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SAP MM – Materials Management



SAP Materials Management

INDEX

Introduction 31.0. Fundamental Procurement Process 4

2.0. Organizational Elements 5

3.1. Material Master 63.2. Vendor Master 63.3. Purcasing Master !4.1. Purcasing "ocuments #4.2. $otes on %urcasing documents 114.3. Purcasing %rocessing 115.1. &oods recei%t 146.1. In'oice %rocessing 16!.1. Vendor Pa(ment 1!

).0. P*+,-/I$& 20

).1. Materials %lanning and control 20).2. uotations 25).3. Purcase order 26).4. Outline agreement 2)).5. ,ontract 2#).6./ceduling greement 30).!. Purcasing ino records 31).). /ource o su%%l( 33).#. Master conditions 34

#.0. EE+$ /E+VI,E/ M$&EME$ 3!

10.0. VE$"O+ EV*IO$ 44

11.0. I$VE$O+ M$&EME$ 53

12.0. I$VOI,E VE+IFI,IO$ 65

13.0. +E-O*/E M$&EME$ !4

14.0. ,O$/*MPIO$ 7/E" P$$I$& ))

15.0. ME+I E"&E+ 101

EAS-SAP V.Jayaram2




INTRODUCTION

Materials Management co'ers all tas8s 9itin te su%%l( cain: including consum%tion; <ased %lanning: %urcasing: 'endor e'aluation: and in'oice 'eriication. It also includesin'entor( and 9areouse management to manage stoc8 until usuage dictates te c(cle

sould <egin again

e %ur%ose o te MM;Materials Management module is to %ro'ide detailed su%%ort orte da(;to;da( acti'ities o e'er( t(%e o <usiness tat entails te consum%tion omaterial.

e Materials Management module o /P +=3 consists o te ollo9ing com%onents>

• Purcasing.

• E?ternal /er'ices Management.

• Vendor E'aluation.

•In'entor( Management.

• In'oice Veriication.

• areouse Management.

• ,onsum%tion 7ased Planning.

• Material edger.

EAS-SAP V.Jayaram3




1.. !UNDAMENTA" PROCUREMENT PROCESSES

Re#$irements Determinati%n ;; 7asicall(: o9 do 9e 8no9 9e need someting@ ereAuest or goods or ser'ices usuall( comes in te orm o a %urcase reAuisition.Purcase reAuisitions can <e created manuall( or automaticall( <( M+P BMaterial

+eAuirements PlanningC. M+P is %art o te Manuacturing Planning and E?ecution %rocess introduced a<o'e. /im%l( %ut M+P determines te material needs <ased oncurrent and uture sales igures and automaticall( triggers te reAuirements 9ennecessar(.

S%$r&e Determinati%n ;; e source o su%%l( is determined or te needed item <( te %urcasing de%artment or te s(stem

Ven'%r sele&ti%n ;; e reAuisition is assigned to a 'endor

Or'er (r%&essing ;; %urcase order is reAuested 9it reerence to te reAuisition

Or'er )%ll%*-$(s ;; e s(stem %ro'ides automated e?%editing and ollo9s u%reminders to ensure %rom%t deli'er( o te order

+%%'s re&ei(t an' in,ent%ry management ;; e goods are recei'ed into te9areouse 'ia %urcase order goods recei%t

In,%i&e ,eri)i&ati%n ;; e in'oice is 'alidated <( com%aring it to te original %urcaseorder %rice and Auantit( recei'ed

Payment ;; Pa(ment 9ill <e made <ased on %a(ment terms and conditions deined

1.1. !OUR MAIN DOCUMENTS AND TRANSACTIONS IN TE

PROCUREMENT PROCESSES.

P$r&ase Re#$isiti%ns ;; Includes te irst tree ste%s o te %rocurement %rocess: i.e.+eAuirements "etermination: /ource "etermination and Vendor /election.

P$r&ase Or'ers ;; Includes te ste%s our and i'e o te %rocurement %rocess: i.e.Order %rocessing: and Order Follo9;*%

+%%'s Re&ei(t P%sting ;; Includes ste% si? o te in'entor( %rocess: i.e. &oods +ecei%t

and In'entor( Management

In,%i&e Pr%&essing ;; /te%s se'en and eigt o te %rocurement %rocess: i.e. In'oiceVeriication and Pa(ment.

EAS-SAP V.Jayaram4




/.. OR+ANISATIONA" E"EMENTS

Client

e client re%resents te igest le'el o te organizational ierarc(. It re%resents tecor%orate grou% le'el o an organization.

C%m(any &%'e

e com%an( code re%resents an inde%endent accounting unit 9itin a client: i.e. a <usiness unit or 9ic <alance seets and %roit and loss statements: reAuired <( la9: arecom%iled.

Plant

%lant is an organizational unit 9itin a com%an(. %lant %roduces goods: rendersser'ices: or ma8es goods a'aila<le or distri<ution. $ote tat a %lant can <e amanuacturing acilit( or a 9areouse distri<ution center.

St%rage l%&ati%n storage location is te actual %(sical location: 9itin a %lant: 9ere te materialstoc8s are located.

P$r&asing %rgani0ati%n

%urcasing organization is an organizational unit res%onsi<le or %rocuring materialsand ser'ices or one or more %lants and or negotiating %rices and terms o deli'er( 9itte 'endor.

P$r&asing gr%$(

e %urcasing grou% is a s%ecial su<di'ision 9itin a %urcasing organization tat

andles certain s%eciic %urcasing acti'ities: namel( te da(;to;da( <u(ing. Please notetat a %urcasing grou% can %erorm tis unction or se'eral %urcasing organizations.

EAS-SAP V.Jayaram5




.1. MATERIA" MASTER

.1.1. Organi0ati%nal le,els )%r in,ent%ry management

&eneral data

Plant data/torage location dataValuation data

.1./. Material master ,ie*s 2 (rimary ,ie*s )%r (r%&$rement

Purcasing 'ie9Engineering 'ie9ccounting 'ie9

.1.. Ste(s t% &reate a material master

•e material t(%e and industr( sector

• e units o measure: suc as te <ase unit Bstoc8 8ee%ing unitC: and te order unit

• e %urcasing grou% B<u(er grou%C res%onsi<le or te material

• ccounting data: suc as te 'aluation class: %rice control: and standard or

mo'ing a'erage %rice

./ VENDOR MASTER

Vendor Master +ecords include general inormation suc as name and address: currenc(used or te 'endor: terms o %a(ment: contact inormation: etc. Vendor master recordscom%rise inormation or <ot te accounting and %urcasing unction as 9ell as general

'endor data. &eneral data is data tat a%%lies to all com%an( codes 9itin te client. Itincludes suc inormation as address: %one num<er: and te language s%o8en <( te'endor. ccounting data includes accounting s%eciic inormation suc as %a(menttransactions and reconciliation control account inormation. Purcasing data includesitems suc as contact %ersons: terms o deli'er(: etc. 7ecause ccounting and Purcasinga'e dierent inormation needs: eac is %resented 9it a dierent 'ie9 o te 'endor master ile. In te ccounting 'ie9: te accountant as access to te general andaccounting data: and in te Purcasing 'ie9 te %urcasing agent as access to tegeneral data and te %urcasing data.

./.1.+eneral )$n&ti%ns

• erms o %a(ment

• One time 'endor

• 7loc8ing 'endors

• Maintaining <usiness %artners D 'endor: order reci%ient: goods su%%lier: in'oicing

%art(: %a(ee

EAS-SAP V.Jayaram6




.. PURCASIN+ MASTER

In addition to 'endor and material master data: Purcasing is su%%orted in its e'er(da(9or8 <( te ollo9ing additional t(%es o master data>

• Purcasing ino record

•

/ource list• uota arrangement

• ,onditions

• Vendor e'aluation

..1. P$r&asing in)% re&%r'

Ino record is sort or Inormation record. e ino record contains concise inormationa<out a 'endor and a material tat (ou alread( %rocure rom tat 'endor. n ino recordtus re%resents a material-,en'%r relati%nsi(. For e?am%le: te ino record indicateste units o measure in 9ic materials are ordered rom te 'endor: and te a%%lica<le

reminder le'els. It also so9s %rice canges made <( te 'endor or te material. isinormation can <e useul in te %rocess o e'aluating Auotations to determine tesuccessul <idder. Ino records are created automaticall( 9en (ou order a material. oucan also create: cange: and delete ino records.e %urcasing ino record Balso reerred to in a<<re'iated orm as te ino recordC is asource o inormation or %urcasing. It contains inormation on a s%eciic material and a'endor su%%l(ing te material. For e?am%le: te 'endors current %ricing is stored in teino record. e ino record also allo9s <u(ers to Auic8l( determine>

• ic materials a'e <een %re'iousl( oered or su%%lied <( a s%eciic 'endor

• ic 'endors a'e oered or su%%lied a s%eciic material

3.3.1.1. The info record contains data such as:• ,urrent %rices and %ricing conditions

• e num<er o te last %urcase order

• olerance limits or o'er deli'eries and under deli'eries

• e %lanned deli'er( time Blead time reAuired <( te 'endor to deli'er te

materialC• Vendor e'aluation data

• n indicator as to 9eter te 'endor counts as te regular 'endor or te

material• e 'endor su<;range to 9ic te material <elongs

• e a'aila<ilit( %eriod during 9ic te 'endor can su%%l( te material

3.3.1.2. There are two types of info record:

EAS-SAP V.Jayaram!




• Ino records 9it a material master record Be.g. or stoc8 materialC is t(%e o

ino record re%resents te relationsi% <et9een a material or ser'ice Bor 9ic amaster record e?istsC and a 'endor.

• Ino records 9itout a material master record Be.g. or consuma<le materialsC is

t(%e o ino record re%resents te relationsi% <et9een a material or ser'ice or

9ic no master record e?ists and a 'endor.

3.3.1.3. An info record contains general data and organizational data:

• &eneral data "ata tat is 'alid or eac %urcasing organization or eac %lant Bor

e?am%le: origin data: reminder le'els: and te order unitC.• Organizational data "ata suc as %rices and %ricing conditions tat (ou can store

or te rele'ant %urcasing organization or %lant.

../. S%$r&e list

source list s%eciies te %ossi<le sources o su%%l( or a material o'er a gi'en %eriod o

time. It so9s te time %eriod in 9ic a material ma( <e ordered rom a gi'en 'endor or under a long;term agreement. e source list el%s (ou determine 9ic 'endors or internal su%%liers su%%l( a material at a gi'en %oint in time. It is also used in teautomatic selection o 'endors or a material.

... 3$%ta arrangement

Auota arrangement is a mecanism or determining te source o su%%l( to 9ic toassign a material reAuirement on te <asis o Auotas. It ena<les (ou to determine 9ic iste 'alid source or te %rocurement o te material listed in a %urcase reAuisition at an(gi'en time. /etting Auotas allo9s (ou to automaticall( a%%ortion te total reAuirement o

a material o'er a %eriod among a num<er o dierent sources o su%%l(.

..4. Master &%n'iti%ns

Master conditions are conditions tat are deined centrall( and 9ic determine te 'alueo %urcase orders. e( are used as te <asis or calculating te eecti'e %rice.

..5. Ven'%r e,al$ati%n

Vendor e'aluation is te %rocess o anal(zing and assessing te %erormance o (our su%%liers. It also constitutes a <asis or 'endor selection. Vendors are a9arded scores or

a num<er o dierent criteria. Vendors o'erall scores can <e used to determine 9eter te( are retained in or eliminated rom (our 'endor <ase.

4.1. PURCASIN+ DOCUMENTS

4.1.1. Te main '%&$ments an' transa&ti%ns in te (r%&$rement (r%&ess are6

EAS-SAP V.Jayaram)




• Purcase +eAuisitions

• Purcase Orders

• &oods +ecei%t %osting ; u%dates <ot stoc8 and inancial records

• Vendor In'oice %osting

4.1.1.1 Purchase Requisitions

%urcase reAuisition deines a need or a material or ser'ice. It as te ollo9ingcaracteristics>

• It is te %rimar( instrument or identi(ing materials or ser'ices tat must <e

%rocured outside te com%an(.• It autorizes te %urcasing de%artment to %urcase materials in s%eciied

Auantities 9itin a s%eciied time.• It is an internal document> it is not used outside te com%an(.

4.1.1.2. R! "request for quotation#

reAuest or Auotation B+FC is an in'itation to a 'endor to indicate is terms andconditions Bin %articular: is %riceC or te su%%l( o a material or te %ro'ision o aser'ice <( su<mitting a Auotation. s in te case o te %urcase reAuisition: te +Fidentiies te material: Auantit(: and deli'er( date. In addition: te +F containsinormation a<out te 'endor to 9om te +F is sent Bor e?am%le: te 'endors nameand addressC and im%ortant dates or te +F Bsuc as te closing date or a%%lications:or %re;Aualiication date: and <id su<mission deadlinesC.

4.1.1.3. !uotation

Auotation contains te 'endors %ricing and conditions or %ro'iding te material orser'ice stated in te +F. In MM Purcasing: te +F and Auotation are te samedocument. ou enter te 'endors %ricing and conditions in te original +F. en (oucan>

• *se te %rice com%arison list to el% (ou determine te <est Auotation

• /end reGection letters to te a%%ro%riate 'endors

• /tore te %ricing and terms o deli'er( or certain Auotations in te ino record or uture reerence.

4.1.1.4. Purchase $rder "P.$#

e %urcase order re%resents te ormal and inal a%%ro'al o a %urcasing transaction9it te 'endor. It identiies>

• e 'endor

• e material or ser'ice to <e ordered

EAS-SAP V.Jayaram#




• e Auantit(

• e %rice

• e deli'er( date and terms o deli'er(

• e terms o %a(ment

In addition: te %urcase order determines 9eter te ordered material is %laced in stoc8 or consumed directl( u%on goods recei%t.

4.1./. A''iti%nal items &an in&l$'e6

• uantit( and=or Value ,ontracts

• uota rrangements

• /ceduling greements

4.1.2.1. %ontract

contract is a longer;term agreement 9it a 'endor Bone o te t9o orms o outline

agreement in te /P s(stemC to su%%l( a material or %ro'ide a ser'ice or a certain %eriod o time. num<er o dierent terms ma( <e used or tis conce%t in %urcasingliterature: including <lan8et order: <lan8et contract: s(stems contract and %eriodcontract. e contract does not contain s%eciic deli'er( dates or te indi'idual deli'er(Auantities. ese are s%eciied su<seAuentl( in release orders issued against te contract.

4.1.2.2. &cheduling agree'ent

e sceduling agreement as similarities 9it a Auantit( contract> it states te targetAuantit( o a material to <e ordered rom a 'endor o'er a %eriod o time: and te %rice.For eac material to <e %rocured: (ou create a sceduling agreement item. For eac

sceduling agreement item: (ou su<seAuentl( set u% a rolling deli'er( scedule <(creating a num<er o indi'idual scedule lines. In 'endor sceduling: 'endors recei'e asceduling agreement release Bcom%rising a eader and a rolling deli'er( scedule madeu% o indi'idual scedule linesC rater tan discrete %urcase or release orders. B$ote tatin addition to standing or a metod o ordering materials or ser'ices ; as ere: in te /P/(stem: te terms release and releasing ma( also <e a%%lied to an internal %urcasingdocument a%%ro'al or clearance %rocess.C e deli'er( scedule s%eciies te Auantitiesto <e deli'ered: te deli'er( dates: and %ossi<l( also deli'er( time;s%ots: and ma( containdata on %re'ious goods recei%ts. deli'er( scedule ma( contain irm: semi;irm: or %lanned BorecastC deli'er( dates.

4./. NOTES ON PURCASIN+ DOCUMENTS

Purcasing documents are dierentiated in te /P s(stem 'ia te document t(%e. isdetermines: or e?am%le: 9ic is te rele'ant num<er range and 9ic ields are oeredor maintenance %ur%oses. e rele'ant document t(%e a%%ears as a deault 'alue 9en(ou create a %urcasing document. "ocument t(%es are deined or +Fs: %urcase

EAS-SAP V.Jayaram10




orders: and contracts: or e?am%le. e standard /P s(stem includes certain documentt(%es. -o9e'er: (our enter%rise can also deine its o9n.

Eac document is assigned a uniAue num<er. B$ote tat te num<er ma( also <e anal%anumeric code> see <elo9C. is num<er can <e assigned internall( or e?ternall(:

de%ending on te %olic( o (our enter%rise. Internal num<er assignment means tat tes(stem assigns te num<er. E?ternal num<er assignment means tat te %erson creatingte document must su%%l( it. l%anumeric assignment is onl( %ossi<le in te latter case.

Eac %urcasing document is su<di'ided into t9o main areas> te eader and indi'idualitems. Eac document 9ill contain a eader and can contain se'eral items. e eader contains inormation rele'ant to te 9ole document. e items s%eci( te materials or ser'ices to <e %rocured. For e?am%le: inormation a<out te 'endor is contained in tedocument eader: and te material descri%tion and Auantit( to order is s%eciied in eacitem. e additional data includes additional inormation a<out te item: and as nodirect connection 9it te %rocurement data o te item. dditional data includes: or

e?am%le: account assignment data Bsuc as cost center and &= accountC and te POistor( or an item: 9ic contains inormation on alread( recorded goods and in'oicerecei%ts relating to te item. Eac item in a %urcasing document re%resents a s%eciic %lanned %rocurement. Purcasing transactions Bin'ol'ing reAuisitioning: ordering andmonitoringC occur on an item;s%eciic <asis.

4.. PURCASIN+ PROCESSIN+

Re#$isiti%ns ma( <e entered directl( or as a result o Materials +eAuirement PlanningBM+PC. 7eore a reAuisition is created: te source o su%%l( must <e determined. isma( <e 'ia a num<er o dierent strategies de%ending on te t(%e o %roduct and industr(

concerned.For e?am%le> our %ac8ing materials are %urcased in large Auantities on a regular <asisrom a single su%%lier. In tis case a long;term contract ma( a'e <een agreed 9it tissu%%lier: and te %urcase reAuisitions ma( call o Auantit( releases against te contract. I (ou 9is to s%read (our %urcasing across a num<er o su%%liers: a Auota arrangementma( <e dra9n u% tat s%lits te %urcase orders into %redeined ratios.

4..1. %* are re#$isiti%ns &reate'

In te /P /(stem: reAuisitions can <e created in te ollo9ing 9a(s>in'ire&tly>

• Via materials %lanning and control ; te /P com%onent ,onsum%tion;7ased

Planning suggests materials tat need to <e ordered on te <asis o %ast

EAS-SAP V.Jayaram11




consum%tion or usage igures and e?isting stoc8 le'els. e com%onent alsoautomaticall( determines te order Auantit( and te deli'er( date.

• Via net9or8s rom te /P com%onent P/

• Via %lant maintenance orders rom te /P com%onent PM

Dire&tly>/omeone rom te reAuesting de%artment enters a %urcase reAuisition manuall(. e %erson creating te reAuisition determines 9at and o9 muc to order: and te deli'er(date. e creation indicator in te reAuisition so9s 9eter te reAuisition 9as createdmanuall( or troug Materials Planning. It is dis%la(ed in anal(ses o reAuisitions and inte statistics data o a reAuisition item. Materials Planning can sti%ulate tat a reAuisition <e resu<mitted to Purcasing i it is not %rocessed 9itin a %redetermined %eriod. Oncete source o su%%l( is determined: te reAuisition ma( a'e a release strateg( assigned toit. is strateg( reAuires s%eciic autorization <eore a %urcase order can <e created.en te reAuisition is released: te data rom te reAuisition is co%ied into a %urcaseorder 9it te details rom te %urcase inormation record.

4../. P$r&ase Or'er Pr%&essing.

• %urcase order is a ormal reAuest to a 'endor to %ro'ide certain materials or

ser'ices under s%eciic conditions BAuantit(: %rice: deli'er( date: etc.C• i8e %urcase reAuisitions: %urcase orders ma( <e entered directl(.

• ere are dierent t(%es o %urcase orders designed to andle 'arious <usiness

situations. s a result o te order t(%e: dierent account assignments can <emade or te items: carging te items to cost centers: assets: %roGects: etc.

• It is %ossi<le to a%%ortion te costs across se'eral cost centers or %roGects 9en

te order is created.

ou can create a PO in tree dierent 9a(s>

1. Vendor 8no9n*se tis %rocedure i (ou 8no9 9ic 'endor is to recei'e te order. is %rocedure is descri<ed later in tis section.2. Vendor un8no9n*se tis %rocedure i (ou 9ant te s(stem to select %ossi<le 'endors. esesuggestions are ten made on te <asis o sources o su%%l( tat a'e <een %redeined in te s(stem. B$ote> te term source co'ers outline %urcaseagreements: ino records: and source listsC.

3. From assigned reAuisitions*se tis %rocedure to list te reAuisitions or (our %urcasing grou% tat a'ealread( <een assigned to a 'endor Btat is: tose reAuisitions containing a 'endor:outline agreement: or ino record as a %rocurement o%tionC. POs can <e generatedrom tese reAuisitions automaticall(.

EAS-SAP V.Jayaram12




5.1. +OODS RECEIPT

en a com%an( recei'es material rom a 'endor: a goods recei%t is a recorded. goodsrecei%t B&+C is a goods mo'ement 9it 9ic te recei%t o goods rom a 'endor or rom %roduction is %osted. goods recei%t leads to an increase in 9areouse stoc8.&oods recei'ing %ersonnel can conirm te recei%t o goods sim%l( <( entering te POnum<er. 7( s%eci(ing %ermissi<le tolerances: <u(ers can limit o'er; and underdeli'erieso ordered goods.

EAS-SAP V.Jayaram13




5.1.1. A&&%$nting '%&$ments

I te mo'ement is rele'ant or Financial ccounting Btat is: i it leads to an u%date o te &= accountsC: an accounting document is created %arallel to te material document.In some cases: se'eral accounting documents are created or a single material document.

is migt <e te case: or e?am%le: i (ou a'e t9o material document items 9itdierent %lants tat <elong to dierent com%an( codes. e &= accounts in'ol'ed in agoods mo'ement are u%dated troug an automatic account assignment.

(.1.1.1)*+ accounts: &toc,- %onsu'ption- )R*R accounts.

t goods recei%t: te integration 9it FI BFinancial ccountingC u%dates te &eneraledger to relect te increase in te stoc8 'alue.

• /toc8 *%date. ic stoc8s are u%dated in te material master record de%ends on

te destination o te goods>• &oods recei%t into te 9areouse. I te goods are destined or te 9areouse: te

s(stem increases total 'aluated stoc8 and te stoc8 t(%e Bor e?am%le: teunrestricted;use stoc8C <( te deli'ered Auantit(. e stoc8 'alue is u%dated at tesame time.

• &oods recei%t into consum%tion. I te goods are destined or consum%tion: onl(

te consum%tion statistics are u%dated in te material master record.• &oods recei%t into goods recei%t <loc8ed stoc8. I te goods recei%t is %osted into

goods recei%t <loc8ed stoc8 Bsee te section &oods +ecei%ts Into &oods +ecei%t7loc8ed /toc8C: te stoc8 remains uncanged. e goods are recorded onl( ingoods recei%t <loc8ed stoc8 o te %urcase order istor(.

• &oods recei%t into a ne9 storage location. I (ou <oo8 goods into a storage

location: 9ic does not (et e?ist or tis material: te storage location data 9ill

automaticall( <e created in te material master record 9en te goods recei%t is %osted.

5.1./. Oter D%&$ments generate' '$ring +%%'s re&ei(t (%sting

•

material document is generated tat ser'es as %roo o te mo'ement and as asource o inormation or an( a%%lications tat ollo9. material documentconsists o a eader and at least one item. e eader contains general data a<outte mo'ement Bor e?am%le: its dateC. Eac item descri<es one mo'ement.

• Purcase order istor(. "uring goods recei%t %osting: a %urcase order istor(

record is automaticall( created. is record contains data essential or Purcasing:suc as> te deli'ered Auantit(: te material document num<er and item: temo'ement t(%e: and te %osting date o te goods recei%t. e 'endor e'aluation

EAS-SAP V.Jayaram14




is also u%dated 9ic allo9s (ou to see i 'endors are adering to te reAuesteddeli'er( dates: etc.

• Order item. I te deli'er( com%leted indicator is set in te material document:

te order item is considered closed: and te o%en %urcase order Auantit( is set tozero.

• ranser Order document• Point o ,onsum%tion ,ost ,enter Order document

• /toc8 uantit( ,onsum%tion statistics

EAS-SAP V.Jayaram15




7.1. INVOICE PROCESSIN+

In'oice 'eriication 'alidates te in'oice <( matcing te %urcase order %rice and %urcase order recei%t Auantit( to te in'oice. is also u%dates te %urcase order

istor( and creates a inancial accounting document. e s(stem su%%orts te cec8ingand matcing o in'oices. e accounts %a(a<le cler8 is notiied o Auantit( and %rice'ariances <ecause te s(stem as access to PO and goods recei%t data. is s%eeds te %rocess o auditing and clearing in'oices or %a(ment. ter a %urcase order as <eeniled: a good recei%t made: and a 'endor in'oice created: te in'oice must <e 'eriied <eore te in'oice is %osted to te ollo9ing areas>

• &= accounts

• ssets

• ,ost ,enters

• ProGects

• Order

EAS-SAP V.Jayaram16




8.1. VENDOR PA9MENT

/Ps standard s(stem contains te most common orms o %a(ments. Eac metod as <een deined se%aratel( or eac countr(. e %a(ment %rogram as <een de'elo%ed or

international transactions 9it 'endors and customers: so (ou can carr( out <otincoming and outgoing %a(ments. e standard %a(ment metods include>

8.1.1. Ce&:

ou can %ost te cec8 %a(ment manuall( or 'ia te %a(ment %rogram.,ec8s issued <( and need to <e dealt 9it se%aratel( in order to create a lin8 <et9eente cec8 num<er and te %a(ment document. It is ad'isa<le to reser'e a se%arate num<er range or manuall( created cec8s in order to 8ee% te use and management o succec8s se%arate rom tat o automaticall( created cec8s.

8.1./. Trans)er

Immediatel( ater recei'ing te closing in'oice: (ou can carr( out a transer %osting ote cleara<le do9n %a(ments. is transaction also su%%orts te transer %osting o %artialamounts. ter tis transer %osting: te corres%onding amount is no longer dis%la(ed inte 'endor account and in te &eneral edger as a do9n %a(ment made: <ut rater as a%a(ment made in te %a(a<les account. is %a(ment made is ta8en into account 9ente in'oice is %aid: eiter manuall( or automaticall(.

ou must carr( out a transer %osting o do9n %a(ments manuall( in te ollo9ing cases>

1. ou 9ant to %re%are (our (ear;end closing. ou a'e recei'ed te closing in'oice or ado9n %a(ment and can no longer clear it 9it te %a(ment %rogram: since (ou 9ill notrun te %a(ment %rogram until ater (ou ne?t %re%are te <alance seet. In tis case: (ouclear te do9n %a(ment 9it te closing in'oice manuall(.2. ou 9ant to allocate a do9n %a(ment to a s%eciic in'oice: 9it 9ic it is to <ecleared. e s(stem notes te document num<er o te in'oice in te line item o tedo9n %a(ment. e %a(ment %rogram su<tracts te do9n %a(ment onl( 9en tecorres%onding in'oice is %aid.3. ou 9ant to clear a do9n %a(ment %artiall(. at is: a do9n %a(ment is cleared 9itse'eral in'oices: 9ic are %aid at dierent times. ou must clear eac do9n %a(mentamount manuall(.

