Current State Assessment

Example for As Is and To Be

• Company Codes: 5 existing company codes representing different business units or legal entities
• Merge Candidates: 4 company codes to be consolidated into single entity for operational efficiency and cost reduction
• Split Requirements: 1 company code division into 2 separate entities for business focus or regulatory compliance
• Legal Entity Mapping: Corporate structure realignment requiring new legal registrations and tax authority notifications

Company Code Prerequisites

Merge Prerequisites (A,B,C,D→1000)

The analysis for company code merge must examine organizational structures including credit control areas, business areas, functional areas, companies, segments, profit centres, controlling areas, valuation levels, plants, sales organizations, and purchasing organizations.

• Chart of Accounts Harmonization: All merging company codes must use identical chart of accounts structure. If different charts exist, conversion is required before merge execution.
• Currency Alignment: Local currencies must be consistent across all merging entities. Multi-currency scenarios require careful conversion and revaluation procedures
• Fiscal Year Variants: Standardized fiscal year periods are mandatory. Different fiscal year variants prevent direct merge and require preliminary harmonization 
• Country/Region Settings: Country keys must be evaluated for tax jurisdiction compatibility and statutory reporting requirements

Split Prerequisites (E→ 2000 & 3000)

• Business units and areas Segregation: Clear operational division criteria with distinct profit centre and segment assignments for independent P&L reporting
• Asset Separation Logic: Fixed asset allocation methodology with separate depreciation areas and valuation approaches for each new entity
• Legal Entity Creation: New company registration, tax ID assignments, and regulatory compliance setup for the split entity
• Financial Statement Structure: Independent balance sheet and income statement requirements with separate closing procedures

Generic Prerequisite for logistics Unit Mergers

• The prerequisite for this scope option is that all affected Logistic Units are attached to the same company code. If this prerequisite is not fulfilled the also available scope option “Company Code Merge” can be used to accomplish this prerequisite. This can be for example necessary if all data of a company code, including the logistic data, has to be merged.
• With the scope option “Company Code Merge” the Plants, Purchasing Organizations and Sales Organizations of the source company code will be attached to the target company code. In a second step, with the Logistic Unit Merge, the Plants, Purchasing Organizations and Sales Organizations can be merged into an existing or new organizational unit within the target company code.
• The scope option “Logistic Unit Mergers” can be delivered together with the Scope Option “Company Code Merge” if necessary or requested
• With the merge of logistic units, it can also come to conflicts regarding the used business processes in the source and target organizational units (currently used processes in source and target differs from the planned processes within the new organizational structure). The resolution/harmonization of such conflicts is not part of the offered service and must be done on Customer side in parallel to the technical merge

Sales Organization Restructuring

Merge Impact Assessment

Sales organizations assigned to merging company codes require consolidation planning with customer reassignment strategies.

Split Requirements

• Customer Portfolio Division: Define customer assignment criteria based on geographic regions, product lines, or market segments
• Sales Territory Redefinition: Establish separate territorial boundaries with distinct sales teams and management structures
• Pricing Procedure Alignment: Maintain consistent pricing schemas while enabling entity-specific pricing strategies

Credit Management Setup: Implement independent credit control areas with separate risk assessment and limit management

• Merge of one or several source Sales Organization into one target Sales Organization.
• Target Sales Organization can be a complete new one or can be one of the existing Units in the system.
• The merge of related objects like Sales Offices, Sales Groups and Sales Districts can be offered optionally.
• Special merge logics are used for objects like Customer Hierarchy, Material Master Admin Data, Customer Partner Functions or Sales Conditions

Purchasing Organization Prerequisites

Procurement Structure Changes

The impact on purchasing includes plant assignments, purchase organization reassignments, vendor master extensions, and purchase order handling.

• Vendor Master Realignment: Extend existing vendors to new purchasing organizations or create separate vendor master records
• Contract Migration Strategy: Evaluate existing purchase contracts for validity across new organizational structure and reassign as needed 
• Purchase Info Record Updates: Update material-vendor relationships with new purchasing organization assignments and pricing conditions
• Approval Workflow Redesign: Reconfigure authorization hierarchies and approval limits for new organizational structure
• Merge of one or several source Purchasing Organization into one target Purchasing Organization.
• Target Purchasing Organization can be a completely new one or can be one of the existing Units in the system.
• The merge of related objects like Purchasing Groups can be offered optionally.
• Special merge logics are used for objects like Material Master Admin Data, Vendor Partner Functions or Purchase Conditions

Plant and Location Management

Physical Asset Allocation

Plants must be reassigned to appropriate company codes as part of the restructuring process.

• Plant Assignment Logic: Determine manufacturing facility ownership based on operational control and asset ownership. Merge of one or several source Plants into one target Plant. Target Plant can be a completely new one or can be one of the existing Plants in the system.
• MRP area and valuation area: to ensure system consistency those dependent object must be considered in merge.
• Storage Location Mapping: Define inventory ownership and establish separate valuation procedures for stock management
• Shipping Point Configuration: Configure logistics execution points with appropriate plant assignments for delivery processing.
• Work Centre Realignment: Allocate production resources and capacity planning across restructured entities