SAP MM DemoNawin's Training Acadamy 1. Introduction SAP R/3 – MM Mr. RG Nawin Krishna, Bsc(cs);Msc(psychology);MBA(HR);SAP(HCM/HR), - Nawin’s Training

SAP MM Demo Nawin's Training Acadamy 1

Introduction SAP R/3 – MM

Mr. RG Nawin Krishna,Bsc(cs);Msc(psychology);MBA(HR);SAP(HCM/HR),

- Nawin’s Training Academy


ERP-Software: SAP R/3


Client / Server

ABAP/4

R/3

SD

MM

PP

QA

PM

HR IS

OC

PS

AM

CO

FI

Sales andDistribution

MaterialManagement

Controlling

FinancialAccounting

Components of Materials Management


MaterialsManagement

(MM)

LogisticsInvoice

Verification

MaterialMaster

PhysicalInventory

Valuation

MRP

ServiceEntrySheet

ServiceMaster

ProductCatalog Purchasing

InventoryMgmt.

ForeignTrade/

Customs

Organizational Data

• A hierarchy in which the organizational units in an enterprise are arranged according to tasks and functions

• Are static data and are rarely changed

• The definition of organization units is a fundamental step, it is a critical factor in how the company will be structured


Organizational Structures


Organizational Structures

• Client• Company• Plant• Valuation Area• Storage Locations• Purchasing Organizations• Purchasing Groups


Organizational Structures: Client

• The client is a unit within an SAP R/3 system that is self-contained both in legal and organizational terms and in terms of data, with separate master records and an independent set of tables.

• From a business viewpoint, the client represents a corporate group, for example.

• Client: 3 numerical digits


Organizational Structures: Company

• The company is the smallest organizational unit of external accounting for which a complete, self-contained bookkeeping system can be replicated.

• A company code represents an independent unit producing its own balance sheet, for example, a company within a corporate group (client).

• Company code = 4 characters


Organizational Structures: Plant

• Lowest valuation area• Organizational level where Material

Requirements (MRP) runs• Generally used to describe a production site, a

distribution center or centralized warehouse• May be a physical or logical unit


Organizational Structures: Valuation Area

• The valuation area determines at which level a material is valuated (inventory value is established)

• SAP R/3 allows valuation at the company code or plant level, but recommends valuation area be set at the plant level.

• Means each plant can have its own material prices and account determination


Organizational Structures: Storage Location

• Subdivision of a plant • Where materials are managed (inventory

management)– Raw Materials– Maintenance, Repair, and Other (MRO)– Finished Product

• May be a physical or logical unit


Organizational Structures: Purchasing Organizations

• An organizational unit responsible for procuring materials or services for one or more plants and for negotiating general conditions of purchase with vendors.

• The purchasing organization assumes legal responsibility for all external purchase transactions.


Purchasing organization


purchasing group MG 0, 3purchasing group MG 0, 3purchasing organization

purchasing group MG 1, 4purchasing group MG 1, 4

purchasing group MG 2, 5purchasing group MG 2, 5

purchasing group MG 7, 8, 9purchasing group MG 7, 8, 9plantplant

purchasing group MG 6purchasing group MG 6

material group

Organizational Structures: Purchasing Organization Groups


•The purchasing organization is further subdivided into purchasing groups (buyer groups), which are responsible for day-to-day buying activities.

A purchasing group can also act for several purchasing organizations.

A purchasing group can be defined by line products (Frame, Engine, Tires…)

Inventory Management with a Warehouse Management System


client

00010001plant

storage location

001001warehouse number

001001storage type

05-04-0305-04-03

002002

05-04-0405-04-04storage bin

MMMM

WMWM

company code

0001 – ABC inc.0001 – ABC inc.

0001 – Jones inc.0001 – Jones inc. 0002 – Model Ltd.0002 – Model Ltd.

purchasing organization

00010001

00010001 00020002 00030003

00020002 00030003 00040004 00010001

00020002 00030003 00040004

distrib.-center factory

(physical stock)

The Module MM – Main Functions


MM – interdependencies to other modules


MM

material master

purchasing

requirements plan.

inventory mgmt.

invoice verification

MM

material master

purchasing

requirements plan.

inventory mgmt.

invoice verification

SDsales and

distrib.

