SAP HCM theories – Flashcards

-Organizational Management -Recruitment and Hiring -Personnel Development -Training and Event Management -Travel Management -Time Management -Compensation Management -Benefits -Personnel Administration -Manager's Desktop -Employee Self-Service (ESS)

*Cornerstone of Human Capital *Management *Basis for structuring personnel planning and development processes *Necessary for Personnel Administration *Used to create organizational structure for a company -Departments -Jobs -Positions -Tasks *Work defined and described through process of job analysis

*Transactions enable recruitment and hiring through: -Advertisement of position vacancies, -Identification of recruitment sources, -Acceptance of applications, -Matching of applicant qualifications to job requirements, -Hiring of employees. *Also allows management of applicant correspondence.

*Personnel Development helps maximize the value of employees in the company. *Processes include: -Performance Appraisals --Facilitates decisions regarding promotions, merit pay, and terminations -Career and Succession Planning --Encourages professional development of employees by identifying possible career goals and planning development --Ensures there are suitable candidates to fill open posts -Career Development --Can be integrated with Training and Event Management to propose training courses to provide any missing qualifications --Proposes development plans and business events that result in the same or higher proficiency of a qualification for a job requirement.

*Involves management of employee activities associated with training, workshop attendance, and other business-related events. *Comprised of four main processes: 1. Business Event Preparation -Creation and maintenance of Master Data for Business Event Catalog --Time schedules, event locations, resources needed, etc. --Business event groups and event types 2. Business Event Catalog Planned dates for events based on demand 3. Day-to-day Activities Booking events, canceling events, sending event notifications 4. Recurring Activities Firm bookings, locking/unlocking events, follow up events.

*Enables organizations to monitor second largest controllable expense associated with travel, training, and entertainment *Includes all necessary functions for dealing with business trips -Travel requests, approval, and settlement -Travel services reserved and booked using external reservation systems *Settlement results forwarded to Financial Accounting module, Payroll, or other systems. -Settlement program determines results such as reimbursement amounts for trips (during specific payroll periods) -Trips must end before end date of payroll period to be settled

*Evaluating work performed by employees and determining employee availability are essential elements for HCM system *Time Management allows flexible display and recording of work times through several SAP system options, such as: -Time Manager's Workplace -Central time sheets (CATS - Cross-Application Time Sheet) -Time recording systems *Examples of employee time data are hours worked, leave, illness, overtime, substitutions, and business trips *Information from work times is used in several ways: -Used to calculate gross wages in Payroll -Used for activity allocation in Controlling to assign costs to sources -Used in Logistics to determine employee availability for capacity requirements planning.

*Controls and manages compensation policy for the enterprise *Processes include: -Job Pricing --Uses external job evaluation systems and salary surveys to generate pay grade structures --Used to determine internal value of jobs and positions to ensure company remains competitive -Budgeting --Enables planning and controlling of expenses for compensation --Budgets assigned to organizational units -Compensation Administration --Used to distribute salary increases, shares, etc to employees according to enterprise policy

*Processes (continued) -Long-term Incentives --Supports five different types of long-term incentives: =Incentive stock options =Nonqualified stock options =Performance shares =Performance units =Restricted stock --Uses vesting rules and schedules to determine when employees can exercise right to receive an award and the amount of the award. --Change events, such as stock splits, are reasons for an employee to change subscribed options --Life events, such as business mergers and marriage or retirement, may change the vesting schedule.

-Employees enroll themselves in benefit plans -Contributions paid either by employee, by employer, or by both (depending on plan choices) -Six international plan categories defined in the SAP ERP system: 1. Health 2. Insurance 3. Savings 4. Stock Purchase 5. Credit 6. Miscellaneous (Fitness programs, company cars, etc.)

-Facilitates the management of HCM Master Data, Personnel files, and relational databases. -Critical for enterprise to maintain accurate and confidential employee records -Can be integrated with Personnel Planning -Can provide default values for Organizational and Personnel Structure data fields. -Generated cost plans can be exported to Business Intelligence analysis

-Tool which enables access to employee information without having to access menu paths or transaction codes -Initial desktop screen consists of six theme categories and their function lists 1. Employee; Organization; Costs and Budget; Recruitment; Special Areas; Workflow Inbox 2. Categories can be customized into customer-specific hierarchies with customer-specific functions 3. Categories can be enabled/disabled by user 4. Desktop screen can be enhanced with enterprise logo

*Employee Self-Service is a set of powerful, easy-to-use applications that empowers employees by allowing them to view, create, and maintain data in the SAP system via the Intranet *Consists of many accessible components, such as: -Time Management -Benefits -Personal Information -Training and Event Management -Qualifications -Appraisals *Enables employee access from any platform at any time from anywhere

-Enterprise Structure -Personnel Structure -Organizational Structure

*Hierarchy is a legal and financial structure *Uses the following SAP organizational elements: -Client -Company Code -Personnel Area -Personnel Subarea

-Highest level in the SAP organizational hierarchy -All Personnel Administration organizational elements exist within a client

-Represents a self-contained, independent accounting unit -Level at which legally required accounting books and statements are created --General Ledger Accounts --Balance Sheets --Profit and Loss Statements

An organizational element used exclusively by Personnel Administration Must be assigned to a Company Code Each Personnel Area must be uniquely and clearly identified within a Company Code Multiple Personnel Areas may exist under a Company Code Uses a four-digit alphanumeric identifier Allows default values for data entry Is a selection criterion for reporting Constitutes a unit in authorization checks

*Also unique to Personnel Administration *Represent further subdivision of Personnel Area *Uses a four-character alphanumeric identifier *Principal organizational aspects of HR are controlled at this level -Pay scale -Wage type structures -Planning of work schedules

