Subcontract Service

This document explains how to process a subcontracting repair order. Subcontracting happens when a component is sent out to a contractor for repair, refurbishment or overhaul. This happens when the dealership or the equipment reseller does not have the capability to perform the required task to make the component serviceable.

A typical scenario starts when a customer contacts the dealership asking for a repair order to a contractor that handles the servicing of the equipment. A maintenance customer order is created to cover the repair order based on a pre-defined service BOM. In turn, a work order and a purchase order are generated after releasing the MCO line. The component is sent out and repaired at the contractor’s workshop. After the work is complete, the contractor returns the serviceable component to the dealer. To close the process, the dealer delivers the serviceable component and bills the customer accordingly.


This document only describes the common subcontracting scenario where a component sent to the dealership is repaired, refurbished or overhauled by the contractor. The automated processes of work order creation, service history approval, purchase order creation, requisition order (component sent out to supplier), MCO line approval, and work order closure are used to describe the flow.

The process is dependent on the component to be repaired having already been received and existing in the warehouse of the dealership from where it will be sent to the contractor.


The maintenance customer order and work order are created, reported, closed off, and invoiced.

Before you start

The product and lot number should exist in the inventory. The lot will be sent out to the contractor with the subcontracting order. Subcontracting repair order types are defined with purchase order category '60 – Repair order'.

For information about prerequisite settings, refer to these documents and apply the configuration recommendations provided:

  1. A valid maintenance agreement must be created in 'Maint Agrmnt. Open' (COS410).

  2. A valid service definition must exist in 'Service. Open' (MOS300).

  3. See Create Maintenance Customer Order Type.

    1. Select an order type with 'Next manual function' = '5-Start work order'.

    2. In 'Maint CO Type. Open' (COS010/F):

      • Set 'Auto approval' to '1-Yes'.
      • Set 'Approval limit' to an amount higher than the total purchase order amount.
  4. See Define Work Order Type.

    1. In 'Work Order Type. Open' (MOS120/F):

      • Set parameter 100 'Should maintenance object update material plan' to '1-Yes'.
      • Set parameter 193 'Close WO without displaying MOS050' to '1-Yes'.
    2. In (MOS120/I):

      • Set parameter 380 'Mandatory approval of time transactions' to '0-Not mandatory'.
      • Set parameter 440 'Default repair order type' using a purchase order type with order category '60-Repair order'.
  5. Define purchase order type. See Repair Order - Purchasing.

    1. In 'Purchase Order Type. Open' (PPS095/H):

      • Set parameter 380 'Inventory management' to '1'.
      • Specify value for parameter 380 'Default order type – repair or exchange order'.
    2. In (PPS095/F), set parameter 150 'Material plan update' to '2-No bal upd'.

  6. See Define Basic Settings for Services.

    1. Auto approval of service history should be activated in 'Service. Connect to Facility' (MOS301/E) by setting 'Auto approval' to '1=Yes'.

    2. A subcontract work center ('Resource type' = 2 in 'Work Center. Open' (PDS010/E)) should be used in 'Product. Connect Materials/Operations' (PDS002) for the operation.

    3. In (PDS002/G), set a 'Run time' and 'Subcontr ctrl' = '1-Pur + Req order'.

    4. In (PDS002/H), specify a 'Unit price' and 'Supplier' or use related option 65='Subcontracting Supplier' to display 'Subcontracting. Connect Supplier' (MOS018) to manage the supplier ID by facility group and/or facility instead. The ‘Unit price’ can be then managed through 'Purchase Agreement. Open' (PPS100).


  7. In 'Settings. Maintenance 1' (CRS788/F), set parameter 18 'Check for open transactions when reporting WO' to 2-'Yes, stop'. See Define Settings for Maintenance 1 (CRS788).

  8. See Define Basic Settings for Subcontracting.

    1. In 'Settings – Purchase' (CRS780/G), set parameter 32 'Planning policy – subcontracting and repair'. See section 'Settings for planned POs should be automatically released to POs' in Settings for Purchase Order.

    2. In (CRS780/E), specify a repair order type for parameter 07 'Default order type = subcontracting'.

    3. In (CRS780/G), specify a location for parameter 34 'Location template – repair order'.

  9. In 'Item. Connect Facility' (MMS003/E), set parameter 'On-hand method' to '2-Acc chg trns tp'. See On-hand Balance Reporting per Facility.

  10. In 'Purchase Agreement. Open Lines' (PPS101/B), define a 'Group ID' using IFPRCS (Service process) and IFSUFI (Service) as main controlling fields for defining a price for the complete service. Specify a 'start date' and a 'purchase price'. Use the main controlling fields CAPRNO (Product), CASTRT (Structure type), CASUFI (Service) and POOPNO (Operation number) to define a price for a specific subcontracting operation.

    See Create Agreements with Supplier.

Follow these steps

  1. See Quick Entry of Normal Maintenance Customer Order.

    The instruction is based on panel sequence=9 in (COS130/P).

    1. Start 'Main CO Quick Entry' (COS130).

    2. Populate the required information 'customer', 'agreement', 'product', 'lot number', 'service', 'facility' and 'order type'.

    3. Populate other optional information if required, for example requested start/finish dates.

    4. Press enter/next to create the maintenance customer order. Panel sequence '9' launches 'Work Request . Open' (MOS170).

      When the maintenance customer order is confirmed, these activities will automatically happen:

      • A maintenance customer order header and line is created.
      • A work request is created in (MOS170).
      • A planned purchase order is created in (PPS170).
      • The planned purchase order is released.
      • The created work request is released.
      • A work order is created in 'Work Order. Open' (MOS100).
      • A purchase order is created in 'Purchase Order. Open' (PPS200).
  2. See Report and Close Repair Order Operations.

  3. See Select Purchase Order for Invoice Matching.

  4. See Print MCO Invoice.

    • The MCO invoice is printed according to the settings defined in 'Output Server Definition. Open' (MNS204) and 'Output Definition. Open' (MNS205). The invoice can be reviewed in 'Maint Invoice. Display' (COS350).
    • With the suggested setup in the before you start section, these steps will automatically happen:
      • The operation is closed (status 90).
      • The service is approved in 'Equipment. Open Service History' (MOS180).
      • The work order is closed (status 90).
      • The MCO line is approved for invoicing (status 50).
    • The work order will be updated to status '97- Invoiced' and the maintenance customer order line updated to '70-Invoiced'.
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