eProcurement and P2P Systems Integration: SAP and Financials Integration (Part 1)

For a complete business-driven look at the benefits (and challenges) associated with eProcurement and broader P2P systems integration in a cloud environment, we encourage you to download: Procurement Systems Integration Within the Enterprise: Exploring Integration In The Cloud.

There is rarely a truly "vanilla" cloud integration scenario with a company's core financial system. Just about every implementation is customized to some degree. This is true even in the case of standard ERP/MRP integration, which often forms the connectivity between frontline buying and procurement activity and IT/finance systems. In this area, typical fields that organizations map for integrations are often highly dependent on the specific ERP and business application packages they are integrating with.

In an SAP environment, for example, journal entries linked to cloud-based eProcurement transactions or a frontline buying environment that sits on top of a direct ERP procurement system must often tie to specific objects mapped in the SAP environment, including projects, orders and cost centers (GL codes are just the ante). Specific requirements may differ based on the degree of the SAP environment's customization for financial accounting, corporate governance, managerial accounting and related areas.

In the case of supporting plan-driven procurement to consolidate ordering within core SAP ECC integrated with an external P2P system, organizations must consider not only what fields are mapped but which system relays information to suppliers (and then how supplier updates and responses are integrated back). The complexity of potential P2P integration into SAP integration is limited only by one's imagination -- or specifically, the imagination of the IT and finance departments that originally deployed the system.

For example, for internal cost allocations, one might opt for simple integration based on standard fields configured within a third-party (or ERP) eProcurement system with ties into inventory systems. And of course there are more customized and complex integration scenarios as well. We'll continue to explore this topic -- and more advanced SAP integration scenarios -- in the next post in this series.

If you're curious about P2P systems integration, we encourage you to download the Spend Matters Perspective: Procurement Systems Integration Within the Enterprise: Exploring Integration In The Cloud. This research brief is part of the Spend Matters Research Library, a service that offers free access to over fifty Spend Matters papers for qualified procurement and supply chain practitioners.

- Jason Busch

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