This solution process describes the creation of service contracts in SAP S/4HANA Cloud Public Edition along with additional capabilities.
The aim of this solution process is to:
- Understand and increase profitability by using service contracts.
- Increase service margin with reduced revenue leakage through long-term agreements with customers.
- Increase service revenue through strong long-term relationships with important customers.
The key capabilities of this solution process are:
- Create or change service contracts in SAP S/4HANA Cloud Public Edition.
- Monitor, cancel, and release service contracts and service contract items.
- Automatically execute periodic billing to manage recurring revenue streams based on service contracts.
A service contract can be created using the UI or using an external interface (using OData APIs). Price agreements (like gross price and/or discounts) specific to a customer can be defined separately using service contracts. Service contract determination is then available for service orders. Service orders can be created with reference to a service contract; in this case, contract and price details from the determined service contract are copied to the service order.
You can also automatically renew an expiring service contract by a predefined period at a predefined date, if the service contract has not been canceled. You can also create a credit memo based on the invoice of a service contract
The link between a service order and a service contract is also available for reporting purposes.
Price adaptation for service contract items is another important option provided in scope item 3MO. This means that a certain item doesn't maintain its price over the whole duration of the contract, but that adaptation of this price is possible for that specific (price adaptation) item. Price adaptation items use a special item category in a service contract. Price adaptation can also be defined via settlement rules in a billing plan. The price to be considered can then be maintained manually on billing request line level.
The app Manage Service Contracts is used to create and manage all service contracts. It is part of the space called Service Management, and can be found within the section Service Contract Management.
Complete the following steps to access and download all the documentation that is available from SAP for scope item Service Contract Management (3MO):
Navigate to the list of solution processes on the SAP Signavio Process Navigator website and log in. Use URL https://me.sap.com/processnavigator and choose Solution Process. You can now see a list of all available solution processes.
- Using the Search in SAP Signavio Process Navigator field (in the top right corner of your screen), search for solution process 3MO.
- In the resulting list, select the entry for the current (i.e. the most recent) version of the solution process for solution scenario Best Practices for SAP S/4HANA Cloud. You can now see the details for the solution process.
- Choose Accelerators.
- Choose Test Script to download the test script as a Microsoft Word file, and open this file.
- If available, choose Set-up instructions to open the set-up instructions for the solution process.
Key Process Flow
- Create a service contract by using the UI or an external interface.
- Define a customer-specific price agreement. You can also do this on header level in the contract: use condition type DSC3.
- Release a service contract without errors.
- Create a service order and select a service contract by using contract determination functionality.
- Confirm a service contract: price and service contract details are considered.
- Adapt a price manually, if needed (for a price adaptation item, on billing request line level, and adjust the settlement rules in a billing plan); the manual price is considered (as defined in the date rule) and the price is considered for billing.
- Enable auto renewal based on a predefined time frame, on a predefined date.
- Yo do this for expiring contracts not canceled within the time frame.
- View expiring contracts and the top five contracts in analytics.
- View details of both a service order and a service contract in reporting.
- Create a credit memo against the invoice for a service contract.
- You can create a service contract from the user interface (UI) and also using an external interface.
- If needed, various price adaptation possibilities are available in service contracts.
- Price agreements (like gross price and discounts) in service contracts are available. Both on header and on item level.
- Service contract determination is available in service orders.
- Auto-renewals for service contracts is available.