EAS-SAP V.Jayaram1!




8.1.. ;ill O) E<&ange

ou can ma8e %a(ments to (our 'endor <( <ill o e?cange using te %a(ment %rogram.ou can also %ost te <ill o e?cange %a(ment manuall(.

o %ost a <ill o e?cange %a(ment manuall(: %roceed as ollo9s>1. /elect "ocument entr( ;H 7ill o e?cange ;H Pa(ment. e s(stem so9s te screenor entering eader data and or selecting a clearing %rocedure.2. Enter te eader data and select te clearing %rocedure Outgoing %a(ment. On te <ottom line: enter te %osting 8e( or %osting a <ill %a(a<le B3# in te standard s(stemC:te num<er o te 'endor account: and te s%ecial &= indicator or te <ill %osting B7 inte standard s(stemC. /elect E$E+. is accesses te screen or entering data on te <illo e?cange. e most im%ortant ields are>

• "ra9er e address data o te 'endor is suggested.

• "ra9ee e address data o te com%an( code is suggested.

• "ue date

Enter te due date o te <ill o e?cange. our <an8 %a(s te <ill o e?cange on tisdate.3. I (ou 9ant to %ost te <ill lia<ilit( to te <an8 su<;account and te corres%ondingclearing account: (ou enter tese t9o line items irst. o do tis: (ou must ma8e tecorres%onding &= account %osting on te <ottom line o te screen. ou can ten cangeto te screen or %rocessing o%en items to clear te <ill %a(a<le.4. /elect Process ;H ,oose o%en items. ou reac te selection screen or o%en items.e s(stem suggests te reAuired data: suc as te 'endor account num<er: te accountt(%e: and te com%an( code. ou can urter limit te items to <e %rocessed <( s%eci(ingselection criteria.

5. ou ten cange to te screen or %rocessing o%en items. ll urter ste%s or clearingo%en items are descri<ed in ,learing O%en Items.6. Post te document <( selecting "ocument ;H Post.e s(stem clears te o%en %a(a<les and %osts a <ill %a(a<le to te 'endor account andte s%ecial &= account.

Once te in'oices are %osted: ccounts Pa(a<le reads and %a(s all in'oices tat are dueand are not <loc8ed or %a(ment. e %a(ments are <ased on inormation B%a(menttermsC tat is s%eciied in eiter te %urcase order or in te 'endor master ile. isinormation can <e canged manuall( on te in'oice.

erms o %a(ment re%resent sti%ulations concerning te time o %a(ment o amounts due:including te s%eciication o an( discounts granted or %rom%t %a(ment: togeter 9itte discount;Auali(ing %eriods Bor e?am%le: te clause %a(a<le in 30 da(s net: or discount o 2 i %a(ment is made 9itin 10 da(sC. In te latter e?am%le: te discount isdeducted rom te in'oice amount i %a(ment is made 9itin te s%eciied %eriod.

ou s%eci( te terms o %a(ment in te 'endor master record. en (ou %lace an order 9it te 'endor: te( automaticall( a%%ear as deault 'aluesJ o9e'er: (ou can cange

EAS-SAP V.Jayaram1)




tem as needed.

erms o %a(ment can also <e entered in te 'endors in'oice. ese are ten te onesused <( te %a(ment %rogram.

8.1.4. ;l%&:ing In,%i&es

en an in'oice is <loc8ed: Financial ccounting cannot %a( te in'oice. e in'oicemust irst <e released in a se%arate ste% <eore it can <e %rocessed. n in'oice can <e <loc8ed or %a(ment due to one o te ollo9ing reasons>

• Variances in an In'oice Item

• mount o an In'oice Item

• /tocastic 7loc8

• Manual 7loc8

,as discount and <loc8ed in'oices> en an in'oice is <loc8ed: te %eriod in 9ic te

'endor grants a cas discount ma( end <eore te in'oice is released. In tis case: <loc8ing te in'oice 9ould <e a disad'antage: since te %a(ment %rogram cannot deductte cas discount. o a'oid tis: (ou can u%date te <aseline date or %a(ment 9en (ourelease te in'oice: so tat te cas discount %eriods can <e sited or9ards.

).0. P*+,-/I$&

e +=3 /(stem consists o 'arious modules tat are com%letel( integrated 9it oneanoter. is integration allo9s 'arious de%artments in a com%an( to sare and maintain

EAS-SAP V.Jayaram1#




te same inormation. Purcasing is a com%onent o te Materials Management BMMCmodule. e MM module is ull( integrated 9it oter modules in te +=3 /(stem. Itsu%%orts all %ases o materials management> materials %lanning and control: %urcasing:goods recei'ing: in'entor( management: and in'oice 'eriication. &ood communication <et9een all %artici%ants in te %rocurement %rocess is necessar( or Purcasing to

unction smootl(. Purcasing communicates 9it oter modules in te +=3 /(stem toensure a constant lo9 o inormation. For e?am%le: it 9or8s side <( side te ollo9ingmodules>· Controlling (CO)

Orders or materials and ser'ices consumed directl( illustrate te interace to te costaccounting s(stem B,ontrollingC. is is <ecause te( can <e assigned to a cost center directl(.· Financial Accounting (FI)

Purcasing and ccounting <ot maintain inormation on 'endors. Inormation on eac'endor is stored in a 'endor master record: 9ic contains <ot accounting and %urcasing inormation. e 'endor master record re%resents te 'endor account ininancial accounting. roug PO account assignment: Purcasing can also s%eci( 9ic

&= accounts are to <e carged in te inancial accounting s(stem.· Sales and Distribution (SD)

itin te rame9or8 o material reAuirements %lanning BM+PC: customer reAuirementsrom /ales can <e %assed on to Purcasing. In addition: 9en creating a reAuisition: (oucan assign it to a sales order.

=.1. MATERIA"S P"ANNIN+ AND CONTRO"

is section %ro'ides an o'er'ie9 o materials %lanning and control and so9s o9 telatter aects %urcasing acti'ities in te /P s(stem.

e section discusses o9 te com%onent ,onsum%tion;7ased Planning>• Identiies 9ic materials to order

• "etermines te Auantit( to order

• /ets te deli'er( date

=.1.1. >at is materials (lanning an' &%ntr%l?

Materials %lanning and control determines o9 muc o 9ic material: com%onent:goods etc. is needed and 9en. is acti'it( is te res%onsi<ilit( o te materials %lanneror controller.

=.1./. Ty(es %) materials (lanning an' &%ntr%l

ere are t9o orms o materials %lanning and control>

/eter'inistic

"eterministic materials %lanning Bmaterial reAuirements %lanning: or M+PC determinesreAuirements on te <asis o <ills o material and outside demand. is %rocedure

EAS-SAP V.Jayaram20




in'ol'es te de'elo%ment o a %roduction %lan directl( rom <ills o material. is ormo materials %lanning is a com%onent o te /P a%%lication Production Planning BPPC.

%onsu'ption0ased

,onsum%tion;<ased %lanning orms %art o te /P a%%lication Materials Management

BMMC. It determines reAuirements on te <asis o %ast consum%tion data.

$ote tat in te /P s(stem <ot o te a<o'e ma( collecti'el( <e reerred to as M+P.

,onsum%tion;<ased %lanninge /P com%onent ,onsum%tion;7ased Planning el%s te res%onsi<le materials %lanner Bor materials or in'entor( controllerC to determine te ollo9ing>

• ic materials to order

• e Auantit( reAuired

• en materials must <e deli'ered to meet current and uture reAuirements

It <ases its decisions on 9at to order on %ast consum%tion. e s(stem can generatereAuisitions automaticall(. ese can <e assigned to a %urcasing grou% B<u(er grou%C ora materials %lanner=controller. e materials %lanner=controller or <u(er can ten con'ertte reAuisition into a standard %urcase order or a release order issued against a contract.

dentifying 'aterials to order

e ,onsum%tion;7ased Planning module identiies material sortages using one o teollo9ing metods>

• 7( reerence to te reorder le'el Breorder %ointC

• *sing a orecasting model

eter reAuirements or a gi'en material are determined <( reerence to te reorderle'el or using a orecasting model is deined in te material master record.

Reorder leel

,onsum%tion;7ased Planning can suggest orders <ased <( reerence to te reorder le'elo a material. e s(stem com%ares te materials reorder le'el 9it te sum o tea'aila<le stoc8. I te a'aila<le stoc8 is less tan te reorder le'el: te s(stem lags tematerial or M+P. n order %ro%osal is ten generated during te ne?t M+P run. ea'aila<le stoc8 is determined using te ollo9ing ormula>

'aila<le stoc8K Bstoc8 on and in te 9areouse L current ordersC ; reser'ed stoc8

=.1.. Releasing Re#$isiti%ns

is section descri<es te release %rocedure or reAuisitions in Purcasing. B$ote tat intis conte?t: release means gi'ing a%%ro'al: or clearance: to go aead 9it te

EAS-SAP V.Jayaram21




%rocurement o te materials or ser'ices set out in te reAuisition: and sould not <econused 9it te issuing o orders against longer;term %urcase agreements: 9ic ma(also <e reerred to as releasing B*/C or calling o B*CC.

It discusses o9 te release Ba%%ro'alC o %urcase reAuisitions is controlled: o9 (ou

can determine 9o must release Ba%%ro'eC a %urcase reAuisition: and o9 a %urcasereAuisition is actuall( released Ba%%ro'edC.

itin Purcasing: tere are t9o %rocedures or releasing %urcase reAuisitions>• +elease %rocedure 1 B9itout classiicationC

• +elease %rocedure 2 B9it classiicationC

Release procedure 1

is %rocedure ser'es as a correction and a%%ro'al %rocedure or %urcase reAuisitions.Its aim is to cec8 te data on material: Auantit(: and dates or accurac( and ensure tecorrectness o te s%eciied account assignment and source o su%%l(. Purcase

reAuisitions are released on an item <( item <asis.

For e?am%le: su%%ose strateg( /1: 9ic is assigned to reAuisitions 9it a ace 'alue omore tanN10:000: reAuires a%%ro'als as so9n in te ollo9ing ta<le.+elease %rereAuisites in te case o release strateg( /1/trateg(

+elease %oint/trateg(

PrereAuisites/1

1 ; ProGect manager none2 ; "e%artment manager none3 ; ,ost center manager 1: 24 ; ,ontroller $one5 ; ,EO 1: 2: 3: 4In addition: te ollo9ing release %rereAuisites a%%l( or release strateg( /1> +elease %oints 1 ; 4 must release a reAuisition <eore it is released <( te ,EO Brelease %oint 5C. +elease %oint 4 ma( release at an( time: <ut <eore release %oint 5.+elease %oints 1 ; 3 release ater a reAuisitionJ Purcasing ma( issue +Fs to %otential'endors.

is %rocedure is onl( a'aila<le or %urcase reAuisitions.

Release procedure 2

e aim o tis %rocedure is to re%lace manual 9ritten autorization %rocedures usingsignatures <( an electronic one: 9ile maintaining te dual control %rinci%le. e %ersonres%onsi<le %rocesses te rele'ant document in te s(stem: tere<( mar8ing it 9it an

EAS-SAP V.Jayaram22




electronic signature 9ic can gi'e te document legal orce. %urcase order containsan item relating to 1:000 %ieces o /teel 1 or %lant 2. e material <elongs to te materialclass Metal 05. e item as a 'alue o 15:000 dollars. s soon as te item as <eenentered: te s(stem %asses on te ield contents rom MM Purcasing to MM,lassiication in a communication structure. ,lassiication irst selects te rele'ant

caracteristics and ten cec8s te caracteristic 'alues.

For e?am%le: let us assume tat te ,lassiication /(stem as <een set u% as ollo9s>/(stem settings or 01;/4 B&rou% 01: %urcase order: strateg( /4CCharacteristic

Characteristic value

Plant 1, 2, 3Material class Metal 1Value > $12,000

is means tat te caracteristics %lant: material class: and 'alue o item are rele'ant or te determination o te release strateg( or %urcase orders. e s(stem determines te

release strateg( /4 on te <asis o te caracteristic 'alues.

is %rocedure is a'aila<le not onl( or %urcase reAuisitions <ut or all oter %urcasingdocuments as 9ell.

+elease on an item;<(;item <asis is onl( %ossi<le in te case o reAuisitions: not in tecase o te oter %urcasing documents. e reorder le'el can eiter <e set manuall( <(te materials %lanner=controller or automaticall( <( te s(stem.

Man$ally e %lanner=controller enters te reorder le'el in te material master record manuall(.

A$t%mati&ally e s(stem regularl( com%ares te reorder le'el 9it uture reAuirements. I te reorderle'el is too ig or too lo9: it can <e corrected using te ormula>

Re%r'er "e,el K saet( stoc8 L dail( reAuirements re%lenisment lead time9ere te re%lenisment lead time is in da(s. e dail( reAuirements are determinedusing orecasting models.

!%re&asting M%'el Forecasting models identi( a %attern o demand or a gi'en material. eir %ur%ose is toidenti( o9 muc o a material is reAuired at a gi'en uture date <ased on tis %attern.

E<am(les %) )%re&asting m%'els6 Constant "emand 'alues are scattered around an a'erage 'alue.

Trend

EAS-SAP V.Jayaram23




"emand eiter rises or alls steadil( o'er a %eriod o time.

Seasonal "emand %ea8s at regular time inter'als. ese and oter orecasting %rocedures aredescri<ed in more detail in te MM ,onsum%tion;7ased Planning &uide.

Determining te %r'er #$antity e actual order Auantit( ta8es te ollo9ing data in te material master record intoaccount>

• te lot;sizing %rocedure

• olerances: suc as te minimum and ma?imum lot size

"%t si0ing (r%&e'$re e lot sizing %rocedure is used to calculate te order Auantit( on te <asis o te lot size.e materials %lanner=controller deines te lot;sizing %rocedure used or a gi'en materialin te material master record.

T%leran&es ,ertain tolerances in te material master record also aect te order Auantit(. eminimum lot size and te ma?imum lot size: or e?am%le: limit te %urcase orderAuantit( to a certain range. I te material as to <e ordered in i?ed %ac8aging units: terounding 'alue is used to round o te order Auantit( to te %ac8aging unit size.

Determining te 'eli,ery 'ate For materials %rocured e?ternall(: te s(stem suggests deli'er( dates <ased on>

• e release date o te reAuisition

• ,ertain tolerances in te material master record

Release 'ate e release date o a %urcase reAuisition is te date on 9ic it is acti'ated <( tematerials %lanner=controller.

!a&t%rs 'etermining te 'eli,ery 'ate e ollo9ing actors inluence te determination o te deli'er( date> %lanned deli'er( time Bin calendar da(sC ; eiter rom te material master record or romte %urcasing ino record &+ %rocessing time Bin 9or8da(sC deined in te material master record %urcasing de%artment %rocessing time Bin 9or8da(sC: 9ic is deined or a gi'en %lant

=./. 3UOTATIONS

is section %ro'ides general inormation on o9 reAuests or Auotation and Auotationsare used in MM Purcasing.

=./.1. >at is a re#$est )%r #$%tati%n?

EAS-SAP V.Jayaram24




reAuest or Auotation B+FC is an in'itation to a 'endor to indicate is terms andconditions Bin %articular: is %riceC or te su%%l( o a material or te %ro'ision o aser'ice <( su<mitting a Auotation. s in te case o te %urcase reAuisition: te +Fidentiies te material: Auantit(: and deli'er( date. In addition: te +F contains

inormation a<out te 'endor to 9om te +F is sent Bor e?am%le: te 'endors nameand addressC and im%ortant dates or te +F Bsuc as te closing date or a%%lications:or %re;Aualiication date: and <id su<mission deadlinesC. +Fs can <e su<Gect to a release %rocedure.

=././. Str$&t$re %) an R!3

e +F is organized as oter %urcasing documents. e eader contains generalinormation a<out te +F: suc as te 'endor address. Eac item identiies teindi'idual materials or 9ic a %rice is reAuired rom te 'endor. One main dierence <et9een +Fs and oter %urcasing document t(%es is te act tat (ou cannot enter

account assignments or +F items.

=./.. >at is a #$%tati%n?

Auotation contains te 'endors %ricing and conditions or %ro'iding te material orser'ice stated in te +F. In MM Purcasing: te +F and Auotation are te samedocument. ou enter te 'endors %ricing and conditions in te original +F. en (oucan> use te %rice com%arison list to el% (ou determine te <est Auotation send reGection letters to te a%%ro%riate 'endors store te %ricing and terms o deli'er( or certain Auotations in te ino record or uturereerence

=./.4. Pr%&essing %) R!3s an' 3$%tati%ns

ou do te ollo9ing 9en %rocessing +Fs and Auotations>1. ou create an +F manuall( or <( reerencing a reAuisition.2. ou s%eci( 9ic 'endors 9ill recei'e te +F. se%arate document is created

or eac addressee.3. ou enter te %rices and conditions rom te 'endors Auotation into te +F.4. ou can monitor te status o te +F and Auotation as it is urter %rocessed

Btat is: ollo9ing creation o a contract or %urcase orderC.

=.. PURCASE ORDER

is section %ro'ides general inormation a<out %urcase orders and o9 te( are %rocessed 9it MM Purcasing.

=..1. >at is a ($r&ase %r'er?

EAS-SAP V.Jayaram25




e %urcase order re%resents te ormal and inal a%%ro'al o a %urcasing transaction9it te 'endor. It identiies

• e 'endor

• e material or ser'ice to <e ordered

•

e Auantit(• e %rice

• e deli'er( date and terms o deli'er(

• e terms o %a(ment

In addition: te %urcase order determines 9eter te ordered material is %laced in stoc8 or consumed directl( u%on goods recei%t. Purcase orders can <e su<Gect to a release %rocedure.

=../. Str$&t$re %) a ($r&ase %r'er

s in te case o oter %urcasing documents: te PO consists o> Header

,ontaining inormation s%eciic to te entire PO. For e?am%le: te terms o %a(ment and te deli'er( terms are in te eader.

· Items

,ontaining inormation s%eciic to te material or ser'ice. For e?am%le>; Material num<er or sort descri%tion Bsort te?tC; uantit(; Price

For eac item: (ou can enter additional inormation suc as time;s%ot scedule lines and

item;s%eciic te?ts. e PO istor( menu ena<les (ou to monitor deli'eries and in'oicesrecei'ed 9it regard to te item.

=... Item &ateg%ry

e item categor( deines 9eter a %urcase order item>• +eAuires a material num<er

• +eAuires an account assignment

• ill <e %laced in stoc8

• +eAuires a goods recei%t B&+C and=or an in'oice recei%t BI+C

e ollo9ing are te item categories deined in te standard s(stem>

=..4. Stan'ar' items &ateg%ries in POs

/tandardPro'ides or normal goods and in'oice recei%t

,onsignment; Material num<er reAuired; no account assignments

EAS-SAP V.Jayaram26




; e%t in stoc8; &+ necessar(; I+ not necessar(

/u<contracting; &+ allo9ed

; I+ necessar(/toc8 transer; Material num<er reAuired; &+ necessar(; $o I+

ird;%art(; ccount assignment reAuired; &+ and I+ allo9ed

&tandard

Items 9it te item categor( /tandard are orders or goods tat are to <e %rocured

e?ternall(. In tis case: goods and in'oice recei%t are %ossi<le.

%onsign'ent

Items 9it te item categor( ,onsignment are items relating to goods %rocured on aconsignment <asis. ccount assignments cannot <e made or material ordered onconsignment. ,onsignment stoc8s are managed se%aratel( and are not 'aluated.

&ucontracting

Order items 9it te item categor( /u<contracting are used to order inised assem<liesrom a su<contractor: or e?am%le. n( com%onents te su<contractor reAuires toassem<le te inal %roduct are entered as material to <e %ro'ided.

&toc, transport order "inter0plant stoc, transfer order#

e stoc8 trans%ort order is a mecanism acilitating te transer o stoc8 rom one %lantto anoter Btat is: a transer in'ol'ing trans%ort o'er a longer distanceC. e stoc8trans%ort order is one o te s%ecial order t(%es in Purcasing.

Third0party order

Part o a triangular <usiness deal. tird;%art( order is an order %laced 9it a 'endorinstructing te latter to su%%l( goods to or %erorm a ser'ice or a tird %art( Bore?am%le: one o (our customersC. e tird;%art( order is s%eciied in te item categor(ield o a reAuisition or %urcase order. e tird;%art( order is one o te s%ecial ordert(%es in Purcasing.

te' category and account assign'ent

e item categor( reAuires an account assignment or materials tat are consumed

EAS-SAP V.Jayaram2!




directl( Btat is: materials tat are not ta8en into stoc8C. In te case o stoc8 material: anaccount assignment is %ossi<le: <ut not mandator(.

P$ tets

ou can enter te?t in a %urcase order directl( or cange te?ts tat are suggested <( tes(stem. ere are t9o 8inds o te?t>• -eader te?t ; a%%lies to te entire document

• Item te?t ; a%%lies to an indi'idual item

ou deine 9ic te?ts a%%ear in 9ic order on %rintouts in ,ustomizing. ou can enterse'eral eader or item te?ts: 9ic (ou can identi( <( (our o9n codes.

=.4. OUT"INE A+REEMENT

=.4.1. >at is an %$tline agreement?

is section %ro'ides general <ac8ground inormation on te outline agreementsB9ic: outside te /P /(stem: ma( also <e reerred to as <lan8et: master: rame9or8 or um<rella agreementsC tat are used in te MM Purcasing com%onent.

n outline agreement is a longer;term arrangement 9it a 'endor regarding te su%%l( o materials or te %erormance o ser'ices according to %redetermined terms andconditions. In MM Purcasing: suc agreements are su<di'ided into ,ontracts and/ceduling agreements Outline agreements ma( <e su<Gect to a release Ba%%ro'al orclearanceC %rocedure.

=.4./. Str$&t$re %) an %$tline agreement

s in te case o oter %urcasing documents: an outline agreement consists o teollo9ing elements>

/ocu'ent header 6

contains inormation s%eciic to te entire agreement. For e?am%le>; e 'endor inormation and eader conditions are in te document eader.

te's6

contain te inormation s%eciic to te material or ser'ice. For e?am%le>; /tatistics on ordering acti'ities or te item

; uantit( or %rice o te item; Pricing conditions: suc as Auantit( discounts and surcarges;

Tets in outline agree'ents

ou can create (our o9n te?ts rom scratc in an agreement or cange a te?t tat as <een suggested <( te s(stem. ere are t9o 8inds o agreement te?t> eader te?t anditem te?t. e te?ts are urter su<di'ided into te?t t(%es: or e?am%le: si%%ing and

EAS-SAP V.Jayaram2)




deli'er( instructions. e te?t t(%e determines te %rint seAuence on te document %rintout.

=.5. CONTRACT

contract is a longer;term agreement 9it a 'endor Bone o te t9o orms o outlineagreement in te /P s(stemC to su%%l( a material or %ro'ide a ser'ice or a certain %eriod o time. num<er o dierent terms ma( <e used or tis conce%t in %urcasingliterature: including <lan8et order: <lan8et contract: s(stems contract and %eriodcontract. e contract does not contain s%eciic deli'er( dates or te indi'idual deli'er(Auantities. ese are s%eciied su<seAuentl( in release orders issued against te contract.

%ontract types

en creating a contract: (ou can coose <et9een te ollo9ing contract t(%es>

alue

e contract is regarded as ulilled 9en release orders totaling a gi'en 'alue a'e <eenissued. *se tis contract t(%e 9en te total 'alue o all release orders sould not e?ceeda certain amount.

!uantity

e contract is regarded as ulilled 9en release orders totaling a gi'en Auantit( a'e <een issued. *se tis contract t(%e 9en te total Auantit( to order o'er te duration ote contract is 8no9n.

5ays of creating contracts

ou can create a contract in one o te ollo9ing 9a(s>· Manuall(ou enter all te contract data manuall(.· *sing te reerencing tecniAueou can create a contract <( reerencing; Purcase reAuisitions; +Fs=Auotations; Oter contracts

ou can also mi? te t9o metods> (ou can create a contract <( reerencing an e?istingone: and ten cange or enter some items manuall(.

=.7. SCEDU"IN+ A+REEMENT

EAS-SAP V.Jayaram2#




e sceduling agreement as similarities 9it a Auantit( contract> it states te targetAuantit( o a material to <e ordered rom a 'endor o'er a %eriod o time: and te %rice.For eac material to <e %rocured: (ou create a sceduling agreement item. For eacsceduling agreement item: (ou su<seAuentl( set u% a rolling deli'er( scedule <(

creating a num<er o indi'idual scedule lines. In 'endor sceduling: 'endors recei'e asceduling agreement release Bcom%rising a eader and a rolling deli'er( scedule madeu% o indi'idual scedule linesC rater tan discrete %urcase or release orders. B$ote tatin addition to standing or a metod o ordering materials or ser'ices ; as ere: in te /P/(stem: te terms release and releasing ma( also <e a%%lied to an internal %urcasingdocument a%%ro'al or clearance %rocess.C e deli'er( scedule s%eciies te Auantitiesto <e deli'ered: te deli'er( dates: and %ossi<l( also deli'er( time;s%ots: and ma( containdata on %re'ious goods recei%ts. deli'er( scedule ma( contain irm: semi;irm: or %lanned BorecastC deli'er( dates.

I (ou are using sceduling agreements: (ou can 9or8 9it or 9itout release

documentation. or8ing 9it suc documentation aords te ad'antage tat (ou candis%la( te 'alid sceduling agreement releases transmitted to a 'endor o'er a certain %eriod 9ene'er necessar(.

I (ou 9or8 9it sceduling agreements 9itout release documentation: te currentscedule is automaticall( out%utted 'ia te message Bout%utC control %rogram.

I (ou 9or8 9it sceduling agreements 9it release documentation: internall( (ou canma8e as man( canges to te indi'idual scedule lines as (ou 9is. s soon as tescedule lines or a certain item a'e <een inalized and te scedule is read( to <etransmitted to te 'endor: (ou generate a sceduling agreement release. is triggers tetransmission o te rele'ant data to te 'endor. e inormation is recorded in te s(stem:allo9ing (ou to 'eri( at an( time e?actl( 9en (ou sent 9ic data to 9ic 'endor.

