SAP and E-Procurement – Master Data Management Considerations

Master data management (MDM) must be a core component of all implementation considerations for P2P deployments in cases where ERP integration will occur. All system integration scenarios for e-procurement (and invoicing) are built upon the assumption that robust (and accurate) data exists. This data is exchanged between systems, which is why, in fact, underlying data objects are so important for organizations to define as early in the implementation process as possible.

FREE Research Report: How to Chose Procurement Technology That “Grows With You”

When considering data objects, the main challenge is not only the technical integration itself, 
but also the quality of data to integrate. When defining data objects, organizations must consider the data to integrate and also decide on needed definitions to maintain this data set. One of the challenges that often surfaces at this phase is the integration of these data objects, mainly in static and rigid records and in validations of ERP (SAP) system where customizations can be needed.

The decision on which data procurement will integrate to the P2P solutions will play a large role in how much functionality is available during normal use of the tool. For example, the integration of budgeting information can enable purchasing approval processes to be connected to individual or business unit budgets. As another example, consider how contract information can be used to drive spend and contract compliance. Other decisions organizations must make at this time involve the initial data load, the frequency of change/updates and an overall data maintenance strategy.

Consider the important of reference and transactional data – these are the primary data types that will integrate with a P2P solution. Reference data includes: company codes, cost centers, GL account codes, account segment structure, suppliers/vendors, users/employees, budgets per account/user and spend categories. Transactional data includes: exchange rates, invoice payments, purchase orders, purchase order revisions, receipts and contract information.

Tired of superficial analysis of P2P implementation strategies? We are. That’s why the Spend Matters team recently published, Cloud P2P Deployment: A How-To Guide to SAP and ERP Integration with eProcurement and Beyond (free download on which this post is based). Authored by Xavier Olivera, director of P2P researchh, Jason Busch, founder and managing director, and Thomas Kase, vice president of research, this is the white paper that vendors, practitioners and consultants will be referencing for years to come on the topic.

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