SAP MM (Material Management) What is ERP? Enterprise resource planning (ERP) is a business process management software that allows an organization can use to collect, store , manage and interpret data from many business activities i.e. its stores & integrates data in single platform maintained by a database management system. E – Enterprise > an Organization R – Resources > Money Man Power Material & Machine P – Planning > Systematic approach to achieve business requirements Why we need ERP?
ERP is used for integration of system business process Standardization of system across business locations For overall control of organization Better controlling & reporting systems of different business processes Best utilization of Money Men Material & Machine
Types of ERP Systems; 1. Decentralized System (Non – ERP System) 2. Centralized System (ERP System) 1. Decentralized System: Decentralized system is a NON-ERP based system where data is maintained locally at individual departments with no access to other departments. There are no advantages in this system Disadvantages: No real time information & time consuming Loss of revenue & customer satisfactions Data maintenance cost goes up Material & inventory cost increases due to non-tracking of Inward & outward flow of material Increase in man power & labor costs Loss of reputation & face legal actions
2. Centralized System: Centralized system is an ERP based system where data is maintained at central location and is shared with various departments & each department has access to information/data to other departments. Advantages:
Real time information is available in fraction of seconds & time saving Increase in revenue & customer satisfaction No data duplication Less man power & decrease in labor cost Payment transactions to vendors on time & no legal issues
ERP Packages: Around 500+ ERP software’s systems are currently being used in market and below are list few;
SAP – All Modules Oracle Fusion – FICO Peoplesoft – HR SIEBEL – CRM (Customer Relationship Management) JD EDWARDS – Manufacturing BAAN – Manufacturing RAMSCO Systems Tally Microsoft Dynamics SAGE Systems
Introduction to SAP SAP – System Applications & Products in Data Processing) is one of the ERP (Enterprise resource planning) package available in market to manage, integrate business operations and customer relations. It was founded in 1972,Germany (Europe) by former employees of IBM - Dietmar Hopp ,Hans Werner Hector, Hasso Plattner, Klaus Tschira, Claus Wellenreuther. SAP Advantages:
Integration is very easy between different modules Client-Server architecture is very strong and more reliable Supports any operating system (Windows/Unix/linux) Supports any database (Oracle/RDBMS/SQL/HANA) Supports around 40+ languages worldwide Any client business requirements can be developed by programmer i.e. ABAP (Advanced Business Application Programming)
SAP Disadvantages: License cost is high Consultation charges are high
Evolution of SAP versions
1973 1976 1979 1992
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SAP SAP SAP SAP
R/98 GmbH R/2 R/3
Current version is SAP R/3 ECC 6.0 EHP 7 R/3 – Real Time / 3 Tier Client Server Architecture ECC – ERP Central Component EHP – Enhancement Package To view version: Systems (in MENU BAR) > Click STATUS
Modules of SAP Below are modules are integrated via SAP R/3 Client Server Architecture
FICO – Financial Accounting & Controlling HR – Human Resource SD – Sales & Distribution MM- Material Management PP – Production Planning QM – Quality Management PM – Plant Maintenance AA – Asset Accounting PS – Project System WF – Work Flow IS – Industry Standard (Retail,Banking,Utilities, Real Estate, Mining) WM – Warehouse Management EWM – Extended Warehouse Management APO – Advanced Planning Optimization SCM – Supply Chain Management CRM – Customer Relationship Management SRM – Supplier Relationship Management
Classification of Modules Functional Modules: FICO, MM, SD, PP, HR, CRM, SRM, SCM Technical Modules: ABAP, Net weaver or BASIS, BI/BW
In real time, SAP Login credentials will be provided by BASIS team
SAP Easy Access screen – restricted to END USER only without TOOLS folder (Customization Part)
SAP Consultants & ABAP team assigned for a particular project will carry out Business transaction customizations as per End User business requirements. Customizations will be carried out in tcode SPRO – Execute Project which is available in below path. Tcode SPRO: SAP Easy Access > Tools > Customizing > IMG (Implementation Guide) > SPRO – Execute Project
SPRO – SAP Project Reference Object
Blue print of MyHome Company
Central Pur Org CCPO
India (777)
MyHome Cement (MHCEM) Comp Code: MHCM/1000
MyHome Power (MHPOW)
MyHome Const (MHCON)
Comp Code: MHPO/2000
Comp Code: MHCN/3000
Kodada Plant
Vizag Plant
Plant Code: MCKP/1001
Plant Code: MCVP/100
Raw 1. Material
Spare Parts
Store Code: KPS1/0010
Store Code:
Koda Pur. Org.
Vizag Pur. Org.
Code: KPPO
CLI EN T
MyHome Group
Ranga Reddy Plant
Hyderabad Plant
Plant Code: MCRP/1003
Plant Code: MPHP/2001
Semi Finished Part Store Code: KPS3/0012
PL AN T
Finished Goods
Hyd Stores Store Code: HPS1/0040
Store Code: KPS4/0013
RR Pur. Org.
Hyd Pur. Org.
Code: RPPO
Code: HPPO
Code: VPPO Koda-Vizag Cross Plant Pur Org Code : KVPO
Raw Material Store Code: VPS1/0020 Finished Goods Store Code: VPS2/0021
CO MP AN Y
RR Stores Store Code: RRS1/0030 0
Hyd-RR Cross Comp Pur Org Code : HRPO
ST OR ES
Pur cha se Org ani zati on
Silent features of Enterprise structure in SAP Client Code – Max 3 digit code (Ex : 000/001 – Master Client , 066 – Early Watch Client , 800 – Training client) Company -Max 6 digit code Company code –Max 4 digit Code only Plant code - Max 4 digit Code only Storage location code - Max 4 digit Code only Purchase Organization code - Max 4 digit Code only Company,Plant,Store,Purchase Organization can be Numerical, Alphabets, or Alpha-Numeric not more than 4 digits Company code should not be same for different companies In a company, one plant code should not be used for another plant in same company. We cannot use same plant code for another plant in different company A company is an organizational unit in Accounting which represents a business organization according to the requirements of commercial law in a particular country. Define Company tcode : OX15
Edit, Copy, Delete, Check Company Code t code OX02
Define Valuation Level : tcode OX14
Define, Copy, Delete, Check plant tcode : OX10
Maintain Storage Location tcode OX09
SAVE
Click New Entries
Maintain purchasing organization tcode OX08
Assign company code to company t code OX16
Assign Plant to company code t code OX18
Assign Purchase organization to company code t code OX01