EhP5 for SAP ERP 6.0
September 2011
English
SAP Best Practices for
Human Capital
Management U.S. V1.605
Solution Scope
SAP AG
Dietmar-Hopp-Allee 16
69190 Walldorf
Germany
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
Copyright
© 2011 SAP AG. All rights reserved. No part of this publication may be reproduced or transmitted in any form or
for any purpose without the express permission of SAP AG. The information contained herein may be changed
without prior notice. Some software products marketed by SAP AG and its distributors contain proprietary
software components of other software vendors.
Microsoft, Windows, Excel, Outlook, and PowerPoint are registered trademarks of Microsoft Corporation.
IBM, DB2, DB2 Universal Database, System i, System i5, System p, System p5, System x, System z, System
z10, System z9, z10, z9, iSeries, pSeries, xSeries, zSeries, eServer, z/VM, z/OS, i5/OS, S/390, OS/390,
OS/400, AS/400, S/390 Parallel Enterprise Server, PowerVM, Power Architecture, POWER6+, POWER6,
POWER5+, POWER5, POWER, OpenPower, PowerPC, BatchPipes, BladeCenter, System Storage, GPFS,
HACMP, RETAIN, DB2 Connect, RACF, Redbooks, OS/2, Parallel Sysplex, MVS/ESA, AIX, Intelligent Miner,
WebSphere, Netfinity, Tivoli and Informix are trademarks or registered trademarks of IBM Corporation.
Linux is the registered trademark of Linus Torvalds in the U.S. and other countries.
Adobe, the Adobe logo, Acrobat, PostScript, and Reader are either trademarks or registered trademarks of
Adobe Systems Incorporated in the United States and/or other countries.
Oracle is a registered trademark of Oracle Corporation.
UNIX, X/Open, OSF/1, and Motif are registered trademarks of the Open Group.
Citrix, ICA, Program Neighborhood, MetaFrame, WinFrame, VideoFrame, and MultiWin are trademarks or
registered trademarks of Citrix Systems, Inc.
HTML, XML, XHTML and W3C are trademarks or registered trademarks of W3C®, World Wide Web
Consortium, Massachusetts Institute of Technology.
Java is a registered trademark of Sun Microsystems, Inc.
JavaScript is a registered trademark of Sun Microsystems, Inc., used under license for technology invented and
implemented by Netscape.
SAP, R/3, SAP NetWeaver, Duet, PartnerEdge, ByDesign, SAP BusinessObjects Explorer, StreamWork, and
other SAP products and services mentioned herein as well as their respective logos are trademarks or
registered trademarks of SAP AG in Germany and other countries.
Business Objects and the Business Objects logo, BusinessObjects, Crystal Reports, Crystal Decisions, Web
Intelligence, Xcelsius, and other Business Objects products and services mentioned herein as well as their
respective logos are trademarks or registered trademarks of Business Objects Software Ltd. Business Objects
is an SAP company.
Sybase and Adaptive Server, iAnywhere, Sybase 365, SQL Anywhere, and other Sybase products and services
mentioned herein as well as their respective logos are trademarks or registered trademarks of Sybase, Inc.
Sybase is an SAP company.
All other product and service names mentioned are the trademarks of their respective companies. Data
contained in this document serves informational purposes only. National product specifications may vary.
These materials are subject to change without notice. These materials are provided by SAP AG and its affiliated
companies ("SAP Group") for informational purposes only, without representation or warranty of any kind, and
SAP Group shall not be liable for errors or omissions with respect to the materials. The only warranties for SAP
Group products and services are those that are set forth in the express warranty statements accompanying
such products and services, if any. Nothing herein should be construed as constituting an additional warranty.
© SAP AG
Page 2 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
Icons
Icon
Meaning
Caution
Example
Note
Recommendation
Syntax
Typographic Conventions
Type Style Description
Example text Words or characters that appear on the screen. These include field names,
screen titles, pushbuttons as well as menu names, paths, and options.
Cross-references to other documentation.
Example text Emphasized words or phrases in body text, titles of graphics and tables.
EXAMPLE
TEXT
Names of elements in the system. These include report names, program
names, transaction codes, table names, and individual key words of a
programming language, when surrounded by body text, for example, SELECT
and INCLUDE.
Example
text
Screen output. This includes file and directory names and their paths,
messages, source code, names of variables and parameters as well as names
of installation, upgrade and database tools.
EXAMPLE
TEXT
Keys on the keyboard, for example, function keys (such as F2) or the ENTER
key.
Example
text
Exact user entry. These are words or characters that you enter in the system
exactly as they appear in the documentation.
<Example
text>
Variable user entry. Pointed brackets indicate that you replace these words
and characters with appropriate entries.
© SAP AG
Page 3 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
Contents
1
SAP Best Practices for Human Capital Management U.S. v1.605: Solution Scope .................... 5
1.1
2
Purpose ............................................................................................................................... 5
Functional Scope – Supported Business Processes or Scenarios ............................................... 5
2.1
Maintain Company Organizational Structures .................................................................... 5
2.2
Personnel Management for Limited HCM ........................................................................... 6
2.3
New Hire / Rehire Administration ........................................................................................ 6
2.4
Time Entry ........................................................................................................................... 6
2.5
Benefits Enrollment and Termination .................................................................................. 7
2.6
Payroll and Post Payroll Processing ................................................................................... 7
2.7
Organizational Change Administration ............................................................................... 8
2.8
Leave Of Absence (LOA) Administration ............................................................................ 8
2.9
Employee Terminations ...................................................................................................... 8
2.10
Maintain Employee Information........................................................................................... 9
2.11
Time Administration ............................................................................................................ 9
2.12
Time Processing – Cross Application Timesheet (CATS) ................................................ 10
2.13
Time Evaluation Processing.............................................................................................. 10
2.14
Benefits Administration ..................................................................................................... 11
2.15
Retroactive Payroll Processing ......................................................................................... 11
2.16
Offcycle Payroll Processing .............................................................................................. 12
2.17
FMLA Processing .............................................................................................................. 12
2.18
Period End Closing for HCM ............................................................................................. 13
2.19
SAP ERP Reporting for HCM............................................................................................ 14
2.20
Employee Self Servces ..................................................................................................... 15
2.21
ManagerSelf Services ....................................................................................................... 15
2.22
Employee Performance Management .............................................................................. 16
© SAP AG
Page 4 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
1 SAP Best Practices for Human Capital
Management U.S. v1.605: Solution Scope
1.1 Purpose
This Solution Scope provides an overview of the processes and functions covered by SAP Best
Practices for Human Capital Management. It describes the functions and explains their business
purposes.
Under Functional Scope – Supported Business Processes or Scenarios, you will find a scenariobased view of the functions. Under Functional Scope – Functions, you will find a view arranged
according to groups of functions and based on the relevant SAP Solution Map.
The Solution Scope does not provide technical explanations of how to use the functions.
For more information about this topic, see the business process documents.
2 Functional Scope – Supported Business
Processes or Scenarios
2.1 Maintain Company Organizational Structures
This scenario describes the typical processes used when updating the organizational structure, for
example, creating new positions for hiring or changes of positions from one organizational unit to
another for transfer. It also describes the processes used to create the various organizational
objects that comprise the organizational structure.
Process Flow

