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Equipment and tools

management (ETM)

Definition
Planning, processing, settlement and
evaluation of the resources in order
to achieve optimal process flow in
constriction /equipment rental
companies.
It is one of the topics from subject
Engineering, construction and
operations
Performance measurement of
resources (materials and

Modules involved
SD Sales and Distribution
PM Plant maintenance
FI and CO Finance and costing

Features
Representation of various catalogs containing equipment,
machinery, tools, accessories, attachments etc.
Catalog BOMs
Shipping and settlement packages
Relationship between owners and administrators of
equipment
Shipping and performance based equipment (PBE)
documents
Settlement calendar
Filler calendar for PBE
Time based /performance based settlement
Inventory management
Equipment planning

Catalogs

Its a structural list of different types of


machinery, for example equipment,
vehicles, machines etc.
It is based on SAP standard classification
system
Each ETM catalog is assigned to class and
class type
That means all numbers assigned in
particular catalog along with characteristics
and values are assigned to class

Catalog BOMs
Representation of catalogs in SAP is
ETM BOMs.
These are similar to production
BOMs, in other words, these are
assemblies like vehicles,
equipment/machinery
BOMs include list of parts along with
item descriptions, quantities and unit

Shipping and settlement


packages
Minibus driven to the construction
site with a box containing small
several items like shovels, buckets,
floor cloths, hand gloves etc. All
these materials are entered in
system and sent together as one
shipping package
Settlement packages are related to
cost assignment of the equipment.

Owners/Administrators
Owner is owner of the equipment which manages
equipment accounting and responsible for
depreciation of equipment. (reduction in value of
asset over a certain period due to wear and tear
Administrator manages on behalf of owner.
Owner and administrator can be same
It collects/receives revenue from rental/external
third parties.
Generally administrator pays lease charges to
owner. This can be fixed amount or may be
dynamic based on % basis.

Shipping and PBE


documents
Shipping document enables to send the
materials/equipment/resources/packag
es along with information like quantity,
description etc.
PBE documents enable to record No of
working hours, idle hours, number of
kilometers, oil consumption etc. for
resources/equipment

Settlement calendar
Important settlement data is stored
in this calendar.
It also controls release of the
settlement

ETM/equipment planning
ETM planning is similar kind of concept like
requirement planning.
Planning is being carried out as per the requirement
and availability of the equipment in warehouse or
magazines at construction sites.
There is a stock and requirements planning controller
The controller uses the classes and characteristics of
the equipment in order to choose best suited
equipment which can fulfill most of requirements.
Controller also ensures the equipment availability for
use at required time


Filler Calendar for PBE
Filler calendar generates missing PBE
documents or completes existing PBE
documents that are incomplete.
For example, project manager/construction site
manager has forgotten to enter PBE document
for excavator A which was idle on 20/12/2016,
due to repairing/maintenance activity
So activity and settlement types in operation
defined in filler calendar for PBE settles and
fills missing hour entries.

Inventory management
Inventory management is based on
different levels as follows,
Document level, recipient level,
material level or equipment level

There are 2 types- chronological and
chaotic inventory management

Prerequisites
Basic customization knowledge for
following modules is essential

PM
MM
SD
FI/CO
PS

Customizing settings
Customizing settings are required to be
carried out for following parameters

Master data
Catalog
Calendar (Settlement calendar)
EDI (Cross company settlement)
Account determination
Inventory

Master data

ETM Catalog
ETM Bill of materials
ETM equipment
Owner/Administrator
Recipient

Benefits
Improve availability and tracking of the
equipment
Manage overall workload
Reduce handling and administration cost
Most flexible prices and account
determination
Optimal equipment utilization
Profitability analysis/return on asset or
equipment

Key process flows


Time based equipment process
Performance based equipment
process
Non-consumable material process
Consumable material process

Time based equipment process


Process includes planning, dispatching and settlement of the time based equipment
Equipment can be single part or multipart
Shipped via ETM shipping document
Settlement is carried out as per the number of days or period for which equipment is
been present at recipient location or at construction site.
The shipping document allows tracking of each equipment (single part or multipart)
TBE is settled periodically with the fixed price, whereas it is not relevant how often
equipment has been used in operation. Example is Crane (e.g. Hook high max. 20
mtr.)
Process starts with equipment request created by project manager or foreman.
ETM requisition note may directly be created by project manager or he /she may call
to administrator/equipment manager responsible for equipment & then he will enter
requirement in the system accordingly.
Once equipment manager assigns the request to equipment, it will then send out to
the project site
Settlement and billing run takes place during month end generally.

Performance based
equipment process
This business process is based on performance measurement of
equipment in terms of amount of fuel consumption, amount of
kilometers etc. for a project & settle PBE
Performance based equipment document is also sent to construction
site along with shipping document for respective equipment in order to
control and record the equipment usage. Ex. Excavator.
The requisition process for PBE is similar to TBE
ETM requisition note may directly be created by project manager or
he /she may call to administrator/equipment manager responsible for
equipment & then he will enter requirement in the system accordingly.
Once equipment manager assigns the request to equipment, it will then
send out to the project site
Once all PBE documents are entered for the required or agreed period,
settlement is being carried out accordingly.
Billing run takes place after creation & correctness checking of the
settlement list by project manager or foreman.

Nonconsumable material process


This process is used if non-consumable material, e.g. site facilities, ladders etc.
has to be shipped from warehouse to a recipient together with equipment in
one ETM shipping document or may be taken out of magazine.
The same ETM shipping document is utilized to return the non-consumable
material to magazine or in warehouse in order to save time, transport cost &
administrative efforts.
Magazines are like little project warehouses on big construction sites/projects.
Construction sites buy non consumable material at a fixed price & after usage,
non-consumable material is given back either to the magazine or warehouse
wherein reduced value will be credited to the project.
During periodic settlement, project gets debited for received material and
credited for returned material. In other words, project pays a kind of provision
fee for the material usage.
Settlement is based on quantity and not on time period.
Cost charging and automated repurchase of non-consumable material is fully
automated/handled via ETM

Consumable
material process

The business process is used for shipping consumable material


like concrete, nails together with equipment with ETM shipping
document to reduce transport/handling cost for the project in
construction industry

Cost charging is done by standard SAP-SD and MM modules

No settlement takes place in ETM for consumable materials.

THE
END