How does SCM fit into the mySAP SRM module? How are these two modules related? What does SRM offer compared to...
By submitting your email address, you agree to receive emails regarding relevant topic offers from TechTarget and its partners. You can withdraw your consent at any time. Contact TechTarget at 275 Grove Street, Newton, MA.
Supplier relationship management (SRM) is a comprehensive approach towards managing an enterprise's interactions with the organizations that supply the goods and services it uses. SRM manages the flow of information between suppliers and purchasing organizations and ensures the integration of supplier information in the procurement process by the buyer. The goal of SRM is to streamline processes regarding the acquisition of products and services, by replacing inefficient paper trails and letting it take advantage of price breaks in company-wide supplier contracts. Ultimately SRM can make more effective the processes between an enterprise and its suppliers.
Meanwhile, supply chain management (SCM) is the management of the entire value-added chain, from the end user to the supplier to the manufacturer, right through to the retailer and the final customer. SCM involves coordinating and integrating the flow of: (1) the product, (2) the information and (3) the finances, both within and among companies. The ultimate goal is to reduce inventory, increase the transaction speed by exchanging data in real-time, and increase sales by implementing customer requirements more efficiently.
SAP's SRM solution integrates with the SCM solution at different process levels. One example is the integration of APO (a component of the SCM solution) with SRM.
For example, in the Direct Material Scenario with Planning in SAP APO: If we do not wish to start the procurement process for direct materials manually in the SRM system, then we can plan such requirements in an external planning system (eg. APO). These requirements can then be sourced automatically in Enterprise Buyer (a component of SRM) via negotiated sources of supply. As soon as Enterprise Buyer has created a purchase order for the requirements, it notifies the planning system (APO). For a complete integration review the SRM business maps available on service marketplace.
Dig Deeper on SAP supplier relationship management software
Related Q&A from Sachin S. Sethi
An SAP SRM user is looking to update an SRM URL process when implementing or changing a catalog in a live environment in SAP SRM.continue reading
An SAP SRM user wants to know how to set Confirmation and Invoice as the default options in a limit-order shopping cart.continue reading
An SAP user wants to know the benefits of implementing SAP SRM, and if it's necessary to also implement SAP BI, XI and MDM at the same time.continue reading
Have a question for an expert?
Please add a title for your question
Get answers from a TechTarget expert on whatever's puzzling you.