and returned to the dealership). Usually, Vehicle repairs are for vehicles owned by
retail customers and are for vehicles under active warranty. The dealer who carries out the
repair will create a warranty claim. The warranty claim will be checked by warranty assessor
and will be reimbursed for the labour and/or material and/or sublet expense. Here is the basic
example of business process cycle where an automotive part should pass though when it
comes for warranty claims.
1. Vehicle Consumer come into dealership
2. Dealer determines if product/service defect is under valid warranty
3. If yes, dealer files warranty claim
4. Warranty assessors may review claim for accuracy
5. Claim is either approved or rejected
6. If approved, claim is processed through to Finance and dealer is reimbursed
Configuration Steps to Implement Warranty Management Solution in SAP:
Primary focus of this document is about configuration guide for Warranty Management solution
in SAP. Similar to SPRO, all warranty related configuration can be carried out via transaction
OWTY.

Following step-by-step configuration to be carried out for warranty claim management in

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SAP:
1. Define Warranty Claim Type
2. Assign Number Range for Claim Type
3. Define Decision Codes
4. Define Pricing for warranty claim
5. Maintain Pricing Condition Records
6. Define Action Matrix for Claim Processing
7. Define GL Account Determination Procedure for Claim Processing
8. Assign Pricing, action matrix and GL Account Determination Procedure to Claim Type
9. Implement Validation/Substitution for claims (Optional)
10. Define Output Determination for claim credit note
11. Maintain Output Condition Records
Each step is explained in detail in below section:
1. Define Warranty Claim Type
Based on business requirement different type of claims can be configured. Refer following
path for configuring the same.
OWTY ==> Warranty Claim Processing ==> Define Warranty Claim Types.

2. Assign Number Range for Claim Type

Similar to other Sales Documents, number range to be assigned for warranty claim document.
Refer following path for configuring the same.
OWTY ==> Warranty Claim ==> Processing ==> Define Number Ranges for Warranty Claims.

Create a Group for assigning Number Range:

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Assign Claim Type to the Group:

3. Define Decision Codes

Decision codes are used to attach status code based on different action done on those
claims. E.g. once claim is approved, decision code XX – Accepted can be attached to the
claim.
To define decision codes, refer following configuration path.
OWTY ==> Warranty Claim ==> Processing ==> Warranty Claim ==> Define Decision Codes.

4. Define Pricing for warranty claim

Every warranty claim should have a pricing structure to determine how much value to be
reimbursed to dealer when product/service to be repaired within warranty period promised by
the company. Similar to configuration of pricing procedure (e.g. definition of access sequence,
condition type, pricing procedure etc.) in the area of Sales and Distribution, warranty pricing
procedure configuration
follows the same process.
To define pricing, refer following configuration path.
OWTY ==> Warranty Claim Processing ==> Pricing.

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Example: Warranty pricing procedure WT0002 available from Standard SAP.

5. Maintain Pricing Condition Records

Similar to SD pricing condition records, warranty pricing condition records can be maintained via
Transaction WYP1/WYP2/WYP3. To maintain conditions records
Please refer following SAP menu path.
SAP Menu ==> Logistics ==> Customer Service ==> Service Agreements ==> Warranty Claim
Processing à Master Data ==>Condition Records for Pricing.

6. Define Action Matrix for Claim Processing

Action Matrix is a consolidated matrix of different actions/activities which can be carried out to
a claim document at any given moment of time and also the consequences once any action is
executed. Action matrix primarily consists of different actions and related status to it. Refer
details about Action and Processing Status as mentioned below.

Action:
Every action does some processing and the processing logic is written is related Function
Module attached to it. For example, standard action T041 has been defined as Elementary

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Action and Function Module WTY04_OC_POST_AC has been attached which would help to post
credit memo for the claim amount.

To define action, follow below configuration path.

OWTY ==> Warranty Claim Processing ==> Control Data ==> Processing Control ==> Define
Actions.

Refer Attached Function Module:

Processing Status:

After every action, claim gets a new status to identify every stage of the warranty claim.
During definition of Action Matrix, these statuses would be used.

To define status, follow below configuration path.

OWTY ==> Warranty Claim Processing ==> Control Data ==> Processing Control ==> Define
Processing Statuses.

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Action Matrix:

Once Action and Processing Statuses are defined, action matrix can defined based on business
requirement. This matrix would suggest what all activities (Claim Check, Claim Approval, Claim
Reject etc.) can be done on a particular warranty claim and after completion of those action
what would happen to the same claim document.

