Org Structure Presentation Oct 8

GOAL OF ORGANIZATION STRUCTURE
WORKSHOP
Obtain an Understanding of the Customers Key
Business Processes
Define the Chico Creek Brewerys Organization
Structure in SAP based on those Business Processes
SAP America, OS.PPT - 10/13/97, Slide 1
AGENDA
Definition of Organization Structure
Customer High Level Business Overview

Business Process Review
Financial/Asset Management
Sales Logistics
Procurement, Logistics Planning
Define the Organizational Elements in SAP based

on the Chico Creek Brewerys Business Processes
and Reporting Requirements.
Document the Companys SAP Organization
Structure
Integrated Business Process Review

Business Overview
Companys Mission Statement
Markets
Customer Base
Products and Services
SAP Implementation Drivers
MISSION STATEMENT
Our mission is to successfully implement SAP R/3 at
the Chico Creek Brewery in a timely, professional
manner so that our client can realize a faster and more
productive way to run their business processes.
We intend to create a sustainable competitive
advantage for Chico Creek Brewery, as well as,
substantial profitable results through the
implementation of SAP R/3.
Integrated Business Processes Overview
Procurement
Logistics Planning
Sales Logistics
Production
Finance / Asset Management

R
Integrated Business Process Overview

Production
Forecast
Sales Oper
Planning
MPS
MRP
Manufacturing
Execution
Order
Settlement
Inventory
Capacity
Costing
Financial and Managerial Reporting and Analysis
Organizational Structure Review

Organizational Structure
3000
US
Chico Creek Brewery
Business
Area
90
Pale Ale
Division
93
Stout
3000
US
3000
US
3000
US
Sales
Organization
Distribution
Channel
4000
Australia
3000
US #1
Purchasing
Organization
Division/
Plant
93
Stout
90
Pale Ale
03
Wholesale
90
Pale Ale
93
Stout
Finance Management /Accounting & Reporting

FINANCIAL
ACCOUNTING
(FI / AM)
SD
MM
FINANCIAL
REPORTING
(FI)
COST CENTER
ACCOUNTING (CCA)
ACCOUNTS
RECEIVABLE
ACCOUNTS
PAYABLE
MANAGEMENT
REPORTING
(CO)
INTERNAL ORDER
ACCOUNTING (OPA)
GENERAL
LEDGER
NATURAL
ACCOUNT
PROJECT
ACCOUNTING
PRODUCT COSTING
PROFIT CENTER
ACCOUNTING (PCA)
ASSET
MANAGEMENT
PROFITABILITY
ANALYSIS (PA)
R
Organizational Elements - FI
Company
Represents a legal/tax entity - Where do you
legally represent the financial events of
transacting business?
Arms Lengths Transactions
Level of External Reporting or Legal Sets of Books
Companies for Name of Customer
Company Codes: Identify the proposed company
codes if any for customer being evaluated.
Benefits: Identify the benefits of recommended
usage of company codes.
Costs: Identify the costs of recommended usage
of company codes.
Issues: Identify any open issues/questions.
Chico Creek Brewing
Co.
Company Codes
North America
Australia
Japan
Singapore
Canada
Operating Chart of Accounts
G/L Account Master Records Required in One or Several
Company Codes
Postings are Made to these Accounts
Maximum of a 10 Digit Code
A company Must be Linked to One Operating Chart of
Accounts
An Operating Chart of Accounts can be Linked to Many
companies
Operating Chart of Accounts = General Ledger
Different from a lot of other Financial System
Applications in that the G/L account is strictly
comprised of the natural account code.
The management reporting structures (i.e. cost centers,
divisions, regions, and job orders) is not embedded
within the chart of accounts.
In SAP there is a relative relationship between the chart
of accounts profit and loss natural account code and
the cost centers.
Organizational Elements - CO
Controlling Area
An organizational unit within a corporation in which
comprehensive independent management accounting
can be performed.
Allows you to group Company Codes from a Cost
Accounting View.
It links the financial accounting module (FI) to the

management accounting module(CO) in SAP.
Linking of FI and CO
The Operating Chart of Accounts Links Financial