Adantages of endor scheduling

Procurement 'ia sceduling agreements as se'eral signiicant ad'antages> streamlines %a%er9or8: sortens %rocessing times ; one deli'er( scedule can re%laceman( %urcase orders or contract release orders. %romotes lo9 in'entories ; (ou can s%eci( te e?act time to deli'er: allo9ing or minimum stoc8 le'els and Gust;in;time BQIC deli'eries. sorter 'endor lead times ; <ecause te deli'er( scedule e?tends into te uture: te'endor as less need to <ac8log orders: tus reducing te lead time or a deli'er(. utomatic generation o deli'er( scedule lines 'ia te M+P s(stem Ba %recondition or tis is tat Purcasing must assign a sceduling agreement as a uniAue source o su%%l(using te Auota arrangement and source list mecanismsC

EAS-SAP V.Jayaram30




=.8. PURCASIN+ IN!O RECORDS

=.8.1. >at is a ($r&asing in)% re&%r'?

e %urcasing ino record Balso reerred to in a<<re'iated orm as te ino recordC is a

source o inormation or %urcasing. It contains inormation on a s%eciic material and a'endor su%%l(ing te material. For e?am%le: te 'endors current %ricing is stored in teino record.

e ino record also allo9s <u(ers to Auic8l( determine>• 9ic materials a'e <een %re'iousl( oered or su%%lied <( a s%eciic 'endor

• 9ic 'endors a'e oered or su%%lied a s%eciic material

=.8./. C%ntents %) an in)% re&%r'

e ino record contains data suc as>•

current %rices and %ricing conditions• te num<er o te last %urcase order

• tolerance limits or o'erdeli'eries and underdeli'eries

• te %lanned deli'er( time Blead time reAuired <( te 'endor to deli'er tematerialC

• 'endor e'aluation data

• an indicator as to 9eter te 'endor counts as te regular 'endor or te material

• te 'endor su<;range to 9ic te material <elongs

• te a'aila<ilit( %eriod during 9ic te 'endor can su%%l( te material

e ino record contains Auotation and ordering data. e data in te ino record Bor

e?am%le: %ricesC is also used as deault data or %urcase orders. For e?am%le: (ou canstore te current and uture Auotation conditions Bdiscounts: i?ed costs etc.C in te inorecord: in order to <e a<le to co%( tem into Pos. ou can also maintain te 'endorsconditions directl( in te ino record.

=.8.. Ty(es %) in)% re&%r'

ere are t9o t(%es o ino record>• Info records with a material master record (e.g. for stock material) is t(%e o

ino record re%resents te relationsi% <et9een a material or ser'ice Bor 9ic amaster record e?istsC and a 'endor.

•

Info records without a material master record (e.g. for consumable materials) is t(%e o ino record re%resents te relationsi% <et9een a material or ser'iceor 9ic no master record e?ists and a 'endor.

&ucontractor info record

su<contractor ino record contains ordering inormation or su<contract orders. Fore?am%le: i (ou su<contract te assem<l( o a com%onent: te su<contractor ino record

EAS-SAP V.Jayaram31




9ould include te 'endors Bsu<contractorsC %rice or assem<ling te com%onent.

Pipeline info record

%i%eline ino record contains inormation on a 'endors commodit( tat is su%%lied

troug a %i%eline Bor e?am%le: oil or 9aterC or 'ia similar means Bor e?am%le:electricit( troug te mainsC. e ino record contains te 'endors %rice or teconsum%tion o suc commodities <( te <u(er B%i%eline 9itdra9alsC. ou can store9itdra9al=usage %rices or dierent 'alidit( %eriods.

&tructure of an info record

n ino record contains general data and organizational data>• General data

"ata tat is 'alid or eac %urcasing organization or eac %lant Bor e?am%le: origin

data: reminder le'els: and te order unitC.• Organiational data

"ata suc as %rices and %ricing conditions tat (ou can store or te rele'ant %urcasingorganization or %lant.

Tets in the info record

e ino record contains te ollo9ing te?t t(%es> Info record memo n internal note tat is ado%ted in te PO item. e ino record memo is not %rinted out

P$ tet in info record

is te?t ser'es to descri<e te order item and corres%onds to te PO te?t in te materialmaster record. It is ado%ted in te PO item and included in te %rintout.

&hort tet

For material tat as a material master record: te sort te?t Bsort descri%tionC is co%ieddirectl( rom te material master record into te PO or te outline %urcase agreement.

PO te?t in ino record 'ersus PO te?t in material master record

For an ino record lin8ed to a material master record: (ou can s%eci( or eac %urcasingorganization 9eter

• onl( te ino record PO te?t is to <e dis%la(ed and %rinted in %urcasing

documents.

EAS-SAP V.Jayaram32




Bo do so: set te indicator $o m. te?t in te %urcasing organization data o te inorecordC.or

• 7ot te ino record PO te?t and te material master record PO te?t are to <e

dis%la(ed and %rinted in %urcasing documents.

7ot te?ts are dis%la(ed and %rinted i te indicator $o m. te?t is not set.

=.=. SOURCES O! SUPP"9

In MM Purcasing: a source o su%%l( ma( <e a 'endor or an outline agreement. ou canmanage sources o su%%l( using source lists and Auota arrangements. e ormer are usedto deine te %reerred or allo9ed sources o a material. uota arrangements are used todetermine 9ic %ortion o te total reAuirement o a material to %rocure rom a gi'ensource.

Ai's of sourcing ad'inistration

/ource list records and Auota arrangements are used in determining te eecti'e sourceo a material. /ource determination is te %rocess o assigning a %articular source o su%%l( to a %urcase reAuisition Bor 'ice 'ersaC.

=.=.1. >at is a s%$r&e list?

source list s%eciies te allo9ed Band disallo9edC sources o su%%l( or a material9itin a %lant. It also indicates te %eriod or 9ic te source is 'alid. Eac source isdeined in te source list <( means o a source list record. e source list oers (ou te

ollo9ing o%tions>• "einition o a source o su%%l( as i?ed. /uc sources count as %reerred

sources o'er a certain %eriod o time.• "etermination o te eecti'e sources Btat is: tose sources tat re%resent te

%reerred sources at a certain %oint in timeC.• "einition o a source o su%%l( as <loc8ed.

=.@. MASTER CONDITIONS

Master conditions are conditions tat determine te eecti'e %rice in te %urcase order.e( ser'e as a central re%ositor( o %ricing or %urcase orders. e( are automaticall(

included in te %rice calculation in te %urcase order i te PO reerences a contract or an ino record: or i it meets certain criteria deined in te e?tended conditions.

ere are tree t(%es o master condition>1. ,onditions in contracts ; ,onditions in a contract a%%l( to all release orders issued

against te contract.2. ,onditions in ino records ; ,onditions in te ino record a%%l( to orders tat

s%eci( te material and 'endor contained in te ino record.

EAS-SAP V.Jayaram33




3. E?tended conditions ; ese are a le?i<le 9a( o setting 'endor %ricing.E?tended conditions are master conditions tat are included in te %ricecalculation in a %urcase order onl( i te PO meets certain criteria. One 9a( touse e?tended conditions 9ould <e to deine a 10 discount on all orders %laced9it a s%eciic 'endor tat are created <( a certain %urcasing organization. In

tis case: te 'endor num<er and %urcasing organization are te t9o criteria aPO must meet <eore te %rice in te PO can <e calculated.

E?tended conditions are more le?i<le tan master conditions in ino records or contracts <ecause (ou can deine 9ic criteria te( must meet <eore te( are a%%lied to a %urcase order.

e documentation on outline agreements and %urcasing ino records so9s o9 teconditions s%eciied in outline agreements and %urcasing ino records: res%ecti'el(:inluence te calculation o te eecti'e %rice in te %urcase order.

In tis ca%ter: (ou 9ill learn o9 to s%eci( conditions tat a%%l( to te %ricing o allorders or an( material 9it a 'endor: not onl( or a s%eciic material or material grou% asis te case 9it outline agreements and ino records.

6.7.1. %onditions technique

e conditions tecniAue is used to deine %ricing across a%%lications. For e?am%le: it isused in te /" B/ales R "istri<utionC module as 9ell as in te MM module. e goal o te conditions tecniAue is to calculate te eecti'e %rice in a %urcase order. Master conditions are sim%l( conditions deined 9it te conditions tecniAue. ile tis

section is not essential to (our understanding o master conditions in %urcase orders: itdoes %ro'ide useul <ac8ground inormation on te mecanism or determining %ricing inPurcasing.

[email protected]. 8asic ele'ents of the conditions technique

e conditions tecniAue consists o our main elements>• ,ondition t(%es

• ,ondition ta<les

• ccess seAuences

• ,alculation scema B%ricing %rocedureC

ese conce%ts are im%ortant or understanding o9 te s(stem determines %ricing inmaster conditions.

%ondition type

condition t(%e is a re%resentation o a %ricing element. ,ondition t(%es e?ist or discounts: surcarges: and reigt costs: or e?am%le. ou use condition t(%es to enter %ricing in %urcasing documents. ou learned o9 to s%eci( condition t(%es 9en

EAS-SAP V.Jayaram34




entering %ricing in Auotations and %urcase orders: or e?am%le.

%ondition tale

condition ta<le deines te com<ination o ields Bte 8e(C tat identiies an indi'idual

condition record. e s(stem stores te condition data (ou enter in te orm o acondition record. For e?am%le: 9en (ou enter a 'endors %ricing in a %urcasing inorecord 9it reerence to a material master record: te 8e( o te condition ta<le includeste 'endor num<er and te material num<er.

e actual %ricing inormation ; suc as te gross %rice and an( discounts ; is stored in acondition record under tis 8e(.

Access sequence

n access seAuence is a searc strateg( tat te s(stem uses to ind condition records or

a %articular condition t(%e. e access seAuence determines te seAuence in 9ic tes(stem searces condition records or a 'alid %rice.

Price calculation sche'a "pricing procedure#

calculation scema Balso 8no9n as a %ricing %rocedure: <ut te same mecanism canalso <e used to calculate ta? amounts: %eriod;end re<ates: or costs: or e?am%leC is agrou% o condition t(%es: deined in a %articular seAuence. It ena<les te s(stem todetermine tat a %articular set o condition t(%es: in a s%eciied seAuence: a%%l( in gi'encircumstances. For e?am%le: te calculation scema determines 9ic condition t(%esa%%l( to te gross %rice. e calculation scema also determines tat te condition t(%esor discounts are calculated in te eecti'e %rice automaticall(.

it MM ,ustomizing: (ou can deine %rice calculation scemas or s%eciic 'endorsand=or %urcasing organizations. e s(stem searces or %ricing data in conditionrecords. e criteria it uses in te searc de%end on te 8e(s in te condition ta<le. eseAuence o te searc de%ends on te access seAuence s%eciied or te condition t(%e.ic condition t(%es are used in te searc are deined in te calculation scema.

For e?am%le: su%%ose tat (ou a'e Gust created an ino record tat s%eciies a 10discount rom te gross %rice. is condition is ten stored in a condition record under te 'endor and material num<er. en te material is ordered rom te 'endor in a PO:te s(stem searces or te discount using te access seAuence.

e calculation scema ensures tat te 10 discount is deducted rom te gross %riceinstead o te net %rice during te %rice calculation %rocess.

ou can maintain conditions in te ollo9ing 9a(s>

EAS-SAP V.Jayaram35




Prices

it tis metod: (ou can list or maintain te conditions tat determine te net %rice in asingle ino record or contract. ou can enter te going mar8et %rice or a material.

/iscounts and surcharges

it tis metod: (ou can enter discounts or surcarges tat a%%l( to all ino records or,ontracts meeting (our %urcasing criteria.

$ther condition types

I (our com%an( as deined its o9n condition t(%es: access seAuences: and conditionta<les: (ou can deine master conditions tat use tese %ricing elements.

Pri&e &anges

ou can cange %ricing <( a i?ed amount glo<all(.

@.. EXTERNA" SERVICES MANA+EMENT

MM E?ternal /er'ices Management BMM /+VC is a %rogram 9itin te MaterialsManagement BMMC module. It su%%orts te com%lete c(cle o <id in'itation: a9ard o contract: and acce%tance o ser'ices.e MM E?ternal /er'ices Management documentation

• aords a general introduction to te %rocurement o e?ternall( %erormed ser'ices

•

indicates te organizational le'els: master data: and documents o te a%%lication• descri<es te a'aila<le unctionalit( and o9 it 9or8s

• e?%lains te %rocedures or creating documents in te s(stem

@.1. ESM !$n&ti%nality

e %rogram oers te ollo9ing unctionalit(>• ser'ice master data<ase: in 9ic te descri%tions o all ser'ices tat are to <e

%rocured can <e stored.• se%arate set o ser'ice s%eciications can <e created or eac concrete

%rocurement %roGect or %ro%osed %rocurement in te %urcasing document.

/ets o ser'ice s%eciications ma( include <ot items 9it ser'ices and items 9itmaterials.

• en creating suc s%eciications: te user does not a'e to list indi'idual

ser'ices manuall(. Instead: te data is sim%l( co%ied rom te master data. *se otis reerencing tecniAue means tat data onl( as to <e entered once. emanual entr( eort is reduced to a minimum.

• ere are t9o 9a(s o entering ser'ices>

EAS-SAP V.Jayaram36




o as %lanned ser'ices

o as un%lanned ser'ices

@.1.1. Planne' Ser,i&es

7( %lanned ser'ices: 9e mean ser'ices 9ose %recise nature and intended sco%e arealread( 8no9n at te <eginning o a %rocurement %roGect. t te time te( are reAuested:te( are eiter entered 9it te aid o a ser'ice master record: or set out in ser'ices%eciications as sort or long te?ts. Prices and Auantities are sti%ulated in <ot cases.

@.1./. Un(lanne' Ser,i&es

%rocurement %roGect ma( constitute or include a num<er o indi'idual ser'ices 9ic(ou initiall( cannot or do not 9is to s%eci( in detail Bor e?am%le: te construction o an oice <uildingC. /uc initiall( undeined ser'ices: 9ic are termed un%lanned

ser'ices: tus a'e no descri%tions. e( are entered in te orm o mone( 'alue limits./er'ices ma( <e %erormed u% to a 'alue not e?ceeding tese limits. is allo9s (ou toe?ercise a degree o cost control in suc situations.

ou can set a 'alue limit at te u%%ermost le'el Bor e?am%le: 5 million dollars or teconstruction o te aorementioned oice <uildingC. In addition: (ou can set limits or indi'idual contracts 9itin te %roGect Bor e?am%le: 200:000 dollars or masonr( 9or8sand 250:000 dollars or electrical installationsC. e s(stem cec8s aderence to <ottese su<;limits and te o'erall limit. en te ser'ices a'e <een %erormed: te( arerecorded in entr( seets and ten acce%ted. e acce%ted ser'ice entr( seet constituteste <asis or su<seAuent in'oice 'eriication in te case o ser'ices.

@./. Organi0ati%nal "e,els

e organizational le'el at 9ic ser'ices are %rocured is te %urcasing organization."e%ending on te size o te enter%rise and te 9a( Purcasing is set u%: a %urcasingorganization can assume res%onsi<ilit( or all %rocurement Bcentral %urcasingC or te %urcasing unction can <e s%lit u% among se'eral %urcasing organizations: eac o 9ic %rocures te %articular ser'ices tat a'e <een assigned to it. e indi'idual %urcasing organizations can <e su<di'ided into 'arious %urcasing grou%s Bgrou%s o <u(ersC: eac 9it its o9n res%onsi<ilities.

@.. Master Data

is section discusses te master data utilized <( MM E?ternal /er'ices Management>• /er'ice master data

• Vendor master data

@..1. Ser,i&e master

EAS-SAP V.Jayaram3!




e ser'ice master data<ase Bcom%rising all te indi'idual ser'ice master recordsC is usedto store te descri%tions o all ser'ices tat a'e to <e %rocured on an ongoing <asis. Inaddition to te descri%tion o te ser'ice: a ser'ice master record contains inormationnecessar( or its %rocurement Bor e?am%le: te?ts: units o measure: %ricesC. e ser'ice

master ser'es as a source o deault data %ro'ided <( te s(stem during te su<seAuentcreation o ser'ice s%eciications Bin connection 9it a <id in'itation %rocedure: or e?am%leC. -ere (ou can also maintain ser'ices rom general: standardized sets o ser'ices%eciications B8no9n as standard ser'ice catalogsC suc as te one or te constructionindustr(. e indi'idual ser'ice master records can <e grou%ed according to dierentser'ice t(%es Bor e?am%le: <( sector or tradeC.

/P su%%lies a user e?it ena<ling (ou: or e?am%le: to cec8 9eter te ser'ice num<er entered corres%onds to te num<er in te standard ser'ice catalog.

@../.Ven'%r master

e 'endor master data<ase Bcom%rising all te indi'idual 'endor master recordsCcontains inormation on ser'ice %ro'iders. In addition to te name and address o teser'ice %ro'ider: an indi'idual 'endor master record contains data on

• te currenc( or transactions 9it tis 'endor:

• terms o %a(ment: and

• names o contact %ersons

s te 'endor is also regarded as a creditor in ccounting: te 'endor master record alsocontains accounting data suc as te control account. e 'endor master record istereore maintained <( <ot Purcasing and ccounting.

@.4. P$r&asing D%&$ments

EAS-SAP V.Jayaram3)




is section introduces te documents used in te %rocurement o ser'ices and discusseste structure o tese documents in te /P /(stem.

%urcasing document is an instrument used <( Purcasing to %rocure

materials or ser'ices. ou 9ill ind more inormation on te indi'idual %urcasing documents in te MM Purcasing documentation.

In addition to te documents or te standard materials %urcasing unction:tere is a document or te entr( o ser'ices actuall( %erormed <( 'endors or su<contractors. Furtermore: te in'oice 'eriication document is also rele'antto ser'ices.

P$r&ase re#$isiti%n

e %urcase reAuisition deines te reAuirement o a material or a ser'ice.

+eAuisitions originate outside te Purcasing "e%artment: tat is to sa(: in teuser de%artments: 9itin Plant Maintenance: and in te ProGect /(stem. e(re%resent a reAuest to Purcasing to %rocure te s%eciied Auantities o tematerials or ser'ices on or <( te desired date. e %urcase reAuisition is adocument tat is designed or internal use onl(.

Re#$est )%r #$%tati%n R!3B

e +F is an in'itation to a 'endor to sti%ulate: troug te su<mission o aAuotation B<idC: is %rices and conditions Bamongst oter inormationC or su%%l(ing a material or %erorming a ser'ice.

3$%tati%n

e Auotation B<idC contains a 'endors %rices and conditions or te su%%l( or %erormance o te materials or ser'ices s%eciied in te +F.

P$r&ase %r'er POB

e PO is a <inding reAuest to a 'endor to su%%l( certain materials or %erormcertain ser'ices in accordance 9it s%eciied terms and conditions.

C%ntra&t

EAS-SAP V.Jayaram3#




In te /P MM /(stem: te term contract denotes a orm o longer;term:'olume %urcasing agreement 9it a 'endor co'ering te su%%l( o a material or te %erormance o ser'ices. Fulillment is on te <asis o indi'idual releaseorders issued <( te <u(ing entit( according to need o'er te duration o te

contract.

/er'ice s%eciications are entered in te contract Bin e?actl( te same 9a( as inte POC at document item or su<;item le'el.

Ser,i&e entry seet

e ser'ice entr( seet is used to record ser'ices as te( are actuall( %erormed <( te 'endor or su<contractor. In te case o %lanned ser'ices: te ser'icesactuall( %erormed are recorded in te entr( seet 9it reerence to tes%eciications alread( entered in te PO. In te case o un%lanned ser'ices

Bdeined onl( in te orm o mone( limits in te POC: te ser'ice entr( seetconstitutes te document in 9ic %recise s%eciications are entered into tes(stem or te irst time.

@.5. Ste(s in (r%&$rement %) ser,i&es.

e %rocurement o ser'ices ma( in'ol'e te ollo9ing %ases>• ,reation o %urcase reAuisition

• "etermination o %ossi<le sources

• In'itation to %otential ser'ice %ro'iders to su<mit <ids Bcreation o +FC

• Entr( o Auotations B<idsC

•

nal(sis and e'aluation o Auotations• 9ard o contract Border %lacementC

• Entr( o ser'ices actuall( %erormed

• cce%tance o ser'ices %erormed

• ,ec8ing and a%%ro'ing in'oices su<mitted <( 'endors or ser'ices %erormed

e ollo9ing sections descri<e tese ste%s in more detail>

Creating a ($r&ase re#$isiti%n

%urcase reAuisition is created in order to inorm Purcasing tat a certain ser'ice ist

needed. ou can s%eci( 9ic consum%tion account is to <e carged. It is tus %ossi<leto ma8e %ro'ision in te reAuisition or te costs o %rocurement to <e assigned to acertain cost center or a sales order: or e?am%le B<( s%eci(ing te rele'ant accountassignment categor(C. ou can enter te account assignment categor( in te reAuisition or in te %urcase order.

Determining (%ssile s%$r&es

EAS-SAP V.Jayaram40




I a %ossi<le source e?ists or te %rocurement o a certain ser'ice: (ou can

a'e te s(stem automaticall( ind te source and assign te reAuisition to it: or coose te desired source rom a list generated <( te s(stem

ou can ado%t a %otential source o a ser'ice suggested <( te s(stem: <ut (ou are noto<liged to.

S%$r&e 'eterminati%n in te system

en determining %ossi<le sources o a reAuested ser'ice: te s(stem reers to teollo9ing inormation in te seAuence so9n>

1. Vendor service conditions

e s(stem irst cec8s 9eter master conditions 9ose 'alidit( %eriod co'ers tedeli'er( date so9n in te reAuisition e?ist or te ser'ice

I master conditions e?ist or one or more 'endors: te s(stem suggests tis 'endor as tesource. e %rices and conditions o te rele'ant master conditions are ten suggested9en (ou create a %urcase order 9it reerence to te assigned reAuisition.

2. Contracts

I contracts relating to eiter te material grou% or te ser'ice so9n in te reAuisitione?ist: te s(stem suggests tese contracts as sources.

I a reAuisition as <een assigned to a contract: te s(stem can generate release ordersagainst it.

Via te ,ustomizing acilit( in Purcasing: (ou can deine o9 te sources or ser'icesare to <e determined. For e?am%le: (ou can s%eci( tat a contract is suggested as asource i it contains at least one ser'ice rom te reAuisition. -o9e'er: (ou can alsos%eci( tat a contract is onl( to <e suggested i it co'ers all te ser'ices set out in tereAuisition.

ou can also enter te source o te ser'ices set out in a reAuisition directl(. For e?am%le:9it tis unction (ou can assign te reAuisition to a 'endor rom 9om (ou a'e not (et %rocured an( ser'ices to date.

In,iting i's &reating an R!3B

I a <id in'itation %rocess is to <e initiated or ser'ices: (ou must set out te ser'icedescri%tions in a reAuest or Auotation B+FC. In doing so: (ou can sim%li( and s%eed u%te data entr( %rocess <( using data rom te ser'ice master record. Planned ser'icescan <e entered 9it %recise descri%tions. lternati'el(: it is eAuall( %ossi<le to enter Gust amone( 'alue limit co'ering un%lanned ser'ices. *n%lanned ser'ices are ser'ices9ose e?act nature is not clear at te time o te <id in'itation %ase. Entering 'alue

EAS-SAP V.Jayaram41




limits to co'er suc cases ensures tat cost control can still <e maintained.

<id in'itation ma( in'ol'e %lanned ser'ices onl(: un%lanned ser'ices onl(: or somecom<ination o <ot. e +F is entered onl( once: and can ten <e assigned to an(num<er o %otential <idders. e s(stem creates a se%arate +F 9it a uniAue num<er or

eac <idder.

Entering #$%tati%ns

en a Auotation is recei'ed rom a <idder: te latters %rices and conditions are enteredin te +F tat alread( e?ists in te s(stem. e status o tis +F is ten canged> te+F in act <ecomes a Auotation. In te /P /(stem: te +F and te Auotation areeecti'el( one and te same document.

Analysis an' e,al$ati%n %) #$%tati%ns

en all Auotations a'e <een recei'ed and entered: te most a'ora<le one isdetermined using te %rice com%arison list. +eGection letters can <e sent to unsuccessul <idders.

A*ar' %) &%ntra&t %r'er (la&ementB

e successul <idder can <e sent a %urcase order as a document o contractual natureor a once;onl( transaction. o minimize te time and eort e?%ended in entering data: %urcase orders BPOsC can <e created <( reerencing a Auotation. I a longer;termcoo%eration 9it a 'endor is %lanned: a contract 9it Auantities and 'alues can <e set u%.ou can ten release certain ser'ices against tis longer;term contract on te desireddates <( issuing release orders rom time to time. ou also a'e te o%tion o storing %rices or certain ser'ices. at is to sa(: (ou can use te contract as a %rice list.

Entering ser,i&es a&t$ally (er)%rme'

ou enter ser'ices tat a'e actuall( <een %erormed <( means o ser'ice entr( seets. Indoing so: (ou can reerence te PO. is %rocedure is suita<le or te entr( o %lannedser'ices. t te time o entr(: eac indi'idual item o te entr( seet is recorded togeter 9it its actual 'alue. *n%lanned ser'ices can <e %recisel( s%eciied as indi'idual items atte time te( are entered as a'ing <een %erormed. e( are recorded 9it teir e?act'alue and are cec8ed 9it regard to aderence to te 'alue limits s%eciied in te PO.ou can e'aluate te Aualit( and timeliness o te ser'ices %ro'ided <( (our 'endors.9o semi;automatic criteria are a'aila<le in MM Vendor E'aluation or tis %ur%ose.

Releasing a((r%,ingB te ser,i&e entry seet ou can ma8e ser'ice entr( seets su<Gect to a release Ba%%ro'alC %rocedure. In te %rocess: (ou can release eac indi'idual entr( seet Bindi'idual releaseC or se'eral entr(seets at once Bcollecti'e releaseC. ssume an entr( seet to te 'alue o N10:000 is

EAS-SAP V.Jayaram42




su<Gect to release strateg( /3: in 9ic tree dierent %oints Bindi'iduals or de%artmentsCin (our com%an( must gi'e teir a%%ro'al. e entr( seet counts as a'ing <eenacce%ted 9en te tird release %oint as released Ba%%ro'edC it. I a release %rocedureas <een deined: an indi'idual entr( seet cannot <e directl( manuall( acce%ted.

A&&e(ting ser,i&es (er)%rme'

In te ne?t ste%: te ser'ices listed in te entr( seet as a'ing <een %erormed areacce%ted. e acce%tance and entr( o ser'ices can <e deined as se%arate ste%s.-o9e'er: it is also %ossi<le to a'e entr( and acce%tance carried out <( te sameindi'idual or de%artment.

Ce&:ing in,%i&es )%r ser,i&es

e inal %ase o te ser'ice %rocurement c(cle is 'eriication tat in'oices su<mitted <( 'endors or su<contractors are correct. In te %rocess: te igest;le'el 'alue limitrom te acce%ted entr( seet is ta8en and com%ared 9it te in'oice. e ta?es so9n inte in'oice are cec8ed. I te 'alue limit is e?ceeded: te s(stem issues a 9arningmessage.

1. VENDOR EVA"UATION

Integration o te Vendor E'aluation /(stem

EAS-SAP V.Jayaram43




e Vendor E'aluation com%onent as <een com%letel( integrated into MM Purcasing.Inormation suc as deli'er( dates: %rices: and Auantities can <e ta8en rom %urcaseorders. Vendor E'aluation also uses data rom ualit( Management: suc as te results o incoming ins%ections or Aualit( audits. It also accesses <asic data in MaterialsManagement: suc as goods recei%t data rom In'entor( Management: and data rom te

ogistics Inormation /(stem BI/C.

