cancel
Showing results for 
Search instead for 
Did you mean: 

Questions related to Division in SD part of Enterprise structure

Former Member
0 Kudos

Dear Expert Friends,

I know "Division represents a product line or grouping of material services". But That is the definition. To be a good SAP SD consultant I am curious to understand answers to below questions :

> Strategy : What should be suggested to the clients? Fewer or greater divisions? why?

> Master data : How will divisions affect the master data? why?

> Transactions : How will divisions affect the Transactions? why?

> How can division creation help in achieving maximum impact on business transactions and subsequent reporting?

I done some research and have found no answers or relevant data for above questions.

_

Thank you for your time.

Accepted Solutions (1)

Accepted Solutions (1)

Lakshmipathi
Active Contributor
0 Kudos

Strategy
Less Divisions are recommended why because, your master data would accordingly be minimized

Master Data
Division will not affect but if you have more Divisions, again all those Divisions will have to be extended to the required sales areas

Transactions
Affecting or not affecting would be controlled, as you would be aware,  through your sales document type.  If you set the document type to control, then obviously, you will have invoice split which again, many clients would not accept to this.

To explain little bit in detail, let us assume Colgate-Palmolive as a Sales Organisation where they would be manufacturing different varieties like soaps, tooth pastes etc.  Here you need to go for different Division for Soaps and Tooth pastes as logically, that is correct. 

At the same time, having different Divisions will help you to have MIS reports but it is upto the client to indicate as to how they want their financial reporting should be.  Needless to mention, based on Material Group or Material Pricing group also, you can generate reports.  So before going for different Divisions, we need to decide how far, that would be useful from Management perspective.

Most importantly, as explained in SAP help,

use of divisions lets you organize your sales structure around groups of similar products or product lines. This allows the people in a division who process orders and service customers to specialize within a manageable area of expertise.

So to restrict users to create sale order for certain Division also, you can make use of that.

G. Lakshmipathi

Former Member
0 Kudos

Dear G. Lakshmipathi,


Thank you for the reply. Please find below responses :


Strategy
Of what I know, master data can be shared between the divisions. If such is the case, we can have multiple divisions with shared master data. Which will still result into minimized master data. I understand shared master data totally depends on the business and processes one is dealing with. My question here, is it only the master data size due to which fewer number of divisions are recommended? or are they any other factors?

Master Data
I think you answered the affect of having greater/fewer divisions to master data under strategy. Or maybe the same answer is relevant here as well.

Transactions

Yes I agree. effects can be controlled through sales document types. I will research further on this. Thank you for the lead.

Again thank you for throwing some light on Division purpose, reporting methods and example. Restricting users from creating SO for a particular is good information.

_

Thank you for your time.

Lakshmipathi
Active Contributor
0 Kudos

SCN has provided "Helpful Answer" and "Correct Answer" to award to members who help you in solving the issue.  Please dont select this for your own comments.

G. Lakshmipathi

Former Member
0 Kudos

Thanks for the information Lakshmipathi. I am new here, Thank you for the direction.

0 Kudos

Thank you so much for detailed and wonderful explanation on sales organization and division.

Answers (1)

Answers (1)

vijay_padmaraja
Explorer
0 Kudos

Hi Mr.Chandwani,

First of all Mr.Lakshmipathi is becoming a legend in providing solutions and I am already beacoming his fan and yes his answer is perfect. However I would like to add a little more to his answer. In layman's term you can imagine Division takes up the following roles:

     1. As an additional combination criteria for thebusiness process helping to generate reports in an accurate manner.

     2. As that which ensures the products are never confused with other products.

     3. As a combination to provide more pricing options.

But ultimately it is the customer's requirement. It is best to keep it as less as possible.

Hope I am helping

Regards

Vijay

Former Member
0 Kudos

Dear Vijay,

I agree with you that it totally depends on the business. And thank you for adding 3 more points to the clarity.

What would you comment on Lakshmipathi's answers and my further questions related to Strategy & Master Data?

_

Thank you

vijay_padmaraja
Explorer
0 Kudos

Hi Pratik,

for your further question, here is a scenario.I am sure you do assignments during your trial implementation. I am pretty sure you would have come across an error which can be resolved using the Tcodes VOR1, 2 & 3. likewise you would have had to maintain condition master at OVKK against respective sales area and pricing procedure. Now imagine, you face an error while processing a sales order such as the material cannot be processed for this sales area; it can be resolved by using cross division however the end users might not always remember to do that especially when there are too many divisions or even worse custom divisions come into the picture (like in real time scenarios) now as a consultant tracking them and maintaining/changing the entries can be frustrating. I hope you understand what I am talking about, we have a huge set of factorial like combinations we need to maintain and track. So in order simplify things (consultant's job) we restrict the number of divisions to a minimum as possible.

But in reality it does not matter that much cuz then again in the automobile company I work for we have only one division for each region yet we have consolidated ALL the products under the same division relevant to the region, we proposed it and they accepted it since anyway their main objective was that the inter customer placed orders and received material for the same which naturally does not require product specific reports too often. So as far as SAP is concerned it does not matter that much as long as things are easy to track.

I hope i am on track.

Regards

Vijay

Former Member
0 Kudos

Here is what i can pull out of the above comments

> Should be easy to track

> Should try and have minimum size

> Business process plays a role in developing strategy.

> Can also be to create a disjoint between multiple areas of expertise.

Thank you Lakshmipathi & Vijay!