How SAP FSCM Complements Standard FI-AR to Reduce Days Sales Outstanding

  • by Mark Chalfen, Finance Capability Lead, Bluefin Solutions
  • October 25, 2010
Standard accounts receivable (AR) functionality is split among many transactions, taking extra time from a busy AR team. By performing the whole customer contact process using a single transaction within SAP Financial Supply Chain Management (SAP FSCM), you can reduce the time spent by the AR team, ensuring more customers are contacted. The business can make better decisions, reducing potential bad debt. This includes having a complete dispute management system and prioritized worklist process in place. Walk through processes in AR, and then see how they work as compared to SAP FSCM to see the benefits, including a reduction in working capital and a reduction in days sales outstanding.
Key Concept
SAP Financial Supply Chain Management (SAP FSCM) provides more convenient access to the processes you normally perform in your FI-AR system. It is a licensable product, but comes with certain SAP ERP 6.0 implementations. Two important submodules of SAP FSCM are Collections Management and Dispute Management.

Over the past few years there has been a great deal of interest around SAP Financial Supply Chain Management (SAP FSCM). SAP has invested a great deal of time and effort in designing and improving the product. This can be seen by the various business function sets — collections of new functionality within an enhancement package — that have been released:

  • FIN_FSCM_CCD
  • FIN_FSCM_CCD2
  • FIN_FSCM_INTEGRATION
  • FIN_FSCM_CCD_INTEGRATION

Many articles have focused on what SAP FSCM actually does and delivers (see the note for specific references). They are useful if you are aware of the current SAP accounts receivable (AR) functionality; however, some of the functionality is new within SAP FSCM and does not replace actual AR functionality.

Note
For some SAP FSCM references, see the articles, “Improve Your Receivables Management with SAP Collections Management” and “Adapt and Automate SAP Dispute Management.” I also wrote this blog post about FSCM functionality.

I’ll review the current SAP AR transactions and then compare them to the new functionality that has been delivered so far within SAP FSCM.

Mark Chalfen

Mark Chalfen is the finance capability lead at Bluefin Solutions, a niche SAP consultancy in the UK, and an SAP mentor. Mark has more than 12 years’ experience in SAP FI/CO in a number of industries. Mark’s core skills include Financial Supply Chain Management (SAP FSCM) and the new GL. He is currently advising a wide variety of clients on maximizing their SAP landscape either in the current R/3 version or upgrading to SAP ERP.

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Comments

4/27/2016 4:36:55 PM
Murali Srikakolapu

The article is very informative. Thank you.

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