1. GOAL OF ORGANIZATION STRUCTURE WORKSHOP
Obtain an Understanding of the Customer’s Key Business Processes
Define the Chico Creek Brewery’s Organization Structure in SAP based on those Business Processes 1

2. AGENDA Definition of Organization Structure
Customer High Level Business Overview
Business Process Review
Financial/Asset Management
Sales Logistics
Procurement, Logistics Planning
Define the Organizational Elements in SAP based on the Chico Creek Brewery’s Business Processes and Reporting Requirements.
Document the Company’s SAP Organization Structure 3

3. Integrated Business Process Review
Business Overview
Company’s Mission Statement
Markets
Customer Base
Products and Services
SAP Implementation Drivers
Review the Legal Organizational Structure. 4

4. MISSION STATEMENT
Our mission is to successfully implement SAP R/3 at the Chico Creek Brewery in a timely, professional manner so that our client can realize a faster and more productive way to run their business processes.
We intend to create a sustainable competitive advantage for Chico Creek Brewery, as well as, substantial profitable results through the implementation of SAP R/3.

5. Integrated Business Processes Overview
Procurement
Logistics Planning
Sales Logistics
Production
Finance / Asset Management 6

6. Integrated Business Process Overview
Production
Fore-cast
Sales Oper Planning
MPS
MRP
Manufacturing Execution
Order Settlement
Capacity
Inventory
Costing
Review Material Management-Questionnaire OS-MM-000.
Financial and Managerial Reporting and Analysis 8

7. Organizational Structure Review
3000 US
Chico Creek Brewery
Business
Area 90
Pale Ale 93
Stout
4000
Australia
3000 US #1
Purchasing
Organization
Division/
Plant 90
Pale Ale
3000 US 93
Stout
3000 US
Sales
Organization
3000 US
Distribution
Channel 03
Wholesale
Division 90
Pale Ale 93
Stout 12

8. Finance Management /Accounting & Reporting
FINANCIAL
ACCOUNTING
(FI / AM)
FINANCIAL
REPORTING
(FI)
MANAGEMENT
REPORTING
(CO)
COST CENTER
ACCOUNTING (CCA)
ACCOUNTS SD
RECEIVABLE
INTERNAL ORDER
ACCOUNTING (OPA)
PROJECT
ACCOUNTING
GENERAL
LEDGER
NATURAL
ACCOUNT
ACCOUNTS MM
PAYABLE
PRODUCT COSTING
Review Financial Reporting Questionnaire OS-FI-010 and Managerial Accounting and Reporting Questionnaire OS-CO-000.
The Financial Accounting(FI) application in SAP records all movements of goods and services and all other business transactions between the company and its customers and vendors. The FI module represents from an accounting perspective a company’s general ledger.
The controlling module is where all management reporting is performed in SAP. In controlling you are able to slice and dice your company up in many different ways to fulfill different management objectives.
The controlling module in SAP supports: cost center accounting, internal order accounting, project accounting, product costing, profit center accounting, and profitability analysis.
Both the information stored in the financial module and the controlling module comprise the population of data from which financial and managerial reporting will be derived. Both modules data are updated through either transaction postings which originated in SD and MM or can be directly updated through transactions in Accounts Receivable, Accounts Payable, and GL.
For example, you may receive an invoice from SAP for consulting services for which an original purchase order was recorded under the procurement system.When the invoice is posted in SAP, the Vendor SAP will be credited and the following could be updated under the Financial and Controlling Module
G/L Account called Professional Fees - Consulting (FI)
Project called SAP Installation (CO)
Cost Center called Internal Systems (CO)
Profit Center called Internet
PROFIT CENTER
ACCOUNTING (PCA)
ASSET
MANAGEMENT
PROFITABILITY
ANALYSIS (PA) 10

9. Organizational Elements - FI
Company
Represents a legal/tax entity - Where do you legally represent the financial events of transacting business?
Arms Lengths Transactions
Level of External Reporting or Legal Sets of Books
A company is an independent legal accounting unit within a client. It is the only hierarchical element in SAP that must represent a true legal entity. The legal requirements of a balance sheet and profit and loss statement are fulfilled on the company code level. The balance sheet has a complete shareholder equity section.
At the moment of entering a transaction, all debits must equal all credits at the company level. Thus, you are guaranteed a balanced set of books.
Multiple company codes can be set up for each client, thus enabling accounting data to be managed simultaneously for several independent companies. 18

