AP SD Enterprise Structure
Enterprise structure or Organizational structure in SAP is a structure of SAP organizational units that reflects the structure of the business in the real world. There are various SAP organizational units that can be mapped to business structure based on the real world business requirements such as: Client, Company Code, Plant, Storage Location, Sales Organization, Distribution Channel, Division, Sales Office, Sales Group, Sales Person, Shipping Point, Loading Point, etc.
We must set the enterprise structure correctly in the first place. The change of it usually requires a great effort and very time consuming. To set it up correctly we must have a comprehensive knowledge about the business processes and how to map it to SAP configuration.
A specific organizational unit is defined by a specific function or module in SAP. Company code is defined by FI module. Plant is defined by Logistics function. Storage Location and Purchasing Organization are defined by MM module.
In SD module we have to define Sales Organization, Distribution Channel, and Division. We have an option whether to use Sales Office, Sales Group, and Sales Person or not.
Sales Organization is an organizational unit that responsible to sell and distribute products and negotiate the term of sales to the customers. Sales Organization is the highest organizational unit in SD module. We should have only one Sales Organization in one company code. We must have a very good reason in term of business process to create more than one Sales Organizations in one company code. For example, we want to divide the market into regions where each region is responsible for its own product liability and customer rights-of-recourse (right to recover a bad debt).
A sales organization must be assigned exactly to one company code.
A sales organization is assigned to one or more plants.
Distribution Channel is an organizational unit that represents the channel through which the materials or services reach the customer, such as wholesale channel, direct sale channel, retail channel, etc.
A distribution channel can be assigned to one or more sales organizations.
Division is a way to group materials or services. A wide range of materials or services can be divided into divisions. A material or service is always assigned to just one division.
In SAP SD, the use of divisions allows us organize our sales structure around groups of similar products or product lines. We can define a division-specific sales structure. Within a division, we can also carry out statistical analyses or devise our own marketing strategies.
A sales area is a combination of sales organization, distribution channel and division. Sales documents, delivery documents, and billing documents are always assigned to a sales area. Every sales process always takes in a specific sales area.