Accounting(General Ledger) to Management Accounting in the
following way:
A Company Code is Linked to the Operating Chart of Accounts
The Controlling Area is Linked to the Operating Chart of Accounts
A Company Code then can be Linked to any Controlling Area as long as they
are both Linked to the Same Operating Chart of Accounts
Several Companies can be Linked to a Single Controlling Area

regardless of the Companies Functional Currency.
Profit Center Accounting
Used to Calculate the Profit of an Area of Responsibility within the
Organization (e.g. the Brewery)
The Areas of Responsibility (Profit Centers) could be Based on
Regions, Functions, or Products (e.g. Production).
Supports Calculating Operating Profit using the Cost of Goods Sold
P/L Format and/or the Period Accounting Method
A Profit Center can also be Viewed as an Investment Center since it
is Possible to Transfer at Period End the Balance Sheet Positions
for Assets, WIP, AR, AP, and Inventory
Profit Center
A Profit Center is not an Independent Account Assignment
Object at the Moment of Entering a Transaction in SD or MM; It is
Derived From Existing Objects and is Allocated to the Correct
Cost Object
As a Default, Revenue and Costs for Profit Centers are Derived
as follows:
Sales Order Line Item based on the Product being Sold
Direct Costs Based on the Assignment of Production Orders and Direct

Costs.
Overhead Costs Based on the Assignment of the Cost Center or other

Cost Object
Profit Centers for Chico Creek Brewing
Profit Centers: A division of the functional business areas
which CCBC is involved with (e.g. the sale of
merchandise).
Benefits: The ability to capture costs in Profit Centers, and
perform profitability analysis on a single part of the
business.
Issues: Identify additional Cost Centers in the
Organizational Structure, and map them to existing
processes..
Cost Centers
Departmental Breakdown of your Legal Entity Structure
Lowest Level of Organization where you want to Collect and Analyze

Costs/Departmental Performance
Departmental Budgets and Expense Analysis
Interdepartmental Cost Allocations
Each Cost Center is Assigned to a Profit Center, which is Assigned to a

Company Code
Cost Centers are Structured into Organizational and/or Functional

Hierarchical Groups
Chico Creek Brewing Company, Company Codes and Profit Centers
Operating Concern
CCBC
Controlling Area
1000
Company Code
Company Code
Company Code
Company Code
Company Code
2000
3000
4000
5000
6000
United States
Australia
Japan
Canada
Singapore (Planned)
Controlling Area
1000
Profit Center
1000
Profit Center
1100
Profit Center
1200
Profit Center
1300
Profit Center
1400
Profit Center
1500
Profit Center
1600
Taproom (Pub)
Merchandise
Porter
Stout
Pale Ale
Hefe Weisen
Seasonal
Organizational Elements - CO 10/08/98

Chico Creek Brewing Company, Cost Centers
CC 2100
Manufacturing
CC 2101
CC 2106
CC 2111
Water purifier
Malt Mill
Whirlpool
CC 2102
CC 2107
CC 2112
Mash Turn
Lauter Tun
Filters
CC 2103
CC 2108
CC 2120
Kettle
Hop Strainer
Bottling
CC 2104
CC 2109
CC 2130
Heat Exchanger
Fermenters
Kegging
CC 2105
CC 2110
CC 2140
Conditin. Tanks
Wort Receiver
Finished Goods
CC 2400
CC 2500
Taproom (Pub)
Merchandise
CC 2200
US
Administration
CC 3200
AU
Administration
CC 4200
JP
Administration
CC 5200
CAN
Administration
CC 6200
SP
Administration
CC 2300
US
Sales & Distrib.
CC 3300
AU
Sales & Distrib.
CC 4300
JP
Sales & Distrib.
CC 2210
Accounting
US
CC 3210
Accounting
AU
CC 4210
Accounting
JP
CC 5210
Accounting
CAN
CC 6210
Accounting
SP
CC 2310
CC3310
CC4310
Sales, US
Sales, AU
Sales, JP
CC 2220
Legal
US
CC 3220
Legal
AU
CC 4220
Legal
JP
CC 5220
Legal
CAN
CC 6220
Legal
SP
CC 2350
CC 3350
CC 4350
Distribution, US
Distribution,AU
Distribution,JP
CC 2230
Purchasing
US
CC 3230
Purchasing
AU
CC 4230
Purchasing
JP
CC 5230
Purchasing
CAN
CC 6230
Purchasing
SP
CC 2240
Management
US
CC 3240
Management
AU
CC 4240
Management
JP
CC 5240
Management
CAN
CC 6240
Management
SP
CC 5300
CAN
Sales & Distrib.
CC 6300
SP
Sales & Distrib.
CC 2250
Insurance
US
CC 3250
Insurance
AU
CC 4250
Insurance
JP
CC 5250
Insurance
CAN
CC 6250
Insurance
SP
CC 5310
CC 6310
Sales, CA
Sales, SP
CC 2260
HR
US
CC 3260
HR
AU
CC 4260
HR
JP
CC 5260
HR
CAN
CC 6260
HR
SP
CC 5350
CC6350
Distribution, CA
Distribution,SP
AM - Depreciation Areas
USA
Canada
Chart of Depreciation
Chart of Depr.
Depr. Areas
Australia Japan
Chart of Depr. Chart of Depr.
Depr.
Areas
Depr.
Areas
Depr.
Areas
Company
Code
Company
Code
Company
Code
Canada
Australia
Japan
Company Code
Pub/
Brewery
Taproom
Merch.
AM - Asset Number Structure
Asset Classification
IM - Hierarchical Structure
Investment Management
Program
Orders (CO)
Projects (PS)
R
Organizational Elements - MM
Purchasing Organizations and Plants
Chico Creek Brewing Co.
United States
Canada
Singapore
Purchasing
organizations
Brewery
Tap Room
Retail
Plants
Brewing
Plant
Tap Room
Plant
Retail
Plant
Storage
Dry
Inventory
Wet
Inventory
Japan
Australia
Purchasing Organization
Responsible for procurement for the brewing, tap room and

