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Process 147

Besides sending quotations in response to inquiries, presales activities
can include managing customer contacts and creating outline agreements
(explained in the next paragraph). SAP ERP provides some capabilities to
track data pertaining to established customers, such as their preferences and
purchasing history. Companies can analyze these data to create marketing
and sales strategies designed to encourage customers to place additional
orders. In addition, the system can track potential customers. ERP systems
typically manage basic presales activities. Companies utilize customer rela-
tionship management (CRM) systems, discussed in Chapter 2, to manage very
detailed presales, sales-pipeline, sales prospects, and marketing activities that
generate a quotation in the ERP system. The handoff between the presales
processes in a CRM system and the quotation-to-cash process in the ERP sys-
tem is a critical integration point for most companies because failures, such as
missed sales opportunities, can signifi cantly reduce sales revenues.
Just as quotations are binding agreements made by sellers, outline agree-
ments are binding agreements made by customers to purchase specifi c quanti-
ties or values of materials. An example is a GBI customer who enters into an
outline agreement to purchase 1,000 standard touring bicycles over a six-month
period for a specifi ed price. Alternatively, the agreement may specify value
instead of quantity. In this case, the customer agrees to purchase bicycles val-
ued at $30,000 over the next six months. These types of outline agreements are
called contracts. Another form of outline agreement includes specifi c delivery
schedules. For example, a GBI customer could agree to purchase 1,200 bicycles
over the next six months and to accept delivery of these bicycles on a specifi c
schedule. In this case, the agreement is called a scheduling agreement.

Data

Several types of organizational and master data are necessary to process an
inquiry and create a quotation. These data are presented in Figure 5-21.
Particularly important are data concerning the customer, the materials, and
pricing. User input consists of the customer number, material numbers, quanti-
ties, and dates. The SAP ERP system uses these inputs to obtain the necessary
organizational data, such as sales area, from the various master data in the sys-
tem. Recall that the material master and customer master are associated with
specifi c organizational elements. SAP ERP also uses the customer number to
obtain necessary customer data, such as contact information, from the customer
master. Finally, the system uses material numbers to obtain availability and pric-
ing data from available pricing conditions or customer-material info records.
The preceding paragraph deals with existing customers. If the inquiry is
from a new customer, then the system will not contain either master data or a
customer-material info record for that customer. In such cases, the company
must fi rst create the customer master data in the system. The info record is not
essential because pricing data are available via pricing conditions.
The quotation can be created with or without reference to existing docu-
ments. If the quotation is created without reference, then all of the necessary
data must be provided when the quotation is created. However, if a reference
document—such as a previously created inquiry, quotation, sales order, or an
outline agreement—is used, then data from these documents are automatically
included in the quotation. These data are then updated as needed before the
quotation is completed. Figure 5-22 diagrams the process of incorporating
existing data into the quotation.

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