10. Organizational Elements - FI
Companies for Name of Customer
Company Codes: Identify the proposed company codes if any for customer being evaluated.
Benefits: Identify the benefits of recommended usage of company codes.
Costs: Identify the costs of recommended usage of company codes.
Issues: Identify any open issues/questions. 20

12. Organizational Elements - FI
Operating Chart of Accounts
G/L Account Master Records Required in One or Several Company Codes
Postings are Made to these Accounts
Maximum of a 10 Digit Code
A company Must be Linked to One Operating Chart of Accounts
An Operating Chart of Accounts can be Linked to Many companies
This is the systematic listing of all G/L account master records that are required in one or several company codes. This is the G/L accounts to which all postings will be made. Thus, when a document is entered, the user would use an account number in the operational chart of accounts.
The G/L account in SAP can have a maximum of a 10 digit code and it traditionally represents what most organizations refer to as the natural account. For example, travel expense, sales revenue, etc. SAP does not embed in the G/L account the management reporting structures(i.e. cost centers, job order, divisions, regions, etc.) Most other systems embed the management reporting structures (like cost center, job order, division, regions) in the account code. This means that they have hardcoded their management hierarchies within the chart of accounts. This makes hierarchy reorganisations difficult and management reporting inflexible.
In SAP, the managerial coding block(department, profit center, etc.) is defined under the Controlling module. 25

13. Organizational Elements - FI
Operating Chart of Accounts = General Ledger
Different from a lot of other Financial System Applications in that the G/L account is strictly comprised of the natural account code.
The management reporting structures (i.e. cost centers, divisions, regions, and job orders) is not embedded within the chart of accounts.
In SAP there is a relative relationship between the chart of accounts profit and loss natural account code and the cost centers. 30

14. Organizational Elements - CO
Controlling Area
An organizational unit within a corporation in which comprehensive independent management accounting can be performed.
Allows you to group Company Codes from a Cost Accounting View.
It links the financial accounting module (FI) to the management accounting module(CO) in SAP. 32

15. Organizational Elements - CO
Linking of FI and CO
The Operating Chart of Accounts Links Financial Accounting(General Ledger) to Management Accounting in the following way:
A Company Code is Linked to the Operating Chart of Accounts
The Controlling Area is Linked to the Operating Chart of Accounts
A Company Code then can be Linked to any Controlling Area as long as they are both Linked to the Same Operating Chart of Accounts
Several Companies can be Linked to a Single Controlling Area regardless of the Companies Functional Currency. 33

16. Organizational Elements - CO
Profit Center Accounting
Used to Calculate the Profit of an Area of Responsibility within the Organization (e.g. the Brewery)
The Areas of Responsibility (Profit Centers) could be Based on Regions, Functions, or Products (e.g. Production).
Supports Calculating Operating Profit using the Cost of Goods Sold P/L Format and/or the Period Accounting Method
A Profit Center can also be Viewed as an Investment Center since it is Possible to Transfer at Period End the Balance Sheet Positions for Assets, WIP, AR, AP, and Inventory 37

17. Organizational Elements - CO
Profit Center
A Profit Center is not an Independent Account Assignment Object at the Moment of Entering a Transaction in SD or MM; It is Derived From Existing Objects and is Allocated to the Correct Cost Object
As a Default, Revenue and Costs for Profit Centers are Derived as follows:
Sales Order Line Item based on the Product being Sold
Direct Costs Based on the Assignment of Production Orders and Direct Costs.
Overhead Costs Based on the Assignment of the Cost Center or other Cost Object 38

18. Organizational Elements - CO
Profit Centers for Chico Creek Brewing
Profit Centers: A division of the functional business areas which CCBC is involved with (e.g. the sale of merchandise).
Benefits: The ability to capture costs in Profit Centers, and perform profitability analysis on a single part of the business.
Issues: Identify additional Cost Centers in the Organizational Structure, and map them to existing processes.. 39

19. Organizational Elements - CO
Cost Centers
Departmental Breakdown of your Legal Entity Structure
Lowest Level of Organization where you want to Collect and Analyze Costs/Departmental Performance
Departmental Budgets and Expense Analysis
Interdepartmental Cost Allocations
Each Cost Center is Assigned to a Profit Center, which is Assigned to a Company Code
Cost Centers are Structured into Organizational and/or Functional Hierarchical Groups 41

20. Organizational Elements - CO
Chico Creek Brewing Company, Company Codes and Profit Centers
Operating Concern
CCBC
Controlling Area
1000
Company Code
2000
United States
Company Code
3000
Australia
Company Code
4000
Japan
Company Code
5000
Canada
Company Code
6000
Singapore (Planned)
Controlling Area
1000
Profit Center
1000
Taproom (Pub)
Profit Center
1100
Merchandise
Profit Center
1200
Porter
Profit Center
1300
Stout
Profit Center
1400
Pale Ale
Profit Center
1500
Hefe Weisen
Profit Center
1600
Seasonal

