An introduction to Equipment Integration (Device-as-a-Service)
In the S/4HANA release of 2020, SAP introduced a new feature called as ‘Equipment Integration (Device-as-a-Service)’ in response to changing customer behaviour and evolution in the subscription business models.
Service providers offer their customers bundles of hardware devices (such as laptops, desktops, tablets, printers, or mobile phones), software, and services for a monthly subscription fee as part of a single contract (such offerings have come into the picture due to change in customer behaviour and technological advancement and commonly referred as Device-as-a-Service model). Solution quotations combine hardware and services.
To support such models where the subscription is for the hardware or the subscription(s) are dependent on the hardware, this feature of integration between the equipment master and the subscription contract has been provided. The ability to bundle different kinds of products (hardware, service, and subscription) already existed and hardware products resulted in the creation of SD Sales Orders from which downstream processes such as Delivery, Goods Issue etc. could be carried out. This has been taken further now, where if the hardware resulted in the creation of Equipment, then such Equipment can be linked back to the related Subscription Contract. With this integration, dependent processes such as those below can be built.
- Activation of subscription and start of billing only after the hardware is delivered to the customer and installed
- Cancellation of subscription if the related hardware is deactivated
The following graphic illustrates the process of transactional data flow for Equipment Integration between S/4 HANA SOM and S/4 HANA SD.
In a business scenario, where the equipment ID is not known before a hardware device is delivered to the customer, the activation of the subscription contract depends on the equipment delivery status. SAP provides the following example implementation where the physical device is a sales sub-item of the contract’s main item. The sales item is processed for delivery where the equipment ID, linked to the serial number of the sales product, is assigned in the delivery document. On the POST GOODS ISSUE of the delivery document, the equipment status is updated to ECUS.
The subscription contract will not be distributed and activated until the equipment ID’s are maintained and the relevant status (e.g. At Customer, Ready for Use) is set on the equipment.
This is achieved by using the ODI framework. A standard example schema EQUI has been provided with steps:
|EQUM||Equipment data maintained||This step will be executed only if the equipment ID’s are maintained on the subscription contract.|
|EQUA||Are all Equipment active||This step will be executed only if the linked equipment has a status of ECUS (At Customer).|
|PCEA||Call FICA Message contract activation||This step will trigger the creation of FICA and CC contracts which will be executed only once the above two steps are successful.|
The equipment integration provides the following features to support the Device-as-a-Service business model.
- Maintenance of equipment IDs on subscription contract – Equipment IDs for a subscription item in subscription order or solution quotation can be maintained under the object List. The maintained equipment IDs are copied to the subscription contract item on submit/accept. Additionally, you can search for equipment based on their Equipment ID, Serial Number, Reference Product ID and so on.
- Auto-update of equipment IDs based on serial number assignment – SAP has delivered an example implementation of how equipment ID’s can be automatically maintained on a subscription contract based on serial number assignment during the delivery of the sales item. If the equipment master is created and activated when serial numbers for a product are created, then during the delivery it is possible to identify the relevant equipment ID’s. By tracking back from the delivery, it should be possible to identify the relevant sales item in the subscription order or solution quotation. If the products are structured in such a way that the sales item is a sub-item of a subscription item or vice versa then that subscription item is the one on which maintenance of equipment ID’s is required. By leveraging the still open-for-change subscription order or the ‘Maintain Equipment IDs’ change process, equipment ID’s can be maintained on the relevant subscription contract. This system-based auto-update is achieved by using Event Type Linkages.
Trigger subscription contract activation on equipment activation – Like above, an example implementation of how subscription contract distribution and activation can be triggered based on the status of the equipment has been provided by SAP as an out-of-box functionality.
- Billing start date based on equipment activation – Generally, with a subscription contract, the date from which the recurring charges are applicable is the same as the contract start date. When equipment is in the picture, we have scenarios where the recurring charges are applicable only once the relevant equipment is activated. Additionally, it could also be ‘once the equipment is activated’ or ‘X number of days after contract start’ whichever is earlier. To support such scenarios a Date Type CONTBILS (Start of Billing) has been provided.
- Equipment ID as a technical resource – The ID associated with the hardware (Serial Number or Equipment ID) might be relevant in the calculation of usage-based charges in CC. To facilitate this, equipment IDs maintained in the object list are copied to technical resources and distributed to the CC Contract.
- Early distribution when equipment activation is delayed – Typically, early distribution of subscription contracts is applicable only when the start date is in the future. With equipment, we have the scenario where the contract start date might be immediate, but the actual activation and distribution should happen only once the related equipment is activated which could be in the future. With Revenue Accounting and Reporting in the picture, an early view into such a contract might be required even though it is not yet active. To support this, a feature has been provided that allows for the execution of early distribution even when the start date is immediate, but the actual distribution is to be deferred.
- Distribution and activation of the subscription contract
- Changes process (BTMF) – Scale up/down equipment and Replace equipment