Creating Organizational Units, Jobs and Positions

Maintaining Organizational Units, Jobs and Positions

Organization and Staffing changes
Key Points

Provides processes for creating and maintaining organizational objects

Describes method for maintaining the organizational structure and staffing changes

US compliance job attributes delivered

Integration with Finance
© SAP AG
Page 5 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
2.2 Personnel Management for Limited HCM
The HR mini master record can be created to allow companies to record working time. Working time
can be recorded on a sales order, internal order, service order, or a project. Additionally you can
switch over to travel management for reimbursement and posting of travel expenses.
Process Flow

Create employee mini master record

Time Recording using Cross Application Time Sheet (CATS)

Approval of Working times

Time Sheet: Transfer to Target Components
Key Points

Integrated with SAP Best Practices Baseline solution

Ability to maintain employee mini master record

Ability to enter time using CATS

Ability to approve time entries
2.3 New Hire / Rehire Administration
This scenario describes the typical processes used for hiring candidates or rehiring employees using
personnel actions.
Process Flow

New Hire personnel action

Rehire personnel action

Activate Non-Employee personnel action

Reactivate Non-Employee personnel action
Key Points

Provides processes for hiring and rehiring employees into the organization
2.4 Time Entry
This scenario encompasses the typical processes to create and maintain employee time information,
completing hourly time entries using CATS, attendance, and absence recording, or Time Managers
Workplace.
Process Flow
Key process flows covered:
© SAP AG
Page 6 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope

