Avoid These 11 Common Unit-of-Measure Errors

  • by Rohana Gunawardena, SAP Practice Director, Exium Inc.
  • December 1, 2005
To keep your SCM operations running smoothly, learn how to avoid and correct these 11 common unit-of-measure errors that can bring them to a standstill.
Key Concept
The crucial role of units of measure (UoMs) in SAP is to give context to quantities. A key activity of an SAP system is maintaining clear communication with external business partners (e.g., sending a purchase order to a vendor for raw materials or sending an invoice to a customer). You can accomplish this communication in a number of ways, such as paper invoice, EDI purchase order, or XML delivery confirmation. Quantity is one of the most important aspects of that communication: You need to be sure that an order for five cases of a material is not interpreted as five pieces or five pallets.
Units of measure (UoMs) are a key part of global configuration affecting all SAP R/3 modules, SAP New Dimension products, and interfaces to external systems. The importance of this configuration is signified by its position at the top of the IMG. Despite this, little attention is often paid to UoMs during the configuration of SAP systems. More often than not, the SAP default values are accepted without much concern. Luckily, these work correctly for most companies.

As you roll out your SAP system across multiple companies and countries, however, needs like conversion from metric to US/British Imperial measure arise that necessitate a more detailed analysis of the UoM configuration. Lack of attention to the conversion factor for a UoM or other local settings can, at least, irritate or confuse users. At worst, miscalculated documents can be sent to customers or foreign customs officials, resulting in blocked shipments or expensive disputes.

Another major area of concern is the conversion of quantities from one UoM to another and the problems unfavorable rounding differences can cause. This happens most often with conversion between two US or British Imperial UoMs (e.g., pounds to ounces). In extreme cases, this type of rounding error can bring your warehouse operations to a halt.

Rohana Gunawardena

Rohana Gunawardena heads the SAP practice division at Exium Inc. Exium is a leading business and technology consulting firm that enables companies to achieve their strategic business goals. Exium specializes in delivering superior IT solutions using ERP systems, with a special focus on SAP products. Rohana has been working with SAP since 1992. During his career he has assisted multiple clients on detailed system correction projects, such as correcting inventory balances, controlling area reorganizations, retrospectively activating group currency, and optimizing inter-company accounting transactions. He has spoken at many SAP conferences and has published more than 20 articles in Financials Expert, SCM Expert, and SAPtips on various aspects of SAP. His presentations have focused on Financials module selection, the order-to-cash process, global rollouts, business segment reporting, cross-module integration, and the financial impact of SCM transactions. Rohana is widely acknowledged as a leading SAP expert. Rohana is a Fellow of the Institute of Chartered Accountants in England & Wales. Previously Rohana has worked with the consulting practices of Accenture, Deloitte, and PwC.

Rohana will be presenting at the upcoming SAPinsider Financials 2017 conference, June 14-16, 2017, in Amsterdam. For information on this event, click here.

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