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WHAT DO WE HAVE IN THIS PRESENTATION????
PHASE 1 BASICS OF SAP What is SAP? SAP the company Origin and Evolution of SAP Reasons why company implements SAP Benefits from SAP Failures of SAP Modules of SAP Markets of SAP
WHAT DO WE HAVE IN THIS PRESENTATION????
PHASE 2 : SAP MM- MODULE• Material flow• Production Planning and control• Production Planning systems• Master Production Schedule• Material Requirement Planning• Bill Of Material• Purchasing• Inventory Management• Overview Of SAP MM - module
WHAT IS SAP?????
SAP ( ess aay pee) stands for
Systems, Applications , Products in Data Processing . SAP is an integrated business solution software comes under Enterprise Resource Planning. (E R P)
S A P INTRODUCTION…………….
THE SAP SYSTEM IS A COLLECTION OF SOFTWARE THAT PERFORMS STANDARD BUSINESS FUNCTION.
IT PROVIDES A COMPLETE SOLUTION TO STANDARD BUSINESS REQUIREMENTS.
IT INCORPORATES CONCEPT OF ERP BUSINESS PROCESS PLANNING INTO AN INTEGRATED SOLUTION FOR BUSINESS APPLICATIONS.
THE COMPANY…….. SAP the company was founded in Germany in 1972
by five ex- IBM engineers . Being incorporated in Germany the full name of
parent company is SAP AG , located in Walldorf , Germany .
World’s Third largest independent software provider
Serves more than 10 million global customers worldwide in more than 120 countries .
Now 70 – 80 % top companies in their respective fields have implemented SAP.
HOW DID SAP EVOLVE ???
INVENTORY CONTROL 1960
MATERIAL REQUIREMENT PLANNING1980
ENTERPRISE RESOURCE PLANNING 1990
SAPR/3
THE COMPANYPRODUCTS
MODULES
SAP R/3 VERSION(R=Realtime,3=3tier)
data
1st tier PRESENTATION TIER
2nd tier
LOGIC TIER
3rd tier
DATA TIER
SAP UNIQUE ARCHITECTURE
R/3 Application
Database
Dispatcher
Workprocess
Workprocess
Programs
Presentation SAPGUISAPGUI
Workprocess
TerminalTerminalprocessprocessTerminalTerminalprocessprocess
TablesTables
Buffer
DBDB
REASONS WHY A COMPANY IMPLEMENTS SAP.
For better decision making.For strategic planning.For higher system performance.To gain competitive advantage.To meet key business goals.To gain increased solution flexibility.Enables a company to link its business functions.Ties together disseperate business processes.Enabling business change.Replacement of an outdated inefficient IT architecture.
BENEFITS FROM SAP
Simultaneous visibility across whole enterprise Offers good understanding of current situation
of company Offers high security and info consistency To choose best marketing strategy Offers co ordination across the company Enables to focus attention on core process.
GROWING COMPANIESNEED TO WORK SMARTAND MOVE FAST TO BE
SUCCESSFULL
FAILURES OF SAP
TWO MAJOR FAILURES
CLIENT FAILURE
SYSTEM FAILURE
Client Failure:
Incorrect application Of software. Poor analysis of cost and benefits. Lack of trained personnel Not enough systems or probably
computers to handle.
System Failure
Localization of software. Customization for different
accounting systems and tax systems which changes from country to country.
SAP IS MADE FOR…>>>
ALL RANGE OF COMPANIES DIFFERENT SUITE ARE AVAILABLE FOR
DIFFERENT RANGE OF COMPANIES DESIGNED TO SATISFY THE
INFORMATION NEEDS FOR ALL BUSINESS FUNCTIONS
DIFFERENT MODULE SELECTION FOR DIFFERENT AREA OF BUSINESSES
MULTILINGUISTIC, BASE INDEPENDENT- works on any operating systems.
WHAT IT TAKES TO IMPLEMENT SAP……
THREE MAJOR FACTORS
cost…… timeframe…… hardware……
GENERAL AREAS OF APPLICATION OF SAP
Financials Human Resource Customer Relationship Management Supplier Relationship Management. Product life Cycle Management Business Intelligence Supply Chain Management
Modules or Products of SAP
F I Financial Accounting CO Controlling AM Asset Management PS Project Systems MM Materials Management QM Quality Management PP Production Planning SD Sales and Distribution PM Plant Maintenance
Markets of SAP…………. Manufacturing Chemicals Automotive Transportation and Tourism Consumer goods Government, Public administration Health Care and Hospitals Educational Institutions and Research
Ok Now we knowBasics of
SAP!!
How does SAP helps me as an Mechanical OR
Production engineer??