Manual time entry – Attendances

Manual time entry – Absences

Manual time entry – Weekly screen

Cross Application Time Sheet entry and release

Time Managers Workplace Employee Selection

Time Managers Workplace View Employee Data

Time Managers Workplace Time Entry
Key Points

Multiple methods of time entry

Overtime can be entered manually (with quotas) or calculated by the system
2.5 Benefits Enrollment and Termination
This scenario describes the typical processes performed by the Human Resources department to
enroll employees into the available Benefit Plans and then to discontinue the plans upon the
departure of the employee.
Process Flow

New Hire personnel action enrollment into benefits

Open enrollment processing

Maintaining employee elections in each benefit plan

Map Beneficiaries and Dependents to specific plans

Print Confirmation or Enrollment Statements

Terminate benefit plans upon the employee’s departure
Key Points

Provides processes for enrolling employees into benefit plans according to their elections for
each plan
2.6 Payroll and Post Payroll Processing
SAP Best Practices for HCM U.S. delivers a preconfigured, ready-to-run payroll solution. The most
common shared payroll practices across the US are delivered, including absence processing, check
and direct deposit payments, benefits administration, garnishment administration with third party
remittance, FMLA processing, and posting to FI/CO.
Process Flow
The following functions are provided:

Maintain Master Data and Time Data
© SAP AG
Page 7 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope

Run US Payroll

Run Simulations and production runs for FI/CO Posting and 3rd Party Remittance

DME Management

Off-cycle payroll processing

Payroll journal reporting
Key Points
o
Sample best practices wage type catalog delivered
o
Integration with Financials Baseline package
2.7 Employee Transfer Administration
This scenario describes the typical processes used when changing positions or changing a person’s
pay.
Process Flow

Change in Position Personnel Action

Change in Pay Personnel Action
Key Points

Provides processes for changing the position of an employee within the organization or
changing their rate of pay
2.8 Leave Of Absence (LOA) Processing
This scenario describes the typical processes used when employees take leave of absence.
Process Flow

Leave of Absence – Active Status personnel action

Leave of Absence – Inactive Status personnel action

Return to Work from Active personnel action

Return to Work from Inactive personnel action
Key Points

Provides processes for placing an employee on a leave of absence and returning them back
to work
2.9 Employee Terminations
This scenario describes the typical processes when an employee has decided to retire from the
company or has been separated from the company.
© SAP AG
Page 8 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
After the employee has left the enterprise, he or she has employment status 0. Payroll recognizes
this status and as a result, the employee is not included in the next payroll run. If an employee has
employment status 0, he or she is also ignored by a large number of evaluations.
Process Flow

Employee Separation personnel action

Employee Retirement personnel action

Deactivate Non-Employee personnel action
Key Points

Provides processes for separating employees and non-employees from the organization

Provides processes for retiring an employee
2.10
Maintain Employee Information
This scenario describes the typical processes used to create and maintain employee master records
that contain all personal data, time data, benefit data, and payroll data.
Process Flow

Creating employee master data

Maintaining employee master data
Key Points

Provides processes for creating and maintaining data for the processing of employee
general data, benefits, time, and payroll
2.11
Time Administration
This scenario describes the typical processes used in Time Management to review and process
quota balances.
Process Flow

Employee Quota Overview

Absence Quota Report

Creating Quotas Manually

Quota Corrections

Time Quota Compensation
© SAP AG
Page 9 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
Key Points

Provides methods of reviewing employee quota balances including manually created quotas
and automatically generated quotas

Allows for correction of quotas

Describes method for compensating quota balances
2.12 Time Processing – Cross Application Timesheet
(CATS)
This scenario covers time recording using the Cross Application Time Sheet.
Process Flow
This scenario describes additional processing steps necessary for time recorded using the Cross
Application Time Sheet (CATS). It includes the following steps:

Allow the supervisor or time administrator to review and approve the employee’s time. This
step may not be necessary depending upon the settings configured in the CATS data entry
profile that was used to record the time.

Transfer the time to the various SAP modules depending on the data recorded.
Key Points

Allows supervisor to review time prior to being processed for pay.

