SAP MM/WM

Configuration Pack

Enterprise Structure

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Copyright 2007-09@SAPTOPJOBS All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form, or by any means electronic or mechanical including photocopying, recording or any information storage and retrieval system without permission in writing from SAPTOPJOBS

INDEX 1. Over-view:------------------------------------------------------------------------------------4 2. Getting into the Configuration area of SAP------------------------------------ 11 3. Enterprise structure ------------------------------------------------------------------- 14

3.1 Define valuation level ------------------------------------------------------------ 15 3.2 Define Plant ------------------------------------------------------------------------- 17 3.3 Maintain plant details and Factory calendar in Plant--------------- 20 3.4 Define Location -------------------------------------------------------------------- 22 3.5 Maintain Storage Location----------------------------------------------------- 24 3.6 Maintain Purchase organization--------------------------------------------- 28 3.7 Assign Plant to company ------------------------------------------------------- 30 3.8 Assign purchase organization to the company code ----------------- 31 3.9 Assign purchase organization to plant------------------------------------ 32

4. Material Master -------------------------------------------------------------------------- 33 4.1 Assign field to field selection groups --------------------------------------- 34 4.2 Define plant specific field and screen selection------------------------ 38 4.3 Define material type-------------------------------------------------------------- 39 4.4 Define Number range for each material type --------------------------- 43 4.5 Define industry sector ----------------------------------------------------------- 45 4.6 Maintain user specific settings----------------------------------------------- 46 4.7 Set material block for goods movement----------------------------------- 49 4.8 Define storage location MRP per plant ------------------------------------ 51

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1. Over-view:- MM Module is the one of the most important logistics modules in SAP. MM module covers the following basic functions

Planning Procurement Inventory Management

Planning: - The following are the two types of planning in MM module. Consumption Based Planning Material Requirement Planning

Consumption Based Planning is based on past consumption pattern. In this type of planning requirement is triggered by the stock level and NOT by any planned independent requirement or dependant requirements. Material Requirement Planning is the detailed planning based on requirements and stock levels. Procurement: - Procurement activities involves everything from the stage of identifying vendors up to making payments to the respective vendor. The following are the important procurement functions: - Identify the vendor

Negotiate the terms and conditions

Release the purchase order

Follow up for supplies

Ensure right quantity and quality materials are received

at right time Ensure payment to the vendor at right time as per the

agreement terms. Procurement Proposals: - As a result of planning, procurement proposals are created for the net requirement quantities either in terms of planned order or as purchase requisitions. If it is a planned order, it has to be converted to the purchase requisition. This is an important function between planner and the procurement person. If purchase requisitions are directly generated, it has to be converted to purchase order. Purchasing: - Purchasing is the process of releasing the document to the identified vendor authorizing him to supply the materials at a negotiated price. Three important purchasing methods are

a. Purchase Order

b. Contracts

c. Scheduling Agreement

a. Purchase Order: - It is the process of issuing PO to the vendor requesting him to supply according to the requirements as a one time or as per the delivery schedule. b. Contracts: - Contracts of quantity based or rate based can be issued to the vendor authorizing him to supply till reaching certain quantities or certain value of supply is reached. Every contract will have a release order. c. Scheduling Agreement: - Scheduling agreement is similar to PO. It will specify the quantity, rate but the schedule of delivery will be informed through the delivery schedule to the vendor. Each scheduling agreement will have a delivery schedule. If scheduling agreement is available with a vendor, MRP can automatically create the delivery schedule instead of PR or Planned order during MRP run. Inventory Management: - Entire stocks and material movements are dealt in inventory management. Each material movement is associated with a movement type number. Movement type is responsible to determine the right GL account for FI postings. When performing the inventory management transactions system performs the following actions instantly Material document is generated FI document is generated Controlling document is generated Inventory is adjusted

Inventory Management is tightly integrated with MRP and MRP data.

Master Data in MM: - As in every module, Master data plays a major role in MM module as well. Following are the important master data in MM module. Material Master (across all modules) Vendor Master Purchase Info record Quota arrangement (MM and PP modules) Source List

Integration of MM with other Modules: - Materials Management and its component inventory management is directly linked with MRP, purchasing and invoicing for vendor supplies. MRP takes the inventory into account and also the expected receipt and issues during MRP run which is the vital data for successful MRP. MM with PP Staging of components for production order

Receipt of finished products into the warehouse

MM with QM A movement type determines whether the material is

subject to QM or not.

Goods posted to QM stock if it is subjected to QM MM with SD Availability check can be carried out on creating sales

order As soon as the delivery against the sales order is created,

that quantity is marked for delivery and deducted from stock when performing post goods issue (PGI) for delivery.