5hat is endor 9aluation

e Vendor E'aluation /(stem su%%orts (ou in te o%timization o (our %rocurement %rocesses in te case o <ot materials and ser'ices.

Procure'ent of ;aterials

e s(stem el%s (ou select sources o su%%l( and acilitate te continual monitoring o

e?isting su%%l( relationsi%s. It %ro'ides (ou 9it accurate inormation on %rices: andterms o %a(ment and deli'er(. 7( e'aluating 'endors: (ou can im%ro'e (our enter%risescom%etiti'eness. ou can Auic8l( determine and resol'e an( %rocurement %ro<lems tatma( arise on te <asis o detailed inormation and in colla<oration 9it te rele'ant'endors.

Procure'ent of &erices

ou can cec8 te relia<ilit( o te 'endors rom 9ic (ou %rocure ser'ices on a %lant; <(;%lant <asis. ou can determine 9eter te 'endors %erorm te ser'ices 9itin tes%eciied timerames and a%%raise te Aualit( o te 9or8 carried out.

&cores and %riteria

e /P /tandard /(stem oers (ou a scoring range rom 1 to 100 %oints: 9ic is usedto measure te %erormance o (our 'endors on te <asis o i'e main criteria. ou candetermine and com%are te %erormance o (our 'endors <( reerence to teir o'erallscores. e main criteria a'aila<le in te standard s(stem are> Price ualit( "eli'er( &eneral ser'ice=su%%ort

ese our main criteria ser'e as a <asis or te e'aluation o 'endors rom 9om (ou %rocure materials.

ou can also deine oter or urter main criteria: as reAuired. ou can assign dierent9eigts to te indi'idual criteria. e 'endors o'erall score is com%uted ta8ing into

EAS-SAP V.Jayaram44




account te 9eigted scores a9arded or eac o te main criteria. e Vendor E'aluation /(stem ensures tat e'aluation o 'endors is o<Gecti'e: since all 'endors areassessed according to uniorm criteria and te scores are com%uted automaticall(. In tis9a(: su<Gecti'e im%ressions and Gudgments can <e largel( a'oided. o create a detailede'aluation: eac main criterion can <e di'ided into se'eral su<criteria. e standard

s(stem %ro'ides (ou 9it certain su<criteria: 9ic suice as a <asis or e'aluation: <ut(ou can also deine (our o9n additional su<criteria.

e scores or te su<criteria are calculated in tree dierent 9a(s. Auto'atic

/cores are calculated <( te s(stem on te <asis o e?isting data. &e'i0auto'atic

ou enter indi'idual scores or im%ortant materials: or or te Aualit( andtimeliness o a ser'ice %erormed: (oursel. e s(stem ten calculates te iger;le'el score rom tese.

;anual

ou enter a <lan8et score or a su< criterion %er 'endor.ou can decide (oursel 9ic o tese metods (ou 9ant to use.

Analyses e results o 'endor e'aluation are dis%la(ed in te orm o anal(ses. For e?am%le: (oucan generate ran8ing lists o te <est 'endors according to o'erall score or ran8ing listsor s%eciic materials. ,anges to e'aluations are recorded in logs: and (ou a'e teo%tion o %rinting out e'aluation seets.

1.1. Organi0ati%nal "e,el )%r Ven'%r E,al$ati%n

e organizational le'el or Vendor E'aluation is te %urcasing organization> Eac %urcasing organization e'aluates te 'endors tat a'e <een assigned to it. e s(stemdoes not su%%ort a com%arison o Vendor E'aluations at te iger com%an( code le'el.

Vendor E'aluation uses te ollo9ing master data>• Vendor master record

• Material master record

• Purcasing ino record

is section descri<es te most im%ortant elements o Vendor E'aluation>

O'erall /coreMain ,riteria /u<criteria

EAS-SAP V.Jayaram45

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#over

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#main

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#sub

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#over

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#main

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#sub




/coring +ange eigting o /cores

1.1.1. O,erall S&%re

e o'erall score re%resents te com%lete e'aluation o a 'endor. It is a com<ination o te scores te 'endor as acie'ed or all te main criteria. ou can com%are dierent'endors on te <asis o teir o'erall scores 9itout generating a detailed anal(sis o teir e'aluations.Vendor O'erall score out o 100/mit )57ro9n )3Qones 6#om%son 5!ilson 40t a glance: (ou can see tat out o te i'e 'endors: /mit recei'ed te <est o'erall

score: and ilson te 9orst. /mit and 7ro9n scored almost te same %oints.

1.1./. Main &riteria

e main criteria orm te <asis or assessing te %erormance o a 'endor. e s(stemcalculates te o'erall score or a 'endor rom te main criteria scores. ou can e'aluate'endors according to se'eral main criteria: 9ic (ou consider im%ortant. e scores or te main criteria are a more accurate re%resentation o te %erormance o a 'endor tante o'erall score. 7( com%aring scores at main criteria le'el: (ou can determine tat'endor Qones acie'ed a lo9er o'erall score tan 'endor /mit: <ut 'endor Qones scored <etter in te main criterion Price. I te %rice o te material is te decisi'e actor 9en(ou decide on (our ne?t %rocurement: ten (ou 9ould select 'endor Qones.

Ne&essary main &riteria

ou can determine te t(%e and num<er o main criteria (oursel. e s(stem su%%orts ama?imum o ## main criteria. ou can s%eci( te num<er o main criteria or eac %urcasing organization and decide 9ic main criteria are to <e co'ered <( te o'erallscore. e ollo9ing i'e main criteria are a'aila<le in te standard s(stem>

• Price

• ualit(

• "eli'er(

•

&eneral ser'ice=su%%ort

1.1.. S$&riteria

/u<criteria are te smallest units to 9ic scores can <e assigned in Vendor E'aluation.e s(stem calculates a score or te iger;le'el main criterion <ased on te scores a'endor recei'es or te 'arious su<criteria. ere are tree t(%es o su<criteria>

• Manual

EAS-SAP V.Jayaram46

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#range

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#weight

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#range

http://isds.bus.lsu.edu/cvoc/sap/projects/tutorial/Fall1997/cory/VE/#weight




• /emi;automatic

• utomatic

e( are named ater te dierent metods o scoring. e indi'idual scoring metodsulill dierent %ur%oses and in'ol'e dierent 8inds o maintenance. Please reer to

"etermining /cores.

Ne&essary S$&riteria

e automatic su<criteria %ro'ided in te standard s(stem suice or te e'aluation o a'endor rom 9om (ou %rocure materials. at is to sa(: (ou do not necessaril( a'e tomaintain scores or manual or semi;automatic su<criteria in order to %erorm e'aluations.e s(stem %ro'ides or a ma?imum o t9ent( su<criteria or eac main criterion. In te/P /tandard /(stem tere are t9o automatic su<criteria or te main criterion Price:tree or te main criterion ualit(: and our or te main criteria "eli'er(. ismeans tat (ou can determine u% to 1): 1!: and 16 additional su<criteria res%ecti'el( or

eac o tese main criteria. ere are no automatic su<criteria or te main criteria&eneral ser'ice=su%%ort and E?ternal ser'ice. -o9e'er: tree semi;automaticsu<criteria are included in te /P /tandard /(stem or &eneral ser'ice=su%%ort andt9o or E?ternal ser'ice. is means tat (ou can deine u% to 1) and 1! additionalmanual or semi;automatic su<criteria res%ecti'el( or tese t9o main criteria. endeining manual su<criteria: %lease note tat (ou 9ill retain a <etter o'er'ie9 i (ou 8ee%te num<er o criteria lo9. 7( doing tis: (ou 9ill also minimize (our maintenanceeort.

&hort /escription of Auto'atic &ucriteria

is section <riel( descri<es te indi'idual automatic su<criteria. e automatic

su<criteria are>• Price

o Price le'el

o Price istor(

• ualit(

o &oods recei%t

o ualit( audit

o ,om%laints=reGection le'el

• "eli'er(

o On;time deli'er( %erormance

o uantit( relia<ilit(

o ,om%liance 9it si%%ing instructionso ,onirmation date

Price+eel

is su<criterion com%ares relationsi% o a 'endors %rice to te mar8et %rice. I te'endors %rice is lo9er tan te mar8et %rice: e=se recei'es a good scoreJ i it is iger tan te mar8et %rice e=se is assigned a %oor score. On te <asis o te su<criterion

EAS-SAP V.Jayaram4!




Price e'el (ou can com%are a 'endors %rice to te current mar8et %rice at a certain %ointin time.

Price<istory

is su<criterion com%ares te de'elo%ment o te 'endors %rice 9it te mar8et %rice.On te <asis o te su<criterion Price -istor(: (ou can determine 9eter te 'endors %rice as increased or decreased o'er a certain %eriod in com%arison 9it canges in temar8et %rice o'er te same %eriod.

)oods Receipt

is su<criterion is used to e'aluate te Aualit( o te material tat te 'endor deli'ers.ualit( ins%ection ta8es %lace at te time o goods recei%t.

!uality Audit

is su<criterion is used to e'aluate te Aualit( assurance s(stem used <( a com%an( in

manuacturing %roducts.

%o'plaints*Re=ection +eel

is su<criterion is used to e'aluate 9eter te materials deli'ered <( te 'endor areregularl( ound to <e ault( su<seAuent to incoming ins%ection Bor e?am%le: on te so%;loorC leading to additional e?%ense and loss o time Bdue to loss o %roduction: re9or8ingetc.C. e score BM 8e( Aualit( igureC is calculated in M ualit( Management andte data %assed on to MM Vendor E'aluation: 9ere it is used in te scoring s(stem.

$n0Ti'e /eliery Perfor'ance

is su<criterion is used to determine o9 %recisel( a 'endor as adered to te s%eciieddeli'er( dates.

!uantity Reliaility

is su<criterion is used to determine 9eter a 'endor as deli'ered te Auantit(s%eciied in te %urcase order.

On;time deli'er( %erormance and uantit( relia<ilit( al9a(s a'e to <e seentogeter. ou can s%eci( or eac material Bin te material master recordC or or allmaterials Bin te s(stem settingsC te minimum Auantit( o te ordered materials tatmust <e deli'ered in order or a goods recei%t to <e included in te e'aluation. isena<les (ou to a'oid a situation in 9ic a %unctual goods recei%t in'ol'ing onl( a smallAuantit( o ordered materials is included in te e'aluation 9it a good score or on;timedeli'er( %erormance. I tis minimum Auantit( is not deli'ered: te 'endor is nota9arded a score or te latter criterion: and o<tains a lo9 score or Auantit( relia<ilit(.

%o'pliance 5ith &hipping nstructions

EAS-SAP V.Jayaram4)




is su<criterion is used to determine o9 %recisel( a 'endor com%lies 9it (ourinstructions or te si%%ing or %ac8ing o a material.

%onfir'ation /ate

is su<criterion is used to determine 9eter a 'endor aderes to a %re'iousl(conirmed deli'er( date Bor e?am%le: te deli'er( date conirmed in a si%%ingnotiicationC.

1.1.4. S&%ring Range

o com%are te %erormance o one 'endor 9it anoter: it is necessar( to esta<lis arange Bor scaleC o %ossi<le scores. ou can deine (our o9n scoring range rom te9orst; to te <est;%ossi<le acie'a<le score. e e?am%les in tis documentation are

<ased on a scoring range o 1 to 100 %oints. is scale %ro'ides (ou 9it a goodo'er'ie9 and also %ermits Auite a inel( dierentiated rating o indi'idual 'endors.

e scoring range is deined 9en te s(stem is conigured.

1.1.5. >eigting %) S&%res

e scores a 'endor is a9arded or main criteria can <e 9eigted dierentl( to relectdierences in te signiicance o te criteria.

5eighting actor

7( using 9eigting actors: (ou can increase or reduce te im%ortance o certain criteria9en a score is calculated at te ne?t igest le'el.

/u%%ose a 'endor recei'es )0 %oints or te criterion Price and )0 %oints or te criterion/er'ice. /ince te %rice o te material is more im%ortant to (ou tan te ser'ice te'endor %ro'ides: (ou assign te criterion Price a 9eigting actor o 3 and te criterion/er'ice a actor o 1. e )0 %oints or Price are ten 9ort tree times more tan te )0 %oints or /er'ice 9en te o'erall score is calculated.

5eighting >eys

9eigting 8e( is an indentiier under 9ic te 9eigting actors or a num<er o maincriteria can <e grou%ed togeter and sa'ed. I (ou 8no9 tat (ou 9ill 9ant to carr( out ane'aluation re%eatedl( 9it certain main criteria and certain 9eigting actors: (ou cansa'e tis com<ination under a 9eigting 8e(. en (ou carr( out te ne?t 'endore'aluation: Gust enter te rele'ant 9eigting 8e( instead o entering a 9eigting actor or eac indi'idual criterion. e s(stem ten automaticall( sets all te 9eigting actors.ere are t9o %ossi<le t(%es o 9eigting 8e( in te standard s(stem>

• e( 01

• e( 02

EAS-SAP V.Jayaram4#




e( 01 %ermits te eAual 9eigting o all criteria.e( 02 ena<les (ou to e'aluate 'endors su%%l(ing small %arts: or e?am%le.e 9eigting actors under tis 8e( are distri<uted as ollo9s>

Price 5ualit( 3

"eli'er( 2&eneral ser'ice=su%%ort 1E?ternal ser'ice 2

1./. E,al$ating Ven'%rs

e e'aluation o 'endors is su<Gect to certain %reconditions. 7eore (ou <egin: (ou mustconsider te ollo9ing>

• -a'e (ou maintained te s(stem settings@

• "o (ou a'e te reAuired autorizations@

• ic 'endor do (ou 9ant to e'aluate@ B'endor 8e(C

•

ic %urcasing organization is to e'aluate te 'endor B%urcasing organization8e(C@• Is tis te irst time te 'endor as <een e'aluated@

• I not: 9en 9as te last e'aluation@

7elo9 are te ste%s (ou must carr( out to e'aluate a 'endor>• Enter 'endor inormation

• Enter 9eigting 8e(

• Enter scores or manual su<criteria

• E'aluate all main criteria

1. Cal&$lating S&%res

Calculating the O!erall Score

e s(stem deri'es te o'erall score rom te scores or te 'arious main criteria: ta8ingte 9eigting actors assigned <( Purcasing or eac main criterion into account. ou

learn o9 to assign 9eigting actors in ,ustomizing.

e ollo9ing e?am%le e?%lains tis %rocess>

E?am%le

e ta<le <elo9 dis%la(s te scores or a 'endor and teir 9eigting actors>Main criterion /core eigting actor

EAS-SAP V.Jayaram50




Price !0 40ualit( )5 20"eli'er( 50 10/er'ice 50 1

,on'erting eigting Factors into Percentages o ma8e te 9eigting actors clearer tote user: te s(stem con'erts tem into %ercentages.

1. e s(stem adds te actors togeter and eAuates te total 9it 100 >40 L 20 L 10 L 1 K !1 eAuals 100

2.o e?%ress te indi'idual 9eigting actors as %ercentages o 100: te s(stemirst di'ides 100 <( te sum o te 9eigting actors>100 = !1 K 1.4

3.en te s(stem multi%lies te 9eigting actors te <u(er assigned to te main

criteria <( tis %ercentage>40 ? 1.4 K 56.020 ? 1.4 K 2).010 ? 1.4 K 14.001 ? 1.4 K 01.4

4.e ollo9ing ta<le dis%la(s te results as a %ercentage o te o'erall score>Main criterion /core Percentage o o'erall scorePrice !0 56.0 ualit( )5 2).0 "eli'er( 50 14.0 &en. /er'ice 50 01.4

-o9e'er: internall(: te s(stem uses te 9eigting actors to com%ute te o'erallscore.

1. e scores or te main criteria are multi%lied <( teir 9eigting actors.!0 ? 40 K 2)00 %oints)5 ? 20 K 1!00 %oints50 ? 10 K 0500 %oints50 ? 01 K 0050 %oints

2. otal %oints K 5550.

3. is total is di'ided <( te sum o te 9eigting actors>5550 = !1 K !) %ointse 'endor is a9arded an o'erall score o !) %oints.

%alculating the &core for a ;ain %riterion

EAS-SAP V.Jayaram51




e scores or te indi'idual main criteria are determined in te same 9a( as teo'erall score> e s(stem calculates te scores or all te su<criteria or a maincriterion according to te 9eigting actors (ou assigned to tem.

&'oothing of ndiidual &cores

score or a ne9 good recei%t or te scores or a ne9 ser'ice 9ill cange tee?isting scores or te current mont. e ne9 indi'idual score does not a'e tesame signiicance as te %re'ious com%osite score: <ecause te latter 9ascalculated rom a num<er o indi'idual scores. For tis reason: te ne9 indi'idualscore is gi'en a lo9er 9eigting Btat is to sa(: it is smootedC. In carr(ing outtis %rocess: te s(stem a%%lies te rele'ant smooting actors tat (ou a'edeined or eac indi'idual score in ,ustomizing.

11.. INVENTOR9 MANA+EMENT

/Ps In'entor( Management s(stem allo9s (ou to• Manage (our stoc8s on a Auantit( and 'alue <asis

• Plan: enter: and cec8 an( goods mo'ements

• ,arr( out %(sical in'entor(

;anaging &toc,s y !uantity

In te In'entor( Management s(stem: te %(sical stoc8s relect all transactions resultingin a cange in stoc8 and tus in u%dated in'entor( le'els. e user can easil( o<tain ano'er'ie9 o te current stoc8s o an( gi'en material. For eac material: not onl( testoc8s in te 9areouse are so9n: <ut also te stoc8s ordered <ut not (et deli'ered:reser'ed or %roduction or or a customer: and te stoc8s in Aualit( ins%ection can <e

EAS-SAP V.Jayaram52




monitored: or e?am%le. I a urter su<di'ision <( lots is reAuired or a material: one <atc %er lot is %ossi<le. ese <atces are ten managed indi'iduall( in te stoc8./%ecial stoc8s rom te 'endor or rom te customer Bor e?am%le: consignment stoc8sCare managed se%aratel( rom (our com%an(s o9n stoc8.

;anaging &toc,s 8y alue

e stoc8s are managed not onl( on a Auantit( <asis <ut also <( 'alue ; a %rereAuisite orcost accounting. it e'er( goods mo'ement: te ollo9ing 'alues are u%dated>

• e stoc8 'alue or in'entor( management

• e account assignment or cost accounting

• e corres%onding &= accounts or inancial accounting 'ia automatic account

assignment

7ot te Auantit( and te 'alue are u%dated automaticall( 9en entering a goodsmo'ement.

Planning- 9ntry- and Proof of )oods ;oe'ents

&oods mo'ements include <ot e?ternal mo'ements Bgoods recei%ts rom e?ternal %rocurement: goods issues or sales ordersC and internal mo'ements Bgoods recei%tsrom %roduction: 9itdra9als o material or internal %ur%oses: stoc8 transers: andtranser %ostingsC. For eac goods mo'ement a document is created 9ic is used <( tes(stem to u%date Auantities and 'alues and ser'es as %roo o goods mo'ements. &oodsrecei%t=issue sli%s are %rinted to acilitate %(sical mo'ements and te monitoring o teindi'idual stoc8s in te 9areouse.

Physical nentory

e adGustment <et9een te %(sical stoc8s and te <oo8 in'entories can <e carried outinde%endentl( o te %(sical in'entor( metod selected.e /P /(stem su%%orts te ollo9ing %(sical in'entor( metods>

• Periodic in'entor(

• In'entor( sam%ling

• ,(cle counting

e ollo9ing lin8s 9ill %ro'ide more detailed inormation>

For In'entor( Management: (ou must maintain te ollo9ing data>· Plant data

is data can <e maintained 'ia dierent 'ie9s Bor e?am%le: 'ia Purcasing: /torage:or8 scedulingC. ou a'e to maintain at least one 'ie9 tat reAuires te entr( o teorganizational le'el %lant.· Valuation data

EAS-SAP V.Jayaram53




Valuation data is reAuired or managing te stoc8 <( 'alue. ou maintain tis data 'ia teccounting 'ie9.· Storage location data

ou maintain te storage location data 'ia te /torage 'ie9.

e 'ie9s tat are im%ortant or In'entor( Management are descri<ed ere. Eac 'ie9 isillustrated <( an e?am%le.· Work Scheduling

Inormation or %roducing te material. E?am%les> %roduction unit: o'erdeli'er( andunderdeli'er( tolerances allo9ed.· Accounting

Price and accounting inormation. E?am%les> t(%e o %rice control and 'aluation class.Maintenance o tis 'ie9 is mandator( or In'entor( Management: i te material t(%eindicates tat te material is managed <( 'alue in stoc8.· MRP

Inormation or M+P. E?am%les> saet( stoc8: reorder le'el: a'aila<ilit( cec8.· Purchasing

Procurement inormation or a material. E?am%les> o'erdeli'er( and underdeli'er(tolerances: %urcasing order unit o measure Border unitC.· Classifcation

(%ical data or classiication o te material. E?am%les> class: caracteristic.· Storage

Inormation or 9areousing and storing te material. E?am%les> unit o issue: storageconditions: i?ed <in location at te storage location.· Quality Management

Inormation or sam%ling and ins%ecting a material. E?am%les> indicator or goods recei%t'ia Aualit( ins%ection: sam%ling on a %ercentage <asis.11.1. Planne' +%%'s Re&ei(t

e In'entor( Management s(stem can andle <ot %lanned goods recei%ts andun%lanned goods recei%ts. Planning a goods recei%t in ad'ance means storing certaininormation tat is im%ortant or te goods recei%t <eore te actual goods recei%t is %osted: or e?am%le>

• 9at@ B9ic material@C

• o9 muc@ Bin 9ic Auantit(@C

• 9en@ Bon 9ic deli'er( date@C

• rom 9ere@ Brom 9ic 'endor or %lant@C

• to 9ere@ Bto 9ic destination: into 9ic stoc8@C

e goal o tis %lanning is to sim%li( and accelerate te goods recei%t %rocess and to <etter organize te 9or8 at te goods recei'ing %oint: so tat <ottlenec8s can <e a'oided:or e?am%le. lso: i goods recei%ts are %lanned: Material +eAuirements Planning BM+PCcan monitor te stoc8s o ordered or manuactured materials and acie'e an o%timalin'entor( <alance. *nless recei%ts are %lanned: te s(stem cannot trac8 materials tata'e <een ordered. Planned recei%ts: tereore: are crucial to regulating te le'el o in'entor( in te 9areouse. Planned recei%ts are also im%ortant or determining 9eter (ou a'e recei'ed materials %romised <( 'endors or in;ouse %roduction. itout tem:te s(stem cannot esta<lis a lin8 <et9een orders and recei'ed material.

EAS-SAP V.Jayaram54




11./. Tree Ty(es %) Planne' +%%'s Re&ei(ts

"e%ending on te source o inormation Btat is: te document in 9ic te data rele'antto %lanning is storedC: te s(stem distinguises <et9een tree t(%es o %lanned goods

recei%ts>

"lanned goods recei#ts using #urchase orders

it te MM Purcasing com%onent (ou do not need to %lan goods recei%ts manuall( inte s(stem. e %urcase orders created <( MM Purcasing contain all o te inormationneeded or %lanning te goods recei%t.

"lanned goods recei#ts using #roduction orders

it te PP Production Orders com%onent (ou do not need to %lan goods recei%ts rom

%roduction manuall(. e orders contain all inormation necessar( to %lan a goodsrecei%t.

"lanned goods recei#ts using reser!ations

I (our com%an( does not a'e te MM Purcasing com%onent or te PP ProductionOrders com%onent: (ou enter reser'ations to %lan goods recei%ts rom te 'endor or rom %roduction.ltoug reser'ations can <e used to %lan goods recei%ts: teir main %ur%ose is to %langoods issues Bor 9itdra9alsC.

$onitoring "lanned Goods %ecei#ts7ot on te stoc8 o'er'ie9 screen and on te %lant stoc8 a'aila<ilit( screen: te %lannedgoods recei%ts are dis%la(ed as ollo9s Bsee te ollo9ing ta<leC>

Stock T&#es 'sed to $onitor "lanned Goods %ecei#tsPlanned &+s 'ia /toc8 Purcase order O%en PO Auantit( BtotalCOrder O%en order Auantit( BtotalC+eser'ation Planned recei%ts

11.. +%%'s re&ei(ts )%r ($r&ase %r'ers

I (our com%an( uses te MM Purcasing com%onent: deli'eries rom 'endors are mostli8el( te result o %urcase orders initiated <( te %urcasing de%artment. e %urcaseorder is not onl( te document 9it 9ic te %urcasing de%artment orders goods romte 'endorJ it is also an im%ortant %lanning and trac8ing tool or te ollo9ingde%artments> Purcasing: Material +eAuirements Planning BM+PC: In'entor(Management: and In'oice Veriication.

EAS-SAP V.Jayaram55




Reference to a Purchase $rder

I a material is deli'ered or a %urcase order: it is im%ortant or all o te de%artmentsin'ol'ed tat te goods recei%t entr( in te s(stem reerences tis %urcase order: or teollo9ing reasons>

5hy &hould ?ou Refer to the Purchase $rder

• &oods recei'ing can cec8 9eter te deli'er( actuall( corres%onds to te order.

• e s(stem can %ro%ose data rom te %urcase order during entr( o te goods

recei%t Bor e?am%le: te material ordered: its Auantit(: and so onC. is sim%liies <ot data entr( and cec8ing Bo'erdeli'eries and underdeli'eriesC.

• e deli'er( data is u%dated in te %urcase order istor(: allo9ing te

Purcasing de%artment to monitor te %urcase order istor( and initiate reminder %rocedures in te case o a late deli'er(.

• e 'endor in'oice is cec8ed against te ordered Auantit( and te deli'ered

Auantit(.•

e goods recei%t is 'aluated on te <asis o te %urcase order %rice or tein'oice %rice.

<ow /o ?ou ind the %orrect Purchase $rder

e %urcase order num<er is usuall( listed on te deli'er( note: 9ic is attaced to teordered goods and %assed on <( te 'endor to te goods recei'ing %oint. I te %urcaseorder num<er is not on te deli'er( note: (ou can searc in te s(stem or te %urcaseorder tat initiated te deli'er( using te material num<er or te 'endor num<er. Fordetails on searcing or te %urcase order: see Entering a &oods +ecei%t or a PurcaseOrderC.

/estination of the )oods

Ordered goods can a'e te ollo9ing destinations>

5arehouse

I te material is intended or te 9areouse: te orderer can deine a storage location.is storage location is ten automaticall( %ro%osed <( te s(stem during entr( o tegoods recei%t: and (ou can acce%t or cange it. I no storage location is entered in te %urcase order: (ou must deine a storage location 9en (ou enter te goods recei%t.&oods recei%ts or te 9areouse can <e %osted to tree dierent stoc8 t(%es>

• to unrestricted;use stoc8

•

to stoc8 in Aualit( ins%ection• to <loc8ed stoc8

It can alread( <e deined in te %urcase order 9eter or not te material is to <e %ostedto stoc8 in Aualit( ins%ection. -o9e'er: at te time o goods recei%t (ou decide to 9icstoc8 t(%e te material is %osted.