To define action matrix, please following below configuration path.

OWTY ==> Warranty Claim Processing ==> Control Data Processing Control ==> Define Action
Controls.

Example of Standard Action Matrix is AP02.

Above given example (highlighted row), matrix suggests that for a claim document we can
perform action T060 (via attached Function Module to it) only if the claim status is B002 and
once we complete action T060, claim would have status B060.

7. Define GL Account Determination Procedure for Claim Processing

Every warranty claim should have account determination procedure attached to it to determine
right GL account for posting claim expenses. Similar to configuration of Revenue Account
Determination Procedure (e.g. definition of access sequence, condition type,
pricing procedure etc.) in the area of Finance, warranty GL Configuration procedure follows the
same process.

To define GL determination procedure, refer following configuration path.

OWTY ==> Warranty Claim Processing ==> Revenue Account ==>Determination.

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Example of Standard GL Determination procedure is KOFI00.

8. Assign Pricing, Action matrix and GL Account Determination Procedure to Claim Type

Pricing Procedure, Action Matrix and GL Account Determination procedure can be assigned to a
claim type. To assign pricing procedure, action matrix and GL determination procedure, refer
following configuration path.

OWTY ==> Warranty Claim Processing ==> Define Warranty Claim Types.

9. Implement Validation/Substitution for claims (Optional)

Validation and Substitution rules are similar functionality as available in the area of Finance.
During warranty claim processing, if there is any business requirement to perform certain
validation OR to substitute certain values as requested by business, these rules can be
implemented.

Implementation of Validation & Substitution is exactly similar to the functionality available in

Finance Area. To implement validation and substitution please refer following configuration path.

OWTY ==> Warranty Claim Processing ==> Control Data ==> VSR Checks.

10. Define Output Determination for claim credit note

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In case business has requirement to have an output (Print/Mail) for warranty credit notes,
output determination procedure needs to be configure similar to output determination in SD
area. Only difference here is, output type is assigned to FI documents generated for the claim.
To implement output/message determination for warranty please refer following configuration
path.

OWTY ==> Warranty Claim Processing ==> Message Determination.

11. Maintain Output Condition Records

Similar to SD output condition records, warranty message condition records can be maintained
via Transaction WYN1/WYN2/WYN3. To
maintain conditions records please refer following SAP menu path.

SAP Menu ==> Logistics ==> Customer Service ==> Service Agreements ==> Warranty Claim
==> Processing ==> Master Data ==>
Condition Records for Message Determination.

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31 Comments

Hidayathulla Hasan Sep 20, 2014 2:45 AM

Excellent uttam!!!!

This was my much awaited topic in EAM on SCN.

I searched on this topic on different forums but couldn't serve my purpose.

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Bookmarked and liked.

Thank$
Hidayath
Like (2)

Jogesw ara Rao Kavala Sep 20, 2014 4:11 AM

Very Good Documentation Uttam !

Like (1)

Uttam Palui Sep 26, 2014 6:03 AM (in response to Jogesw ara Rao Kavala)

Thanks You.
Like (0)

vemuri santosh kumar Sep 20, 2014 4:44 AM

Thank you for sharing this document

Like (1)

Vimal Kumar Sep 21, 2014 5:52 AM

Good One
Like (1)

Navaneetha Krishnan Sep 22, 2014 7:04 AM

Hi Uttam,
Pretty good document for configuring the basic Warranty processing.
To my knowledge we use the concept of actions and action matrix only in IS-Auto.
So I have some queries, if you can help me to understanding these things, i will be very happy.

1. Is the warranty processing be used in other kind of industries (consumer durables) using the
concept of actions and action matrices.
2. Also can you just post the sequence of transactions we have to do once these configurations are
done (like warranty order ....etc) so that we can understanding how the business process makes
use of this configuration.

Thanks in advance for this.

Like (0)

Uttam Palui Sep 22, 2014 7:29 AM (in response to Navaneetha Krishnan)

Hi Navaneetha,

I have worked on this topic for AUTO domain only.For AUTO domain, we have used Object
as VELO but there are other options/objects available like Equipment, Functional Location. I
would suggest to explore these option which are related consumer durable.

Regarding Transactions, for warranty claim its only Claim creation and then through action
matrix customer gets created directly into Finance though FI Credit Memo.

I am not if I have answered your queries. Please let me know if you need further details.

Best Regards
Uttam Palui
Like (0)

Navaneetha Krishnan Sep 22, 2014 8:16 AM (in response to Uttam Palui)

Thanks for updating Uttam.

