When preparing to set up your organization hierarchical
model for Sterling Selling and
Fulfillment Foundation,
you need to identify which roles and responsibilities you want to
define for each organization.
To determine which organizations should have which
roles and responsibilities assigned to them:
- Identify each of the Organizations for your organization
hierarchy. That is, business group, companies, legal entities, sales
organizations and purchasing organizations.
There
can be several reasons for a business group to have multiple companies.
One example is the acquisition of a company. Another example could
be when the business group has two unrelated businesses.
A company may need to have multiple legal entities
if it operates in geographical areas that are different from each
other in regards to legal issues such as currency, taxation structure,
or other legal requirements.
Decide the basis
for defining sales organizations (for example, sales channel, product
group, geography or customer). Sales organizations have sourcing rules
and pricing rules. This may help you determine sales organizations.
For example, if you have different pricing rules or sourcing rules
for different sales channels or geographies, then your sales organizations
can be based on sales channel and geography.
- Identify Enterprises for the organizations in your
organization hierarchy. Considerations for identifying Enterprises
are explained through the examples in Model example 1: electronics company and Model example 2: third-party logistics company.
- Identify Catalog organization(s). Any organization
in the organization hierarchy can be the catalog organization. Typically,
the main company is the catalog organization. The Catalog organization
needs to be defined at a lower level in the organization hierarchy
if two organizations of the company have same item identifier for
two different physical items and the company does not have a common
Item ID for the two items. The Catalog organization can be defined
at a lower level if two legal entities do not cross sell each other's
items. But, the Catalog organization cannot be below the Inventory
organization in the hierarchical structure.
- Identify Inventory organization(s). Any organization
in the organization hierarchy can be an inventory organization. Typically,
an inventory organization is kept at the legal entity level. There
are both advantages and disadvantages in keeping the Inventory organization
at this level in the hierarchy. For example, if the Inventory organization
is at the legal entity level then all sales organizations of the legal
entity have equal access to the inventory in the locations of the
legal entity (with the capabilities to restrict access of a sales
organization to only designated physical locations within the inventory
organization). This can be an advantage in one business and can be
disadvantage in other business.
- Identify physical location owners (nodes). This
definition in most cases should map the real ownership of physical
locations. Typically legal entities are owners of the physical asset
and are modeled as owner organizations of nodes.