%onsu'ption

EAS-SAP V.Jayaram56




I te material is intended or consum%tion Border items 9it account assignmentsC: tePurcasing de%artment can s%eci( a reci%ient or an unloading %oint. 7ot s%eciicationsare ten automaticall( %ro%osed <( te s(stem during entr( o te goods recei%t. ou canstill cange te unloading %oint 9en (ou enter te goods recei%t: <ut (ou cannot cangete reci%ient.

)oods Receipt 8loc,ed &toc,

ou can conditionall( acce%t a deli'er(. ou record suc deli'eries in goods recei%t <loc8ed stoc8. *nli8e goods recei%ts to te 9areouse: te recei%ts %osted to te goodsrecei%t <loc8ed stoc8 are not (et %art o te 'aluated stoc8.

11.4. Reser,ati%ns

5hat s a Reseration

reser'ation is a reAuest to te 9areouse to 8ee% materials read( or a goods issue at a

later date and or a certain %ur%ose. reser'ation or goods issue can <e reAuested <('arious de%artments or 'arious account assignment o<Gects Bsuc as cost center: order:asset: etc.C.

Purpose of a Reseration

e %ur%ose o a reser'ation is to ensure tat a material 9ill <e a'aila<le 9en it isneeded. It is also to sim%li( and accelerate te goods issue %rocess and to %re%are tetas8s at te %oint o goods issue. lso im%ortant is tat Material +eAuirements PlanningBM+PC: 9ic means tat reAuired materials are %rocured in time i te( are out o stoc8:ta8es reser'ations into account.

nfor'ation in a ReserationIn a reser'ation: inormation is stored tat is rele'ant or te goods issue and or M+P: or e?am%le>

• 9at@ B9ic material@C

• o9 muc@ Bin 9ic Auantit(@C

• 9en@ Bor 9ic reAuirement date@C

• rom 9ere@ Brom 9ic %lant or 9areouse@C

• to 9ere@ Bto 9ic reci%ient or customer@C

&tructure of a Reseration

reser'ation document consists o a eader and at least one item. e eader contains

general data a<out te reser'ation Bcreator: mo'ement t(%e: account assignmentC. eitems descri<e indi'idual %lanned mo'ements Bmaterial: Auantit(: reAuirement dateC.

ou can create a reser'ation or e?actl( one %ur%ose onl(J tat is: in a reser'ation: (oucan onl( enter one mo'ement t(%e and one account assignment o<Gect Bor e?am%le: acost centerC.

EAS-SAP V.Jayaram5!




Reseration +eel

+eser'ations are made at %lant or storage;location le'el. For materials andled in <atces:reser'ations can also <e made at <atc le'el.

;anual*Auto'atic Reserations

e /P /(stem su%%orts manual and automatic reser'ations. Manual reser'ations areentered directl( <( te user. utomatic reser'ations are generated automaticall( <( tes(stem. ere are t9o t(%es o automatic reser'ations>

%eser!ations for orders networks *S elements+ en a order: a net9or8: or a %roGect is created: te com%onents rom te9areouse are reser'ed automaticall(.

Stock transfer reser!ations+

I: at storage location le'el: reorder %oint %lanning is used or material

reAuirements %lanning and te a'aila<le stoc8 on and alls <elo9 te reorder %oint: te s(stem generates a stoc8 transer reser'ation in te %lant: 9it tereser'ation Auantit( corres%onding to te re%lenisment Auantit(.

ou cannot maintain automatic reser'ations directl(. For e?am%le: it is not %ossi<le tocange reser'ations or a order directl(. ou a'e to cange te com%onents in te order.e s(stem ten u%dates te reser'ation automaticall(.5hat are the Results of a Reseration

en a reser'ation is entered: te ollo9ing e'ents occur in te s(stem>• reser'ation document: 9ic ser'es as %roo o te reAuest: is created.

• In te material master record: total stoc8 and unrestricted;use stoc8 o te materialremain uncanged. +eser'ed stoc8 is increased <( te reser'ed Auantit(.

•

In M+P: a'aila<le stoc8 is reduced <( te reser'ed Auantit(. is is 'isi<le in tecurrent stoc8=reAuirements list. e reser'ation causes an entr( to <e made in tereAuirements %lanning ile.

/isplaying Resered &toc,

ere are t9o unctions a'aila<le or dis%la(ing reser'ed stoc8>

Stock o!er!iew at #lant le!el+

en (ou use tis unction: te s(stem dis%la(s te total reser'ed stoc8 o te material at

%lant le'el. From te stoc8 o'er'ie9: (ou can select En'ironment to dis%la( a list o tereser'ations or te material.

Current stock,re-uirements list+

en (ou use tis unction: te s(stem lists all o te o%en reser'ations or te materialat %lant le'el: along 9it te reser'ed Auantit( or eac.

EAS-SAP V.Jayaram5)




11.5. +%%'s iss$es

Types of )oods ssues

,om%anies usuall( distinguis <et9een 'arious t(%es o goods issues: eac o 9ic isandled in te /P /(stem as ollo9s>

/elieries to %usto'ers

itdra9al: %ic8ing: and si%%ing o goods to customers are carried out in te /ales R"istri<ution B/"C s(stem and are dealt 9it in detail in te /" document /" /i%%ing&uide. e( are not discussed in detail in tis manual. e In'entor( Managements(stem %ro'ides t9o mo'ement t(%es or %osting goods issues to customers i (our com%an( does not use te /" module. ese are te mo'ement t(%es ,onsum%tion tosales order and ,onsum%tion to sales.

5ithdrawal of ;aterial for Production $rders

In'entor( Management %ro'ides or staging te com%onents or %roduction. ou enter9itdra9als or %roduction as goods issues 9it reerence to te %roduction orders or9ic te com%onents are reAuired.$ther nternal &taging of ;aterial

Materials can <e 9itdra9n not onl( or %roduction <ut also or oter %ur%oses Bore?am%le: or cost center: ,O order: maintenance order: or assetC.

Return /elieries to endors

s descri<ed in &oods +ecei%ts or Purcase Orders: return deli'eries to 'endors areentered 9it te unction Material document KH +eturn deli'er( or 9it te unction&oods recei%t KH For %urcase order.

&crapping*&a'pling

I a material is no longer usa<le: it must <e scra%%ed. /cra%%ing o a material is entered inte /P /(stem as a goods issue. e 9itdra9al o sam%les must also <e entered as agoods issue.

9ntering )oods ssue 5ith*5ithout Reference /ocu'ent

7eore entering a goods issue: (ou a'e to ind out 9eter an( reerence document ordata e?ists in te s(stem.

en (ou enter a goods recei%t: (ou can reerence• +eser'ations

• Production orders

EAS-SAP V.Jayaram5#




• 7ills o material

I a reerence document Breser'ation=orderC e?ists: it is im%ortant to enter te goods issue9it reerence to tis document: or te ollo9ing reasons>

• e goods issuing de%artment can cec8 9eter 9at 9as reAuested is actuall(

issued.• "uring entr( o goods issue: te s(stem can suggest data rom te reerence

document Bor e?am%le: account assignment: reAuested material: Auantit(: etc.C.is sim%liies <ot data entr( and cec8ing Bo'erdeli'eries and underdeli'eriesC9en entering a goods issue.

• ter a 9itdra9al: te Auantit( 9itdra9n is u%dated in te reerence document

and te reser'ed Auantit( is reduced accordingl(. us: In'entor( Managementcan monitor te 9itdra9al %rocess: and Material +eAuirements Planning BM+PCcan u%date te stoc8=reAuirements list.

I (ou do not reerence te corres%onding reerence document during te goods issue: te

reser'ation remains o%en and te reAuested Auantit( remains reser'ed: altoug tereAuest no longer reall( e?ists. ,onseAuentl(: a'aila<le stoc8 in M+P no longercorres%onds to te stoc8 actuall( a'aila<leS <ow /o ?ou ind the Reference /ocu'ent

I (ou do not 8no9 te num<er o te reerence document: (ou can ind it in te s(stemusing te material num<er or te account assignment.

11.7. Trans)er P%stings an' St%&: Trans)er

In a com%an(: goods mo'ements do not onl( occur in te orm o goods recei%ts and

goods issues. "e%ending on te organization o te com%an( Bor e?am%le: decentralizedstorageC and its sales %olic(: internal stoc8 transers migt also <e necessar(.

11.7.1. St%&: Trans)er "e,el

/toc8 transers can occur at tree dierent le'els>• rom com%an( code to com%an( code

• rom %lant to %lant

• rom storage location to storage location Bin te %lantC

[email protected]. ro' %o'pany %ode to %o'pany %ode

stoc8 transer rom com%an( code to com%an( code corres%onds to a stoc8 transer

rom %lant to %lant: 9it <ot %lants <elonging to dierent com%an( codes.

[email protected]. ro' Plant to Plant

stoc8 transer rom %lant to %lant not onl( leads to a cange in stoc8 Auantit( in <ot %lantsJ i <ot %lants are assigned to dierent 'aluation areas: an accounting document isalso created. is t(%e o stoc8 transer can onl( <e carried out rom unrestricted;usestoc8 o te issuing %lant to unrestricted;use stoc8 o te recei'ing %lant. /toc8 transers

EAS-SAP V.Jayaram60




rom %lant to %lant are rele'ant or Material +eAuirements Planning BM+PC: since M+Po%erates at %lant le'el.

[email protected]. ro' &torage +ocation to &torage +ocation "in the Plant#

stoc8 transer rom storage location to storage location in te same %lant sim%l( causesan u%date o te stoc8 Auantities in <ot storage locations. e stoc8 'alue remainsuncanged: and te e'ent is not rele'ant or accounting. stoc8 transer rom storagelocation to storage location is %ossi<le or all stoc8 t(%es.

11.8. St%&: Trans)ers Vers$s Trans)er P%stings

ou can %ost <ot stoc8 transers and transer %ostings in te In'entor( Managements(stem. ranser %ostings dier rom stoc8 transers in tat transer %ostings are generall(not connected 9it a %(sical goods mo'ement. e( usuall( in'ol'e a cange in stoc8t(%e: <atc num<er: or material num<er. n e?am%le o transer %osting is te release

rom ins%ection into te com%an(s o9n stoc8.In te In'entor( Management menu: <ot stoc8 transers and transer %ostings are locatedunder te menu entr( ranser %osting.

11.8.1 St%&: Trans)er Pr%&e'$res

ere are tree dierent %rocedures or carr(ing out a stoc8 transer>• /toc8 transer 'ia stoc8 transer %osting using one;ste% %rocedure

• /toc8 transer 'ia stoc8 transer %osting using t9o;ste% %rocedure

• /toc8 transer 'ia stoc8 trans%ort order

11..1.1. $ne0&tep Procedure ersus Two0&tep Procedure

7ot stoc8 transers and transer %ostings consist o a goods issue rom an issuing %ointand a goods recei%t at a recei'ing %oint. ou can %ost a stoc8 transer rom storagelocation to storage location or rom %lant to %lant eiter in one ste% or in t9o ste%s. ead'antage o te one;ste% %rocedure is tat (ou enter a single transaction in te s(stem.e t9o;ste% %rocedure: on te oter and: allo9s (ou to monitor te stoc8s in transit.ter te goods issue is %osted at te issuing %oint: te stoc8 a%%ears in stoc8 transer atte recei'ing %oint and is managed as suc in te s(stem. e t9o;ste% %rocedure is alsoreAuired i users decide to gi'e autorizations onl( or teir o9n %lants.

o carr( out a stoc8 transer rom %lant to %lant or a material tat is s%lit;'aluated at terecei'ing %oint: (ou a'e to use te one;ste% %rocedure or a stoc8 trans%ort order ortecnical reasons.

;aterial /ocu'ents for &toc, Transfers

"uring a one;ste% stoc8 transer: te s(stem creates t9o material document items ore'er( item (ou enter>

EAS-SAP V.Jayaram61




• an item or remo'al rom storage at te issuing %oint

• n item or %lacement into storage at te recei'ing %oint

ese items are so9n in te dis%la( o te material document.

11..1.2. /uring a two0step stoc, transfer- two 'aterial docu'ents are created:• From issuing %oint> *%on te remo'al rom storage at te issuing %oint: a material

document is created. For e'er( item (ou enter: t9o material document items arecreated: namel(>

o n item or te remo'al rom storage at te issuing %oint

o n item or te %lacement into stoc8 in transer at te recei'ing %oint

• From recei'ing %oint> *%on te %lacement into storage at te recei'ing %oint: a

material document is created. For e'er( item (ou enter: onl( one materialdocument item is created: <ecause te Auantit( is onl( transerred rom stoc8 intranser into unrestricted;use stoc8 at te recei'ing %oint.

11.=. Pysi&al In,ent%ry

E'er( com%an( must carr( out a %(sical in'entor( o its 9areouse stoc8s at least once %er iscal (ear to <alance its in'entor(. Various %rocedures can <e im%lemented or tis.

11.=.1. Pysi&al In,ent%ry Pr%&e'$re

e /P /(stem su%%orts te ollo9ing %(sical in'entor( %rocedures>• %eriodic in'entor(

• continuous in'entor(

• c(cle counting

• in'entor( sam%ling

Periodic nentory

In a %eriodic in'entor(: all stoc8s o te com%an( are %(sicall( counted on te <alanceseet 8e( date. In tis case: e'er( material must <e counted. "uring counting: te entire9areouse must <e <loc8ed or material mo'ements.

%ontinuous nentory

it te continuous in'entor( %rocedure: stoc8s are counted continuousl( during teentire iscal (ear. In tis case: it is im%ortant to ensure tat e'er( material is %(sicall(counted at least once during te (ear.

%ycle0%ounting,(cle counting is a metod o %(sical in'entor( 9ere in'entor( is counted at regularinter'als 9itin a iscal (ear. ese inter'als Bor c(clesC de%end on te c(cle countingindicator set or te materials. ,(cle ,ounting allo9s ast;mo'ing items to <e countedmore reAuentl( tan slo9;mo'ing items: or e?am%le.

nentory &a'pling

In in'entor( sam%ling: randoml( selected stoc8s o te com%an( are %(sicall( counted

EAS-SAP V.Jayaram62




on te <alance seet 8e( date. I te 'ariances <et9een te result o te count and te <oo8 in'entor( <alance are small enoug: it is %resumed tat te <oo8 in'entor( <alancesor te oter stoc8s are correct.

5hich &toc,s %an 8e nentoried In te /P /(stem: %(sical in'entor( can <e carried out <ot or a com%an(s o9n stoc8 and or s%ecial stoc8. In'entor( or a com%an(s stoc8 and or s%ecial stoc8s Bsuc as:consignment stoc8 at customer: e?ternal consignment stoc8 rom 'endor or returna<le %ac8agingC must <e ta8en se%aratel( Bin dierent %(sical in'entor( documentsC:o9e'er. Furtermore: te stoc8 can <e di'ided into stoc8 t(%es. In te standard s(stem: a %(sical in'entor( can <e carried out or te ollo9ing stoc8 t(%es>

• 1 ; unrestricted;use stoc8 in te 9areouse

• 2 ; stoc8 in Aualit( ins%ection

• 4 ; <loc8ed stoc8

I <atc status management is acti'e: stoc8 t(%e 1 co'ers <ot unrestricted;use stoc8 andrestricted;use stoc8.

In'entor( o all stoc8 t(%es mentioned can <e ta8en in a single transaction. For tematerials to <e in'entoried: one item is created in te %(sical in'entor( document or e'er( stoc8 t(%e. P(sical in'entor( ta8es %lace at storage location le'el. se%arate %(sical in'entor( document is created or e'er( storage location. I no storage locationsegment e?ists or a material: tis means tat no goods mo'ement as e'er ta8en %laceor te material in te storage location. e material tereore as ne'er ad an( stoc8 atte storage location and does not e?ist at stoc8 management le'el in te storage location.It is tereore not %ossi<le to carr( out a %(sical in'entor( or te material in tis storage

location.

is is not to <e conused 9it a material or 9ic a goods mo'ement as ta8en %laceand or 9ic te stoc8 <alance is currentl( zero. %(sical in'entor( must <e carriedout in tis case. It is also %ossi<le to carr( out a %(sical in'entor( since storage locationdata is not deleted 9en te stoc8 <alance is zero.

EAS-SAP V.Jayaram63




1/.. INVOICE VERI!ICATION

e /P s(stem is made u% o se'eral com%onents lin8ed togeter so tat dierentde%artments 9itin a com%an( can coo%erate 9it one anoter. e In'oice Veriication

com%onent is %art o te Materials Management BMMC s(stem. It %ro'ides te lin8 <et9een te Materials Management com%onent and te Financial ccounting:,ontrolling: and sset ccounting com%onents.

noice erification in ;aterials ;anage'ent seres the following purposes:

• It com%letes te materials %rocurement %rocess ; 9ic starts 9it te %urcase

reAuisition: continues 9it %urcasing and goods recei%t and ends 9it tein'oice recei%t

• It allo9s in'oices tat do not originate in materials %rocurement Bor e?am%le:

ser'ices: e?%enses: course costs: etc.C to <e %rocessed• It allo9s credit memos to <e %rocessed: eiter as in'oice cancellations or

discounts

In'oice Veriication does not andle te %a(ment or te anal(sis o in'oices. einormation reAuired or tese %rocesses is %assed on to oter de%artments.

noice erification tas,s include:

• Entering in'oices and credit memos tat a'e <een recei'ed

• ,ec8ing te accurac( o in'oices 9it res%ect to contents: %rices: and aritmetic

• E?ecuting te account %ostings resulting rom an in'oice

• *%dating certain data in te /P s(stem: or e?am%le: o%en items and material

%rices•

,ec8ing in'oices tat 9ere <loc8ed <ecause te( 'aried too greatl( rom te %urcase order

e ig degree o integration in te /P s(stem allo9s tese tas8s to <e carried outsmootl( and eicientl(.

s a rule: an in'oice reers to a transaction or 9ic te issuing %art( reAuests %a(ment.In'oice Veriication diers de%ending on te t(%e o in'oice in'ol'ed>

EAS-SAP V.Jayaram64




· Invoices ased on !urchase orders

it %urcase;order;<ased In'oice Veriication: all te items o a %urcase order can <esettled togeter: regardless o 9eter an item as <een recei'ed in se'eral %artialdeli'eries. ll te deli'eries are totaled and %osted as one item.· Invoices ased on goods recei!t

it goods;recei%t;<ased In'oice Veriication: eac indi'idual goods recei%t is in'oicedse%aratel(.· Invoices "ithout an order re#erence

en tere is no reerence to a %urcase order: it is %ossi<le to %ost te transactiondirectl( to a material account: a &= account: or an asset account.

1/.1. In,%i&e Veri)i&ati%n Pr%&ess

Eac in'oice contains 'arious items o inormation. o %ost an in'oice: (ou must enter tis inormation into te s(stem. I an in'oice reers to an e?isting transaction: certainitems o inormation 9ill alread( <e a'aila<le in te s(stem. e s(stem %ro%oses tisinormation as deault data so tat (ou onl( need to com%are it and: i necessar(: correct

an( %ossi<le 'ariances.

I an in'oice reers to a %urcase order: or e?am%le: (ou onl( need to enter te num<er o te %urcase order. e s(stem selects te rigt transaction and %ro%oses data rom te %urcase order: including te 'endor: material: Auantit( ordered: terms o deli'er(: termso %a(ment. ou can: o course: o'er9rite tis deault data i tere are 'ariances. ou candis%la( te %urcase order istor( to see: or e?am%le: 9ic Auantities a'e <eendeli'ered and o9 muc as alread( <een in'oiced.

I tere are 'ariances <et9een te %urcase order or goods recei%t and te in'oice: tes(stem 9ill issue a 9arning on te screen. I te 'ariances are 9itin te %reset tolerance

limits: te s(stem 9ill allo9 te in'oice to <e %osted <ut 9ill automaticall( <loc8 it or %a(ment. e in'oice must ten <e released in a se%arate ste%. I te 'ariances are not9itin te tolerances: te s(stem 9ill not allo9 te in'oice to <e %osted.

en te in'oice is entered: te s(stem also inds te rele'ant account. utomatic %ostings or sales ta?: cas discount clearing: and %rice 'ariances are also generated andte %osting records dis%la(ed. I a <alance is created: te user is reAuired to ma8ecorrections: as an in'oice can onl( <e %osted i te <alance eAuals zero.

s soon as te in'oice is %osted: certain data: suc as te a'erage %rice o te materialordered and te %urcase order istor(: is u%dated in te s(stem.

e in'oice %osting com%letes In'oice Veriication. e data necessar( or te in'oice to <e %aid is no9 contained in te s(stem. e accounting de%artment can retrie'e te dataand ma8e te a%%ro%riate %a(ments 9it te aid o te Financial ccounting com%onent.

1/./. In,%i&e Data

EAS-SAP V.Jayaram65




n in'oice contains 'arious inormation: suc as>• o issued te in'oice@

• ic transaction does te in'oice reer to@

• -o9 muc ta? do (ou a'e to %a(@

I te in'oice reers to a %articular transaction: te s(stem 9ill automaticall( retrie'einormation %ertaining to te transaction and %ro%ose 'alues on te screen or (ou tocec8. Inormation tat can <e retrie'ed includes>

• erms o %a(ment

• uantities to <e in'oiced

• e amounts te s(stem e?%ects %er item

I te 'endors in'oice contains dierent details: (ou can o'er9rite te data %ro%osed.e s(stem cec8s 9eter (our entries are %ermissi<le and 9ill dis%la( a 9arning or oter message i an(ting is incorrect.

e inormation 8no9n to te /P s(stem and te ields in 9ic (ou can enter ne9inormation rom te in'oice are located on dierent screens.

1/.. Cas Dis&%$nts

e cas discount agreements or a 'endor can <e stored in te 'endor master record.e( can ten <e co%ied rom te %urcase order: 9ere te( can <e canged.

en (ou enter an in'oice: te agreements Brom te %urcase order: i a'aila<le:oter9ise rom te 'endor master recordC are dis%la(ed as deault 'alues on te 'endorscreen in te section Pa(ment control. ese 'alues can <e o'er9ritten.

e ollo9ing ields also a'e to <e illed out>· $aseline date

is ield s%eciies te starting date rom 9ic te da(s or te terms o %a(ment are'alid. e date %ro%osed <( te s(stem can <e canged: i reAuired.· %iscount ase

I te amount Auali(ing or cas discount is dierent rom te in'oiced amount: (oumust enter te correct amount ere.· %iscount amount

In tis ield (ou can enter a i?ed amount 9ic te 'endor in te in'oice grants as a casdiscount. I (ou ill out tis ield: te s(stem 9ill ignore te dis%la(ed terms o %a(ment.· &erms o# !ayment

In tis ield: te s(stem dis%la(s a 8e( or te terms o %a(ment: i an( are stored in tes(stem. ese agreements come rom te %urcase order or rom te 'endor masterrecord. o te rigt o te screen: te s(stem dis%la(s te actual terms: tat is: te %eriodin 9ic cas discount is to <e granted: te %ercentage discount: and te date on 9icte in'oice is %a(a<le net. 7ot te 8e( or te terms o %a(ment and te 'alues <elonging to te 8e( can <e o'er9ritten.

I no 'alues are %ro%osed: (ou can eiter enter a 8e( or te da(s and %ercentage rates.

EAS-SAP V.Jayaram66




1/..1. Ty(es %) Cas Dis&%$nts

ere are t9o 9a(s o %osting te cas discount amounts>· Posting the gross amount

I (ou %ost te gross amount o an in'oice: te s(stem 9ill ignore te cas discountamount 9en (ou enter te in'oice data. e cas discount amount is %osted to a se%arateincome account 9en %a(ment is later made.· Posting the net amount

I (ou %ost te net amount o an in'oice: te cas discount amount is credited directl( tote account to 9ic te costs are %osted. For e?am%le: i (ou are %osting an amount to acost center: onl( te in'oice amount minus te cas discount amount is %osted to te costcenter.

ou s%eci( te 9a( in 9ic cas discount is to <e cleared on te initial screen in

In'oice Veriication in te ield "ocument t(%e. In te standard s(stem: tere are t9odocument t(%es>+E ; &ross %osting+$ ; $et %osting

1/.4. Ta< Data

s a rule: incoming in'oices include sales ta?. is is s%eciied eiter as a %ercentage rateor as a set amount. is must <e entered togeter 9it te general in'oice data. erele'ant %ostings are made automaticall( <( te s(stem.

ou enter te ta? inormation contained in te in'oice in te ollo9ing ields>· &a' amount

In tis ield (ou enter te amount o te ta? contained in te in'oice.· &a' code

e ta? code is a 8e( tat s%eciies te ta? t(%e and te ta? %ercentage. e s(stemallo9s onl( te ta? codes deined <( (our s(stem administrator.· Calculate ta'

I te ta? amount is not s%eciied e?%licitl( in te in'oice: te s(stem can calculate teta? amount itsel.

our s(stem administrator can determine o9 man( ta? amounts and codes can <e

entered in te 'endor screen <( ma8ing te a%%ro%riate settings in te ,ustomizings(stem o In'oice Veriication.

e ta? code entered or an item can <e canged on te item screen Bunless te ta? codeis contained in te &= accountC.

e s(stem uses te ta? code and te amounts on te indi'idual items to determine teta? <ase or eac ta? code. en (ou coose /imulate or Post: te s(stem cec8s

EAS-SAP V.Jayaram6!




9eter te ta? amounts are correct and as8 (ou to ma8e an( necessar( corrections.

Posting Taes

ic ta?es are to <e %aid and o9 te( are to <e %osted in te s(stem de%ends on teta? regulations deined <( la9 in te countr( o te com%an( concerned. e %ostings

made are controlled <( te ta? code. distinction is made <et9een te ollo9ing>• "educti<le ta?es

• $on;deducti<le ta?es

/eductile taes

In%ut ta? is %aid to te 'endor: 9o %asses tis on to te ta? autorities. e osettingentr( or te ta? %a(ment is %osted to a se%arate in%ut ta? account. On te <asis o tisaccount and te sales ta? account: Financial ccounting can calculate te dierence <et9een te ta? recei'ed and ta? %aid and %a( te amount to te a%%ro%riate ta? autorit(.

e s(stem creates a line or e'er( ta? code (ou enter. I 'arious line items a'e te sameta? code: te ta? %ostings are summed u%.

Bon0deductile taes

ere are tree dierent 9a(s o %rocessing non;deducti<le ta?es>· "istri<ution among in'oice itemsit tis %rocessing metod: (ou %ost te in'oice and ta? amounts to te 'endor account.e ta?es are distri<uted among te &= account line items and totaled in eac case as anet 'alue. E?am%le> "istri<ution among In'oice Items /e%arate %osting linesit tis %rocessing metod: (ou %ost te in'oice amount and te ta? amount to te

'endor account. e osetting entr( is s%lit> te osetting entr( or te in'oice amount is %osted to te stoc8 account: and te osetting entr( or te ta? amount is %osted tose%arate ta? accounts. E?am%le> /e%arate Posting ines /ales ta? not carged

In tis case: te in'oice does not contain an( ta?es. e ta? is determined <( te ta? codeentered. ou do not enter a ta? amount. e ta? e?%ense is eiter distri<uted among tein'oice items or %osted se%aratel(. e osetting entr( is %osted to se%arate ta? accounts.E?am%le> /ales a? $ot ,arged

In all tree cases: te ta? can <e deined on multi%le le'els. e %ostings to te indi'idual

le'els can <e distri<uted to dierent accounts.

e %rocedure: ta? records: and te accounts to <e %osted are controlled 'ia te ta? codeJ(ou can maintain te settings in te ,ustomizing s(stem o Financial ccounting.