Costing assignment to master cost center with integration with payroll
2.13
Time Evaluation Processing
Workforce time evaluation processing handles overtime, holiday time, time-off, shifts, and more.
This activity evaluates employee time including overtime, holiday time, shifts, time off entitlements
(quotas), and so on. Time evaluation should be processed immediately before processing payroll to
ensure consistency in the results.
Process Flow

Process time evaluation

View time cluster

View time results

Time Management Pool

Time Statement Form
Key Points

Time wage types generated based time entered or scheduled time

Quotas automatically generated
© SAP AG
Page 10 of 17
SAP Best Practices

SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
Multiple methods for reviewing time evaluation results
2.14
Benefits Administration
This scenario describes the typical processes performed by the Human Resources department to
monitor and make corrections to employee’s data in the available benefit plans.
Process Flow

Mass generation of Adjustment Reasons

Group enrollment into specified benefit plans

Monitoring of employee elections in each benefit plan

Validating employee elections

Adjusting employee’s data
Key Points

Provides processes for enrolling, monitoring, and verifying employees in benefit plans
according to their requested elections for each plan.
2.15
Retroactive Payroll Processing
The Retroactive Payroll Processing component helps you to understand the process to calculate
retroactive monetary changes or posting related changes within SAP’s payroll component.
Retroactivity refers to the ability to make employee master data changes prior to the current pay
period. SAP Payroll then automatically recalculates previous periods and adjusts the results
accordingly. The majority of SAP Payroll users find retroactivity to be one of the most useful and
powerful functionalities, and at the same time one of the most complex functionalities.
Master data changes that are earlier than the current pay period dates trigger a retro payroll for an
employee in the current payroll run. SAP recalculates all payroll periods starting with the earliest
payroll period that is affected by this change and pays out or deducts the differences from the
current pay.
Process Flow

Set controls to administer depth of retroactive changes

Change payroll relevant master data

Execute payroll including retroactive calculations and processes
Key Points

Automatic calculation of retroactive payments and integration with Finance

Easy installation procedure by usage of a step-by-step approach

BC Sets provide for fast implementation methodology
© SAP AG
Page 11 of 17
SAP Best Practices
2.16
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
Offcycle Payroll Processing
Offcycle Payroll Processing covers processes for replacing lost/stolen checks, reversing payments,
paying in advance, manual check processing, and bonus payments.
Offcycle Payroll Processing helps you to understand the process of replacing lost or stolen checks,
reversing payments, paying an employee on-demand in advance, processing manual checks and
paying bonuses through a payroll run that is not a regular run.
Offcycle Payroll Processing functions include:
Process Flow

Complete processing of employee offcycle Payroll

Run payroll for payments including bonuses and other one-time payments, advance
payments (multiple pay periods), and absence payments (days within a payroll period)

Execute a correction payroll when changes have been made to an employee's master data

Process payroll data for a check that was manually created outside of the system

View an employee's payroll history

Replace payments

Reverse payments

Adjust W2 data of individual employee during the year end process
In this scenario, you can:

Set-up off cycle payments

Process off-cycle payments

Execute payroll including retroactive calculations and processes

Executing subsequent activities
Key Points

Easy installation procedure by usage of a step-by-step approach

BC Sets provide for fast implementation methodology
2.17
FMLA Processing
The FMLA Workbench lets you create and check FMLA requests. This Best Practices package
covers federal laws.
You can use the Family Medical Leave Act (FMLA) Workbench to complete all tasks concerning
FMLA requests, such as creating and checking FMLA requests. This SAP Best Practices package
covers the federal laws concerning FMLA but does not cover the relevant state laws.
The FMLA Workbench displays all FMLA requests recorded for an employee, including rejected
requests. FMLA rules are part of the FMLA requests. The rules represent all laws and guidelines
according to which employees are potentially eligible to request absences covered by FMLA. The
system determines the FMLA rules according to the employee and the reason specified. Each FMLA
request must specify the FMLA reason.
© SAP AG
Page 12 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
Process Flow

Create and Check FMLA Request

Completing and Approving an FMLA Request

Creating Additional FMLA Requests

Testing FMLA Requests

Processing Absences

Recording Absences

Changing Absences

Checking FMLA Entitlements

Changing and Deleting FMLA Requests
Key Points

Provides calendar year and rolling year FMLA tracking
2.18
Period End Closing for HCM
The closing operations component helps you prepare and carry out the activities required for
daily/month-end, quarterly-end, and year-end closing in payroll.
For this purpose, the system provides a series of standard reports that can be used to generate
evaluations and analyses of payroll.
For quarterly and year end closing a number of payroll tax reports can be generated using tax
reporter functionality
This scenario consists of the following period end reports:

Form W-2 Wage and Tax Statement

Form W-2c Corrected Wage and Tax Statement

Form 940 Employer’s Annual Federal Unemployment Tax Return

Form 941 Employer’s Quarterly Federal Tax Return

Form 941c Supporting Statement to Correct Information

Form 1099-R Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans,
IRAs, Insurance Contracts, and so on

