Integrating S/4HANA with External Supplier ERP Systems

"Buyer-Supplier collaboration" is a strategic partnership where a buyer and supplier work together to "achieve mutual goals", "improve processes", and "enhance product development". It goes beyond traditional transactional relationships by fostering "Open Communication", "Information Sharing", and "Joint Decision-Making". This collaboration can lead to various benefits, including "Reduced Costs", "Improved Product Quality", "Faster Innovation" and "Increased Efficiency". 

It is often seen that the Suppliers of major OEMs/ Components Manufacturers are also SAP S/4HANA / SAP ECC users.

The integration of the procurement functionality of "SAP S/4HANA Cloud Public Edition" with "External SAP Supplier Systems" allows suppliers and buyers to exchange documents by using Web services based on the SOAP protocol.

The purpose of this blog is to throw some light on another Standard offering from SAP that can be leveraged by existing SAP S/4HANA Cloud Customers to collaborate with their Suppliers more effectively.

The Supplier Organisation must have an "SAP ERP" like ECC,S/4HANA etc.        

This integration between the "Buyer Organisation's SAP S/4HANA Cloud system" and the "Supplier's SAP ERP system" facilitates seamless Communication between the Buyers and Suppliers.

For purchasing organisations whose suppliers use traditional data exchange protocols like electronic data interchange (EDI) or in Two-Tier scenarios, where subsidiaries are on SAP S/4HANA Cloud, this feature provides a set of robust Application Programming Interfaces (APIs) to simplify and automate exchanging procurement documents and their follow-on messages.

The "Simple Object Access Protocol" (SOAP) messaging protocol supports this Integration.        

Procurement Process

• Create, change, cancel purchase order (Outbound Message) - Web Service used "OrderRequest_Out".

• Receive purchase order confirmation (Inbound Message) - Web Service used "OrderConfirmationRequest_In".

• Receive Advance Shipping Notification (ASN, Inbound Delivery Message) - Web Service used "DeliveryRequest_In".

• Receive supplier invoice (Inbound Message) - Web Service used "InvoiceRequest_In".

Returns Process

• Create return purchase order (Outbound Message) - Web Service used "OrderRequest_Out"

• Receive return purchase order confirmation (Inbound Message) - Web Service used "OrderConfirmationRequest_In"

• Receive supplier invoice: Credit Memo (Inbound Message) - Web Service used "InvoiceRequest_In"

Purchase Scheduling Agreement Integration

• When a scheduling agreement delivery schedule is released, Buyer Organisation's system sends a delivery schedule of a Purchase Scheduling Agreement to the supplier system using the WebService - "SchedulingAgreementDeliverySchedule_Out".

• Buyer Organisation's system receives an Advanced Shipping Notification(ASN) from the supplier system using the WebService - "DeliveryRequest_In".

• Buyer Organisation's system receives an Invoice from the supplier system using the WebService - "InvoiceRequest_In".

Note : Buyer Organisation can integrate SAP S/4HANA Cloud Public Edition with external SAP systems that perform data exchange using formats such as "IDoc" by using "SAP Cloud Platform Integration" to enable the required mapping of SOAP services and "IDoc"

Benefits

• Increase productivity, performance, and work satisfaction of procurement professionals and accounts payable accountants
• Enable higher degrees of scalability with process efficiency gains
• Experience higher degree of automation in exchanging procurement documents with suppliers
• Save costs for paper, postage, mailing, records management
• Reduce time and manual efforts in corresponding with suppliers

Please feel free to add any more information in the comments which you feel would be helpful to the readers.