Special sales order stocks can be maintained.

MM with PM Goods movements are performed with respect to Equipment BOM Maintenance order With serial number management, serial number can be

entered with every serial number MM with FI When posting the material movements, GL accounts are

determined through movement type and valuation class information.

Entire accounting entries are posted instantaneously

OK friends, having understood the over view of MM module; let us try to look at what is there in store with this MM pack for you.

For ease of learning and better understanding of MM module, it is divided in to five topics as mentioned below. Enterprise structure

Planning

Master Data and PR

Purchasing

Inventory Management

To the each one of the above topic, complete configuration, user manual and power point presentation is provided. Configuration - Enterprise Structure: - Define Plant Define Storage Location Assign Plant to a company Define Purchase Organization Purchase organization assignment Defining material master field selection Material Master Plant specific field selection Define Material Type Define number range for material type Define Industry sector for material master. Configuration - Planning:- Complete configuration of Material Requirement Planning Consumption based planning Configuration - Master Data and PR: - Define system message attributes Defining purchase value key Define payment terms

Define Inco terms Define Account Group (Field selection for vendor master) Define number range for account group Define purchasing groups Define copying rules Define Document types Configure Release strategy for PR Configuration Purchasing: - Define Document type Define Number Range Define tolerance limit for price variance Release procedure for Purchase orders Configure stock transport orders Define Access Sequence Define Condition Type Define calculation schema Define Schema determination Account Determination Configuration Inventory Management: - Define Plant Parameters Define Field selection for goods movements Movement type setting Configure automatic storage location creation Define screen layout Define availability check for movement types Configure negative stock Define output determination Configure stock determination Configure split valuation

2. Getting into the Configuration area of SAP

BACKGROUND There are two types of access to the user in SAP.

1. Easy access - used to access daily transactions 2. Project view or IMG used to access for configuration.

SAP Easy access is to perform the master data maintenance and perform transaction. SAP configuration is to maintain the backend settings according to the business requirements. Access to each transaction is controlled by authorization. Follow the steps explained here to get into the configuration area in SAP.

INSTRUCTIONS

1. Type SPRO in the SAP main screen dialog box,

2. Click

3. Click on

4. Click appropriate node to look at more details.

When the menu path is mentioned as IMG, follow the above steps.

3. Enterprise structure

Enter price structure describes the entire organization details. Organizational details are broadly divided into the two areas like financial area and logistics area. Financial area deals with company code

controlling area

Currency and more.

Logistics area deals with Plant

Storage location

Sales organization

Sales Distribution channel

Sales Division etc.

3.1 Define valuation level

BACKGROUND This configuration setting enables to define at which level the stock are to be valuated in SAP. Stocks can be valuated at following two levels in SAP. Plant level

Company code level

It is recommended to keep at plant level. This is a client level setting.

INSTRUCTIONS Follow the Menu Path: IMG Enterprise structure Definition Logistics - General Define valuation level

1. Click

2. Select the radio button

3. Click Save

3.2 Define Plant

BACKGROUND This configuration setting enables to define the plant. Each manufacturing facility or branch of a company is defined as a plant in SAP. Plant is assigned to the company code. Storage locations are created under each plant. If the valuation level is the plant, the stocks are valuated at plant level. Note: - It is common practice to copy plan from the existing defined plant. It will be defined by the FI.

INSTRUCTIONS Follow the Menu Path: IMG Enterprise structure Definition Logistics - General Define copy, delete, check plant

1. Click

2. Click 3. Click

4. Click

5. Enter from plant as 0001 to copy from SAP defined plant 6. Enter To Plant E.g. IND6

7. Click

8. Click to return to main menu.

Note: - Definition of plant and assignment of plant to the company codes along with relevant GL accounts is done by the FI team. However the creation of plant is demonstrated.

3.3 Maintain plant details and Factory calendar in Plant

BACKGROUND

When copying the plant, the entire details will be copied from the source plant. Address of the plant and other details attached to the plant can be changed.

INSTRUCTIONS Follow the Menu Path: IMG Enterprise structure Definition Logistics - General Define copy, delete, check plant

1. Double click 2. Select plant IND6 by clicking the grey box in the left side 3. Click 4. Click 5. Maintain the entire address, contact details of the plant.

6. Factory calendar must be attached to the plant

Below screen shows the details of plant settings.

3.4 Define Location

BACKGROUND This configuration setting enables to define the location. Location indicates where the materials are stored inside the plant.