21. Chico Creek Brewing Company, Cost Centers
Organizational Elements - CO 10/08/98
Chico Creek Brewing Company, Cost Centers
CC 2100
Manufacturing
CC 2200 US
Administration
CC 3200 AU
Administration
CC 4200 JP
Administration
CC 5200
CAN
Administration
CC 6200 SP
Administration
CC 2300 US
Sales & Distrib.
CC 3300 AU
Sales & Distrib.
CC 4300 JP
Sales & Distrib.
CC 2101
Water purifier
CC 2106
Malt Mill
CC 2111
Whirlpool
CC 2210
Accounting US
CC 3210
Accounting AU
CC 4210
Accounting JP
CC 5210
Accounting
CAN
CC 6210
Accounting SP
CC 2310
Sales, US
CC3310
Sales, AU
CC4310
Sales, JP
CC 2102
Mash Turn
CC 2107
Lauter Tun
CC 2112
Filters
CC 2220
Legal US
CC 3220
Legal AU
CC 4220
Legal JP
CC 5220
Legal
CAN
CC 6220
Legal SP
CC 2350
Distribution, US
CC 3350
Distribution,AU
CC 4350
Distribution,JP
CC 2103
Kettle
CC 2108
Hop Strainer
CC 2120
Bottling
CC 2230
Purchasing US
CC 3230
Purchasing AU
CC 4230
Purchasing JP
CC 5230
Purchasing
CAN
CC 6230
Purchasing SP
CC 5300
CAN
Sales & Distrib.
CC 6300 SP
Sales & Distrib.
CC 2104
Heat Exchanger
CC 2109
Fermenters
CC 2130
Kegging
CC 2240
Management US
CC 3240
Management AU
CC 4240
Management JP
CC 5240
Management
CAN
CC 6240
Management SP
CC 2105
Conditin. Tanks
CC 2110
Wort Receiver
CC 2140
Finished Goods
CC 2250
Insurance US
CC 3250
Insurance AU
CC 4250
Insurance JP
CC 5250
Insurance
CAN
CC 6250
Insurance SP
CC 5310
Sales, CA
CC 6310
Sales, SP
CC 2260 HR US
CC 3260 HR AU
CC 4260 HR JP
CC 5260 HR
CAN
CC 6260 HR SP
CC 5350
Distribution, CA
CC6350
Distribution,SP
CC 2400
Taproom (Pub)
CC 2500
Merchandise

22. AM - Depreciation Areas
USA
Canada
Australia
Japan
Chart of Depreciation
Chart of Depr.
Chart of Depr.
Chart of Depr.
Depr. Areas
Depr. Areas
Depr.Areas
Depr. Areas
Company Code
Brewery
Pub/
Taproom
Merch.
Company Code
Canada
Company Code
Australia
Company Code
Japan

23. AM - Asset Number Structure

24. Asset Classification

25. IM - Hierarchical Structure
Investment Management
Program
Orders (CO)
Projects (PS)

26. Purchasing organizations
Organizational Elements - MM
Purchasing Organizations and Plants
Chico Creek Brewing Co.
United States
Canada
Singapore
Japan
Australia
Purchasing organizations
Brewery
Tap Room
Retail
Brewing
Plant
Tap Room
Plant
Retail
Plant
Plants
Dry
Inventory
Wet
Inventory
Storage 44

27. Organizational Elements - MM
Purchasing Organization
Responsible for procurement for the brewing, tap room and retail plants
Responsible for negotiating pricing and delivery terms with vendors for each purchasing organization 45

28. Organizational Elements - MM
Purchasing Organization for Chico Creek Brewing Co.
Purchasing Organization: Each company will have its own purchasing organization
Benefits: A purchasing organization is assigned to a cost center where inventory is tracked and costs are incurred 46

29. Organizational Elements - MM
Plant
It is a production facility that can have multiple locations associated with it
Usually a manufacturing facility, warehouse or a location that stocks, manages and valuates inventory
May be a physical site with multiple manufacturing/production lines
Can be a physical location (cost centers may or may not be associated to a plant i.e. administrative vs. manufacturing cost centers)
SD availability checking is normally done at the plant level 47