*Control features are stored according to country *Main organizational functions are: -To specify country grouping --Must be unique within the Company Code --Master Data entry, set up, and processing of wage types and pay scale groups depend on country grouping *Sets groupings for Time Management so work schedules and substitution, absence, and leave types can be set up *Generates default pay scale type and area for employee basic pay *Defines a public holiday calendar *Defines subarea-specific wage types for Personnel Areas

*Is a relational, rather than hierarchical, structure *Forms employee groups by specific status and type that are needed for HR administration *Relates primarily to work hours and compensation *Made up of three elements: -Employee Group -Employee Subgroup -Payroll areas *Levels are used to provide default values for payroll, as selection criteria for reporting, and are used for authorization checks

*A general division of employees *Defines the relationship between an employee and a company based on employee's contribution to the company in terms of work *Three main employee groups are: -Active employees -Pensioners -Early Retirees *Groups can be extended to suit individual customer requirements -May add Contractors, Consultants, etc.

Example: Active employees can be divided into subgroups for Wage Earners, Salaried Employees, Non Pay-scale Employees, and Trainees

*Can define default values for data entry using employee subgroup *Allows defining different payroll procedures for different subgroups -Can specify whether an employee's pay should be accounted for on an hourly or monthly basis *Controls the validity of wage types -Groupings for Primary wage types controls validity of wage type on subgroup level -Collective agreement provisions restrict validity of pay scale groups to certain employee groups

*An organizational unit used for running payroll *All employees who have payroll runs at the same time and for the same period are assigned to the same payroll area. -Example: Payroll may be run twice a month for some employees and once a month for others *Employees may only change payroll areas at the end of a period

*Uses an organizational plan to provide a model of the structural and personnel environment at an enterprise -Create plan using organizational units and positions *Maps the hierarchies within your organization -Depicts the hierarchy that exists between the various organizational units and how they relate to one another -Depicts the individual positions and reporting structure that exists in an enterprise (otherwise known as the Chain of Command) *Organizational Structure consists of: -Organizational Units -Jobs/Tasks -Positions -Persons

*Reflect the various business units or departments within the enterprise *Several Organizational Units may be created and related to one another in the organizational plan *Units can be defined as functional, divisional, or geographical departments, or as a project group *Examples of Organizational Units include: -Accounting -Sales department -Manufacturing department -Human Resources department

*Jobs are general classifications of tasks performed by employees *Each job represents a unique classification of responsibilities in an organization -Examples include Manager, Analyst, Supervisor *When created, a job should consider the specific tasks and responsibilities associated with it *Tasks are the individual duties and responsibilities undertaken by employees as reflected in job descriptions -Job descriptions should be as general as possible and as specific as necessary -Examples of tasks include "maintains inventory", "oversees production", "prepares accounting statements"

*Positions are individual employee assignments *Positions are occupied by persons *A number of positions can be based on the same job *A position inherits a job's tasks; however, additional tasks may be defined for an individual position *As a rule, one employee fills a position -It is possible for a position to be occupied by more than one employee (each working less than full time) -Example: Job sharing, where one employee works 50% of a position and another works the remaining 50% *Positions can be 100% filled, partially filled, or vacant.

-Persons represent employees within an organization -Persons are assigned to positions within the organizational structure -Persons are linked to the Organizational plan through their position assignment -Information for persons is maintained in Personnel Administration using Infotypes

*The HCM Master Data database contains and stores all data *Data must be kept current for each employee *Employee information is kept in a Personnel file -Access to a Personnel file is usually through the employee's internally assigned personnel number -A Personnel file is created and maintained through use of Infotypes *Master Data can be accessed in one of three ways: 1. Single Screen Maintenance - maintain one Infotype at a time for a single personnel number 2. Personnel Actions - the system displays all relevant Infotypes one after the other for a single personnel number 3. Fast Entry - enables maintenance of an Infotype for more than one personnel number simultaneously.

*Infotypes are logical groupings of data fields -Data fields contain individual information such as Last Name, First Name, Social Security Number, etc. *Groupings are made based on data field content *Infotypes have names and four-digit keys, examples are: -Actions (0000) -Organizational Assignment (0001) -Personal Data (0002) -Addresses (0006) -Planned Working Time (0007) -Basic Pay (0008) *Infotypes use specific validity periods for data -Updating an Infotype does not replace data; it creates new validity period -Old data remains in system so historical evaluations can be performed *Over 600 standard Infotypes can be used to maintain employee and applicant data, and custom user-defined Infotypes can be created.

*Integration with other application components facilitates direct, efficient data exchange *HCM data can be used by all departments for support of business processes, such as: -Capacity planning for employee work schedules, setting shifts -Generating department wage/salary/training budgets -Cost planning for new jobs/positions in a department -Transferring payroll, tax, and benefit costs to Financial Accounting -Allocation of wage/training costs to source departments -Determining eligibility for bonuses -Allowing employees to view, change, or sign up for benefits/training -Determining role/profile for access to the SAP system.

*Examples of integration with the Training and Event Management component include: -Sales and Distribution: Billing of attendance fees, use of attendee types Customer and Contact Person -Materials Management: Use of materials as resources for business events, generation of purchase requisitions, and material reservations -Personnel Development : Check for and transfer of qualifications, use of appraisal systems -Time Management : Recording and checking for attendance (for internal event attendees and instructors) -Appointment Calendar: Automatic generation of entries in the Appointment Calendar for attendance bookings and instructor activity -Cost Accounting: Internal activity allocation of attendance fees and instructor costs, cost transfer posting for business event costs.