Outstaffing with SAP Logistics

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Key Takeaways

⇨ Companies like those in retail dealing with seasonal demand spikes should consider a temporary personnel supplier system for seasonal staffing.

⇨ SAP Logistics enables flexible and precise online interaction with partners to accommodate staffing needs.

⇨ This optimization can reduce costs associated with delays in personnel provisioning and, consequently, reduced dissatisfaction caused by unmet personnel requirements.

In the retail industry, there are seasonal or other activity spikes that can be driven by various factors. This could include a general surge in shopping activity before the holidays or a local one, such as due to a major event happening in a specific area. Additionally, specific stores may encounter temporary staffing challenges. Typically, to optimize costs, each store maintains a minimal permanent staff.

Figure 1 General Outstaffing scheme

To address such challenges, the central office of the retail company has contracts with several temporary staffing providers. The retail company plans its temporary staffing needs considering the type of business, the store network, the type of personnel, and the location. Requests for personnel are coordinated with the staffing providers. Subsequently, the actual activities of the hired temporary staff are recorded. When settling accounts with the staffing providers, not only earnings but also deductions are considered.

The key feature of this solution is the integration of HR, logistics ERP, and web-portal processes. This integration enables detailed and flexible planning and tracking of temporary staff activities. It allows for responsive interaction with multiple interchangeable staffing providers. It also facilitates precise evaluation of personnel, considering the actions of each employee. Moreover, it enables settlements with staffing providers accompanied by in-depth analytics and flexible pricing terms.

Brief Description of Business Process Implementation

The technical implementation of the business process involved separate systems for HCM (Human Capital Management) and ERP (Enterprise Resource Planning), as well as a web portal for communication with personnel providers and individual stores. Exchange of data between these systems was facilitated using PI/RFC (Process Integration/Remote Function Call). This article specifically describes the ERP processes. Here is a concise list of these processes:

  • Managing of partners master data for temporary staff suppliers (TSS).
  • Managing the purchased services (TSS services) and the sold of services (penalties).
  • Managing prices for TSS services and penalty prices with detailed classification.
  • Managing contracts for procuring TSS services and for selling services (penalties).
  • Creating and coordinating requests for temporary personnel with suppliers.
  • Recording the actual activities of temporary personnel.
  • Determining the final settlements with TSS providers.

In the context of ERP logistics, master data and document chains for the procurement and sale of services are concurrently used. Data exchange with HR and the web- portal occurs at each stage. Figure 2 illustrates the schema of the business process implementation.

Figure 2 Business process implementation diagram

Management of Temporary Staff Supplier master data

Data about of temporary staff suppliers should be regularly and automatically transmitted from the ERP system to the HR system. These counterparties must be distinct from others. In the SAP ERP system, creditors and debtors were managed in different catalogs. For this process, a creditor and debtor must have the same number. Only the part of the main data required for HR accounting is transmitted. To determine whether a counterparty belongs to TSS, classification of creditors is used. A class “ZPVP” of type 010 was created, and one characteristic was defined for it. This characteristic has one permissible value, “Temporary Staff Supplier”. The class is assigned to one of the vendor account groups. Determining the characteristic value is technically optional and is only defined for necessary vendors (creditors).

To transmit counterparty data to HR, a structure was created in ERP, which includes the fields to be transmitted and their relationships. The “ZTSS” class with the characteristic was also created in HR. The basic creditor data, data on the assignment of the “ZTSS” class to the creditor, and data on the characteristic value for the transmitted creditor are transmitted. Upon receiving the data in HR, the following actions are taken:

  • The presence of the master creditor data in the “General Data, Address” perspective is checked. If it was absent, it is created.
  • The assignment of the “ZPVP” class for the creditor is checked, and if it’s missing, it is added.
  • The characteristic value for the class is updated in accordance with the received data.

HR users can find “TSS” creditors using the standard search tools, including classification. The process of managing TSS counterparties occurs when concluding a contract for the engagement of external personnel with a counterparty. The person responsible for the contract checks for the presence of the corresponding counterparty in SAP ERP. For counter partners already in the system, the presence of the “TSS” characteristic is checked, and if it’s missing, a request is sent to the Master Data Management department to modify the counterparty.

