Describing the Procurement of Services in SAP Ariba

Services procurement within SAP Ariba follows the indirect procurement process, slightly tailored to accommodate the specificities of this type of procurement. ​

Requisitions will contain items marked as services. Services procurement items are catalog items that require you to provide additional information to the supplier during the ordering process. For example, if you want to procure print services, you may have to provide additional information such as, page size, paper type, finishing type and binding type. Some items might require additional collaboration between buyer and the supplier to finalize the details of the item before the order is placed. ​

Service items can be used in SAP Ariba Buying and Invoicing when creating requisitions and RFQ, as well as for sourcing activities within the SAP Ariba Sourcing applications.

In SAP Ariba services procurement items are controlled by category definitions. These service items can be organized into a structural hierarchy that contains service lines, service outlines, and service specifications. Customers that have their SAP Ariba Procurement application integrated with an SAP ERP can use several channels for purchasing services. SAP Ariba allows for the creation of:​

• Standing Orders: for services related to landscape maintenance, facilities maintenance or catering. This type of order can be used for items with the category B in SAP S/4HANA. It requires the supplier to send an invoice against the limit order.
• Service Orders: for services related to equipment or machinery repair or unplanned field services. This type of order can be used for items with the category D in SAP S/4HANA. It requires service entry sheets to be approved by the buyer and invoices created against them.
• Planned Service Orders: for services related to construction, equipment maintenance or field maintenance. This type of order can be used for items with the category D in SAP S/4HANA. Usually, the PO is based on an existing purchasing contract. It requires service entry sheets to be approved by the buyer and invoices created against them.
• Limit Orders: for goods and lean services that correspond to the item category E in SAP S/4HANA Cloud. Limit items are procured without following the goods receipt and the service sheet processes. The requests for limit items are characterized by validity periods to define the effective dates of the procurement process and predefined amount limits to control item prices.

Additionally, customers can handle services purchasing through:

• No-release contracts or blanket purchase orders: can be used for janitorial services, or landscaping services. The contract is sent directly to the supplier through the SAP Business Network. The supplier invoices against the contract items, fees and costs.
• No-release contracts or blanket purchase orders with milestones: sent directly to the supplier through the SAP Business Network. Milestones represent the dates by which a certain service has to be provided. The supplier invoices against the contract and milestone on the due date of a specific milestone. Can be used for services within IT projects, such as web design, consulting, deployments.

A service purchase order or a service order is a formal document from a buyer organization to a supplier to procure services provided by the supplier. Service orders provide a basic process to procure services that can have a planned or unplanned nature of work. In a service procurement workflow, a service order is created after a service requisition is fully approved.​

After approval, the service purchase order is sent via SAP Business Network to the supplier. The supplier can confirm the order and create a service entry sheet for planned or unplanned services once service is provided.​

​Service lines can be planned, meaning that they describe specific pieces of work and have set quantities and amounts. For service orders associated with a release contracts, all planned lines that match the contract accumulate against that contract at the header and line level.​

​Service lines can also be unplanned, meaning that they have a mandatory minimum amount but are otherwise open-ended. For unplanned lines, all accumulation against purchase order limits are calculated based on subtotals; there is no checking on unit price or quantities.​

​The general workflow for procuring service items is similar to the workflow for procuring material items, except that service items follow the service sheet process instead of the goods receipt process.

Service Sheet: A service sheet is a document that supplier users performing a service (Field Contractors) create in order to describe that service. Service Sheets can contain both service and material goods lines. Suppliers can create a service sheet for one or more service lines in an associated service order.​

• ​Service Purchase Orders require that a Service Entry Sheet (SES) be created with the details of the services delivered
• Service Sheets can be created online in the SAP Business Network or in the supplier’s ERP​
• Service Sheets can be auto-generated on the SAP Business Network from a supplier generated invoice​
• Service Sheets can be created by a buyer on behalf of the supplier in SAP Ariba Buying and Invoicing​
• Service Sheets can contain both service and material items​

Approving Service Sheets acknowledges that the service has been provided.​

Accounting Information for the line items on a service sheet comes from:​

• The purchase order associated with the service sheet​
• Based on commodity code accounting​
• Requester’s default accounting information​

​Service Entry Sheets Approval:​

• Approvals can be performed in SAP Ariba Buying and Invoicing or in the ERP​
• Approval is mandatory to allow the supplier to invoice against the service PO​
• Service Entry Sheet may be approved or rejected​
• Default approval flow adds a Service Sheet Editor when validation fails