SDsales and

distrib.

PMplant

maintenance

PMplant

maintenance

QMquality

management

QMquality

management

PPproductionplanning


Logistik

FIfinancial acc.

FIfinancial acc.

COcontrolling

COcontrolling

AMfixed assets mgmt.


Basic Data• Master records - include information about

1. vendors2. material and services to be procured3. the relation between 1. and 2. (purchasing info

record)e.g. prices / terms and conditions

• bills of material for– production planning– purchasing– sales and distribution– withdrawal of Material


• invoice entry• invoice verification• payment handling

• invoice entry• invoice verification• payment handling

• request for quotation• quotation processing• purch. order handling

• request for quotation• quotation processing• purch. order handling

Structure of the Vendor Master Record


General data• name• address• control data

General data• name• address• control data

accounting data• bank account• acc. maintenance• payment

accounting data• bank account• acc. maintenance• payment

purchasing• terms and cond.• partner functions• currency

purchasing• terms and cond.• partner functions• currency

utilizationutilization

for eachpurchasingorganization

for eachpurchasingorganization

client wide orfor each

company code

client wide orfor each

company code

client wideclient wide

area of validityarea of validitysectionssections

Create a Vendor


Creating Your Own Vendor Master Record

UsageWe recommend that you create your own vendor master record for this scenario. If, however, you prefer to use the reference vendor instead, it could be that the order currency has already been changed and this IDES scenario may no longer work.

You create a German vendor in company code 1000, IDES AG Germany, to create purchase orders and invoices denominated in euros.

Create a Vendor


Menu Path Logistics Materials Management Purchasing Master Data Vendor Central Create

Transaction Code XK01

Procedure1.Call up the transaction as follows:

Create a vendor


Field Data

Vendor Your own vendor (choose a number between 1000 and 1999)

Company code 1000

Purch. organization 1000

Account group LIEF

Reference vendor 1080

Reference company code 1000

Reference purchasing organization

1000

.

On the Create Vendor: Initial Screen, enter the following data:

Create a Vendor


On the Create Vendor: Address screen, enter the following data:

Field Data

Description Any

Search term Any, for example "euro"

Street/House number Any

Postal code/City 5-figure, numerical (any)

Country DE

Language DE

1. Choose until you reach the Create Vendor: Accounting and make sure that 160000 appears in the Reconciliation Account 160000 field.

2. Choose until the Create Vendor: Purchasing Data screen appears.

3. On the Create Vendor: Purchasing Data screen, check that the order currency is EUR.

4. Choose until the Create Vendor: Partner Functions screen appears.



Create a Vendor


Create a Vendor


Create a Vendor


Create a Vendor


Views on the Material Master Record


each view is maintained by a certain user department of the firm

accounting: valuation- und calculation-specific information requirements planning: information about material requirements

planning (e. g. reorder point) purchasing: e. g. responsible purchasing group, order unit engineering: technical information storage: information about warehousing, material movements, ... forecast: information about the forecasting of the material requirements S & D: informationen about sales orders and price determination

Demo: Create Material Master




•Select the views: Basic data 1, Purchasing, Purchase Order text, Gl. Plant Data/Storage 1, Accounting 1













SAVE

purchasing info record


info recordinfo record

pricesterms & cond.PO statistics

tolerance levelsdate

pricesterms & cond.PO statistics

tolerance levelsdate

quotation

order

outlineagreement

outline agreem.

PO

Purchasing Process


MM

X X X

X X

determination: requirements

X X X

X X

determination: source of supply

vendor 1vendor 1

vendor 2vendor 2

vendor selection

vendor

PO

PO

purchase order processing

PO monitoring

goods received &inventory mgmt.

PO invoice?=

invoice verificationinvoice verification

?