retail plants
Responsible for negotiating pricing and delivery terms with

vendors for each purchasing organization
Purchasing Organization for Chico Creek Brewing Co.
Purchasing Organization: Each company will have its own

purchasing organization
Benefits: A purchasing organization is assigned to a cost

center where inventory is tracked and costs are incurred
Plant
It is a production facility that can have multiple locations

associated with it
Usually a manufacturing facility, warehouse or a location that

stocks, manages and valuates inventory
May be a physical site with multiple

manufacturing/production lines
Can be a physical location (cost centers may or may not be

associated to a plant i.e. administrative vs. manufacturing
cost centers)
SD availability checking is normally done at the plant level
Plant (Cont.)
Links to production (PP), materials management (MM), and

sales and distribution (SD)
A plant is assigned to a company
Purchasing organizations are assigned to plants
Plant for Chico Creek Brewing Co.
Plant: There are three plants: brewing, tap room and retail
Benefits: Being able to keep track of the profits and costs of

each plant
Storage Location
A location within a plant where inventory is stored
Storage Locations for Chico Brewing Co.
Storage Locations: Brewery and tap room will have two

separate storage locations: one for dry goods and one for
wet or cold goods.
Benefits: Assets and incurred costs can be tracked by the

different storage locations.
Organizational Elements - SD
Sales Organization, Distribution Channel and Division
Chico Creek Brewing Company
3000
US
4000
Australia
Sales
Organization
3000
US
Distribution
Channel
03
Wholesale
Division
90
Pale Ale
93
Stout
Sales Organization
A representation of a selling unit responsible for
product liability and other claims made by
customers
Each business transaction is processed within a

sales organization
Master Data Maintenance for Customers, Pricing
at Sales Organization Level
Sales Organization Assigned to a Company Code
where Sales Revenue is Recognized (Links SD &
FI)
Plants Assigned to a Sales Organization

Sales Organization for Chico Creek Brewing Company
Sales Organization: United States, Australia, Canada,
Japan, Singapore, Tap Room, Catering, Bakery,
Merchandise
Benefits: To produce statistics for each of the sales

organizations.
Costs: A manager will be required to head up each
sales organization, therefore, costs may be slightly
higher.
Distribution Channel
Used to define how different products reach
consumers (I.e. retail, wholesale, or direct sale)
Relevant Master Data such as price, minimum
order qty, and ship-from location may differ
between each channel
Each Sales Order travels through one Distribution
Channel
Distribution Channel assigned to a Sales
Organization (I.e. direct sale for Merchandise
items)
R
Distribution Channels for Chico Creek Brewing Company
Distribution Channels: Wholesale, Direct Sale,
and Retail
Benefits: We can determine the profitability of
each channel within a specified sales
organization.
Costs: By having additional distribution channels
(wholesale, retail), we will incur transportation
costs.
R
Division
A way of Grouping Materials, Products, or
Services
Assign each product line to a particular division
Define customer-specific agreements for each

division, including partial deliveries, pricing, and
payment terms
Division for Chico Creek Brewing Company
Division: 5 types of beer, menu items, souvenirs,
and services provided by catering.
Benefits: To keep track of how well each product
sells within a given area.
Costs: By making the divisions equal to each type
of product and service, the divisions will become
more difficult to configure and maintain.
Sales Area
Sales Area is a Combination of:
Sales Organization
Distribution Channel
Division
All customer data relevant for sales is defined

according to the sales area (I.e. can specify for
each customer how pricing is done in each sales
area)
Links the Order Entry System(SD) to the
Financial/Managerial System(FI/CO)
R
Sales Area for Chico Creek Brewing Company