State Unemployment Insurance (SUI) wage reports
Process Flow

Day-end closing

Month-end closing

Quarterly closing

Year-end closing
© SAP AG
Page 13 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
Key Points

Review payroll results and wage type details

Reconcile payroll postings

Execute quarterly reports and year-end W-2 activities
2.19
SAP ERP Reporting for HCM
The SAP Best Practices for HCM delivers standard reporting and period end closing activities.
The following reports are covered:

Most common standard US compliance reports

Ad hoc HR Queries, Infosets, and User groups

Tax reporter for period end closing

HR Audit Report
Process Flow

Personnel Administration reporting

Organizational Management reporting

Benefits reporting

Time Management reporting

Payroll Reporting

Public Sector reporting

Flexible HCM Ad-hoc Queries

Audit Log
Key Points

Access valuable HCM data efficiently and when needed

Avoid user anxiety on accessing data at cutover and go-live

Avoid writing unnecessary, complex custom reports that waste project dollars and increase
ongoing maintenance costs

Save valuable development dollars for where they are most needed
© SAP AG
Page 14 of 17
SAP Best Practices
2.20
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
Employee Self Services
The SAP Best Practices for HCM delivers Employee Self-Services via NetWeaver Business Client
(NWBC). Employee self service
Employee Self-Service (ESS) provides capabilities that enable employees to create, view, and
modify data anytime and anywhere, using multiple technologies. It provides for an employee-centric
portal environment. With easy access to the information they need to do their jobs, employees can
manage duties that were previously handled for them. ESS also expedites life and work changes
(such as marriage or a new job), freeing HR professionals from mundane administrative tasks and
allowing them to dedicate their time and resources to strategic initiatives.
This scenario deals with the Employee Self Services second level navigation menu item for the
NWBC front-end. Within the ESS menu, this document will focus on the Personal Profile, and
Working Time tab.
The following elements of employee master data are shown and processed: Personal Data (IT0002),
Address (IT0006), and Family/Related Person (IT0021). From a payment perspective, the
remuneration statement and compensation statement are displayed. Time data maintained includes
attendance/absences on a timesheet as well as create a leave request. Quota accrued (balances)
as well as Time Statements can be seen.
Process Flow

Creating employee personal profile

Maintaining employee personal profile

Creating employee working time

View employee payslip and compensation statements

View employee time statements

View employee absence quota balances
Key Points

Provides processes for creating and maintaining employee personal profile

Provides process for creating and maintaining employee working time

Utilization of workflows for timesheet and request approvals
2.21
Manager Self Services
The SAP Best Practices for HCM delivers Manager Self-Services via NetWeaver Business Client
(NWBC).
SAP Manager Self-Service empowers managers to make departmental decisions that align with
strategic business objectives in areas such as budgeting, recruitment, compensation, and cost
management.
By leveraging analytical information and flexible reporting options, managers can plan, measure, and
communicate the effects of HCM strategies on overall business results.
© SAP AG
Page 15 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope
This scenario deals with the Manager Self Services menu item for the NWBC front-end. Within the
MSS menu, the manager is able to focus on the Manage Employee Time functionality.
Process Flow

Approve timesheet

Approve leave request
Key Points

Provides processes for approving timesheet and leave request

Manager approval using power list and SAP inbox

Workflow approvals routed to Manager
2.22
Employee Performance Management
This scenario deals with the Predefined Performance Management process which includes goal
planning, goal tracking, and performance appraisal (by both the employee and the manager) as well
as performance monitoring.
It starts with team goal and individual goal setting by manager and employee. The next step is the
review step which is followed by the appraisal step which starts with the manager giving their ratings
and comments, and any other team members included in the process give their rating.
The employee approves or rejects each of the phases. There is also calibration support for the
Predefine User Interface.
Process Flow

Creation of performance appraisal template

Creation of performance appraisal process and timelines

During the planning phase, goals are established for the company, team and employee

The review phase consists of reviewing and updating goals

The appraisal phase consists of appraising the individual performance, and calibrating the
team performance ratings
Key Points

Configuration is minimal

Use of a standardized performance management process

Templates and appraisal documents are created via a wizard

Role based

Utilization of workflows for notification of employees and managers
© SAP AG
Page 16 of 17
SAP Best Practices
SAP Best Practices for
Human Capital Management U.S. v1.605: Solution Scope

Pre-defined corporate goals and core values are automatically cascaded through all levels
of the enterprise

Portal access via Manager and Employee Self Service

Integration with other talent management modules of SAP e.g. Enterprise learning
© SAP AG
Page 17 of 17