EAS-SAP V.Jayaram6)




1/.5. A&&%$nt M%,ements

en (ou %ost an in'oice: te s(stem selects te accounts to <e %osted. ccountassignment is <ased %artl( on (our entries 9en (ou create an in'oice and %artl( oninormation stored in te s(stem.

•

our entries #ro!ide the following information+ o Is te in'oice %osted as a net or as a gross amount@

o ic 'endor account must <e %osted@

o ic &= accounts must <e %osted@

o ic amounts must <e %osted@

• The material master record #ro!ides the following information+

o ic 'aluation class does te material <elong to@

o at t(%e o %rice control is te material su<Gect to@

o ic account must <e %osted or te material@

o Is te stoc8 a'aila<le smaller tan te Auantit( in'oiced@

• "osted documents #ro!ide the following information+

o at is te %urcase order %rice@o -as tere <een a goods recei%t or te %urcase order@

o %ost in'oices correctl(: (our s(stem administrator must deine te accounts in tecart o accounts and te actions to <e ta8en or te dierent %ostings 9en te /Ps(stem is <eing installed in (our com%an(.

e /P accounts are deined in a cart o accounts. e ollo9ing accounts are %articularl( im%ortant or In'oice Veriication>· &he vendor account

For eac 'endor tere is a se%arate account in te su<;ledger to 9ic all amounts

concerning tis 'endor are %osted. %osting to te 'endor account is not te same as a %a(ment. Pa(ment is onl( e?ecuted 9en te Financial ccounting de%artment %osts te'endors %a(ment to a <an8 account: or e?am%le.· &he stock account

In te /P s(stem: tere is no se%arate account or eac material. Instead: dierentmaterials 9it similar eatures are grou%ed togeter in a common account Bor e?am%le:ra9 materials: acidsC. e account rele'ant or a material is deined in te s(stem 9ente material master record is created.· &he (R)IR clearing account

e &+=I+ clearing account is an intermediate account <et9een te 9areouse stoc8seet account and te 'endor account. t goods recei%t: te net in'oice amount e?%ectedis %osted rom te stoc8 account to te &+=I+ clearing account. is %osting is tencleared <( an osetting entr( on te 'endor account at in'oice recei%t.

EAS-SAP V.Jayaram6#




1/.7. In,%i&es *it ,arian&es

Four dierent t(%es o 'ariances are %ossi<le>· Quantity variance

e Auantit( s%eciied in te in'oice is dierent rom te Auantit( deli'ered and te

Auantit( in'oiced so ar.E?am%le> 100 %ieces ordered at N10 %er %iece

50 %ieces deli'ered0 %ieces alread( in'oicedIn'oice arri'es or N)00 or )0 %ieces· Price variance

e %rice s%eciied in te in'oice is dierent rom te %rice s%eciied in te %urcaseorder.E?am%le> 100 %ieces ordered at N1.30 %er %iece

100 %ieces deli'ered

0 %ieces alread( in'oicedIn'oice arri'es or N124 or 100 %ieces· Quantity and !rice variance

-ere 9e a'e a 'ariance in <ot Auantit( and %rice.E?am%le> 100 %ieces ordered at N10 %er %iece

60 %ieces deli'ered0 %ieces alread( in'oicedIn'oice arri'es or N1100 or 100 %ieces· Variance in order !rice *uantity

I te unit in 9ic a material is %riced is dierent rom te unit in 9ic a material isordered: te Auantit( o a material ordered is reerred to as te order %rice Auantit( Bore?am%le: te %urcase order is issued or %ieces: <ut te %rice is in N %er 8gC. I (ou a'ea %urcase order 9it an order %rice Auantit(: tere must <e a con'ersion actor <et9eente %rice unit and te Auantit( unit. I te con'ersion actor in te in'oice is dierentrom te con'ersion actor at goods recei%t: tere is a 'ariance in order %rice Auantit(. Ite in'oice is recei'ed <eore te goods: te con'ersion actor in te in'oice is com%ared9it tat o te %urcase order.E?am%le> 100 %ieces BK 250 8gC ordered at N20 %er 8g

100 %ieces deli'ered BK 240 8gC

0 %ieces alread( in'oicedIn'oice arri'es or N5200 or 100 %ieces BK 260 8gC

us: te con'ersion actor o te order %rice Auantit( and te order Auantit( isin te %urcase order> 2.5 8g %er %ieceat goods recei%t> 2.4 8g %er %iecein te in'oice> 2.6 8g %er %iece

EAS-SAP V.Jayaram!0




Tolerance

Variances are allo9ed 9itin certain tolerance limits. our s(stem administrator setstese. Eac time a 'ariance occurs: te s(stem cec8s 9eter it is 9itin te deinedtolerance limit.

I te 'ariance is outside te tolerance limit: te s(stem dis%la(s tis in a 9arningmessage. I (ou do not adGust (our entries: (ou can still %ost te in'oice. I: o9e'er: teu%%er tolerance limit is e?ceeded: te s(stem automaticall( <loc8s te in'oice or %a(ment. Financial ccounting can ten onl( %a( te in'oice ater te in'oice as <eenreleased in a se%arate ste%.I te 'ariance is 9itin te tolerance limit: te s(stem acce%ts te entr(. In tis case:tere is no need or a 9arning message or a %a(ment <loc8.

1/.8. Deli,ery &%sts

In te /P /(stem: tere are t9o t(%es o deli'er( costs>

"lanned deli!er& costs are entered in te %urcase order. Pro'isions are set u% or te rele'ant costs atgoods recei%t. e deli'er( costs %osted at goods recei%t can <e reerenced atin'oice entr(.

'n#lanned deli!er& costs are onl( entered 9en te in'oice is entered. $o %ro'ision is made at goodsrecei%t.

"lanned /eli!er& Costs

Planned deli'er( costs can <e di'ided u% according to te ollo9ing criteria>• Origin o costs

o

reigt costso customs dut(

our s(stem administrator can deine urter origin t(%es using te conditionsunctionalit( in te ,ustomizing s(stem o Purcasing.

• ,alculation o costs

o i?ed amount: inde%endent o deli'ered Auantit(

o Auantit(;de%endent amount

o %ercentage 'alue o goods deli'ered.

Planned deli'er( costs are automaticall( %osted to a clearing account 9en (ou enter te

goods recei%t. Eac origin t(%e as its o9n clearing account. en (ou %ost te in'oiceor tese deli'er( costs: te corres%onding clearing accounts are settled.

In In'oice Veriication: it is %ossi<le to list all te %lanned deli'er( costs or eiter a %urcase order: a 'endor: or a <ill o lading. ou can co%( te rele'ant items rom tis listinto te document.

ou do not a'e to s%eci( a certain 'endor or %lanned deli'er( costs. en (ou %lan

EAS-SAP V.Jayaram!1




te deli'er( costs in a %urcase order: (ou can enter a 'endor Bor e?am%le: a reigtsu%%lier or a customs oiceC. In In'oice Veriication: o9e'er: te deli'er( costs can <e %osted to anoter in'oicing %art(.

Planned deli'er( costs are entered on te %urcase order or eac item. t in'oice recei%t:

te( are allocated to te rele'ant items.

'n#lanned /eli!er& Costs

*n%lanned deli'er( costs are deli'er( costs tat 9ere not agreed u%on in te %urcaseorder and are not entered until te in'oice is recei'ed. e ollo9ing %ossi<ilities e?ist>· +n!lanned delivery costs re#er to a !urchase order, ut have not eenentered in the !urchase order-

I un%lanned deli'er( costs reer to a %urcase order: te s(stem can determine teaccounts to 9ic te costs must <e %osted rom te %urcase order. I tere are se'eralitems in te %urcase order: te s(stem automaticall( distri<utes te costs on te <asis ote total 'alues alread( in'oiced.· +n!lanned delivery costs do not re#er to a !urchase order-en (ou enter an in'oice or deli'er( costs tat do not reer to a %urcase order: tes(stem cannot allocate te costs and (ou a'e to tell it 9ic accounts te deli'er( costssould <e %osted to.

• I (ou 8no9 te material or 9ic te deli'er( costs 9ere incurred: (ou can de<it

te costs directl( to te material stoc8.• I (ou do not 8no9 te material: (ou can %ost te costs to a &= account. In te

standard s(stem: tere is a s%ecial &= account or un%lanned deli'er( costs tatcannot <e allocated to an( s%eciic account.

1.. >AREOUSE MANA+EMENT

,om%uter su%%ort o te organization and management o 9areouses as <ecomeim%erati'e or eicient and eecti'e %rocessing o logistic reAuirements 9itin acom%an(. e /P areouse Management BMC s(stem %ro'ides te le?i<le:eicient: automated su%%ort tat ena<les (ou to>

EAS-SAP V.Jayaram!2




• manage igl( com%le? 9areouse structures and se'eral dierent t(%es o

9areousing acilities including automatic 9areouses: custom;designed storageareas: ig rac8 storage: <loc8 storage: i?ed <in storage and all oter commonl(used storage areas

• deine and ada%t a 'ariet( o storage <ins or use in (our s%eciic 9areousing

com%le?• %rocess all rele'ant 9areousing acti'ities and mo'ement tas8s: suc as goods

recei%ts: goods issues: internal and e?ternal stoc8 transers: automaticre%lenisment o i?ed <ins: material staging to %roduction areas and stoc8dierence andling

• utilize random slotting or multi%le o9ners o goods

• dis%la( summar( e'aluations o all goods mo'ements in te 9areouse

• im%lement a 'ariet( o readil( a'aila<le %ut;a9a( and %ic8ing strategies including

sel;designed strategies• su%%ort te storage and retrie'al o azardous materials and all oter goods tat

reAuire s%ecial andling•

maintain u%;to;te;minute in'entor( records at te storage <in le'el using real;time continuous in'entor( tecniAues

• su%%ort te use o automated <arcode scanners and +F tecnolog( or all stoc8

mo'ements• interace to e?ternal non;/P 9areousing s(stems

• ull( integrate (our areouse Management s(stem or instantaneous interaction

9it oter /P com%onents to include Materials Management BMMC: In'entor(Management BIMC Production Planning BPPC: ualit( Management BMC and/ales and "istri<ution B/"C.

In addition to su%%orting te design o all t(%ical storage areas: te M s(stem %ro'ides

automated su%%ort or se'eral ad'anced 9areousing tecniAues: suc as• te anal(sis o reAuirements and automatic assignment o goods to o%timum

locations in te 9areouse using %uta9a( strategies tat can <e easil( deined tomatc te caracteristics o eac storage area

• te coniguration o areas or <ac8order staging and cross;doc8ing o recei'ed

goods• te setu% o or9ard %ic8 areas and %roduction su%%l( areas 9it automatic

continuous re%lenisment rom case or reser'e storage 9en a certain tresold isreaced.

7eginning 9it te %lanning %ase: te M s(stem carries out stoc8 a'aila<ilit( cec8s

9ene'er transactions are initiated in eac o te res%ecti'e s(stem com%onents.ltoug it is %ossi<le to %rint material documents or eac se%arate transaction in te9areouse: te M s(stem acilitates automatic lo9troug 9areousing tas8s tat are'irtuall( %a%erless.

In te areouse Management s(stem: (ou create transer orders <ased on transer reAuirements. ranser orders trigger and control te %(sical mo'ement o goods 9itinte 9areouse. e M s(stem su%%orts te %rocessing o all rele'ant mo'ements:

EAS-SAP V.Jayaram!3




including goods recei%ts and goods issues initiated <( te In'entor( Management BIMCs(stem: deli'eries rom te /ales and "istri<ution B/"C s(stem: as 9ell as mo'ementstat ta8e %lace 9itin te 9areouse: suc as internal stoc8 transers. it its in'entor(unctions: te M s(stem ensures tat <oo8 in'entories in te In'entor( Managements(stem matc te stoc8 in te 9areouse: at an( time. 7ecause /P com%onents are ull(

integrated: (ou do not need se%arate interace %rograms <et9een te In'entor(Management s(stem and te areouse Management s(stem.

ntegration with other &AP ;odules

e M s(stem is ull( integrated into te /P s(stem as a 9ole. Most acti'ities tatta8e %lace 9itin te M s(stem are initiated in te In'entor( Management BIMC s(stem.For e?am%le: goods recei%ts: most goods issues and %osting canges are all initiated inte IM s(stem and su<seAuentl( %rocessed in te M s(stem. e M s(stem is also

interaced to te /ales and "istri<ution B/"C s(stem troug te /i%%ing module to %rocess deli'er( documents or <ot te integrated s(stem and te "ecentralized Ms(stem. e areouse Management interace to te ualit( Management BMC s(stemallo9s 9areouse administrators to trac8 and manage ins%ection lots tat are stored in te9areouse.

e M s(stem is also interaced to te Production Planning BPPC s(stem to assist in %ro'iding materials to su%%l( areas in %roduction. /torage *nit Management

/torage unit B/*C management in te areouse Management BMC s(stem %ro'ides teca%a<ilit( to manage and control material lo9 utilizing storage units 9itin te

9areouse.

/ecentralized 5arehouse ;anage'ent

For users 9o alread( a'e te /P +=2 /(stem: it is %ossi<le to install te M s(stemas an +=3 com%onent so tat M unctions can <e carried out inde%endent o tea'aila<ilit( o te central +=2 ost s(stem.

1.1. >are%$se str$&t$re

7eore (ou can use te areouse Management BMC s(stem to assist (ou in managingte 9areousing unctions in (our com%an(: (ou must irst deine>

• e structure B%(sical la(outC o (our 9areousing com%le?

• Inormation a<out goods stored in (our 9areousing acilities

EAS-SAP V.Jayaram!4




ou deine tis inormation in te 9areouse master record: te storage t(%e records andte material master records. e M s(stem uses te data stored in tese records too%timize te %rocess o stoc8 mo'ements.

e %(sical storage acilities o a com%an( ma( e?ist in one or more %(sical <uildings

and can consist o se'eral t(%es o storage Bor e?am%le: ig rac8 storage: <loc8 storage: %ic8ing areasC and oter areas 9itin te 9areousing com%le? Bsuc as interim stagingareas or goods recei%t and goods issueC.

ou can deine an entire %(sical 9areousing com%le? in te areouse ManagementBMC s(stem using a single 9areouse num<er. Eac o te storage acilities or areas can <e deined as a storage t(%e <( its s%atial: tecnical or organizational actors.

Physical 5arehousing %o'ple storage t(%e generall( consists o se'eral storage s%aces or slots. ese are 8no9n asstorage <ins in te M s(stem. itin a storage t(%e: (ou can classi( storage <ins

according to te t(%e o <in: or e?am%le: small <ins or large <ins.

ou can also assign storage <ins to a storage section.

&torage 8in Types and &torage &ections

e e?istence o a Auantit( o material in a storage <in is reerred to in te M s(stem asa Auant. For eac storage t(%e: (ou can deine 9eter Auants or onl( a single materialor Auants rom dierent materials or <atces can <e stored in a storage <in.

1./. Inter)a&e *it %ter SAP m%'$les

e management res%onsi<ilities o a 9areousing de%artment in'ol'e carr(ing out andmonitoring te mo'ement o goods into: out o: and 9itin 9areouses.

e acti'ities o a 9areousing de%artment can include te ollo9ing>• recei'ing: identi(ing and sorting goods

• %lacing goods into storage <ins

• ta8ing in'entor(

• monitoring and ins%ecting goods in storage

• %re%lanning te distri<ution o materials stored in te 9areouse

• %ic8ing and accumulating orders

•

%ac8aging: loading and si%%ing goods

For some o tese acti'ities: suc as recei'ing and si%%ing: te areouse ManagementBMC s(stem must interact 9it oter com%onents o te /P s(stem: suc as In'entor(Management BIMC and /ales and "istri<ution B/"C. is interaction in'ol'es tee?cange o data <et9een te 'arious s(stems. In tis section 9e discuss o9communication <et9een tese s(stems is andled.

EAS-SAP V.Jayaram!5




&toc, ;oe'ents

In te areouse Management BMC s(stem: tere are t9o t(%es o stoc8 mo'ements>• mo'ements tat aect onl( te 9areouse: or e?am%le: stoc8 transers 9itin a

9areouse• mo'ements tat aect not onl( te 9areouse <ut also oter de%artments: suc as

stoc8 transers to customers or to %roduction

/toc8 mo'ements in te areouse Management BMC s(stem are generall( initiated <(anoter s(stem: suc as te In'entor( Management BIMC s(stem or te /ales and"istri<ution B/"C s(stem.

E?am%les include>• goods recei%t

• goods issue

• %osting cange

&toc, ;oe'ents etween &torage Types

E'er( mo'ement o goods in te areouse Management BMC s(stem is carried out9it a transer order and in'ol'es te mo'ement o materials rom one storage t(%e toanoter. en stoc8 is mo'ed: a source storage t(%e and storage <in as 9ell as adestination storage t(%e and storage <in are used. For e?am%le: an ongoing record o stoc8 is 8e%t as it is mo'ed rom te goods recei%t area to ig rac8 storage and into ro921: stac8 4: le'el 2: 9ic is a %(sical storage <in. is means tat e'er( mo'ementre%resents a stoc8 transer <et9een t9o storage t(%es. e actual or total amount o stoc8 in te s(stem: o course: does not cange.

&toc, ;oe'ents noling nteri' &torage Areas Mo'ements in'ol'ing te In'entor( Management BIMC s(stem use storage t(%es tat arecalled interim storage areas. Interim storage areas are used to e?cange Auantit( data <et9een te t9o s(stems. %osting in te IM s(stem: suc as a goods recei%t %osting:u%dates te Auantit( o a'aila<le stoc8 in te IM s(stem and simultaneousl( %osts teres%ecti'e Auantit( to te interim storage area in te M s(stem. e total Auantit( o stoc8 in te M s(stem is u%dated <( tis %osting. is ensures tat te stoc8 Auantitiesare al9a(s te same in <ot s(stems.In summar(: interim storage areas or goods recei%t: goods issue: and dierences are usedto tem%oraril( store data <eore it is %osted to te storage areas in te 9areouse.

1.. Trans)er re#$irements

e transer reAuirement document re%resents an e?isting reAuirement to mo'e a s%eciicAuantit( o material into te 9areouse: out o te 9areouse or rom one storage <in toanoter 9itin te 9areouse. ou create transer reAuirements 9it or 9itout+eerence to oter s(stem documents. *sing transer reAuirements as %lanningdocuments: (ou create transer orders tat are ten used to e?ecute %(sical stoc8mo'ements.

EAS-SAP V.Jayaram!6




transer reAuirement can ans9er se'eral im%ortant Auestions a<out a %lanned stoc8mo'ement>

• at sould <e mo'ed@

• -o9 muc sould <e mo'ed@

•

o or 9at caused te mo'ement B9as it manuall( or automaticall( createdC@• -as a Auantit( o stoc8 alread( <een transerred@

ou use transer reAuirements to %ass inormation a<out stoc8 mo'ements tat are %ostedin te In'entor( Management s(stem to te M s(stem: <ut te( are not limited to tatunction. ou can also use transer reAuirements to start stoc8 mo'ements 9itin te Ms(stem or to initiate te su%%l( o materials to %roduction storage <ins at IP locationsusing te Production Planning BPPC s(stem. ou can also use te transer reAuirementre%orting unctions to retrie'e an o'er'ie9 o stoc8 tat is to <e mo'ed.

&toc, ;oe'ents Bot nitiated y Transfer Require'ents

ou can also carr( out stoc8 mo'ements 9itout transer reAuirements. For e?am%le: (oudo not a'e to use a transer reAuirement i transer orders are created rom deli'eriesusing te /ales and "istri<ution B/"C s(stem. e deli'er( re%laces te transer reAuirement and (ou manuall( create a transer order tat is <ased on te deli'er(.

<ow is a Transfer Require'ent &tructured transer reAuirement consists o a eader tat contains general inormation a<out teentire reAuirement and one or more items. en (ou create a transer reAuirement: (oucan enter 'alues in all ields o te eader e?ce%t te ields in te dditional data section.ese ields are maintained <( te s(stem.

e irst section o te screen item contains inormation rom te eader. In te secondsection: (ou enter inormation a<out te Auantit( to <e transerred. e s(stem maintainste data a<out te o%en Auantit(. In te tird section: (ou enter inormation a<out tematerial to <e transerred.

Transfer types

stoc8 transer is identiied <( a transer t(%e. ou use transer t(%es to grou% togeter and select transer reAuirements and transer orders or urter %rocessing.

1.4. Trans)er %r'ers

transer reAuirement contains inormation a<out a %lanned mo'ement o stoc8 in te9areouse. e corres%onding transer order contains te inormation te s(stem needsto carr( out te mo'ement: tat is: te %(sical mo'ement o a s%eciic Auantit( o material rom one %lace to anoter. &oods are %laced into a storage <in: remo'ed rom astorage <in: or transerred rom one storage <in to anoter 9itin te 9areouse using

EAS-SAP V.Jayaram!!




transer orders. ranser orders are also used to trac8 te logical transers o stoc8.ogical transers o stoc8 occur: or e?am%le: 9en goods are returned rom ins%ectionand made a'aila<le or general use. ese logical transers are called %osting canges inte areouse Management BMC s(stem.

ou can %rint out transer orders in te 9areouse ater te( are created: so tat te %(sical stoc8 mo'ement can <e carried out immediatel(. ou can also reAuire tatcertain stoc8 mo'ements <e conirmed. is means tat te 9areouse 9or8er mustindicate tat te %(sical transer too8 %lace. /ometimes te Auantit( tat sould <etranserred is not te Auantit( tat is actuall( transerred. ou can enter tis dierence9en te transer order is conirmed. it te conirmation o te deli'er( and te entr(o dierences: te s(stem can ensure tat te <oo8 in'entor( is te same as te %(sicalin'entor(.

<ow is a Transfer $rder %reated

ou can create transer orders <( reerring to anoter document: suc as a transer reAuirement: a deli'er( document: or a material document. ou can also create a transer order 9itout reerring to an( oter document.

5hat nfor'ation /oes a Transfer $rder %ontain

In order to carr( out its unction: a transer order must contain a material num<er: teAuantit( to <e transerred: 9ere te material is located: and 9ere te material is to <edeli'ered. e inormation tat te transer order needs comes rom se'eral sources>

• material master record

•

9areouse management mo'ement t(%e• strategies or inding te source or destination storage <ins

• user entries

• source documents: suc as transer reAuirements and deli'eries

<ow is a Transfer $rder &tructured

e transer order consists o a transer order eader: 9ic contains general inormationa<out te entire order: and one or more items.

Transfer $rder <eader

e transer order eader identiies te transer order num<er and te date tat it 9ascreated and conirmed. It also identiies te transer reAuirement on 9ic it is <ased andte mo'ement t(%e. I te transer order as <een %rinted: te rr order %rinted cec8 <o? is mar8ed.

EAS-SAP V.Jayaram!)




Transfer $rder te'

transer order contains one or more items. e num<er o items de%ends on o9 man(storage <ins te s(stem accesses in order to reac te total Auantit( o goods needed <(te transer reAuirement Bstoc8 remo'alC or o9 man( <ins are needed to store te goods

Bstoc8 %lacementC.

n item 9itin a transer order contains t9o or tree su<sections tat identi( tedirection o te stoc8 mo'ement

• out o a 9areouse or rom an interim storage area Bte source o te stoc8C. is

su<section contains te storage <in and te amount o material tat is <eingtranserred rom a storage area.

• into a 9areouse or an interim storage area Bte destination o te stoc8C. is

su<section contains te storage <in and te amount o material tat is <eingtranserred into a storage area.

• return to storage. e s(stem generates a return su<section 9en a Auantit(

remains ater te material: in te desired Auantit(: is remo'ed rom a storage <in.is can a%%en i: or e?am%le: a ull issue is deined or te source storage t(%e: <ut te entire Auantit( as not <e reAuested. e return Auantit( is returned to itsoriginal storage <in or transerred to anoter one.

e transer order num<er and item num<er are dis%la(ed at te to% o te item screen.e item screen %ro'ides s%eciic inormation a<out te mo'ement o a Auantit( o material rom a source storage <in to a destination storage <in.

I te actual Auantit( is te same as te reAuired Auantit(: te dierence Auantit( 9ill <ezero.

1.5. Trans)ers int% te *are%$se

nfor'ation aout &toc, Place'ents en stoc8 is %laced into te 9areouse: it generall( is transerred rom te interimstorage area or goods recei%ts. Inormation a<out te source Binterim storage t(%e:interim storage section: and interim storage <inC is recorded in te transer reAuirement or te s(stem determines it rom te M mo'ement t(%e.

&earching for a &torage Type

e s(stem must no9 determine into 9ic storage t(%e te material sould <e %laced.

ou deine tis inormation in te storage t(%e searc ta<le.

In te storage t(%e searc ta<le: (ou can deine a searc seAuence 9it u% to ten storaget(%es. 7e sure to enter an e Bor stoc8 %lacementC in te ct. column. is means tat tes(stem uses te searc seAuence to ind a destination storage t(%e.

e list o storage t(%es is ierarcical: tat is: te s(stem searces or em%t( storage <ins in te irst storage t(%e: ten in te second storage t(%e: and so on. e ta<le entries

EAS-SAP V.Jayaram!#




tat te s(stem uses or tis searc de%end on te mo'ement t(%e and=or te material <eing %laced into storage.

ou can also grou% materials togeter <( te storage t(%e indicator so tat te s(stemuses te same searc seAuence and stores te grou% o materials in te same storage t(%e

or t(%es. o im%lement tis (ou deine>• a storage t(%e indicator in te material master record Bte Placement /torage (%e

indicator ieldC• a storage t(%e indicator in te storage t(%e searc Bin te (%e Indicator ieldC

Reference to ;oe'ent Type

Entries in te +e column o te storage t(%e searc ta<le inluence storage t(%e searcaccording to mo'ement t(%e.

o lin8 a mo'ement t(%e to a storage t(%e searc seAuence: (ou enter a reerence num<er

in te +eerence (%e /earc column o te ta<le dis%la(ed. is same num<er 9ill alsoa%%ear in te +eerence storage t(%e searc ield or eac mo'ement t(%e selected.

Access $pti'ization for &torage Type &earch &trategies

en storage t(%e indicators are used and se'eral materials 9it dierent stoc8 categories Bsuc as s%ecial stoc8C e?ist: te num<er o entries in te storage t(%e searcta<le can <ecome 'er( large. o decrease te num<er o tese entries: (ou can deine anaccess strateg( or te storage t(%e searc ta<le using te access strateg( ta<le.

<azardous ;aterials

ou can also inluence storage t(%e searc according to azardous material storageclasses and 9ater %ollution classes.

&earching for a &torage 8in

Once te storage t(%e as <een determined: te s(stem ten searces 9itin te storaget(%e to ind an a%%ro%riate storage <in in 9ic te material can <e %laced. o ind astorage <in: te s(stem uses a searc strateg( tat as <een deined or te storage t(%e.For eac storage t(%e (ou can deine one stoc8 %lacement strateg(.

