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Podcast: Become an SAP Pricing Expert - Live: Matthias Liebich, Author, Ultimate SAP Pricing Guide Print E-mail

sappricingguide.jpg"On Matthias' keys to success an independent SAP Pricing consultant, and how to use The Ultimate SAP Pricing Guide to advance your (or your teams') pricing know-how"
Podcast Interview Date: March 23, 2010
Podcast: Listen Now!
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Establishing yourself as an independent SAP consultant is no easy project. Today's interview subject has pulled it off. Matthias Liebich, senior SAP Pricing consultant, has expertise in SAP Pricing that dates back to the R/2 days. During this special 16 minute podcast, which I recorded live with Matthias in his home office in Atlanta, Georgia, I ask Matthias about why SAP Pricing consultants are necessary and how he has managed to keep himself marketable over the years. 

This podcast was taped not long after the release of Matthias' new book, The Ultimate SAP Pricing Guide. Originally inspired by a series of articles on SAP Pricing Matthias wrote for, Matthias' SAP Pricing Guide is the book he wished that he had as a reference guide when he first got his start in SAP Pricing. During our interview, I ask Matthias about the changes in SAP Pricing functionality from prior releases, the importance of ABAP to SAP Pricing projects, and how to avoid costly project mistakes by going about SAP Pricing in the wrong way. Matthias also explains why mastering the Condition Technique, a cornerstone of SAP Pricing functionality, is also a great idea - whether or not you specialize in SAP Pricing.

Podcast Highlights:

50 Matthias was born 45 minutes south of Walldorf, the SAP mothership, and he obtained R/2 training at Walldorf in the early days.

1:26 In the early R/2 days, Matthias developed a custom pricing solution for a client. In the those days, SAP had rudimentary pricing capabilities. His client needed more flexibility, so he developing a solution with custom tables that resembles the Condition Technique in today's R/3 and SAP ERP systems.

1:55 Three days of R/3 training and Matthias was out in the field, but how did he break into Pricing? After that three day jumpstart class, Matthias in was sent straight to his client as an SAP expert in Pricing. He had to scrambled to read the SAP Pricing documentation. This was one major reason why he wrote the Ultimate SAP Pricing Guide, to make it easier to understand the functionality. Standard SAP documentation doesn't explain in detail how the individual SAP Pricing components fit together.

3:25 So how has SAP Pricing functionality changed over the years? What do consultants need to know to stay in top of these releases? For those who are moving from 4.6 to 4.7 to 6.0, it's not a big change. After the 4.6 release, there were hardly any changes to the SAP Pricing components. There were some minor changes to SAP Rebate procedures, and some screens and fields were changed.

The big changes in functionality were from the 3.0 and 4.0 and 4.6 releases. During those releases, SAP Rebate functionality became more robust. Also, Master Data transactions to maintain multiple condition records for different condition types were introduced in 4.0. The lesson? If you're interviewing for a 6.0 job, and you only have 4.6C experience, tell the hiring manager you can do it, there aren't many changes.

4:30 Complexity in SAP generates a need for consulting, but why do we specifically need SAP Pricing consultants? As it turns out, many SAP users are turned off by SAP Pricing because it can be complicated to understand the Condition Technique and other pricing concepts. A good SAP Pricing consultant brings the best understanding of how to apply the ideal configuration based on a clients' process design. So when companies are looking for a good SAP Pricing consultant, they should be looking for someone who can guide them through the right configuration based on the design.

5:40 What's the right techno-functional skills mix of the SAP Pricing consultant? Do they need to know ABAP? Ideally yes. Yes, Although the standard SAP Pricing functionality is pretty flexible, especially in certain industries, such as consumer products, their requirements are not fulfilled by standard SAP Pricing functionality. SAP provides you with several areas in Pricing to use ABAP knowledge to make modifications, so it's a big bonus to have ABAP knowledge if you have pricing experience.

6:40 Yes you need ABAP, but good SAP Pricing consultants do more than just configuring tables - they solve business problems. Many clients Matthias has seen try to replicate their pricing systems from legacy to SAP on a one to one basis. But it could be that in legacy systems they didn't have the capability to do certain things. In SAP, you might be able to group certain records, which can improve performance and reduce maintenance efforts.

8:15 One of the main reasons Matthias wrote the book was to help others along their skills progression. So who is the book for? Matthias: the book is suitable for a broad range of users and consultants. There are tons of screen prints, and it starts out with the basics: you can use the book to do a step by step design of your pricing system within SAP. The cornerstone of SAP Pricing is the Condition Technique.

If you understand this technique, you can apply it to several areas outside of pricing in the SAP system. In the later chapters in the book, the book explains how the SAP Master Data comes out in the final pricing for the customer. Then the final sections of the book cover advanced and special pricing scenarios like SAP Free Goods Configuration, which was a missing link in version 3.0 of SAP R/3. Other topics like rebates, sales deals, and promotions are also covered. In the end of the book, we go into custom modifications, how to tweak the system if the standard functionality is not enough, and this is where ABAP comes in.

10:50 What are the mistakes SAP project teams make around SAP Pricing? And what are the keys to effective SAP Pricing projects? First, you should understand how products are priced at a customer, what are the different prices, allowances, charges, and rebates. Understand these requirements and build the design. Don't just start configuring one requirement after another on the fly; it gets very convoluted. Gather all the business requirements in one phase and work it into the design.

12:10 And how can SAP project teams use this book? Because the chapters are structured one on top of the other, you can understand how the SAP Pricing configuration works. You'll know why things are happening a certain way and how it can be changed to meet business requirements.

12:50 Matthias is not just an SAP Pricing person, so what are the keys to his success as an independent consultant in this field?. Matthias: Always add to your knowledge, pricing is part of the order to cash process, so you need to understand how the order is created, how pricing is affected by the order process, and after the pricing is complete, what can change from order to invoices, how you handle credits, rebates. If you understand the Condition Technique, you can not only apply this to pricing, but to other aspects of SAP as well. For example, on one project, Matthias was able to reconfigure the SAP patent functionality, which is also based on the Condition Technique principle. Matthias was also able to get on an early flagship truck optimization project based on his grasp of the broad applicability of the Condition Technique, so build on the skills that you have.

14:57 Don't fear ABAP, get your feet wet, and from the ABAP side, you can move into functional directions in SAP like Pricing as well.

15:15 Matthias' advice on the book writing process: have a concept and stick to it, don't get discouraged if you get stuck somewhere. Go through it in a logical manner, explain it as you would have wanted it explained to you. Matthias wrote the book he would have wanted to read earlier in his career. Reader reviews are available on


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