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The reporting of order entry and order backlog is a central function in the corporate environment. It offers valuable insights into sales performance and business development, thereby supporting decision-making processes. In SAP S/4HANA, integrated reporting capabilities help companies analyze and evaluate their order situation. However, there are several challenges because the standard reporting in SAP S/4HANA does not fully meet all requirements.
Why do you need order entry or order backlog reporting?
Order entry is a crucial metric for measuring sales performance. It also serves as an early warning system for future revenue. Typical questions include:
- What is the net value of all customer orders created (or modified) within a specific period?
- What is the ratio between revenue and order entry in a given month?
The order backlog shows the value of all open customer orders at a specific point in time. From this, you can deduce how much of the planned revenue for the current year is already covered by customer orders. Additionally, it indicates how much revenue can be expected in the current year from already received orders. A high order backlog, for example, points to strong demand for the offered services.
Why SAP S/4HANA Standard is not enough
SAP S/4HANA offers a powerful platform for reporting on order entry and order backlog. Some key advantages include:
- Real-time data: Thanks to SAP HANA’s in-memory technology, companies can analyze their order data in real-time. This enables immediate responses to market changes and precise resource management.
- Integrated analytics tools: S/4HANA integrates modern analytics tools like SAP FIORI and Embedded Analytics, allowing data analysis directly within the system and the creation of custom dashboards.
- Scalability and flexibility: The platform is highly scalable and flexible, enabling companies to adapt and expand their reporting requirements as they grow.
However, these general advantages are offset by significant drawbacks due to missing functionalities:
In the FIORI apps for sales, only the order values of (open) customer orders are displayed. Service orders are completely ignored and thus missing in the reporting!
The same applies to changes in customer orders. If customer orders are canceled, this does not reflect as a negative order entry in the reporting of the corresponding period. The order entry appears too high. It would be correct if the change in the period in which it occurred was represented as a negative order entry (cancellation) and the order entry was accordingly reduced.
Retroactive changes to the order value in the customer order are also not evaluated correctly in SAP standard reporting. In such cases, it would be correct to display the delta, i.e., the increase or decrease in order value, in the period in which the change occurred. Instead, only the final sum is visible. For example, with cancellations, the reporting may falsely indicate that no order entry was achieved by sales.
Certain business cases, such as cross-company scenarios, are also not covered in SAP S/4HANA standard reporting:
- For cross-company customer orders, one customer order must generate an order entry in two company codes (the selling and the producing company code).
- For cross-company stock transfer orders, the order entry must occur in the delivering company code, even if there is no customer order there. In SAP, it is only recorded in the sales organization.
Some of these cases were covered in the old Sales Information System (SIS). SIS is still available in S/4HANA, but by default, it is initially deactivated. The issues with service orders and cross-company orders, however, persist.
The expectation that S/4HANA would provide meaningful order entry and order backlog reporting at the push of a button, compared to SAP ECC, is unfortunately not fulfilled with the standard options available.
Our Solution for an International Machinery Manufacturer
We used the embedded Business Warehouse in S/4HANA to collect the necessary data since it is free and already available. Therefore, there were no additional costs for our client. We used Analytics for Office as the reporting frontend for power users, and end-users work with QlikView.
From the Business Warehouse, data from the service and sales modules is extracted daily, and so-called snapshots are created. By comparing the snapshots daily, changes are identified. These include:
- Order cancellation → negative order entry on the day of cancellation
- Order deletion → negative order entry on the day of deletion
- Quantity change in an order → Delta order entry recorded on the day of change
- Price change → Delta order entry recorded on the day of change
- Changes in defined reporting characteristics, such as product hierarchy:
If a product hierarchy changes in an order, this is reflected in the relevant reporting by showing the old product hierarchy with the negative order entry and the new one with the positive
Additionally, a routine was implemented to handle exchange rate changes for foreign currency orders. If the order backlog in the document currency goes to zero (the order has been fully invoiced), the order backlog in the company code currency is also set to zero, even if there would have been differing calculated results due to exchange rate fluctuations.
As another feature, the customer can also view when the order backlog is expected to convert into revenue (e.g., based on the delivery date, even if there are multiple schedules).
What can we do for you?
How does your order entry and order backlog reporting look? Are you familiar with the challenges described above? Our approach to the implementation project is as follows: The first step is always an analysis of the actual situation. Which processes (e.g., cross-company processes, currency management, etc.) are relevant and should be considered in the reporting?
We can deliver the business concept for order entry and order backlog “out of the box.” This includes both business definitions for key figures and characteristics as well as concepts for common business transactions in SAP.
For implementation, we can use Embedded Business Warehouse, BW/4HANA, BW on HANA, or, in the future, SAP Datasphere as the backend. Frontend technologies like Analysis for Office, SAP SAC, or even Microsoft Power BI are suitable.
Do you have any further questions?
Contact us!
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