Create Purchase Order (PO)


1

vendor known

purch. ordervendor 2vendor 2

2

vendor not known

terms & cond.

outlineagrement

source list

vendor

info record

3

assigned purchaserequisition exists(from user department)

purch. req.vendor 2vendor 2

purch. order

purch. order

Purchasing Process

• Create a requisition• First release of requisition • Create RFQ (Request for Quotation) with

reference to requisition• Create PO (Purchase Order) with reference to

RFQ• Department receives material ordered (GR)• Department pays invoice (MIRO).


Purchase Requisition


Document generated by a user department or storeroom-personnel to notify the purchasing department of items it needs to order, their quantity, and the timeframe. It may also contain the authorization to proceed with the purchase. Also called purchase request or requisition.

Request for Quotation


Is a standard business process whose purpose is to invite suppliers into a bidding process to bid on specific products or services. RFQ generally means the same thing as IFB (Invitation For Bid)

Purchase Order


Buyer-generated document that authorizes a purchase transaction. It sets forth the descriptions, quantities, prices, discounts, payment terms, date of performance or shipment, other associated terms and conditions, and identifies a specific seller.

Create Purchase Requisition






• In the item, enter your material, Plant= 1000, QT = 100



• Save your Purchase requisition

• Take note of Purchase requisition number

Demo: Create Purchase Order




• Open document overview: Click on document overview button

• Choose “Selection variant list” icon

•Then select “My purchase requisition”, you will get your purchase requisition listed

•Click on “adopt” icon, your purchase requisition will be copied to the purchase order (or you can drag and drop it into the shopping cart)





• Enter your vendor, and price 30 euro and save

Posting an Order Entry (Goods Receipt)


MMMM

Logistics

purchasing req. planning

inventorycontrolling

invoiceverification

goods receipt

inventory mgmt.

goods issue. transferposting

SDsales and

distrib.

SDsales and

distrib.

PMplant

maintenance

PMplant

maintenance

QMquality

management

QMquality

management



FIfinancial acc.

FIfinancial acc.

COcontrolling

COcontrolling



Goods Receipt: Transfer posting


• Unrestricted stock: You can consume the material stock in unrestricted use. • Quality inspection: Area controlled by QM to inspect the quality of material.• Blocked stock: is a holding area for materials that have not been posted to a company’s warehouse stock.

Demo: Posting Order Entry (Goods Received)


1. Use T_code : MIGO2. Select Goods Receipt3. Select Purchase Order4. Enter PO number for goods to be received.5. Hit "Enter"



6. Enter Document date & posting date7. Enter Header text (comment) if necessary.8. Close detail data.



9. Notice that movement data is "101"10. If you only received first item, then Check the "OK" box for first line item.therefore, the second item need not be processed



11. If you only received 3 pcs out of 10 pcs of item one & 2 pcs out of 10 pcs of item two, then Check the "OK" box for both line item 12. Input actual quantity (3 & 2 pcs ).13. Hit "Enter"



14. Click "Check" button to find out if there is any error. 15. Check the "status" column . . Green means OK . Yellow means Warning . Red means error

Invoice Verification


inputinformation

inputinformation invoice verificationinvoice verification output

informationoutput

information

ordersactions:

• enter invoice• verify invoice• post invoice• update

relevant data• (re-edit

invoice)

goods receipt

master data:materialvendorsaccounts

terms & cond.

financialaccounting

assetmanagement

cost accounting

Invoice Verification


•When you post an invoice, an accounting document is

created:

•Update Vendor account

•Update the account GR/IR (Goods Receipt/Invoice

Receive)

•Update master data: moving average price, value

•Update purchase order history

Create Invoice


Create Invoice using Tcode MIRO

Enter the Purchase order no. and click on Enter, to display the material details.

Enter the Required details in all Tabs

Create Invoice (contd..)


Click the check box, to calculate the Tax



Enter the Amount and click on save



Invoice is created

Demo: Invoice Verification


Using the tcode: MIRO"





net amount for positions

[email protected]


Documents

SAP MM DemoNawin's Training Acadamy 1. Introduction SAP R/3 – MM Mr. RG Nawin Krishna, Bsc(cs);Msc(psychology);MBA(HR);SAP(HCM/HR), - Nawin’s Training