Like (0)

Chintan Budhbhatti Sep 23, 2014 9:44 AM

Uttam Palui,

Awesome document....very nicely explained.....

Need to configure on my IDES......

Great work....Thumps up!!!!

Chin2.

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Like (1)

Uttam Palui Sep 26, 2014 6:01 AM (in response to Chintan Budhbhatti)

Thanks Chintan

Like (0)

Lokesh Ojha Sep 23, 2014 2:29 PM

thanks for docx uttam ...really gr8 wrk.....

Like (1)

Uttam Palui Sep 26, 2014 6:01 AM (in response to Lokesh Ojha)

Thanks Lokesh

Like (1)

Jitendra Kumar Sep 30, 2014 1:08 PM

Nicely written document Uttam!!!! you explained the processes thoroughly!!!!

Like (0)

Rahul Prakash Oct 1, 2014 7:11 AM

Good work Uttam...

Regards,
Rahul
Like (0)

Uttam Palui Oct 6, 2014 11:38 AM (in response to Rahul Prakash)

Thanks Rahul.

Like (0)

Arvind Pereira Oct 1, 2014 7:39 AM

Hi Uttam,

You have covered features in SAP along with related technical configuration to implement Warranty
Management solution, good work for EAM.

thanks
Arvind Leo Pereira

Like (0)

Uttam Palui Oct 6, 2014 11:38 AM (in response to Arvind Pereira)

Thanks Arvind.
Like (0)

Kashi Yadaram Oct 6, 2014 7:04 PM

Excellent explanation! liked your approach of explaining from business scenario through
configuration.

Like (0)

Uttam Palui Oct 7, 2014 7:28 AM (in response to Kashi Yadaram)

Thanks Kashi
Like (0)

Caetano Almeida Oct 8, 2014 7:38 PM

Nice document. Thanks for sharing!

Like (0)

Uttam Palui Mar 27, 2015 5:48 AM (in response to Caetano Almeida)

Thanks Caetano.

Regards
Uttam
Like (0)

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Vivek Kumar Sinha Oct 24, 2014 1:06 PM

Hi Uttam,

Thank you for sharing such an informative document.

I am interested in doing traning in SAP For Auotmotive. Please suggest me to go further in this....

Regards,
Vivek.
Like (0)

Uttam Palui Mar 27, 2015 5:50 AM (in response to Vivek Kumar Sinha)

Thanks Vivek.

Please try exploring VMS node under Logistics Execution. This is used by Automotive
Industry.

Regards
Uttam
Like (0)

Anand Rao Oct 27, 2014 2:11 PM

Hi Uttam_Very good document! It covers both conceptual explanation and configuration guidelines!
Like (0)

Uttam Palui Mar 27, 2015 5:48 AM (in response to Anand Rao)

Thanks Anand.
Regards
Uttam
Like (0)

Ravi Prakash Oct 29, 2014 8:47 AM

Good documentation Uttam.

Like (0)

Uttam Palui Mar 27, 2015 5:49 AM (in response to Ravi Prakash)

Thanks Ravi.

Regards
Uttam
Like (0)

Paul White Mar 31, 2015 9:43 PM

Nice document, Uttam.

Can you tell me if it's possible to use any of the Warranty Claim functionality if you're not using CS/SD
and just have PM configured? For example, if I want to return a purchased item that has broken
under warranty to the vendor. I've read that the Warranty Claim can be used for a vendor warranty, but
it still seems like the process is customer-centric and CS is needed for this.

Any advice? Thanks!

Paul
Like (0)

Uttam Palui Apr 7, 2015 11:03 AM (in response to Paul White)

Hi Paul,

I have NOT explored that area but if you try creating claim using standard SAP configuration,
you can see that you can manage claims attaching to Equipment/Functional Location etc. I
would suggest please explore that option.

I have used Vehicle Object for my case. Hope it helps.

Regards
Uttam Palui
Like (0)

vinod yadav Apr 22, 2015 5:37 AM

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Very Good document.
Thanks for sharing.
Like (0)

Gibson Nyarugw e Apr 22, 2015 9:55 AM

Hello Experts

I saw this document highly valuable, can someone kindly provide how can claims management be
done on the side of the customer, say in the automobile example given above, the EAM or PM a part
got damaged and still covered under the warrant or guarantee.

Can this be triggered on the equipment being maintained, how can this be loaded to avoid the
customer going to a new supplier where they supposed to approach the supplier, how can alerts be
generated in the SAP system?

Regards

Gibson
Like (0)

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