Managing the purchased services (TSS services) and the sold of services (penalties)

External personnel positions correspond to services from the standard service catalog in ERP MM SRV (transaction AC01, table ASMD). The certain material group called “External Staff Positions” is used to manage services related to external personnel. The HR to ERP data transfer regularly transmits the HRP1000 table, which includes a list of all positions, each having a position code HRP1000-OBJID (HRP1000-OTYPE=C). Each service corresponding to a TSS position has a reference to a position from HR. To establish this reference, a Z-table called “Position-Service Link” is used, linking data from tables ASMD and HRP1000, along with a validity period. To edit such a table, a maintenance view and a Z-transaction for configuration are used. When saving a service from the “External Staff Positions” material group, the system will prompt for changes to be made in the “Position-Service Link” table.

In addition to services corresponding to HR-positions, several generalized piecework services are also used. These services are exclusively managed in ERP.

Communication update with HR is carried out when a new service (new position) is added to the contract for the engagement of external personnel or when its usage is expanded for new store networks, business types, or personnel types.

Claims are managed as material masters with of type DIEN (services). In the SAP ERP system, claims can correspond to specific Materials such as:

  • Supplier Evaluation
  • Material Damage
  • Cart Loss
  • Non-Appearance

These materials should be extended to cover all sales organizations and distribution channels corresponding to stores. All the listed materials belong to a certain material group called “Penalties, Others.” They are measured in “EA” (each) unit and have a material account assignment group “Penalties – Outstaff. Personnel”. These materials also have the valuation class is “Penalties for Business Contracts”.

Managing Prices for Procured Services (TSS Services) and prices for Penalties

Prices for the purchase of temporary staff services can be divided, for example:

  • Periods of Validity: Prices can vary based on different time periods.
  • Plants: Prices may differ depending on the plant (store).
  • Regions: Different regions may have different pricing structures.
  • Tariff Zones: Tariff zones can influence pricing.
  • Retail chains type: Prices can vary for different retail chains, like hypermarkets, supermarkets, and discount stores.
  • Business Types: Different types of businesses, such as retail, logistics, and manufacturing, can have different pricing structures.

To manage prices at the plant and regional levels, standard condition functionality is used. For each combination of business type and retail chain type, a condition type with an appropriate name is created. Additional attributes, such as the association with a retail chain or business type, are determined at the contract header level. This allows for the automatic selection of these conditions in purchase orders.

The tariff zone for a plant is managed in HR and contains references to specific plants. Information about the tariff zone is transferred from the HR system to a custom ERP table, which includes the plant code and the tariff zone code and name.

A calculation scheme was used considering the access sequence: Prices are first searched for the specific store; if not found, the system looks for prices at the regional level, considering the retail chain and business type. If regional prices are not specified, the system searches for prices based on the tariff zone, considering retail chain and business type.

Price conditions are managed independently of contracts. When a price changes, a new price is entered for the next validity period. The previous price is retained in the historical records for reference. This approach ensures that pricing can be adjusted dynamically to meet changing business needs while maintaining a historical record of prices for auditing and reference purposes.

For the sold services (penalties), two different approaches are utilized:

  • Formula Condition: This approach employs coefficients to adjust the cost based on the received evaluation for materials with DIEN type (penalties) like “Supplier Evaluation” and “Absence”
  • Amount Condition: In the case of materials with DIEN type such as “Loss of Carts” and “Material Damage,” a sum condition is used.

Pricing conditions for these materials can be managed in various combinations, including specific stores (plants), regions, tariff zones, retail chains, and business types.

In the HR system, individual and group coefficients are collected, which are then used to calculate final scores for supplier evaluation. These coefficients are transferred to the ERP system, typically on a five-point scale. Depending on the received scores, different coefficients can be applied to the supplier’s documents. The system utilizes these coefficient changes in the calculation of procurement based on associated purchase orders and in calculating the cost of penalties within an agreement.

To determine the price, pricing scales are maintained in the ZS** conditions. These pricing scales are used to calculate the adjusted prices based on the coefficients derived from supplier evaluations, providing a flexible pricing mechanism that considers supplier performance and other factors when determining costs and penalties.