INSTRUCTIONS Follow the Menu Path: IMG Enterprise structure Definition Logistics - General Define Location

1. Click 2. Click

3. Update required and optional fields: Field Name Description Value Plant Name of the plant e.g. IND6 Location Location

identification E.g. PROD

Name Description of the location

Production location

4. Click

Note: - Maintain the address of the location in the subsequent screen.

5. Enter title as Company 6. Enter country 7. Click

8. Click .

3.5 Maintain Storage Location

BACKGROUND This configuration setting enables to define the physical storage location. This will indicate where the stocks are stored physically inside the plant. Each item must have storage location. One material can be stored in many storage locations. Storage locations can be assigned to the warehouse through warehouse management.

INSTRUCTIONS Follow the Menu Path: IMG Enterprise structure Definition Materials Management Maintain storage location Click

Enter the plant where the storage location is to be created. E.g. IND6 Click

Click Enter Storage location Enter description of the storage location Click

Select the storage location Double Click Enter the sequential number 1 Click

Select the sequence number Click

Maintain the address. Click Click Repeat the above to maintain the address for all storage locations.

3.6 Maintain Purchase organization

BACKGROUND This configuration setting enables to define the purchase organization. Purchase organization is the part of the enterprise structure from MM point of view. It represents the responsibilities to Procure materials and services

Negotiation with vendor

Purchase organization is assigned to the company codes and plants. Following are the possibilities of assignments. One purchase organization to many company codes

One purchase organization to one company code

One purchase organization to one plant

Note: - It must be assigned to plant.

INSTRUCTIONS Follow the Menu Path: IMG Enterprise structure Definition Materials Management Maintain purchase organization

1. Click

2. click 3. Update the following fields

Field Name Description Purch.organization Key identifying the purchase

organization. E.g. IND6 Purch.org.descr. Description of the purchase

organization. E.g. For plant IND6

4. Click .

3.7 Assign Plant to company

BACKGROUND This configuration setting enables to assign plant to the company code.

INSTRUCTIONS Follow the Menu Path: IMG Enterprise structure Assignment Logistics General Assign plant to company code

1. Click 2. Select the desired company code by clicking the cursor

on it. 3. Click 4. Select the plant from the display

5. Click

6. Click .

3.8 Assign purchase organization to the company code

BACKGROUND This configuration setting enables to assign the purchase organization to a company code.

INSTRUCTIONS Follow the Menu Path: IMG Enterprise structure Assignment Materials Management Assign purchase organization to company code

1. Click

2. Select the desired company code by clicking the cursor on it.

3. Click

4. Select the purchase organization

5. Click

6. Click

3.9 Assign purchase organization to plant

BACKGROUND This configuration setting enables to assign the purchase organization to a plant.

INSTRUCTIONS Follow the Menu Path: IMG Enterprise structure Assignment Materials Management Assign purchase organization to plant

1. Click

2. Select the desired plant by clicking the cursor on it.

3. Click

4. Select the purchase organization

5. Click

6. Click

All right guys, not much about MM organization structure. Now we shall look into material master related to configurations.

4. Material Master Material master contains all information about a material. All the information have to be maintained by the different end users. Example: Physical, sales and storage related details of a material is

maintained by the logistics team

Finance related information is maintained by the finance team

Quality related information is maintained by the QM team

Ok, now lets go to the configuration details of material master.

4.1 Assign field to field selection groups

BACKGROUND This configuration setting enables to define the field in the material master as mandatory or optional or to hide. Lets try to make the purchasing value key as mandatory entry for plant IND6.

INSTRUCTIONS Follow the Menu Path: IMG Logistics General Material master Field Selection Assign fields to field selection groups

1. Click

2. Click in purchasing value key row

3. Create new field ref by copying from the standard SAP

entry. E.g. IND6 as field reference.

4. Click

5. Select the field selection as required entry

6. Click

4.2 Define plant specific field and screen selection

BACKGROUND When there are more than one Bill Of Material, system will select the first alternate by default. It can be configured in such a way that system takes the right alternate for a given period.

INSTRUCTIONS Follow the Menu Path: IMG Logistics General Material master Field Selection Define plant specific field selection and plant specific screen selection

1. Click

2. Maintain field reference as IND6 for plant IND6.

3. Click Save .

4.3 Define material type

BACKGROUND Similar to the above alternate defining in production area, for other areas like Inventory, MRP, Costing, Sales and Distribution and Plant Maintenance can be maintained. Only the menu path is given here and the rest of the settings are similar to above 1.1.8.