+egardless o te %ut;a9a( strateg(: tere are t9o oter actors tat aect o9 te s(stemsearces or em%t( storage <ins. storage section storage <in t(%e7ot o tese actors are inde%endent o te strateg( tat is used or stoc8 %lacement.7ot can <e used 9it all stoc8 %lacement strategies 9it te e?ce%tion o i?ed <instrateg(: or 9ic storage sections cannot <e used.

&torage sections

EAS-SAP V.Jayaram)0




ou can di'ide a storage t(%e into se'eral storage sections in 9ic 'arious materials can <e stored. ou can use tese storage sections: or e?am%le: to ensure tat reAuentl( usedmaterials Bast;mo'ing itemsC are stored in te ront o te 9areouse 9ile seldomused materials Bslo9;mo'ing items are stored in te <ac8 o te 9areouse. storaget(%e is di'ided into storage sections on te <asis o storage <ins. en (ou create a

storage <in (ou assign it to a storage section.

I storage section cec8ing is acti'e or te storage t(%e: ten te s(stem searces in testorage t(%e onl( or tose em%t( storage <ins in storage sections tat a'e <een allo9edor te material <eing %laced into storage. en (ou are creating a transer order andmanuall( enter a storage <in: ten te s(stem cec8s 9eter te <in is in a storagesection tat is allo9ed or te material.

&torage in type search

In one storage t(%e (ou ma( a'e storage <ins o dierent sizes. en te s(stem %laces

goods in storage: it can searc or a storage <in tat 9ill accommodate a s%eciic storageunit t(%e. en (ou create a storage <in (ou assign it to a storage <in t(%e.

In te ta<le or assigning storage unit t(%es to storage t(%es: (ou can deine u% to tenstorage unit t(%es tat can <e accommodated in eac storage t(%e.

$e?t (ou must assign te storage <in t(%e to eac storage unit t(%e. In te storage <int(%e searc ta<le: (ou can deine u% to ten storage <in t(%es tat can <e used or eacstorage unit t(%e in a storage t(%e.

s a inal ste%: (ou must acti'ate te storage unit t(%e cec8ing or a storage t(%e.

e connection <et9een a material and storage unit t(%e cec8ing is made in te materialmaster record. ou can deine u% to tree dierent %alletizations Bstorage unit t(%e andnum<er o units o material %er storage unit t(%eC or a material.

I storage unit t(%e cec8ing is acti'e or te storage t(%e: te s(stem irst determines i te storage unit t(%e or te material can <e %laced in te storage t(%e. $e?t te s(stemsearces or an em%t( storage <in in te irst storage <in t(%e tat can accommodate testorage unit t(%e. I it does not ind a <in: it ten searces in te second storage <in t(%e:and so on. en (ou are creating a transer order and manuall( enter a storage <in: tente s(stem cec8s 9eter te <in <elongs to one o te allo9ed storage <in t(%es.

1.7. Trans)er %$t %) te *are%$se

nfor'ation aout stoc, re'oals

en stoc8 is remo'ed rom te 9areouse: it generall( is transerred to te interimgoods issue storage area. is inormation a<out te destination Binterim storage t(%e:interim storage section: and interim storage <inC is recorded in te transer reAuirement or

EAS-SAP V.Jayaram)1




te s(stem determines it rom te M mo'ement t(%e.

&earching for a storage type

e s(stem must no9 determine rom 9ic storage t(%e te material sould <e %laced.

ou deine tis inormation in te storage t(%e searc ta<le.

In te storage t(%e searc ta<le: (ou can deine a searc seAuence 9it u% to ten storaget(%es. 7e sure to enter a Bor stoc8 remo'alC in te ct. column.

e list o storage t(%es is ierarcical: tat is: te s(stem searces or te material in teirst storage t(%e: ten in te second storage t(%e: and so on. n entr( o or testorage t(%e means tat te s(stem searces trougout te entire 9areouse or teoldest stoc8. e ta<le entr( tat te s(stem uses or tis searc de%ends on te material7eing remo'ed rom storage.

ou can grou% materials togeter <( a storage t(%e indicator so tat te s(stem uses tesame searc seAuence and remo'es materials rom te same storage t(%e or t(%es.

o im%lement tis (ou deine> storage t(%es in te material master record Bte +emo'al /torage (%e Indicator ieldC a storage t(%e indicator in te storage t(%e searc ta<le Bin te (%e Indicator ieldC

&earching for a storage in

Once te storage t(%e as <een determined: te s(stem ten searces 9itin te storaget(%e to ind an a%%ro%riate storage <in rom 9ic te material can <e remo'ed. o ind astorage <in: te s(stem uses a searc strateg( tat as <een deined or te storage t(%e.For eac storage t(%e (ou can deine one stoc8 remo'al strateg(.

1.8. +%%'s re&ei(t

e recei%t o goods into te areouse Management BMC s(stem is generall( initiated9it a %osting in te IM s(stem. it te IM %osting: te s(stem assigns a Auantit( o material to a storage <in in an interim storage area and creates a transer reAuirement inte M s(stem.

/u<seAuentl( (ou create a transer order <ased on te inormation in te transer reAuirement. *sing a %redetermined searc strateg(: te s(stem determines 9ere in te9areouse te goods sould <e %laced. it tis transer order te goods are transerredrom te interim storage area to a storage <in in te 9areouse.

e 9areouse 9or8er conirms tat te goods a'e <een transerred. n( discre%ancies <et9een te Auantit( reAuested and te Auantit( transerred into te 9areouse are

EAS-SAP V.Jayaram)2




recorded in te M s(stem and ten cleared into te IM s(stem. t tis %oint: te goodsrecei%t is inised.

)oods Receipt Process

ou can also %ost goods recei%ts irst in te M s(stem <( creating a transer order. B$otranser reAuirement is needed.C e IM s(stem initiall( as no inormation a<out tisgoods recei%t. /u<seAuentl( (ou record tis goods recei%t in te IM s(stem.

e ollo9ing ta<le summarizes te goods recei%ts <( IM tas8: mo'ement t(%e: and teinterim storage area to 9ic te goods are %osted.&oods +ecei%t or IM as8 Mo'ement (%e /torage reaPurcase order For %urcase order 101 #02 $o %urcase order Oter 501 #02In;%lant %roduction Oter 521 #01Ins%ection For %urcase order 101 #02

Ins%ection release ranser %osting 321 #22

rom &oods mo'ement KH &oods recei%t menu rom &oods mo'ement menu

1.=. St%&: trans)ers an' (%sting &anges

/toc8 transers in te Materials Management s(stem include te %(sical mo'ement omaterials rom>

• one %lant to anoter %lant

• storage <in to storage <in Binternal transersC

• 9areouse to 9areouse

• storage location to storage location

For stoc8 transers 9itin te same 9areouse: (ou can create: manage and dis%la(inormation a<out te mo'ement o stoc8 rom te time it is recei'ed until it lea'es te9areouse using te areouse Management BMC s(stem. For stoc8 transers rom onestorage location to anoter storage location: te %rocess <egins in te In'entor(Management BIMC s(stem and is com%leted in te M s(stem.

EAS-SAP V.Jayaram)3




Reasons for ;a,ing Posting %hanges

Posting canges are made or se'eral reasons>• to release stoc8 rom ins%ection into a'aila<le stoc8

• to con'ert <loc8ed stoc8 to ins%ection stoc8

•

to designate a'aila<le material as ins%ection stoc8• to cange a material num<er

• to s%lit a'aila<le materials into t9o or more <atces

• to con'ert s%ecial stoc8: suc as consignment stoc8 or returned stoc8: into te

com%an(s o9n stoc8 to cange o9nersi% o stoc8 in te same 9areouse rom one %lant to anoter

Posting canges are initiated in te In'entor( Management BIMC s(stem Bas transer %ostingsC and su<seAuentl( carried out in te areouse Management BMC s(stem.en a transer %osting is carried out in te IM s(stem: a %osting cange notice iscreated in te M s(stem. lso: t9o Auants o eAual negati'e and %ositi'e amounts are

created in te %osting cange interim storage area ; a negati'e Auant or te material to <eremo'ed and a %ositi'e Auant or te material to <e added.

ou use te M s(stem to create a transer order to %rocess te %osting cange noticeand clear te %osting cange area. en (ou %rocess te %osting cange notice: tematerial can ten <e %osted <ac8 to te original storage <in or transerred to anoter <in9itin te 9areouse.

The position change notice list

Posting canges initiated in te IM s(stem can <e 'ie9ed <( dis%la(ing te %osting

cange notice list in te M s(stem. en retrie'ing tis list: (ou can dis%la( all %ostingcange notices tat are still o%en and=or tose tat are %artiall( or ull( cleared.

1.@. In,ent%ry

e %ractice o ta8ing an annual in'entor( count at te end o te iscal (ear otenreAuires an enormous eort or large 9areouse com%le?es. e costs to a com%an( arerelati'el( ig: and te %(sical counting %rocess in te 9areouse is la<or intensi'e. Inman( actories: an annual in'entor( count 9ould result in lost out%ut <ecause o te eortreAuired. ereore: la9 under certain circumstances allo9s se'eral 'ariations to tecon'entional annual in'entor( count.

e areouse Management BMC s(stem su%%orts te ollo9ing in'entor( metods>• nnual in'entor( count Balso called %eriodic in'entor(C

• ,ontinuous in'entor(

• ,ontinuous in'entor( during stoc8 %lacement

• ,ontinuous in'entor( <ased on zero stoc8 cec8

• ,(cle counting

• In'entor( sam%ling

EAS-SAP V.Jayaram)4




For a storage t(%e: (ou can deine eiter an annual or a continuous in'entor( count. oucan also select one or more o te oter t(%es o in'entor( metods: suc as an in'entor( <ased on stoc8 %lacement or <ased on stoc8 remo'al Bzero stoc8 cec8C.

*nli8e te material;related in'entor( in te In'entor( Management BIMC s(stem: (ou use

te M s(stem to carr( out an in'entor( on a storage <in le'el or te 9areousesmanaged <( te M s(stem. e in'entor( is regarded as com%leted i an in'entor( 9asta8en or e'er( storage <in in te 9areouse at least once during te iscal (ear.

1.1. St%rage $nit management

it /* management: te %rimar( in%ut %arameter is te storage unit num<er. /incemuc o te %(sical acti'it( 9itin (our 9areouse consists o mo'ing storage units:(ou can manage tis acti'it( in te M s(stem using /* num<ers.

en /* management is acti'e in (our 9areouse: at an( gi'en time (ou can 8no9

9ere eac storage unit is located: te amount o material contained in it and 9ico%erations a'e <een %rocessed or %lanned or it.

unctions

In addition to te ca%a<ilities alread( a'aila<le using te areouse Management s(stem:te acti'ation o storage unit management in (our s(stem ena<les (ou to access se'eralunctions tat are s%eciicall( designed or 9or8ing 9it storage units.

*sing /* management: (ou can>• create omogeneous storage units

• create eterogeneous Bmi?edC storage units

•

%lace materials into storage using an identiication BI"C %oint• conirm storage unit mo'ements

ou can enter a se%arate storage unit num<er or eac transer order item.· trans#er storage units internally

ou can create internal transer orders <ased on te storage unit num<er to mo'eindi'idual storage units to anoter location 9itin te 9areouse.

• add stoc8 to e?isting storage units

• dis%la( te contents o storage units

• %rint documents to accom%an( storage units

ll o tese unctions are ull( integrated or storage unit management 9itin te Ms(stem.

EAS-SAP V.Jayaram)5




14.. CONSUMPTION ;ASED P"ANNIN+

e central role o material reAuirements %lanning is to monitor stoc8s and: in %articular:to automaticall( generate order %ro%osals or %urcasing and %roduction B%lanned orders: %urcase reAuisitions: or deli'er( scedulesC. is target is acie'ed <( using 'ariousmaterials %lanning metods 9ic eac co'er dierent %rocedures. ,onsum%tion;<ased %lanning %rocedures are straigt or9ard materials %lanning %rocedures 9it 9ic (oucan acie'e set targets 9it relati'el( little eort. ereore: tese %lanning %roceduresare used in areas 9itout in;ouse %roduction and=or in %roduction %lants or %lanning <ot 7; and ,;%arts and o%erating su%%lies. In contrast to consum%tion;<ased %lanning:M+P 9itout 7OM e?%losion concentrates on te e?act reAuirement Auantities: 9icare entered in te s(stem in te orm o sales orders and material reser'ations. n(un%lanned reAuirements can <e determined <( te orecast. M+P %ro'ides a goodsolution to %lanning inised %roducts.

e ollo9ing is 'alid or <ot %lanning metods> e t(%e o order %ro%osal 9ic isautomaticall( generated during materials %lanning de%ends on te %rocurement t(%e o te material. For materials tat are %roduced internall(: a %lanned order is al9a(s created.For materials %rocured e?ternall(: te M+P controller as te coice <et9een creating a %lanned order or a %urcase reAuisition. I e decides to create a %lanned order: e must

EAS-SAP V.Jayaram)6




determined: are continuall( ada%ted to suit current consum%tion needs. I: during tecurrent %eriod: material as alread( <een 9itdra9n rom stoc8: ten te orecastreAuirement is reduced <( te Auantit( o material tat 9as 9itdra9n. is means tatte Auantit( o te orecast reAuirement tat as alread( <een used is not included in te %lanning run again.

ou can s%eci( te %eriod s%lit or te orecast Bdail(: 9ee8l(: montl( or %er accounting %eriodC and te num<er o %eriods to <e included in te orecast indi'iduall( or eacmaterial. It is %ossi<le: o9e'er: tat te orecast %eriod s%lit is not s%eciic enoug or %lanning %ur%oses. ereore: or eac material: (ou can determine tat te M+P orecastreAuirement 'alues sould <e di'ided according to a iner %eriod s%lit. ou can alsodetermine o9 man( orecast %eriods are to <e ta8en into account during reAuirements %lanning.

For a montl( orecast: te reAuirements date 9ould <e set on te irst 9or8da( o temont <ecause: or %lanning: it is assumed tat te total reAuirement must <e a'aila<le at

te <eginning o te %eriod. ou can ten di'ide tis montl( reAuirement into eiter dail( or 9ee8l( reAuirements.

e reAuirements Auantities orecast <( te s(stem are used in te %lanning run to carr(out te net reAuirements calculation. "uring tis calculation: e'er( %eriod is cec8ed toma8e sure tat te orecast reAuirements are co'ered eiter <( a'aila<le 9areouse stoc8: <( %lanned recei%ts rom %urcasing or <( %roduction. I te reAuirements orecast <( tes(stem are not met <( tese a<o'e mentioned %ossi<ilities: ten an order %ro%osal isgenerated.

14.1.. Time-(ase' (lanning

I a 'endor al9a(s deli'ers a material on a %articular da( o te 9ee8: it ma8es sense to %lan tis material according to te same c(cle in 9ic it is deli'ered: <ut dis%laced <(te deli'er( time. is is %ossi<le 9it te time;%ased %lanning %rocedure.

I a %articular material is to <e %lanned using tis %rocedure: (ou must set te M+P t(%eor time;%ased %lanning and (ou must enter te %lanning c(cle in te material master record. ou enter te %lanning c(cle in te orm o a %lanning calendar in te Planningc(cle ield. ou must also deine a %lanned deli'er( time and te ot;or;lot order Auantit( as te lot;size 8e(.

ou can also use te o%timum lot;sizing %rocedures or time;%ased %lanning. e( areused ere in te same 9a( as in +eorder Point Planning.

Materials tat are %lanned using te time;%ased %lanning tecniAue are %ro'ided 9it anMP+ date in te %lanning ile. is date is set 9en creating a material master record andis re;set ater eac %lanning run. It re%resents te date on 9ic te material is to <e %lanned again and is calculated on te <asis o te %lanning c(cle entered in te materialmaster record. For materials tat are %lanned using te time;%ased %lanning %rocedure:

EAS-SAP V.Jayaram))




te t9o indicators: te total cange indicator and te net cange;%lanning indicator areirrele'ant. ereore: te( are not set <( te s(stem e'en i canges tat are rele'ant tote %lanning run are made.

7( using tis %lanning tecniAue: (ou can set te s(stem so tat it onl( %lans materials on

s%eciic %re;deined da(s. For e?am%le: i (ou assign te same %lanning c(cle to all tematerials o a %articular 'endor: te s(stem 9ill al9a(s %lan tese materials on te sameda(. e %urcase reAuisitions tat are created in te %lanning run to co'er materialsortages can <e %rocessed: %er 'endor: <( te M+P controller in te /P %urcasings(stem.

I (ou use te /P Mercandise Management /(stem: te s(stem %ro%oses te %lanningc(cle rom te 'endor su<;range 9en (ou create a material master record. e 'endor su<;range contains all te goods o a %articular 'endor tat: rom a logistical 'ie9: can <e %lanned similarl(.

ou can also enter an M+P date during te %lanning run: meaning tat (ou can <ring te %lanning run or9ard to an earlier date: i necessar(. For e?am%le: i te %lanning run isset or Monda(: (ou can <ring it or9ard to /aturda( instead.

14./. MRP Parameters

14./.1. +eneral Parameters ere are %arameters in te material master record tat (ou can determine or e'er(material: inde%endent o M+P and lot;sizing %rocedures>

Procure'ent type

e %rocurement t(%e is automaticall( suggested <( te s(stem de%ending on tematerial t(%e. -o9e'er: (ou can o'er9rite te deault 'alue. material can <e %roducedin;ouse: it can <e e?ternall( %rocured or it can <e %artl( %roduced in;ouse and %artl( %rocured e?ternall(. I <ot %rocurement t(%es are %ossi<le or a material <ut (ou onl(9ant to s%eci( one: ten (ou must enter te a%%ro%riate indicator ere.

;RP group

e M+P grou%: grou%s togeter materials rom te %lanning %oint o 'ie9 or allocatings%ecial control %arameters or te %lanning run. e M+P grou% is deined in,ustomizing 9ere it is also %ro'ided 9it te control %arameters.

&pecial procure'ent type

Entering a s%ecial %rocurement t(%e ma8es it %ossi<le or (ou to s%eci( te %rocurementt(%e in;ouse %roduction or e?ternal %rocurement more e?actl(. For e?am%le: settingtis indicator 9ould ma8e it %ossi<le or (ou to determine tat an e?ternall( %rocured

EAS-SAP V.Jayaram)#




material sould <e %rocured 'ia consignment orders.

;RP controller

In tis ield: (ou must enter a 8e( or a single M+P controller or or a grou% o M+Pcontrollers 9o=9ic is res%onsi<le or te %lanning o a material. In te uture: (ou can %rocess te M+P results according to te M+P controller.

Purchasing group

In tis ield: (ou must enter a 8e( or a <u(er or or a grou% o <u(ers 9o=9ic isres%onsi<le or %urcasing te material. s a result: during a %lanning run: order %ro%osals or e?ternall( %rocured materials can immediatel( <e allocated to tea%%ro%riate %urcasing grou%.

A8% indicator

it te 7, indicator: (ou can classi( te material according to its consum%tion 'alue.is indicator is used 9itin logistics controlling or anal(sis %ur%oses. It can also <eautomaticall( s%eciied <( te s(stem.

PP% Planning calendar

it te %lanning calendar: (ou can deine le?i<le %eriod lengts or grou%ingreAuirements togeter and or determining %rocurement dates. o ma8e tis %ossi<le: (oumust select te lot;sizing %rocedure: Period lot size according to %lanning calendar and(ou must also s%eci( a %lanning calendar. e reAuirements Auantities are ten grou%edtogeter into a lot according to te %eriod tat (ou determined in te %lanning calendar.e %rocurement date is co%ied rom te %lanning calendar.

14././. Parameters De(en'ent %n te MRP Pr%&e'$res

s 9ell as te general %arameters descri<ed a<o'e: (ou must also determine te M+P %rocedure in te material master record according to 9ic te material is to <e %lanned.ou do tis <( s%eci(ing te so;called M+P t(%e.

M+P t(%es and meaning>

V7 Manual reorder %oint %lanning>9it manual calculation o te reorder le'eland saet( stoc8

VM utomatic reorder %oint %lanning %rocedure>9it automatic calculation o te reorder le'el and saet( stoc8

VV Forecast;<ased %lanning>

EAS-SAP V.Jayaram#0




9it orecast or %lanning total stoc8 V+ ime;%ased %lanning+2 ime;%ased %lanning>

9it automatic calculation o reorder le'elP" M+P 9itout 7OM e?%losion

ter (ou a'e s%eciied te M+P %rocedure: (ou enter te %arameters de%endent on te %lanning %rocedure tat (ou selected. n o'er'ie9 o tese %arameters is %ro'ided in teollo9ing ta<le.

Parameters "e%endent on te M+P (%eFor... ou must maintainou can maintainV7 reorder le'el saet( stoc8 VM reorder le'el saet( stoc8 VV saet( stoc8

reorder le'el: <ut does not ma8e senseV+ %lanning c(cle saet( stoc8

reorder levelR2 planning ccle sa!et stoc"

reorder levelP# sa!et stoc"

reorder level,ut does not %a"e sense

Planning cycle

e( tat determines on 9ic da(s te material is to <e %lanned and ordered. I a 'endor al9a(s deli'ers a material on a certain da(s o te 9ee8: it ma8es sense to carr( out te %lanning run according to te same c(cle: <ut dis%laced <( te deli'er( time. e %lanning c(cle is entered as a %lanning calendar in te s(stem. It is reAuired or time; %ased %lanning.

&afety stoc,

e saet( stoc8 is used to %re'ent material sortalls during te stoc8ing;u% %eriod9ic ma( occur i consum%tion is une?%ectedl( ig or i deli'er( dates are not 8e%t.ou a'e te coice <et9een manuall( determining te saet( stoc8 or letting te s(stemautomaticall( determine it or (ou 9en carr(ing out te orecast. /aet( stoc8 orms a %art o te reorder le'el and is not included in reAuirements %lanning.

&erice leel

I te saet( stoc8 le'el is to <e calculated <( te s(stem ten (ou must s%eci( a ser'icele'el. is le'el indicates te %ercentage o e?isting reAuirements 9ic is to <e co'ered <( 9areouse stoc8. e iger (ou s%eci( te ser'ice le'el: te iger te s(stem 9ill

EAS-SAP V.Jayaram#1




calculate te saet( stoc8 le'el in order to com%ensate or additional consum%tion or dela(s in deli'er(.

Reorder leel

e reorder le'el is onl( rele'ant or reorder %oint %lanning. In automatic reorder %oint %lanning: te s(stem calculates te reorder le'el during orecasting. I a material master record is recreated: te reorder le'el must al9a(s <e entered manuall( e'en i it iso'er9ritten again <( te s(stem as is te case in automatic reorder %oint %lanning. It istus %ossi<le to %lan a material e'en i no orecast as (et <een carried out or it. I (ouenter a reorder le'el or time;%ased %lanning: te s(stem uses a mi?ture o te t9o %lanning %rocedures: reorder %oint %lanning and time;%ased %lanning> materials tat are %lanned using time;%ased %lanning are not onl( included in te %lanning run on teM+P date: <ut te( are also re%lanned i material stoc8 alls <elo9 te reorder le'el dueto a goods issue. e ollo9ing ields are onl( signiicant i te orecast must <e carriedout <ecause o te M+P t(%e 9ic 9as cosen. For e?am%le: tis is te case or

automatic reorder %oint %lanning: or orecast;<ased %lanning: and or time;%ased %lanning.

Period indicator

e %eriod indicator s%eciies te time %eriod or 9ic te s(stem is to store istoricalor orecast 'alues. ou can deine te %eriod indicator 9en maintaining te M+P %arameters as 9ell as 9en (ou are maintaining te orecast %arameters.

iscal year ariant

ou must enter te iscal (ear 'ariant i (ou 9ant to create a le?i<le %eriod lengt eAualto te accounting %eriod or te material.

&plitting indicator

I (ou s%eci( a s%litting indicator: te s(stem 9ill onl( ta8e a certain num<er o %eriodsinto account or reAuirements %lanning and it 9ill also s%lit tem into smaller time %eriods Bas long as te %eriod indicator is not set to dail( AuantitiesC. e s%littingindicator is irrele'ant or reorder %oint %lanning.

14./.. Parameters )%r S&e'$ling In sceduling: te s(stem determines te <asic dates or all te order %ro%osals tat itcreated during material reAuirements %lanning. o <e a<le to %lan tese order %ro%osalse?actl(: te ollo9ing %arameters are im%ortant 9en (ou are maintaining te materialmaster record>

&cheduling 'argin ,ey

e sceduling margin 8e( is used to allocate loats to te material or calcualating <asic

EAS-SAP V.Jayaram#2




dates and or carr(ing out lead time sceduling or te %lanned order ; or materials tatare %roduced in;ouse. e loat is te o%ening %eriod or determining <asic dates and teloat <eore %roduction and te loat ater %roduction or lead time sceduling. oumaintain te loats in ,ustomizing and te( are calculated in 9or8da(s.

Planned deliery ti'e e %lanned deli'er( time determines te time reAuired to o<tain a material <( means oe?ternal %rocurement. ou must onl( enter te %lanned deli'er( time i te material ise?ternall( %rocured.

n0house production ti'e

e in;ouse %roduction time determines te lengt o time reAuired to %roduce anassem<l( or a inised %roduct. e in;ouse %roduction time is inde%endent o te orderAuantit(. ou must onl( enter tis indicator i te material in Auestion is to <e %roducedin;ouse.

)oods receipt processing ti'e e goods recei%t %rocessing time s%eciies te time reAuired to ins%ect te material andto transer it to stoc8. It re%resents te time s%an Bin 9or8da(sC <et9een te recei%t o tegoods and te in9ard stoc8 mo'ement. e s(stem also ta8es goods recei%t %rocessingtime into account during sceduling.

14./.4. Parameters )%r Cal&$lating te "%t Si0e

Once (ou a'e s%eciied an M+P %rocedure and te a%%ro%riate %arameters or tis %articular %rocedure: (ou must also enter te %rocedure according to 9ic te s(stem isto calculate te lot size or material reAuirements %lanning. "e%ending on te selectedlot;sizing %rocedure: (ou can=must s%eci( eiter one or se'eral o te %arameters gi'enin te ollo9ing a<le>Parameters reAuired or lot;size calculation

"o (ou use... ou must maintain ou can maintainot;or;lot order Auantit( Minimum lot size

Ma?imum lot size+ounding %roile+ounding 'alue

Fi?ed lot size Fi?ed lot size+e%lenis u% to ma?imum stoc8 Auantit( Ma?imum stoc8 Period lot size Minimum lot size

Ma?imum lot size+ounding %roile+ounding 'alue

O%timum lot size ot size inde%endent costs Minimum lot size/torage costs indicator Ma?imum lot size

+ounding %roile+ounding 'alue

EAS-SAP V.Jayaram#3




Period and o%timum lot;sizing %rocedures are irrele'ant as ar as manual reorder %oint %lanning is concerned as tese t9o %rocedures need te uture reAuirement 'alues or lot;sizing 9ic can onl( <e determined <( using te orecast.

e lot;sizing %rocedure: re%lenis u% to ma?imum stoc8 le'el can onl( <e used orreorder %oint %lanning.