As a Mechanical or Production engineer areas where SAP applies PP - production planning MM- material management SD- sales and distribution PM- plant maintenance QM – quality management
AS A MECHANICAL ENGINEER AREAS WHERE SAP APPLIES……. PP - production planning MM- material management SD- sales and distribution PM- plant maintenance QM – quality management
GENERAL OVERVIEW OF MANUFACTURING
INDUSTRY
ADMIN FINANCE PURCHASE STORES
PROD. SHOPS MAINTENANCE R&D / D&D
SAP
Supply Chain Management: The delivery of enhanced customer and economic valuethrough management of the flow of physical goods andassociated information.
Information Information FlowFlow
DemandDemand
Product FlowProduct Flow
SupplierSupplier PurchasingPurchasing ProductionProduction DistributionDistribution RetailingRetailing CustomerCustomer
FinancialFinancialControlControl
HumanHumanResourcesResources
The Integrated Supply Chain
MATERIALS MANAGEMENT…….
Material Flow
Flow of materials used to convert raw materials to finished goods is material flow.
Materials Management is a coordinating function responsible for planning and controlling materials flow. Its objectives are as follows:
Maximize the use of firm’s resources. Provide the required level of customer
service.
Materials Management MM – Materials management can reduce
costs by being sure that the right materials are in the right place at the right time and the resources of the company are properly used.
There are several ways of classifying this flow of materials.
A very useful classification, Manufacturing Planning and Control, Physical Supply/ Distribution.
Manufacturing Planning And Control - MPCS
Manufacturing planning and control is responsible for the planning and control of the flow of materials through the manufacturing process. The primary activities carried out are as follows:
Production planning
Implementation and control
Inventory management All three works together for greater efficiency
Inputs Needed to MPCS
Product description Bill of Material
Process Specification
components
subassemblies
Route sheetOPERATION REQUIRED
SEQUENCE OF OPERATIONS
Equipments & Accessories
TIME REQUIRED
Std. time needed
Facilities needed Work center file
Quantities MRP
Flow of inputsfor release of materials.
MATERIAL MASTER
Basic purchasing MRP accounting stock costing
Scheduling forecasting evaluation quality
B O M Bill of materials
ROUTING Standard cost estimate
In house MAKING Outsourcing
GOODS ISSUE TOOL ISSUE GOODS RECEIPT TOOL RECEIPT
USED REWORK SCRAP
Physical supply and Distribution
Involve all the activities from moving goods from supplier to customer.
Activities are: Transportation Warehousing Packaging Materials Handling Order entry
The balancing Act -Priority vs. Capacity
PRIORITY
How many neededWhat are neededWhen are needed
Marketplace Establishes
Priorities
Manufacturing Responsible
To plan To meet requirements
CAPACITY
Capability To produce
goods
MachineryLabor
Materialsresources
Strategic business plan Shows what company wants to achieve in
near future. It is based on long term forecasts and
includes participation of marketing, finance, production and engineering plans.
Financialplan
Marketing plan
Production plan
Engineeringplan
Strategic Business
plan
Production plan Given the objectives set by the strategic business plan,
production management is concerned with the following: The Quantities of each product group that must be produced in
each period. The Desired inventory levels. The resources of equipments, labor, material needed in each
period. The Availability of resources needed. Production planners must device a plan to satisfy market
demand within the resources available to the company. This will involve determining the resources needed to meet
market demand, comparing the results to the resources available, devising a plan to balance requirements and availability.
After the production planning next step in the manufacturing planning and control process is to prepare a master production schedule (MPS).
It forms the link between production planning and what manufacturing will actually build.
It forms the basis for calculating the capacity and resources needed.
The MPS drives the material requirement plan. As a schedule of items to be built.
The MPS and bills of material determine what components are needed from manufacturing and purchasing.
It keeps priorities valid. The MPS is priority plan for manufacturing.
Master Production Schedule
Master Production Schedule Master Production schedule is plan for production of
individual end items. The end items made by the company are assembled
from component and subcomponent parts. These must be available in right quantities at the
right time to support the master production schedule. The information needed to develop an MPS is
provided by: The production plan. Forecasts for individual end items. Actual orders received from customers and stock
replishment. Inventory levels for individual end items. Capacity restraints.
Material Requirement Plan The material requirement plan (MRP) is a plan
for the production and purchase of the components used in making the items in the master production schedule.
Material requirement planning is the system used to avoid missing parts.
It establishes a schedule (priority plan) showing the components required at each level of the assembly and, based on lead times, calculates the time when these components will be needed.
Production plan
Master Production Schedule MPS
MATERIAL REQUIREMENT PLAN MRP
Purchasing Production activity control
MANUFACTURING PLANNING AND CONTROL SYSTEM
There are 3 inputs to MRP systems: Master production Schedule. Inventory records Bills of materials
Bill of materials. The bill of material is one of the most important documents in manufacturing company.
Before we make something, we must know what components are needed to make it.
