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For many organisations goods/material procurement is well controlled and a familiar process.  Goods can contain clear product specifications with associated part numbers that can make the procurement cycle simplified and can have high levels of automation.  Services procurement on the other hand is often a challenge, error-prone, and can leave the organisation with limited control.  In many organisation services is the much more dominate spend profile and yet the significant effort is placed into material procurement due to its potential high levels of automation and spend compliance.

This leaves many organisations struggling with how to procure services.  In short, there is often no silver bullet for these scenarios but in my experience the core requirements are;

  • Spend visibility

  • Needs to be easy to use

  • Contract or Rate compliance

In this blog post, I'll demo and outline a small example using Enhanced Limits functionality associated with lean services to purchase some consulting and travel expenses.  Limits procurement is a method when the detailed service planning is not completed on the PR/PO but a value limit is applied.  The details of what and how is entered in the Service Entry Sheet (SES).  The best way I find to think of this from a Supply Chain perspective is; the PO contains the spending commitment or planned spend and the SES is the actual spend but this can be flexible based on your business definition.

When using value limits in the service procurement process the user only needs to assess the total value of the engagement and not need to complete detailed service rate planning; this can be completed on the Service Entry Sheet.  Lets look a simple common example - a systems consultant is required.  The full details around travel, expenses, and days are not fully known, but a budget estimate of the maximum total has been completed.  So to represent this in an easy format we raise a Limit Based Purchase Requisition;

Please note - you do not have to have a Purchase Requisition.  This is dependent on the business process but for this example, I will use a requisition.

From with the Manage Purchase Requisition Professional App (F2229) open the app and select "Create".  Within this create we do not use the Items section but Limit Items section

Select the Create button then Service

When taken to the Purchase Requisition Item you can see on the left (in yellow) the Product Type Group is 2 (Service) and the Item Category is Enhanced Limits.  Complete the required fields but ensure the Overall Limit and Expected Values equate to the total value of the planned spend.  The Requisition Period is important as it states the active period of the service.

Note - the use of a service performer is optional depending on your existing design and is subject to some preconditions.

Once you have completed, save the PR.  Note you can have multiple limit lines - i.e project milestones or various scope of works can be managed in one order.

Once you have saved your PR you can get a view of what has been created.

Either convert the PR to PO or Create a Limit PO directly if that is the business process.

To confirm that the service has been completed and create a Goods Receipt (GR) this is completed by using the Manage Service Entry Sheets App (F2027).

If you have an Service Entry Sheet already you can use the filters to narrow down the list or select the Create Button to generate a new entry sheet.

When the create button is select the create Service Entry Sheet screen is presented.  Complete the basic data with a description of the SES.  The posting date and Reference PO.  Once you enter the reference PO you can select the applicable lines via a pop-up.  Handy for milestone billing.

To enter the values you can either enter directly within the table or you can use the detailed navigation to the fact sheet.  I will enter in the table.  The item description can be amended if required.  The performance date, quantities, and price are mandatory.  You can see I have entered 1 Day x $1275 to draw down from the value limit.

Now I need to add a line for travel expenses.  By selecting the Add button I have inserted an additional line.  On the second line, I have updated the description and added the relevant quantities and pricing.

Before completion and save - notes and attachments can be added.  Once done save the entry and submit for approval if required.

Using the display PO app you can also see the relevant GR's that have been completed from the SES.

So to recap by using Enhanced Limits the service procurement process can be simplified, visible, and transparent where the spend has occurred.  This then allows for further spend analysis as needed.  Limits procurement is often an overlooked business process option and with enhanced limits and Fiori can make the end-user experience more simplified.

Note - Screenshots taken from SAP S/4HANA CLOUD 2008

For more details;

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Hi Simon,


Thank you for your blog, is this process supported in the OP S/4HANA version ?


Best regards.





In the blog it's metioned that the enhanced item category will give a user a better contract compliance, however one of the simplification done in the system design is that you cant reference an outline agreement. If a company are depended on refererencing out contract to get a good overview of there spend and contract compliance. How is using this item category giving a company better contract compliance?
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Hi Simon,

thanks for this helpful Information.

I'm struggeling when creating a PR for services, using App F229. Field for service performer is mandatory. But didn't find any course to use it as optional one.

You mentioned above "Note – the use of a service performer is optional depending on your existing design and is subject to some preconditions.".

I'm wonderig if you can give me a hint.

Thanks a lot.


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Hello Klaus, service performer is an extension of business partner.  Essentially this is a contingent worker.  Notes - 2570961 - Simplification item S4TWL - Business User Management and 2882172 - How to create a Business Partner with role BBP005 (Service Performer) or BBP010 (Freenlanc... will assist you here.


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Hi Simon

The blog is really good!

just need clarification, we are using flexible workflow for purchase requisition and in this the approval workflow is being skipped if we use the item category enhance limit though all the pre conditions are satisfied.

Pls let me know if we need to do any setup.


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Hi, can we reference an outline agreement with Service codes (material type SERV) to a PO line item with 'enhanced limit'? I tried but could not post a SES as it gave me an error 'line item can not be referenced to product group type '2'? How do we leverage prices agreed in a Contract with enhanced item category in PO line item? thanks
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When I try this app, I faced an error like Please maintain an overall limit. How can I solve it ?
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Hi Simon

Is there a way to create a Limit Item PR from a Work Order?
Product and Topic Expert
Product and Topic Expert
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Helpful, Thanks!

I have referred this in my Blog Post on - Procurement of Services in SAP Ariba