Evaluation of supplier services Cost change factor
4.0 – 5.0 0
3.0 – 3.9 3%
2.0 – 2.9 10%
1.0 – 1.9 15%

Table 1 Example of using a rating scale.

For the material “Absence,” data from HR includes the position, store (or region, tariff zone), and the number of hours of absence. The system determines the cost per hour for this position in this store (region, tariff zone) and multiplies it by a coefficient condition applied to the contract, for example, a factor of 3 (penalty multiplier).

For the material “Absence,” data from HR includes the position, store (or region, tariff zone), and the number of hours of absence. The system determines the cost per hour for this position in this store (region, tariff zone) and multiplies it by a coefficient condition applied to the contract, for example, a factor of 3 (penalty multiplier).

In the case of “Loss of Carts,” the quantity is entered directly in the sales order. The system determines the cost by selecting the appropriate price condition based on the access sequence for the specific combination in which the condition is maintained.

For the Material (Material Damage), the price is not managed separately but is specified directly when creating the sales order along with the quantity.

Managing contracts for procuring services and for selling services.

To manage contracts for the temporary staff services and for the sale of services (penalties) new types of documents have been created in the SAP ERP system among purchasing and sales contracts. Document Types: Two types of documents are technically associated with each TSS contract: a Purchase Contract and a Sales Contract. These two documents are linked and share a common legal contract number.

Contract attributes: Each TSS contract is checked for the supplier’s classification characteristic “Temporary Personnel.” Additional attributes such as the retail network type, business type, and personnel type (basic, auxiliary, cleaning) must be specified in the contract’s header (EKKO table). These attributes ensure that only valid services are chosen for the contract. Lists of retail network types, business types, and personnel types can be expanded, and their values are maintained in Z-tables in the ERP system. These values are also synchronized with HR.

Contract Items: In the purchase contract items, you can select the type “U” for Service or “W” for Material Group (services). When you select type “U,” you choose a specific service group and select particular services from the catalog. When you choose type “W,” only one service group (material) is selected.

In the sales contract items, materials are specified, such as “Supplier Evaluation,” “Loss of Carts,” “Material Damage,” and “Absence” if these claims are covered by the contract. For supplier evaluation, a condition considering the evaluation scale is specified. For “Absence” a penalty multiplier is indicated, and for “Loss of Carts,” the price for losing one cart is mentioned.

Contract Approval: Contracts require approval (release). Standard functionality for releasing purchase contracts is used for this purpose. For the sales part of the contract, a developed process is used to pass the unblocking status from the purchase part.

Data transfer to SAP HR: Contract data from both the purchase and sales parts is transferred to SAP HR in the form of a Z-table. This transfer takes place upon full release of the contract or cancellation of the release.

Contract Closure: Before closing a contract, checks are performed to ensure both the purchase and sales parts are closed. Additionally, the system verifies the absence of active requests and open orders.

Creating and coordinating requests for temporary personnel with suppliers

The planned demand for temporary staff services, specifying specific positions with a breakdown by specific stores, is generated in SAP HR. Based on data from SAP HR, the ERP system generates purchase requisition (type ZTSS) “Temporary Staff Supply” for each position. Each PR-item includes the following data:

Field Value Description
Account Assignment Category K Cost center
Item Category D Service
Material Group Z*** “External Staff Positions”
Contract Contract number
Plant Store
Subitem (services tab in PO-item) Several services Services correspond to the position, for each number of hours, price, cost, cost center.
Name of Requisitioner/Requester Reference number from HR Number to link with HR.
Delivery date Date

Table 2 Item of purchase requisition

The price for the service is determined from organizational data (plant, plant region, tariff zone to which the plant belongs). The user can add service items manually to the application, indicating their quantity, price and store. In the PR-item, additional fields “Approval Status” and “Transfer Status” are maintained.

Data from purchase requisitions in ERP are periodically transmitted to a web portal accessible to personnel suppliers for approval. Every registered Temporary Staff Suppliers can see information about the quantity and price of services for each position, with a breakdown by stores and dates. Access to the portal is available from several suppliers with whom a contract has been concluded for the supply of temporary staff. Supplier managers should periodically monitor the portal and note which positions on which dates in which stores they are willing to close with the supply of temporary staff.

