SAP Solution Brief SAP Dispute Management

DISPUTE MANAGEMENT
Optimizing Your Financial Supply Chain

The SAP Dispute Management application enables you to resolve customer disputes over receivables more effectively. Fully integrated with other SAP financial management applications, it can help you improve the tracking and processing of short payments, streamline your accounts-receivable processes, and enhance your customer relationships. Companies that use SAP Dispute Management have reduced their days sales outstanding by as much as 20%.

To improve collections and reduce days sales outstanding (DSO), nearly every company must frequently investigate open receivables from its customers. In many industries, some customers regularly reduce bill paid amounts or fail to pay their bills at all. All too often, companies use manual processes to handle these dispute cases, which can involve many different areas of the organization. Such manual processing is typically time-consuming and expensive, ties up significant resources, and may also delay the resolution of dispute cases. In the United States, for example, 61% of receivables remain open for more than 50 days. There is a way that you can optimize the accounts receivable and collections processes in your financial supply chain with the SAP Dispute Management application, a part of the mySAP ERP Financials solution. Companies that use the application show improvement in the processing of accounts receivable disputes, with days sales outstanding reduced by as much as 20%.
Centralized Case Processing

When your company experiences a dispute with a customer over a receivable, you can open up a dispute case in SAP Dispute Management that becomes the central object for processing the dispute. A dispute case is an electronic file for collecting relevant information and displaying that information in a structured form. It includes attributes such as the reason for the dispute, the disputes priority, and the relevant customer contact. Amount fields in the application show you at a glance the disputed amount and all relevant payments, credit memos, and write-offs.

You can create a dispute case directly from a specific financial transaction, such as the processing of an incoming payment that has been reduced or a customers line-item display. (See Figure 1.) You can also set the application to open dispute cases automatically for payment deductions posted by electronic account statement or lockbox file.

Your department manager can assign a dispute case to a coordinator who is then responsible for resolving the case. The coordinator can also indicate any other employees who should be involved, including those from other departments. The application lets you classify and manage each dispute case according to its current processing status and the reason for the dispute which may include the following: Incomplete supply or service (quantity deficiency) Deficient delivery or service (quality deficiency) A mismatch between price and service (price difference) Failure to meet the delivery date (time difference) Failure to follow through on promised trade promotions Other misunderstandings Employees assigned to process dispute cases receive notification by e-mail. They can process dispute cases directly in the application or via a workflow task. The integration of dispute-case processing with SAP workflow tools makes it easy for you to integrate employees into the resolution process as they are needed, and simplifies the user interface. Users can see an overview of all previous activities related to their dispute cases and receive notification of their responsibilities. They can enter the results of their investigations as notes to the case and save any relevant documents as attachments. SAP Dispute Management lets you inform customers about their cases either automatically or manually at any time. With the manual correspondence option, users can enter text, adding detail to enhance the customers understanding of the dispute. You can involve managers in critical dispute cases through an internal-escalation capability. The close integration of SAP Dispute Management with your accounts-receivable applications allows the immediate update of amount fields and links. As a result, you can check a dispute case at any time to see which payments, credit memos, or other

Figure 1: Create Dispute Case from Posting an Incoming Payment (Short Payment)

When you create a dispute case, the application automatically fills the amount fields. You can also set most attributes automatically, which considerably reduces manual processing. As the case is created, the application links all information for the disputed transaction to the dispute case including the customer name, invoice number, and invoice amount as well as all relevant billing documents. You can then access these items directly from the dispute case as you need them. (See Figure 2.)

write-offs have been applied to the items involved. Once all disputed receivables have been cleared, you can close the dispute case automatically. The application is fully integrated with other software in mySAP ERP Financials, including the SAP Biller Direct application. This means, for example, that your customers can enter dispute cases in SAP Biller Direct and communicate through a note function with the employees who process the cases. You can use the SAP Collections Management application to create dispute cases and collect receivables. The flexible architecture of SAP Dispute Management also enables process integration with industry-specific SAP solutions. This allows you, for example, to use the dispute management application to support your trade-promotion processes.

Many Business Benefits

SAP Dispute Management can help your finance department accelerate customer collections and resolve late-payment issues. With it, you can finally eliminate the use of faxes, voice mail, and spreadsheets to resolve, track, and settle accounts-receivable payments. Improving your processes for dispute resolution and deductions management can cut your DSO and improve your ability to manage cash flow. The application is designed to work as an extension to your SAP software platform and is critical in providing you with financial-supply-chain management capabilities in mySAP ERP Financials.
Manage Your Entire Financial Supply Chain More Efficiently

SAP Dispute Management is a part of the SAP Financial Supply Chain Management (SAP FSCM) set of applications. As one of the new key functional areas of mySAP ERP, SAP FSCM optimizes the financial and information flows within a company and between business partners. In addition to receivables management, SAP FSCM includes applications for electronic bill presentment and payment in SAP Biller Direct, collections management in SAP Collections Management, automation of credit decisions in SAP Credit Management, management of liquidity positions in SAP Cash and Liquidity Management, configuration of payment factories in SAP In-House Cash, and management of financial positions and market risks in SAP Treasury and Risk Management. To learn more about managing your financial supply chain with dispute management and other processes, visit the SAP Web site at www.sap.com/financials.

Figure 2: Dispute Case View

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SAP Dispute Management is powered by the SAP NetWeaver platform, the open integration and application platform that enables change. SAP NetWeaver helps companies align IT with their business. It allows companies to obtain more business value from existing IT investments and to deploy a service-oriented architecture. SAP NetWeaver reduces total cost of ownership (TCO) and complexity across the entire IT landscape. SAP NetWeaver powers mySAP Business Suite, SAP xApps packaged composite applications, and partner solutions. It provides the best way to integrate all systems running SAP or non-SAP software. SAP NetWeaver unifies integration technologies into a single platform and is preintegrated with business applications, reducing the need for custom integration.

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