;ini'u' lot size

7( setting a minimum lot size: (ou are instructing te s(stem Bduring lot;size calculationCto create an order %ro%osal or at least te amount 9ic is s%eciied ere e'en i asmaller Auantit( 9ould a'e <een suicient.

;ai'u' lot size

7( entering a ma?imum lot size: (ou can determine tat during te lot;size calculation:

te s(stem 9ill not e?ceed te Auantit( s%eciied ere or order %ro%osals.

Rounding profile

ou use te rounding %roile to instruct te s(stem to adGust te order Auantit( to adeli'era<le unit. In ,ustomizing: enter a tresold 'alue %er deli'era<le unit rom 9icte s(stem is to round u% to te ne?t unit.

Rounding alue

7( entering a rounding 'alue: (ou are instructing te s(stem to round u% te recei%tAuantit( to a multi%le o te 'alue s%eciied ere. For te i?ed lot size 9it s%litting ando'erla%%ing %rocedure: te rounding 'alue is also used to determine te %artial Auantitiesinto 9ic te total Auantit( o te %lanned order Bield i?ed lot sizeC is s%lit.

ied lot size

7( entering a i?ed lot size: (ou are instructing te s(stem to create order %ro%osals orte amount o te i?ed lot size s%eciied ere. It onl( ma8es sense to use te i?ed lotsize i (ou selected eiter te i?ed lot;sizing %rocedure or te i?ed lot size 9its%litting=o'erla%%ing.

%ycle ti'e

I (ou select te lot;sizing %rocedure: i?ed lot size 9it s%litting and o'erla%%ing: ten(ou must also enter a c(cle time. e c(cle time s%eciies te time inter'al in 9ic te %lanned orders: 9ic are created using tis lot;sizing %rocedure: ma( o'erla%.

;ai'u' stoc, leel

In tis case: te s(stem 9ill create an order %ro%osal or te amount tat results romsu<tracting te a'aila<le stoc8 rom te ma?imum stoc8 le'el during te lot;sizing %rocedure: re%lenis u% to ma?imum stoc8 le'el.

+ot size independent costs

EAS-SAP V.Jayaram#4




e s(stem onl( reAuires te lot size inde%endent costs or te o%timum lot;sizing %rocedure. In tis case: te most economical lot size is determined <( means o te lotsize inde%endent costs and te storage costs

&torage costs indicator

e s(stem onl( reAuires te storage costs indicator or o%timum lot;sizing %rocedures.it tis indicator: (ou can determine te storage cost %ercentage 9ic te s(stem usesduring te lot size calculation.

14./.5. Parameters )%r st%rage l%&ati%n MRP

I (ou 9ant te s(stem to treat certain storage locations as inde%endent units during a %lanning run: ten (ou must s%eci( tis in te material master record or te storagelocations in Auestion. o do tis: (ou must enter te storage location in Auestion in teOrganizational e'els=Proiles %o%;u% 9indo9 and ten (ou must enter te ollo9ing %arameters in te M+P 3 data screen>

;RP ndicator

7( determining te M+P indicator: (ou are instructing te s(stem o9 to treat te storagelocation during reAuirements %lanning. ou can e?clude te storage location rom M+Por it can <e re%lenised 9it goods rom te %lant 9areouse.

Reorder leel and replenish'ent quantity

ou onl( a'e to maintain tese ields i storage location stoc8 is to <e re%lenised <( %lant stoc8. I storage location stoc8 is less tan te reorder le'el 9ic (ou determinedten te s(stem 9ill create a stoc8 transer reser'ation rom %lant stoc8 to storagelocation stoc8 or te re%lenisment Auantit( 9ic (ou s%eciied.

14.. !%re&ast

en a series o consum%tion 'alues is anal(sed: certain %atterns can usuall( <edetected. From tese %atterns it is ten %ossi<le to dierentiate <et9een 'arious orecastmodels>

• ,onstant

• rend

• /easonal

• /easonal trend

constant consum%tion lo9 a%%lies i consum%tion 'alues 'ar( 'er( little rom a sta<lemean 'alue.

it a trend model: consum%tion 'alues all or rise constantl( o'er a long %eriod o time9it onl( occasional de'iations.

I %eriodicall( recurring %ea8 or lo9 'alues: 9ic dier signiicantl( rom a sta<le mean

EAS-SAP V.Jayaram#5




'alue: are o<ser'ed: it is a case o a seasonal consum%tion lo9.

seasonal trend consum%tion model is caracterized <( a continual increase or decreaseo te mean 'alue.

I none o te a<o'e %atterns can <e detected in a series o %ast consum%tion 'alues: ten9e a'e an irregular consum%tion lo9.

14.4. Maintaining MRP Parameters

ou can maintain M+P %arameters and orecast %arameters using %roiles. %roile is acollection o inormation used to conigure certain o<Gects. It stores standard inormationtat (ou need re%eatedl( in almost identical com<inations 9en maintaining dierento<Gects. us: a %roile sim%liies data entr( and data management.

In a %roile (ou s%eci(J•

9ic ields are illed 9it 'alues 9en data on an o<Gect is entered:• 9ic 'alues tese ields contain and

• 9ic o tese 'alues can <e o'er9ritten Bdeault 'aluesC and 9ic cannot <e

o'er9ritten Bi?ed 'aluesC.

In te material master: te o<Gects are te material master records and te o<Gect data iste M+P or orecast data. ere are t9o 8inds o %roile>

M+P %roile Forecast %roile

ou can assign a %roile to a material master record 9en (ou create it. is as teeect tat i?ed 'alues tat are co%ied rom te %roile into a data screen cannot <ecanged in te material master record. 7( contrast: (ou ma( o'er9rite deault 'alues.e 'alues are 9ritten in te material master record 9en (ou sa'e it.

14.5. Sa)ety st%&: an' re%r'er le,el

I a 9areouse tat stores material as to <e read( or deli'er( at all times: ten tere asto <e a ig le'el o saet( stoc8 in tis 9areouse: as orecasting error cannot al9a(s <eruled out. is 9ould also entail a ig le'el o 9areousing costs. e le'el o saet(stoc8 de%ends on te ser'ice le'el (ou select: on te re%lenisment lead time and on te

accurac( o te orecast.

In order to 8ee% te saet( stoc8 and tereore te storage costs as lo9 as %ossi<le: teM+P controller usuall( s%eciies a ser'ice le'el or eac material. From a matematical %oint o 'ie9: te ser'ice le'el re%resents an organizations a<ilit( to a'oid a sortalloccurring during re%lenisment lead time.

I (ou o%t or a relati'el( ig ser'ice le'el: ten te saet( stoc8 le'el calculated <( te

EAS-SAP V.Jayaram#6




s(stem 9ill also <e ig. I (ou o%t or a lo9 ser'ice le'el: ten te saet( stoc8 le'el 9illalso <e lo9.

e re%lenisment lead time reers to te in;ouse %roduction time or in;ouse %roduction and te %lanned deli'er( time or e?ternal %rocurement. It re%resents te time

<et9een te initiation o a %rocurement %rocedure and transerring te material into te9areouse. e re%lenisment lead time is stored at %lant le'el in te material master record <( te M+P controller. /ince te %ro<a<ilit( o a sortall is iger in a longer %eriod: te saet( stoc8 le'el must also <e set iger or long re%lenisment lead times.

Finall(: te saet( stoc8 le'el also de%ends on te accurac( o te orecast. I te orecastde'iates greatl( rom te actual consum%tion 'alues: ten te saet( stoc8 le'el 9ill also <e unusuall( ig.

In addition to te saet( stoc8 le'el: te s(stem recalculates te reorder le'el or materials9ic are su<Gect to automatic reorder le'el adGustment. e reorder le'el is te sum o

te saet( stoc8 and te orecast reAuirement 9itin te re%lenisment lead time or teo'erall lead time or materials %roduced in;ouse.

e s(stem com%ares static a'aila<ilit( during material 9itdra9alJ tat is currenta'aila<ilit(: 9itout ta8ing uture reAuirements into consideration: 9it te reorder le'el.In oter 9ords: it com%ares te remaining stoc8 9it te reorder le'el. I remaining stoc8 alls <elo9 te reorder le'el: ten te s(stem mar8s te material or te %lanning run <(ma8ing an entr( in te %lanning ile. "uring te ne?t %lanning run: te s(stemautomaticall( generates a %urcase reAuisition or a %lanned order or te material.

14.7. Planning res$lts

"e%ending on te creation indicator: te s(stem creates M+P lists during te %lanningrun. ese lists contain te %lanning results or te material. e M+P list al9a(sdis%la(s te uture stoc8=reAuirements situation at te time o te last %lanning run and italso %ro'ides a 9or8 <asis or te M+P controller. e M+P list is stored in te s(stemuntil it is eiter deleted manuall( or re%laced <( te ne9 list rom te ne?t %lanning run.

Eac M+P list is di'ided into a eader and items. In te M+P eader material data isrecorded: suc as te material num<er: te %lant: and M+P %arameters: or e?am%le. eitems: on te oter and: contain inormation on te indi'idual M+P elements B%lannedorders: %urcase orders: reser'ations: sales orders: and so onC.

e indi'idual columns or te items include te M+P date: data concerning te M+Pelement Bor e?am%le: te sort te?t: te num<er: te item: and so onC: te 8e( to tee?ce%tion message: te resceduling date: recei%ts and reAuirements: as 9ell as tea'aila<le Auantit( 9ic re%resents %lanned 9areouse stoc8.

e items can <e grou%ed togeter into indi'idual segments according to te dierent %lanning t(%es. ereore: or e?am%le: (ou can a'e t9o segments in te M+P list or

EAS-SAP V.Jayaram#!




storage location M+P> irstl(: a segment or net reAuirements calculation including all teelements: or 9ic net reAuirements calculation 9as carried out at %lant le'el: andsecondl(: a segment or storage location M+P or elements tat are aected <( testorage location.

$et reAuirements calculation is carried out se%aratel( or eac segment.

14.8. St%&:re#$irements list

In te stoc8=reAuirements list: te most u%;to;date de'elo%ment o stoc8s andreAuirements is dis%la(ed. e la(out o te list on te screen is te same as tat o teM+P list.

e main dierence <et9een te M+P list and te stoc8=reAuirements list is tat eactime te stoc8=reAuirements list is called u%: te s(stem re;reads te 'arious M+Pelements and dis%la(s te most u%;to;date situation. s a result: (ou al9a(s see te most

recent a'aila<ilit( situation or te material in te stoc8=reAuirements list 9ereas teM+P list relects te stoc8 and reAuirements situation at te time te last %lanning 9ascarried out and canges 9ic a'e ta8en %lace ater te %lanning date are not included.

14.=. Planne' %r'ers

%lanned order so9s a %lanned recei%t or a %articular material in a %lant. 7asicall(: its%eciies 9en te recei%t is to ta8e %lace and te Auantit( o goods tat is to <e recei'ed.

Planned orders are generall( created automaticall( during te %lanning run. -ere: tes(stem determines te materials to <e %rocured automaticall( and it also calculates tereAuirement Auantities and dates.

Planned orders can also <e created manuall( <( te M+P controller. In tis case: te M+Pcontroller determines 9ic material is to <e %rocured: o9 muc is to <e %rocured 9enit is to <e %rocured and 9eter e?ternall( or internall(.

Planned orders are con'erted into %roduction orders in te case o in;ouse %roductionand te( are con'erted into %urcase reAuisitions in te case o e?ternal %rocurement.

%lanned order as te ollo9ing eatures>• It is an internal document tat is not used outside te com%an( and it is not

<inding in an( 9a(. It is %urel( a %urcase order %ro%osal rom M+P 9ic isused or co'ering demand and 9ic can <e canged at an( time.

• It ser'es te %ur%ose o an order %ro%osal or e?ternal as 9ell as or internal

%rocurement. e %rocurement source is determined eiter during te creation ote %lanned order or 9en %rocessing te %lanned order.

EAS-SAP V.Jayaram#)




• It can generate de%endent reAuirements and can <e used in te ca%acit(

calculation.

%lanned order consists o a eader and one or more items.

15.. MATERIA" "ED+ER

ledger in accounting is a rame9or8 or dis%la(ing transaction igures in a 9a( tat isrele'ant or certain re%orting or e'aluation %ur%oses. e Material edger is a orm o su< ledger accounting or materials 9it a material master record in te +=3 /(stem. e

Material edger contains material ledger records or materials: distinguised <( teir material num<ers along 9it te 'aluation area and 'aluation t(%e Bin s%lit 'aluationsC.Eac material ledger record collects data rom transactions rele'ant to 'aluation in order to calculate a %rice or 'aluating tis material. material ledger record can contain %ricesin u% to tree currencies. e material ledger su%%orts>

• $e9 %rice control metods or material 'aluation tat allo9 (ou to control 9en

and o9 ne9 %rices are to <e calculated.

For e?am%le: (ou can 8ee% constant material %rice constant or a certain %eriod o time.is is o %articular im%ortance in cost accounting: <ecause 'alues or constant material %rices are more meaningul tan 'alues tat reer to constantl( luctuating material

%rices. e material ledger su%%lies inormation a<out o9 ne9 %rices are calculated:9ic %ostings 9ere made to a material and 9ic transactions ad an eect on te ne9 %rices.

• e %ossi<ilit( o simultaneousl( storing in'entor( 'alues or a material in tree

currencies: ta8ing istorical e?cange rates into consideration.

is %ossi<ilit( is im%ortant 9en %re%aring <alance seets or cor%orate grou%so%erating in more tan one countr(.

EAS-SAP V.Jayaram##




15.1. Pri&e C%ntr%l

e +=3 /(stem contains t9o %rice controls or material 'aluationJ te( are distinguised'ia a %rice control indicator in te material master record or eac material.

e %rice control indicators are> / ; %rice control using a standard %rice V ; %rice control using an a'erage %riceou can enter te %rice control indicator or eac material and 'aluation area in tematerial master record. e +=3 /(stem <ea'es dierentl( or tese %rice controlsde%ending on 9eter te Material edger is acti'e in a s%eciic 'aluation area>

• I te Material edger is not acti'e: materials 9it / %rice control are 'aluated

using te standard %rice: and materials 9it V %rice control are 'aluated using temo'ing a'erage %rice.

• I te Material edger is acti'e: materials 9it / %rice control are 'aluated using

te standard %rice: and materials 9it V %rice control are 'aluated using te %eriodic unit %rice.

15./. Peri%'i& Unit Pri&e

ne9 Periodic *nit Price is calculated 9en (ou carr( out material ledger closing or amaterial. I te material as / %rice control in its master record: te s(stem uses testandard %rice or 'aluation: and te ne9 %eriodic unit %rice is %urel( inormational. I tematerial as V %rice control: te s(stem uses te ne9 %eriodic unit %rice or 'aluation.

e s(stem calculates te %eriodic unit %rice in %arallel in tree currencies.

-o9 te s(stem calculates a ne9 %eriodic unit %rice is descri<ed as ollo9s>1. e stoc8 at te time o te material ledger closing Bclosing in'entor( Auantit(C is

'aluated 9it te %eriodic unit %rice 'alid till no9.2. "ierences <et9een te resulting in'entor( 'alue and te actual 'alue resulting

rom %ostings tat 9ere collected in te material ledger are ta8en intoconsideration in suc a 9a( tat te closing in'entor( 'alue is adGusted.

7ased on tese dierences: te s(stem canges te in'entor( 'alue %ro%ortionalto te in'entor( Auantit( %resent at te time o material ledger closing. I tere isinsuicient in'entor( to a%%l( te total dierence Bin'entor( sortageC: te

%ortion o te dierence not a%%lied is %osted to te %rice dierence accountBtransaction 8e( P+C.3. e adGusted closing in'entor( 'alue is di'ided <( te closing in'entor( Auantit(

Bnum<er o unitsC to determine te ne9 %eriodic unit %rice.

E<am(les e ollo9ing e?am%les so9 (ou o9 te %eriodic unit %rice is calculated in dierentcases. e e?am%les reer to dierences arising rom in'oice recei%ts.

EAS-SAP V.Jayaram100




In!oice %ecei#ts 0uantit& is 1ess than the Goods %ecei#ts 0uantit& I te total in'oice recei%ts Auantit( BI+C is less tan te total goods recei%ts Auantit(B&+C or i tese Auantities are eAual: te s(stem calculates te dierence in te endingin'entor( 'alue as ollo9s> I+ ? Ba'erage %urcase %rice ; %eriodic unit %riceC

In!oice %ecei#ts 0uantit& is Greater than the Goods %ecei#ts 0uantit& I te total in'oice recei%ts Auantit( BI+C is greater tan te total goods recei%ts Auantit(B&+C: te s(stem calculates te dierence in te ending in'entor( 'alue as ollo9s>&+ ? Ba'erage %urcase %rice ; %eriodic unit %riceC

15.. Material le'ger &l%sing6 %,er,ie*

Material ledger closing>• 'aluates material stoc8s in u% to tree currencies

• calculates a ne9 %eriodic unit %rice in u% to tree currencies

•

releases 'alid: mar8ed standard cost estimates• acti'ates 'alid: uture 'aluation %rices

• acilitates manual %rice canges

ou can carr( out material ledger closing or a single material: or all materials or oronl( certain materials in a %lant.

15..1.Materials *it S Pri&e C%ntr%l

en (ou carr( out and sa'e te material ledger closing: te %rices o materials 9itstandard %rice control remain uncanged e?ce%t in te ollo9ing cases>

•

If a standard cost estimate that is !alid on the da& of material ledger closinge2ists for a material this standard cost estimate is released. The results of the

standard cost estimate therefore become the current standard #rice.

e translation o te %rice rom te standard cost estimate ta8es %lace at te timeo te mar8ing.

• If a marked standard cost estimate does not e2ist for a material but rather a

future !aluation #rice that is !alid on the da& of the material ledger closing this #rice becomes the current standard #rice.

e translation o te uture 'aluation %rice ta8es %lace at te time o entr( or 9en teuture 'aluation %rice 9as last canged.

I ne9 standard %rices arise: te in'entor( 'alues are calculated in te currencies. estandard %rice in local currenc( is stored in te material master record. e standard %rices in local currenc( and in te additional currencies are stored in te material ledger master data.





e s(stem calculates te %eriodic unit %rice as statistical inormation. e ne9BstatisticalC %eriodic unit %rice in local currenc( is u%dated in te material master record.e ne9 BstatisticalC %eriodic unit %rice is u%dated in local currenc( and in te additionalcurrencies in te material ledger master data.e material continues to <e 'aluated 9it te standard %rice in local currenc(.

15../. Material *it V Pri&e &%ntr%l

en (ou carr( out and sa'e material ledger closing: te s(stem also calculates a ne9 %eriodic unit %rice in u% to tree currencies and also calculates te in'entor( 'alues intese currencies.

e s(stem 9rites te ne9 %eriodic unit %rice in local currenc( to te material master record. e ne9 %eriodic unit %rices in local currenc( and te additional currencies arealso 9ritten to te material ledger master data.

e material is 'aluated using te ne9 %eriodic unit %rice in local currenc(.e %eriodic unit %rice remains constant until te ne?t material ledger closing.

15.4. Material le'ger &l%sing6 *en?

en material ledger closing is carried out de%ends on te indicator controlling tematerial ledger closing> 1 ; %eriodic 2 ; transaction;related

e ,losing control indicator is dis%la(ed in te material master record and in tematerial ledger eader. e %eriodic closing is currentl( te standard setting. It is 'alidor all materials in a 'aluation area.

15.4.1. Peri%'i& &l%sing

it %eriodic closing: (ou can deine o9 oten a ne9 %eriodic unit %rice is to <ecalculated or a material or or all materials in a 'aluation area. In tis 9a(: te %eriodicunit %rice can remain constant or a da( or a 9ee8: or e?am%le.

ou sould close te material ledger or all materials 9it 'aluation;rele'ant transaction

data at least once e'er( accounting %eriod. ou sould do tis <eore (ou carr( out te %eriod closing %rogram. I a material is not closed in tis time: %rice dierences romre'aluation and %ostings to te %eriod <eore te %re'ious %eriod cannot <e ta8en intoaccount in te materials in'entor( 'alue at te ne?t material ledger closing.

15.4./. Transa&ti%n Relate' Cl%sing





it transaction;related closing: a ne9 %eriodic unit %rice is automaticall( calculated andu%dated ater eac 'aluation;rele'ant transaction. e %rice corres%onds to te mo'inga'erage %rice and as te ad'antage tat (ou can store it in u% to tree currencies.

15.5. Material "e'ger Cl%sing P%sting

Mo'ements or a material tat is 'aluated 9it te material ledger are al9a(s carried outusing te 'aluation %rice. I te %rice control indicator in te material master record is /:mo'ements or te material are carried out 9it te standard %rice. I te %rice controlindicator in te material master record is V: mo'ements or te material are carried out9it te %eriodic unit %rice.

en %ostings suc as in'oice recei%ts occur: te %rices can dier rom te 'aluation %rice. ese dierences are collected and totaled <( te material ledger and ta8en intoaccount during material ledger closing.

15.5.1. ;e)%re material le'ger &l%sing

"ierences <et9een te 'aluation %rice tat occur 9en %ostings are made are collectedte ollo9ing categories>· (R)IR .goods recei!t)invoice recei!t/

"ierences <et9een actual 'alues and te 'aluation %rice tat ma( occur due to in'oicerecei%ts are collected ere. "ierences can occur <et9een a goods recei%t and an in'oicerecei%t: <ecause te in'oice %rice is un8no9n at te time o goods recei%t.

Values rom in'oice recei%ts are %osted to a &+=I+ clearing account and te osettingentr( is made in te 'endor account.· Value Variances

"ierences <et9een actual 'alues and te 'aluation %rice tat can occur due te to teollo9ing are collected ere>

• goods recei%ts or te %roduction order

• transer %ostings

• goods issues

• initial entries o in'entor( data 9it a s%eciied amount

• deli'eries ree o carge

• in9ard mo'ements rom consignment in'entor( to te com%an(s o9n stoc8

• %urcase order;related goods recei%ts

Values rom goods recei%ts are %osted to a &+=I+ clearing accountJ te osetting entr(ta8es %lace in te material in'entor( account. I te te order %rice diers rom te'aluation %rice in te goods recei%t: te s(stem %osts an osetting entr( to te materialstoc8 account and te %rice dierence account Btransaction 8e( P+"C. /uc dierencesare totaled in te material ledger and indicated as to <e closed.





it goods recei%ts tat are not <ased on a %urcase order item: %rice dierence are %osted directl( to te %rice dierence accounts.· Posting to a Prior Period

Variances are collected ere 9en a %osting is made to te %re'ious %eriod using a

'aluation %rice oter tan te one in te current %eriod.

15.5./. At te material le'ger &l%sing

t material ledger closing: te s(stem ta8es te dierences arising in te a<o'ecategories into account: de%ending on te %rice control o te material.

I (ou carr( out material ledger closing or a single material B9itout sa'ingC: (ou candis%la( 9ic %ostings te material ledger 9ould ma8e and 9it 9at amounts i (ou9ere to sa'e te material ledger closing at tis time.

Materials *it S (ri&e &%ntr%l stan'ar' (ri&eB e s(stem calculates or eac material: te <alance on te &+=I+ clearing account and %osts tis amount to a %rice dierence account Btransaction 8e( P+C.

"ierences tat 9ere collected in te Value 'ariances categor( 9ere %osted to 'arious %rice dierence accounts <eore material ledger closing. ese %ostings are not canged.

"ierences tat 9ere collected in te Posting to a %rior %eriod categor( 9ere %osted tote re'aluation account <eore material ledger closing. ese %ostings are not canged.

ne9 %eriodic unit %rice is calculated or statistical inormation.

Materials *it V (ri&e &%ntr%l (eri%'i& $nit (ri&eB e s(stem calculates te <alance on te &+=I+ clearing account and %osts tis amount tote material stoc8 account in %ro%ortion to te current in'entor( Auantit(. e %ortion o te <alances 9it 9ic te material in'entor( cannot <e de<ited are %osted to a %ricedierence account Btransaction 8e( P+C.

"ierences tat 9ere collected in te Value 'ariances categor( 9ere %osted to 'arious %rice dierence accounts <eore material ledger closing. ese %ostings are oset in totalagainst a se%arate %rice dierence account at material ledger closing Btransaction 8e(P+C. e s(stem calculates te <alance and %osts tis amount to te material stoc8 account in %ro%ortion to te current in'entor( Auantit(. e %ortion o te <alances 9it9ic te material in'entor( cannot <e de<ited are %osted to a %rice dierence accountBtransaction 8e( P+C.

"ierences tat 9ere collected in te Posting to a %rior %eriod categor( 9ere %osted tote re'aluation account <eore material ledger closing. e s(stem calculates te <alanceon tis account and %osts tis amount to te material stoc8 account in %ro%ortion to te





current in'entor( Auantit(. e %ortion o te <alances 9it 9ic te material in'entor(cannot <e de<ited are %osted to a %rice dierence account Btransaction 8e( P+C.

e %ostings to te material stoc8 account result in a ne9 %eriodic unit %rice or tematerial: ound <( di'iding te in'entor( 'alue <( te in'entor( Auantit(.

15.7. M$lti(le C$rren&ies

e s(stem stores 'aluation data or a material in its material ledger in u% to treecurrencies. ou s%eci( in 9ic currencies te s(stem stores tis 'aluation data in,ustomizing or Valuation and ccount ssignment.

en (ou: or e?am%le: %ost an in'oice recei%t: te s(stem translates te amount into teoter currencies s%eciied using te current e?cange rate. is means tat te Materialedger as inormation <ased on istorical e?cange rates.

ou can dis%la( and maintain current e?cange rates eiter in ,ustomizing or Financialccounting or <( coosing te menu o%tions ccounting KH Financial accounting KH&eneral ledger KH En'ironment KH ,urrent settings.

I inormation alread( e?ists in more tan on currenc( outside o te material ledger: te'alues 9it currenc( t(%es corres%onding to tose o te material ledger t(%e aretranserred. %roduction order or a standard cost estimate can: or e?am%le: containinormation in com%an( code currenc( and in controlling area currenc(. I te materialledger stores <ot o tese currenc( t(%es: te 'alues are not con'erted: <ut rater transerred to te material ledger 9en te %roduction order is settled or te standard costestimate is mar8ed.

e s(stem stores te dierent currenc( 'alues in te material ledger record. "uringmaterial ledger closing: te s(stem totals tese 'alues se%aratel( in eac currenc( andcalculates a se%arate %eriodic unit %rice in eac currenc(. is metod means tatin'entor( 'alues and %rices or materials 9it V %rice control are calculatedinde%endentl( in te dierent currencies.

e s(stem calculates te %eriodic unit %rice in %arallel in tree currencies.

e s(stem does not translate te %eriodic unit %rice itsel. e 'alues rom tetransactions are translated 9it te e?cange rate 'alid at te time o te transaction andcollected in te material ledger. t material ledger closing: a ne9 %eriodic unit %rice iscalculated or e'er( currenc(.

e %eriodic unit %rice can tereore rise in one currenc( and all in anoter at closingde%ending on e?cange rates on dierent da(s.


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