US
Wholesale
Tap Room
Hats
Tee shirt
Sweatshirts
Stout
Pale Ale
Porter
Hefe Weisen
Seasonal
Stout
Pale Ale
Porter
Hefe Weisen
Seasonal
Direct sale
Retail
Merchandise
Stout
Pale Ale
Porter
Hefe Weisen
Seasonal
Sales Organization, Distribution Channel and Division
Chico Creek Brewing Company
3000
US
3000
AU
03
Wholesale
90
Pale Ale
91
Hefe
5000
Singapore
4000
Japan
04
Direct Sale
92
Porter
93
Stout
5000
Canada
8000
Tap Rm.
9000
Catering
1000
Bakery
05
Retail
94
Seasonal
2000
Merchandise
04
Direct Sale
60
Shirts
70
Sweatshirts
80
Hats
Human Resource Structure

HUMAN RESOURCE MANAGEMENT DEPARTMENT
DIRECTOR
Human Resource Manager
ANALYST
Compensation & Benefits (HRIS)
(Payroll, Benefits)
ANALYST
Employment & Recruiting
(EEOC, AA)
ANALYST
Development
(Training, OD, Safety & Health)
PERSONNEL ASSISTANT
(Graphic Reports, Events Planning)
(Actually Assists All Analysts)
Organizational Structure Review

Organizational Structure
2000
US
Chico Creek Brewery
Business
Area
90
Pale Ale
Division
93
Stout
2000
US
2000
US
2000
US
Sales
Organization
Distribution
Channel
3000
Australia
3000
US #1
Purchasing
Organization
Division/
Plant
93
Stout
90
Pale Ale
03
Wholesale
90
Pale Ale
93
Stout

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GOAL OF ORGANIZATION STRUCTURE

SAP America, OS.PPT - 10/13/97, Slide 1

Definition of Organization Structure

Customer High Level Business Overview

Procurement, Logistics Planning

Define the Organizational Elements in SAP based

SAP America, OS.PPT - 10/13/97, Slide 2

Integrated Business Process Review

SAP America, OS.PPT - 10/13/97, Slide 3

SAP America, OS.PPT - 10/13/97, Slide 4

Integrated Business Processes Overview

Finance / Asset Management

SAP America, OS.PPT - 10/13/97, Slide 5

Integrated Business Process Overview

Financial and Managerial Reporting and Analysis

SAP America, OS.PPT - 10/13/97, Slide 6

Organizational Structure Review

Chico Creek Brewery

SAP America, OS.PPT - 10/13/97, Slide 7

Finance Management /Accounting & Reporting

SAP America, OS.PPT - 10/13/97, Slide 8

SAP America, OS.PPT - 10/13/97, Slide 9

Issues: Identify any open issues/questions.

SAP America, OS.PPT - 10/13/97, Slide 10

SAP America, OS.PPT - 10/13/97, Slide 11

SAP America, OS.PPT - 10/13/97, Slide 12

SAP America, OS.PPT - 10/13/97, Slide 13

It links the financial accounting module (FI) to the

SAP America, OS.PPT - 10/13/97, Slide 14

The Operating Chart of Accounts Links Financial

A Company Code is Linked to the Operating Chart of Accounts

The Controlling Area is Linked to the Operating Chart of Accounts

Several Companies can be Linked to a Single Controlling Area

SAP America, OS.PPT - 10/13/97, Slide 15

SAP America, OS.PPT - 10/13/97, Slide 16

Sales Order Line Item based on the Product being Sold

Direct Costs Based on the Assignment of Production Orders and Direct

Overhead Costs Based on the Assignment of the Cost Center or other

SAP America, OS.PPT - 10/13/97, Slide 17

SAP America, OS.PPT - 10/13/97, Slide 18

Departmental Breakdown of your Legal Entity Structure

Lowest Level of Organization where you want to Collect and Analyze

Departmental Budgets and Expense Analysis

Interdepartmental Cost Allocations

Each Cost Center is Assigned to a Profit Center, which is Assigned to a

Cost Centers are Structured into Organizational and/or Functional

SAP America, OS.PPT - 10/13/97, Slide 19

SAP America, OS.PPT - 10/13/97, Slide 20

Organizational Elements - CO 10/08/98

SAP America, OS.PPT - 10/13/97, Slide 21

SAP America, OS.PPT - 10/13/97, Slide 22

AM - Asset Number Structure

SAP America, OS.PPT - 10/13/97, Slide 23

SAP America, OS.PPT - 10/13/97, Slide 24

SAP America, OS.PPT - 10/13/97, Slide 25

SAP America, OS.PPT - 10/13/97, Slide 26

Responsible for procurement for the brewing, tap room and

Responsible for negotiating pricing and delivery terms with

SAP America, OS.PPT - 10/13/97, Slide 27

Purchasing Organization: Each company will have its own

Benefits: A purchasing organization is assigned to a cost

SAP America, OS.PPT - 10/13/97, Slide 28

It is a production facility that can have multiple locations

Usually a manufacturing facility, warehouse or a location that