What is Enterprise Structure

Siva Prasad
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SAP Trainer and Consultant
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SAP SD Training - in Plain English

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28:43:04 of on-demand video • Updated August 2018

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English So in this chapter we're gonna start learning about Enterprise Structure. What is enterprise structure? How do companies. In the system. Let me give you an example. If you take the company GE, GE is a pretty big company, right? So GE has GE healthcare, GE lighting, and say GE plastics. There are many different companies inside GE, but let's just take one of these. If you take GE Healthcare, GE Healthcare is again, a global company, meaning it does business in the US, it does business in the UK, Canada, India, Singapore, and so on. Now, if you take the US company. The US company has sales offices on the west coast. Because there are hospitals on the west coast. There are hospitals in the midwest. There are hospitals on the east coast. In the south. So on and on. And each sales office contains a whole bunch of groups of people. You know, some people doing a certain line of business. [COUGH] Salesman, say in Rob's group, does only capital equipment, meaning all the big stuff, right? Like X-ray machines or MRI machines and so on. Capital equipment. Steven's group does consumables. Meaning an x-ray equipment requires some tissues, some tubes, or something that's consumed just for that particular X-ray, for that patient. That's a consumable. A syringe is an example of a consumable; a tube is an example of a consumable. You see, the entire company is structure in a certain way, you know, in terms of where it's operated, how many different sales orgs it has, or sales offices it has. And in each sales office, how many different groups of sales reps are there. And of course underneath it, there are so many different sales reps. Right? Selling the product. This is one part of it. Another part is, I'm just taking US, just for the sake of simplicity. Another part is, maybe there's a manufacturing plant somewhere in Wisconsin. So in Wisconsin, so this is a manufacturing plant. So in Wisconsin, there is a plant or a factory, it could be one or more than one. You know, one of these factories is producing capital equipment, another producing consumables, another producing spare parts, so on and so forth. So, each factory will have or can have so many different warehouses. You know, one warehouse in Milwaukee. One warehouse in Waukesha, one warehouse in Brookfield. There just different cities that might have in all different warehouses that store the goods that these factory produces. And when you're shipping say, for example, spare parts for an x-ray machine, they could be shipped out of Brookfield. And when you're shipping an x-ray machine, the entire machine itself, it could be shipped out of Milwaukee. And say if you're shipping some consumables, it could be shipping out of Waukesha. All right. So, what I'm trying to say here, the company runs its business using different org structures. In this case each country represents a company. Because if GE Healthcare wants to do business in Singapore, it has to go set up a legal office there and do there business, so it's company. Where the profit and loss, the balance sheets, assets, liabilities, are maintained at this level. And further downstream, company has plans. One or more than one. Company has warehouses. Company has sales offices Since office, company has expenses around offices. Company has manufacturing expenses. Company is structured in a certain way to represent the structure of the company, entire GE or G healthcare, in SAP is done wire, enterprise structure. So this is the definition of enterprise structure