Last updated: 2nd December 2024
Today, I would like to introduce you to an amazing solution that you as our customer have desired for a long time, the Advanced Intercompany Processes. If you cannot wait, then check out the magic in this system demo here already.
Table of content (for quick access, just click on one of the business area links):
A split between the entities handling sales and production is often needed for various reasons. This leads to the need to support Intercompany Sales:
Intercompany supply chains are spread across various localizations and lead to the need of Intercompany Stock Transfer between group legal entities to run company value chains
Most SAP customer companies with two or more company codes need Intercompany Processes.
Intercompany processes are a must for:
The Advanced Intercompany (ICO) processes
Classic intercompany processes (such as scope items 1MX, 1WO, 1P9) are in maintenance and the advanced processes are the clear way forward. Especially from a financial perspective, there are compelling benefits that every CFO should be aware of:
Must-have for Group Valuation (5W2) and End-to-End Value Chain Analysis
For more information watch the video:
With the continuous feature delivery 2202.3 for SAP S/4HANA Cloud Public Edition we launched two new scope items for the Advanced Intercompany processes:
With the 2022 release for SAP S/4HANA Cloud, private edition and SAP S/4HANA we launched the new scope item
The Advanced Intercompany Sales process is per default disabled for the standard document types and item categories.
To activate the Advanced Intercompany Sales process, specific configurations must be enabled through an expert configuration request. Some configurations have to be done by the customer.
For further details read the Set-Up Instructions document that you will find in the details section of the scope item Advanced Intercompany Sales (5D2).
Currently the process can be activated for item categories TAN and CBXN.
The release restrictions for Advanced Intercompany Sales are described in SAP note 3192584.
Also the scope item Advanced Intercompany Stock Transfer (5HP) provide a Set-Up Instructions document.
Regarding SAP S/4HANA Cloud Private Edition and SAP S/4HANA read the great blog posts from Kazuhisa Iwamoto with detailed information about the set up:
Advanced Intercompany Processes are available with
So this blog post is relevant for SAP S/4HANA Cloud Public Edition, SAP S/4HANA Cloud Private Edition, and SAP S/4HANA (on premise).
Further developments since first launch of the Advanced Intercompany Processes:
With the 2308 release, the new configuration activity Configure Posting Date for Advanced Intercompany Invoices (ID 106441) is available (see blog post Supply Chain in SAP S/4HANA Cloud, Public Edition 2308).
For more information read the PDF documents that you will find under 'Attachments' in the SAP Notes listed at the end of this blog post in chapter More Information / Additional links. These documents are kept constantly up to date.
(🔙Table of Contents)
The first launch of the Advanced Intercompany processes covers the scenario for Single Level / Single System that is explained below. In addition, it is planned to extend the Advanced Intercompany processes also to cover the scenario for Multi Level / Single System with one or more additional Intermediate Companies between the Selling Company and the Delivering Company. This is a subject to be changed.
With the 2502 release in Q1 2025 it is planned to support basic advanced intercompany sales processing with make-to-order (MTO) and advanced variant configuration (AVC). For more details check out the roadmap item Advanced intercompany sales: basic make-to-order process with variant configuration.
First let us have a look on the classic intercompany sales process. For example, a local sales office sells to a customer and the goods are delivered from a plant, which is assigned to another company code, directly to the customer as shown in the next figure.
Starting point of the process is the purchase order of an US customer (step 1) that triggers the creation of a sales order in the US selling company (step 2). The US selling company triggers directly the outbound delivery in the German delivery company (step 3). The US customer receives the goods directly from the physical warehouse in Germany, but the invoice is issued by the US selling company. During the process no valuated stock is created in the US selling company and business documents like the purchase and sales order between the affiliated companies are missing.
Fig. 1: Classic Intercompany Sales - Single Level / Single System
The process for advanced intercompany sales provides functions that allow two affiliated companies to participate in a single intercompany process, such as the following:
A standard sales order can initiate the entire process, which is integrated into the value chain monitoring framework. To orchestrate and monitor each process step, this business processes makes use of the Monitor Value Chains app.
Fig. 2: Advanced Intercompany Sales - Single Level / Single System
What are the key features of the Advanced Intercompany Sales process?
It is a seamless E2E process that is highly automated and embedded into the following areas:
Changes in customer-facing sales order are possible and automatically managed by the system.
Valuated Stock in Transit in the Selling Company allows seamless change of control between affiliates and customer.
Purchase Order in the Selling Company enables landed cost in product costing.
E2E value chain and process monitor allows issue detection and posting services.
My colleague Markus Oertelt has recorded the Advanced Intercompany Sales process for you. Watch the next video by clicking on the video figure or the video link below!
Video link: https://sapvideo.cfapps.eu10-004.hana.ondemand.com/?entry_id=1_2ultb4ci
The system demo is structured into the following sections:
Video time / min | Topic |
00:39 | How to create a sales order? |
02:48 | How to monitor your value chains after the sales order is created? |
04:22 | How to check automatic creation of intercompany purchase and sales order? |
05:30 | How to create delivery documents? |
07:19 | How to check transfer control of goods? |
07:58 | How to pick the delivery goods? |
09:20 | How to post goods issue? |
10:16 | How to create billing document? |
11:45 | How to monitor your value chains? |
In addition, watch the new openSAP Microlearning from Seyba Elik about Advanced Intercompany Sales Value Chain Analysis for SAP S/4HANA Cloud .
In analogy to the chapter above, let me also briefly compare the process of Classic Intercompany Stock Transfer and Advanced Intercompany Stock Transfer with the help of process flow diagrams:
Fig. 4: Classic Intercompany Stock Transfer Process - Single Level / Single System
Fig. 5: Advanced Intercompany Stock Transfer Process - Single Level / Single System
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The Value Chain Monitoring Framework (VCM) is a generic framework for designing, running and monitoring business processes within SAP S/4HANA that supports pre-configured SAP standard E2E processes. The benefits are:
Fig. 6: Value Chain Monitoring Framework
The Monitor Value Chains app enables you to track all steps of the Advanced Intercompany Sales, Advanced Intercompany Stock Transfer, and Sell from Stock with Valuated Stock in Transit (VSiT) business processes. This app provides you with a detailed overview of all relevant steps and documents in these processes. In addition, it directly integrates these processes with other business applications. The business benefits are increased transparency, efficiency, and cross-team collaboration.
Fig. 7: Monitor Value Chains app
(🔙Table of Contents)
SAP Community Call
Also check out the recording of the SAP Community call with my colleague Bernd Strecker (SAP Product Manager for Advanced Intercompany Sales). First, Bernd explains Advanced Intercompany Sales in SAP S/4HANA via his slide deck that is available here. I would especially like to draw your attention to the topic "Planned Features" at 28:46 min with an interesting outlook. The "Q&A" that answers a lot of interesting questions starts at 30:30 min. At 40:57 min Bernd shows a live system demo and finally at 49:13 min he answers some more questions.
For more information on Advanced Intercompany Sales, check out the detailed descriptions from Bernd Strecker and Felix Senger:
SAP Notes
Find more information on current features (Restrictions and General Information) in SAP Notes:
For more information on SAP S/4HANA, check out the following links:
Thanks for reading this blog. Stay tuned!
Follow us via @SAP and #S4HANA, or myself via LinkedIn and @GerhardWelker.
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