To make any product list of components are needed. This is given by BOM.
The American Production and Inventory Control Society (APICS) defines bill of material as “ a listing of all subassemblies intermediate, parts and raw materials that go into making the parent assembly showing the quantities of each required to make an assembly”.
The bill of material shows the components that go into making the parent.
It does not show steps or process used to make the parent or the components.
Purchasing Purchasing is process of buying. Purchasing is responsible for placing
order and for ensuring that goods arrive on time at correct place.
It has major responsibility of locating resources and negotiating prices.
PURCHASING….
REQUISITION
PURCHASES
FIXED VENDOR
QUOTATION AVAILA B
VENDOR SELEC
DATE SELEC
AUTO PUR ORDER
REQUEST FOR QUO
ENTRY FOR QUO
RELEASE FINANCE
Purchasing objectives Obtaining – goods- required quantity –
quality. Obtaining – goods – at lowest cost. Ensure – good service and prompt
delivery –from supplier. Developing - maintaining - good
supplier relationship. Determining purchasing specifications –
right time, right place and at price. Selecting right vendor.
Inventory management Inventories are materials and supplies
that a business or institution carries either for sale or to provide inputs or supplies to the production process.
They contribute 20 to 60 % of total assets.
As they move on they are converted to cash and add value to company.
Hence all the care should be taken to ensure good management is involved.
SUPPLIER
RAW MATERIALSPURCHASED PARTS
WORK IN PROGRESS
FINISHED GOODS
WAREHOUSE
CUSTOMER DEMAND
Flow of inventories
HOW DOES SAP VIEWMATERIALS MODULE
(MM)???
Materials Management (MM) Overview
The Materials Management (MM) module is aimed at managing procurement and receipt of materials & services. Materials management also involves storage, movement, valuation & consumption of materials.
CASE STUDY OF SAP -MM
PROD. SHOP
STORES
PURCHASE
MAINTAINENCE
SAP –MMMODULE
RAW AND TOOL MATERIALSFINISHED MATERIALS
PURCHASE OF MATERIALS
CONSUMABLE MATERIALS
MM Overview The SAP Materials Management (MM) Module provides a
comprehensive solution for Materials Management within the integrated supply chain.
Also, it supports other logistics functions such as plant maintenance and project management, which also require materials information.
MM works as part of an on-line, real-time system for processing, maintaining and recording integrated transactions.
Objectives: Provide a general overview of the Materials
Management (MM) Module and the relevant sub-modules.
Identify areas where MM and other SAP modules integrate.
PHASES OF MATERIAL MANAGEMENT
MAINTAINING BASIC DATAMATERIALS PLANNINGPURCHASINGGOODS RECEIVINGINVENTORY MANAGEMENTWAREHOUSE MANAGEMENTINVOICE VERIFICATION
Inventory Management
WarehouseManagement
AccountingAccounting
Requirement
Production(Internal Procurement)
Material RequirementsMaterial RequirementsPlanningPlanning
GoodsIssue
TransferPosting
Purchasing(External Procurement)
Goods Receipt
Sales and Distribution
InvoiceVerification
Invoice
DemandDemandStocksStocks
ForecastForecast
MM Overview: Procurement Cycle
SAP MM ------ MASTER DATA
MAINTAINS BASIC DATA TO INITIATE PROCESS
CONTAINS VENDOR, MATERIALS, AND DOCUMENTS
THE BASE FOR MM MODULE
SAP MM ------MRP Material Requirement Planning
Responds to the fundamental manufacturing equation: What are we going to make?
Master production schedule. What does it take to make it?
Bill of materials. What have we got?
Inventory records. What do we have to get?
Material Requirements plan: planned orders.
SAP MM----PUR Purchasing
IT DOES STANDARD PURCHASING OPERATIONS
BASIC PURCHASING FUNCTION, CONTRACTS, QUOTA ARRANGEMENTS,
THIS IS INTEGRATION OF SD MODULE
SAP MM ---IS Purchasing Info Systems
IF YOUR VENDOR ARE MORE MM—PUR WILL
EVALUATE VENDORS COMPARES QUOTATIONS OPTS FOR BEST DEAL
SAP MM---WM Warehouse Management
Performs Storage Unit. Storage unit management.
MM---IM INVENTORY MGT.
GOODS RECEIPT INVENTORY CONTROLLING PHYSICAL INVENTORY
SAP MM Applied to tools release
MATERIAL MASTER
BOM
ROUTING
MAKING
GOODS ISSUE
17 VIEWS
SCEStandard
Cost Estimate
INHOUSE OR OUTSOURCE
TOOLS ISSUEURS
GENERAL SCREEN LAYOUT
TRANSACTIONWORK AREA
SYSTEM MENUS
TRANSACTION NAME
TRANSACTION NAVIGATION
TRANSACTION ICONS
