Monday, May 27, 2013

Overview on Oracle Service Contract

Posted by at 4:46 AM Read our previous post

Features of Oracle Service Contract

Service contracts (also referred to as service agreements) are contracts that are usually sold to customers to support, repair and/or maintain some product or service that the customer owns. These contracts often take advantage of the ability to bill on a recurring basis either monthly, quarterly or annually and can give the customer the ability to pay for their services in advance or in arrears of the period of service.

Warranties are generally given away for free when the customer purchases a product or service.  For the purpose of Oracle Service Contracts, warranties are always free of charge and are created automatically by Oracle Order Management when a product is sold. 

Extended warranties are generally sold to the customer at an additional cost at the time their products are purchased.  You can sell the extended warranty contract using Oracle Order Management at the time the product is sold or you can author it manually in Service Contracts.  If you create the Extended Warranty through Order Management, the billing is done in advance for the entire contract duration.  If you create an Extended Warranty in Service Contracts, you can take advantage of the recurring billing feature.

Subscriptions can also be sold through Oracle Service Contract for both tangible and intangible items. Tangible items include magazines, collateral, or any other physical item that can be shipped through Oracle Order Management. Intangible items can be collateral sent via e-mail or permission to access a web site for a set period of time.

Integration with various Modules in Ebusiness Suite

Oracle Service Contracts has many integration points to other Oracle Applications.  Some are required in order for the application to perform at its best, others are optional and depend on your business processes.
         Provides quotes for sales orders
         Manages items associated with Oracle Service Contracts agreements and contracts: services, usages, warranties, subscriptions, and serviceable items
Order Management
         Raises sales orders from which warranties and extended warranties are created.
         Inventory is used to define serviceable products and service items (warranties and extended warranties).
         Creates invoices and credit memos from the billing information generated by Oracle Service Contracts.
Bills of Material
         Associates warranties with serviceable items.
Advanced Pricing
         Supplies the information to price the services and usages sold on the contract.
Install Base
         Provides details of trackable items and the tracking of counters.
         Manages service requests.
         Retrieves contract details for a customer such as account, end date, status, contract type& number on all of their contracts.
         Looks for the preferred engineers for a particular service.
         Has visibility to coverage levels & times, reaction & resolution times for coverage, billing rates and types for a specified coverage.
         Provides customer access to service contracts to view entitlements, preferred technician, response and reaction times via self service mechanisms
Depot Repair
         Provides details for repairs, exchanges, replacements, and loaners, which may update the contract coverage.
         Has visibility to coverage details.
Field Service
         Provides details about service and repairs to be carried out in the field.
         Has visibility to coverage details.

General Quote to Warranty/Extended Warranty flow

1. Determine Service Interest
         This is manual process of presenting and determining the interest in the service warranty with the customer.
2. Negotiate Pricing, Discounts, and Terms
         This is a manual process.
         Discuss with customer and compute pricing of warranty.
         Present pricing to the customer
         Describe benefits and terms.
3. Convert Opportunity to Quote
         Once the customer is convinced, enter quote in the system
         Capture customer details.
         View standard warranty for item as mentioned in the system.
         Add extended warranty to quote.
4. Determine Order Details
         Determine billing options.
         Determine payment options.
5. Convert Quote to Order
         Capture customer data.
         Create sales order.
         Book order.
6. Create Extended Warranty
         Generate an extended warranty.
7. Maintain Customer Install Base
         Update the install base.
8. Verify Entitlement
         View contract entitlement to confirm that it is correct.

You may also like to read           Overview on Install Base
                                                  Overview on Oracle Advanced Inbound


  1. Thanks Apurva

    IF u add process flow like connection with various module with screen shot it will help....

  2. Really good stuff for beginiers to learn Service Contracts.. Thanks Apurva for sharing

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