30. Organizational Elements - MM
Plant (Cont.)
Links to production (PP), materials management (MM), and sales and distribution (SD)
A plant is assigned to a company
Purchasing organizations are assigned to plants 48

31. Organizational Elements - MM
Plant for Chico Creek Brewing Co.
Plant: There are three plants: brewing, tap room and retail
Benefits: Being able to keep track of the profits and costs of each plant 49

32. Organizational Elements - MM
Storage Location
A location within a plant where inventory is stored 50

33. Organizational Elements - MM
Storage Locations for Chico Brewing Co.
Storage Locations: Brewery and tap room will have two separate storage locations: one for “dry” goods and one for “wet” or cold goods.
Benefits: Assets and incurred costs can be tracked by the different storage locations. 51

34. Chico Creek Brewing Company
Organizational Elements - SD
Sales Organization, Distribution Channel and Division
Chico Creek Brewing Company
3000 US
4000
Australia
Sales
Organization
3000 US
Distribution
Channel 03
Wholesale
90 Pale Ale 93
Stout
Division 52

35. Organizational Elements - SD
Sales Organization
A representation of a selling unit responsible for product liability and other claims made by customers
Each business transaction is processed within a sales organization
Master Data Maintenance for Customers, Pricing at Sales Organization Level
Sales Organization Assigned to a Company Code where Sales Revenue is Recognized (Links SD & FI)
Plants Assigned to a Sales Organization 53

36. Organizational Elements - SD
Sales Organization for Chico Creek Brewing Company
Sales Organization: United States, Australia, Canada, Japan, Singapore, Tap Room, Catering, Bakery, Merchandise
Benefits: To produce statistics for each of the sales organizations.
Costs: A manager will be required to head up each sales organization, therefore, costs may be slightly higher. 54

37. Organizational Elements - SD
Distribution Channel
Used to define how different products reach consumers (I.e. retail, wholesale, or direct sale)
Relevant Master Data such as price, minimum order qty, and ship-from location may differ between each channel
Each Sales Order travels through one Distribution Channel
Distribution Channel assigned to a Sales Organization (I.e. direct sale for Merchandise items) 55

38. Organizational Elements - SD
Distribution Channels for Chico Creek Brewing Company
Distribution Channels: Wholesale, Direct Sale, and Retail
Benefits: We can determine the profitability of each channel within a specified sales organization.
Costs: By having additional distribution channels (wholesale, retail), we will incur transportation costs. 56

39. Organizational Elements - SD
Division
A way of Grouping Materials, Products, or Services
Assign each product line to a particular division
Define customer-specific agreements for each division, including partial deliveries, pricing, and payment terms 57

40. Organizational Elements - SD
Division for Chico Creek Brewing Company
Division: 5 types of beer, menu items, souvenirs, and services provided by catering.
Benefits: To keep track of how well each product sells within a given area.
Costs: By making the divisions equal to each type of product and service, the divisions will become more difficult to configure and maintain. 58

41. Organizational Elements - SD
Sales Area
Sales Area is a Combination of:
Sales Organization
Distribution Channel
Division
All customer data relevant for sales is defined according to the sales area (I.e. can specify for each customer how pricing is done in each sales area)
Links the Order Entry System(SD) to the Financial/Managerial System(FI/CO) 59

42. Sales Area for Chico Creek Brewing CompanyUS
Merchandise
Tap Room
Wholesale
Stout
Pale Ale
Porter
Hefe Weisen
Seasonal
Stout
Direct sale
Hats
Pale Ale
Tee shirt
Porter
Sweatshirts
Hefe Weisen
Seasonal
Retail
Stout
Pale Ale
Porter
Hefe Weisen
Seasonal

43. Chico Creek Brewing Company
Organizational Elements - SD
Sales Organization, Distribution Channel and Division
Chico Creek Brewing Company
3000 US
3000 AU
5000
Singapore
4000
Japan
5000
Canada
8000
Tap Rm.
9000
Catering
1000
Bakery
2000
Merchandise 03
Wholesale 04
Direct Sale 05
Retail 04
Direct Sale
90 Pale Ale
91 Hefe
92 Porter
93 Stout
94 Seasonal
60 Shirts
70 Sweatshirts
80 Hats

44. Human Resource Structure

45. Organizational Structure Review
2000 US
Chico Creek Brewery
Business
Area 90
Pale Ale 93
Stout
3000
Australia
3000 US #1
Purchasing
Organization
Division/
Plant 90
Pale Ale
2000 US 93
Stout
2000 US
Sales
Organization
2000 US
Distribution
Channel 03
Wholesale
Division 90
Pale Ale 93
Stout 12