INSTRUCTIONS Follow the Menu Path: IMG Logistics General Material master Basic settings Material types Define Attributes of Material Types

1. Click 2. Select ROH by clicking the grey box in the left

3. Click to copy from ROH to the new material type

4. Type the new material type as YROH

5. Maintain the field reference as FERT

6. Select sales view

Note: - Standard settings are sufficient. Field name Description Field reference Field references are taken

from this material type. X plant material status Cross plant material status to

restrict the usage of material in all the plants.

Item category group Default item category group to determine the item category for the material type.

Tick in this check box will make the initial status of the batch as restricted.

Tick in this check box will not

check with the external number range when creating the material master.

Price control which will appear in the material master. However it can be changed in the material master.

Indicates that the Quantity update in specific valuation area.

Indicates that the value update in specific valuation area.

Double click

Select the check box only in the relevant valuation area. E.g. IND6, IND7 and IND9

7. Click 8. Click

9. Click Save

Effect of this configuration setting with initial status check box ticked. When the new batch is created, the initial status of that batch will be restricted.

Note: - Considering the restricted batch for MRP will be controlled by the IMG setting for MRP. The batch status can be changed to unrestricted-use only through manually or through the QI Usage decision.

4.4 Define Number range for each material type

BACKGROUND This configuration setting enables to define the number range for material type. Each material type must have a number range so as to enable to create the material of that type.

INSTRUCTIONS Follow the Menu Path: IMG Logistics General Material master Basic settings Material types Define Number Range for Each Material Type

1. Click 2. Click

3. Click F6 or from the top, follow the menu path.

GroupInsert to insert the new group

4. Maintain the Text for the new group and maintain the

interval for internal and external number range

5. Click .

6. Click to assign to the material type

7. click on the material type from the Not assigned list

8. Click

9. Tick the group check box to which number range is to be assigned to this material type

10. Click

11. Click .

4.5 Define industry sector

BACKGROUND This configuration setting enables to define the industry sector and field selection specific to the industry sector. Industry sector definition is the one through which any screen sequence can be changed. Industry sector is the mandatory entry when creating the material master.

INSTRUCTIONS Follow the Menu Path: IMG Logistics General Material master Field Selection Define industry sector and Industry-sector-specific field selection

1. Click 2. Select the Mechanical engineering by clicking the grey

box in the left

3. Click

4. Maintain industry sector. E.g. Z

5. Maintain industry description. E.g. Mechanical engineering-sp

6. Maintain field reference. E.g. IND6

7. Click

8. Click

4.6 Maintain user specific settings

BACKGROUND This configuration setting enables to maintain the setting for material master creation specific to the user. By this way, users can be restricted from accessing certain data.

INSTRUCTIONS Follow the Menu Path: IMG Logistics General Material master configure the material master Maintain User settings

1. Click

2. Click Maintain the entries as shown below.

3. Click

4. Click Maintain the entries as shown below

5. Click

Effect of this configuration When user sapuser6 try to create material master, industry sector will not appear to him.

4.7 Set material block for goods movement

BACKGROUND This configuration setting enables to define the block for material. This is essential to prevent usage of same material by different user at a given instance.

INSTRUCTIONS Follow the Menu Path: IMG Materials Management General settings for Materials Management

1. Click

2. Select the appropriate material block Lock exclusively when the material master is read during the goods movement, plant data and accounting data are locked till the material is posted. Another user can not use this material at this time. Late lock data will be blocked only at the time of saving.

3. Click

4.8 Define storage location MRP per plant

BACKGROUND

This configuration setting enables to define the usage of storage location stock during MRP run.

INSTRUCTIONS Follow the Menu Path: IMG Materials Management Consumption Based Planning Planning Define Storage Location MRP per plant

1. Click 2. Enter Plant. E.g. IND6

3. Click

4. Select 1 to exclude storage location from MRP 5. Click 6. Click to reach main IMG menu

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Published by Team of SAP Consultants at SAPTOPJOBS Copyright 2007-09@SAPTOPJOBS INDEX

1. Over-view:- 2. Getting into the Configuration area of SAP 3. Enterprise structure 3.1 Define valuation level 3.2 Define Plant 3.3 Maintain plant details and Factory calendar in Plant 3.4 Define Location 3.5 Maintain Storage Location 3.6 Maintain Purchase organization 3.7 Assign Plant to company 3.8 Assign purchase organization to the company code 3.9 Assign purchase organization to plant

4. Material Master 4.1 Assign field to field selection groups 4.2 Define plant specific field and screen selection 4.3 Define material type 4.4 Define Number range for each material type 4.5 Define industry sector 4.6 Maintain user specific settings 4.7 Set material block for goods movement 4.8 Define storage location MRP per plant