Exploring Central Purchasing

Central Procurement offers a Central Purchasing scenario that provides a single point of access to display and manage purchasing documents centrally. The purchasing documents include purchase requisitions and purchase orders. These documents can be those that are created in the SAP S/4HANA system (which acts as a hub system), or the ones that have been extracted from the connected systems. SAP S/4HANA, SAP S/4HANA Cloud, or SAP ERP act as connected systems. Central Purchasing provides the flexibility of connecting multiple systems across an organization and carrying out procurement processes centrally.

Now you can see what’s happening across the business without jumping in and out of multiple systems or disrupting existing solutions and workflows you’ve spent years defining and refining.

As a result you can:

• Analyze global spend for requisitions and purchase order
• Centrally manage demand across all connected ERPs
• Assign sources of supply and create Purchase Orders
• Aggregate demand for optimized sourcing
• Increase spend compliance and cost savings through aggregation
• Queue management for automated workload balancing
• Central purchase output with central confirmation processing

Information about the arrange options is provided in the next paragraph.

The figure shows the Integration Scenarios in Central Purchasing.

First, the purchase requisition is extracted from the connected system using a job. There is an option for central approval of the extracted PRs. The proxy PR can now be assigned a source of supply from the backend in the central cockpit. If there is no source of supply, a sourcing process can be started. The follow-on documents are then created. The result of a central sourcing is either a central purchase contract or a purchase order in the backend system.

To view this diagram in detail, refer to page 17 of the Course Diagrams PDF.

With Central Purchasing, you have the possibility to enable central confirmation for Backend Purchase Orders. With this, there is a approval worklfow introduced to the central hub and the Central Supplier Confirmation app allows the purchaser to manually create confirmations on behalf of their suppliers, which will update the backend purchase order with confirmed data.