The supplier may reject some request items. If a supplier rejects a request, they specify a reason: quantity or price, along with an explanation.

When rejecting a price, responsible users from the central office of the customer can adjust price terms and update the request. After updating prices in a request, it is re-submitted for approval by the supplier via the portal. If a supplier rejects the quantity in a position, the status and reference number are transferred to HR. The item of purchase requisition in ERP is marked for deletion, and a new PR-item is created in HR, which, after approval, is transferred to ERP. If the supplier agrees on the item of purchase requisition taking into account prices, then the PR-item receives the appropriate status.

In the sales documents chain, based on “HR requests”, a sales Inquiry is formed, containing:

  • Date;
  • Link to the contract;
  • Link to the relevant ERP purchase requisition.
  • Material, which corresponding to the assessment of personnel and/or absenteeism.
  • The amount corresponding to the supplier’s assessment, broken down by store (plant);
  • The amount corresponding to absenteeisms, broken down by store (plant);
  • Link to the plant and cost center corresponding to the store (plant).

The Inquiry are sent to the portal, where suppliers approve them individually by position. If the supplier rejects the quantity, the Inquiry is reformatted through HR. If the price deviates, it is adjusted in ERP.

Recording the actual activities of temporary personnel

In the company’s SAP ERP system, an interface has been developed to record the actual utilization of external personnel. This interface receives data on the factual usage of external personnel over a specific period from SAP HR. The data about executed HR requests are transferred to SAP ERP through an intermediate Z-table for the generation of orders related to contracts. Separate purchase orders and sales orders are generated.

SAP ERP receives data in the following format:

Field Description
Contract The number of the active contract for which factual data on services is being provided.
Counterparty The number of the counterparty associated with the specified contract.
Store (Plant) The plant code within which factual services for external personnel and claims are specified.
Execution Date The end date of the period (month) for service provision or claim issuance, which will be specified in the invoice.
Service Number The service number corresponding to the actual position used.
Hours Quantity The number of hours for each service within the contract, period, and store.
Claim Number The service number (Material Number) corresponding to the claim.
Claim Quantity The assessment coefficient for the company within the contract and period.

Table 3 Data transferred from HR to ERP to reflect the fact of work.

Regularly at the end of the period, the responsible employee from the customer’s central office creates purchase orders considering the received fact. When starting a Z transaction, the user specifies the supplier and contract on the first screen. On the next screen, he selects all the necessary purchase requisitions under this agreement, filtering them by various parameters (status). A purchase order is generated for the selected items.

Similarly, in the Z-interface, based on the data received from HR and existing in ERP, a sales order is generated. The order has a link to the sales part of the TSS contract and to the purchase order. The sales order items contain actual data on claims (fines), quantities, prices, and link to the plant (store).

Purchasing and sales orders include items for one plant (store) per period. Once created, purchase and sales orders are simultaneously released by the customer’s managers.

Determining the final settlements with TSS providers

Invoices are generated for purchase and sales orders. A printed form is created in the system. The form includes acts under the contract (supplier of temporary staff) for a period (month). It also including the purchasing and sales part for all plants and results. When closing purchase and sales invoices, the offset INV_OFFSET is used within the framework of the general contract.


The implementation of the temporary personnel supplier system has proven to be highly successful for the client. It allowed them to optimize their workforce management processes, ensuring timelier and more precise fulfillment of various personnel needs. This optimization resulted in a reduction of costs associated with delays in personnel provisioning and, consequently, reduced dissatisfaction caused by unmet personnel requirements.

More accurate planning has led to cost reductions for both the client and the staffing supplier. The project’s success has been acknowledged not only by the client but also by the outsourcing companies collaborating with them. Positive mentions of the project can be found in Russian media.

The utilization of ERP logistics was a cornerstone of this project, enabling flexible and precise online interaction with partners. The project has been running successfully for several years within a large retail company encompassing food production, warehouses, transportation, and a network of thousands of stores of various retail formats.

Overall, this project stands as a testament to the benefits of effective ERP systems and their capacity to revolutionize workforce management in complex and large-scale enterprises.

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