SAP-MM Implementation

Scope Document
&
Concept Design

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SAP R/3 Implementation

ABC Pvt. Ltd. have decided to implement SAP R/3 for enterprises resource management of
their Project purchases at Delhi. XYZ has been chosen as the implementation partner for the
company-wide R/3 implementation by ABC.

MM purchasing will be implemented for the Delhi office, which will integrate with other

relevant modules of R/3 system.

The Financial and Controlling business processes have already been implemented in

SAP R/3 both Delhi & Gujarat.

In addition the Sales (SD) at Delhi and MM, PP, QM at Ahmedabad is currently under
implementation in SAP R/3. The business processes relevant to Delhi are being
implemented from Delhi and the ones relevant to Ahmedabad are being implemented at

Gujarat.
The SAP implementation team at both locations are discussing whenever required to
maintain the consistency and the integration of the business processes.

Approach to SAP R/3 implementation:

A SAP implementation team has been formed of experienced people from functions and IT
department of ABC. The XYZ consultants will carry out the entire implementation as scope
along with the implementation team from ABC.
The basic approach to the SAP R/3 implementation that will be followed are:

ABC will implement SAP R/3 without modifying any of the business processes of SAP R/3.
This in IT term will mean, the implementation team will not change any table or source code
which will touch the core design of the R/3 system.
ABC, thus will take advantage of the best business practice available with SAP and are being
used world-wide by 10,000 plus organisations. Also as SAP comes with regular upgrades
periodically, the implementation of such upgrades will be structured by SAP and thus be
nearly seamless from ABCs view point. The changing business scenario necessitates
new/additional business processes regularly. Also the technology developments changes the
way the business is carried out. Upgrades release periodically by SAP incorporates
additional business processes which are adopted as best practices and the technology
enhancements.
Any modification of the SAP code and/or table structure will make upgrades very involved
and rework.

XYZ will develop ABAP/4 based programs for:

Print layouts for external documents which are to be presented in a mandatory format

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Users of ABC (including Management) will access information directly from the R/3 system.
The system has excellent drill-down facilities and information can be traced from higher
levels to the source because of the tight integration. In addition R/3 system has number of
standard reports which can be displayed.

The SAP Implementation team will develop any specific reports which were earlier used for
internal purposes. The on-line information and standard SAP reports will meet the
requirements of earlier specific reports. However the presentations of the information will
now be different and ABC will make this as one of the change management point.

The R/3 System being completely integrated, information generated by a function or process
(department) will have immediate effect on other processes. The access to the information
either for create, change or display will through authorisation process. ABCs IT team has
been trained for the authorisation functions. The authorisation for the users from
Ahmedabad will be given by ABC s IT team at Ahmedabad. Training for the teams both for
Ahmedabad and Delhi has thus been provided.
The R/3 implementation scope is being categorised as:

Need to have
Nice to have

The go-live date will take only the need to have as the defined requirements and the
requirement s documented are only of the need to have categories. All nice to have
processes/functions will be excluded from the scope. They may be selectively taken for
implementation if the schedule for go-live permits the same.

The scope of R/3 implementation is documented as exhaustively as possible in the Business

blueprint attached herewith. The implementation will be limited to the same to prevent any
scope creep, with the approach that the go-live date is the over-riding deciding factor. The
scope is arrived at with best of inputs from ABCs implementation team and relevant
functional personnel. Although it is possible that 100% of ABCs (Ahmedabad) business
processes may not have been covered but the spirit of the document is if the business
processes are extremely important they will not be dormant and hence be included in need
to have discussions. The points missed, if any, will be of nice to have categories and hence
excluded from R/3 implementation scope.

XYZ along with SAP implementation team is committed to complete the implementation at
ABC within the target date. ABC and XYZ will provide all necessary resources to achieve the
same. Milestones will assessed through regular reviews with the ABC management.

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The content of the Business Blueprint are:

Benefits expected by ABC on implementation of SAP R/3.

Business background of ABC

Organizational Unit

Enterprises Structure:
Company code
Plants assigned to Company Code
Storage location assigned to Plant(s)
Purchasing organisation assigned to plant

LO Logistics General- LO Managing Material Master Data

MM-Material Management
MM Purchasing
MM Vendor Evaluation
MM Inventory Management
MM Invoice Verification and Material Valuation
MM Consumption-Based Planning

QM Quality Management
QM Procurement

Integration with other modules of R/3 System

Integration with FI/CO

Information System
Purchasing Information System
Inventory Controlling

List of ABAP/4 developed programs

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Business Blueprint- In Detail

Benefits expected on implementation of SAP R/3:

Streamline the Purchase Process at ABC, Delhi using the best business practices in SAP
followed by thousands of Organisations worldwide.

To automate the existing process and get the incidental benefits of process re-engineering
using SAP implementation as a roadmap/template.

To achieve a seamless integration with other logistics and accounting modules like sales
and distribution module and accounting and controlling module, and thereby improve the
efficiency and effectiveness of business processes.

To achieve a site level material control, this is today carried out manually.

Benchmarks:

Average purchasing cycle

Current: 1 to 3 Weeks
Expectation: 1 to 3 days

Department wise/Site wise consolidation data

Current: Not available
Expectation: Immediate

The Business Background:

ABC is in the business of supply of pharmacy products and services

ABC currently have two main locations from where business is transacted:
New Delhi, Which houses the sales organisation of all the sales areas (Division)

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Ahmedabad in Gujarat, which is the manufacturing unit.

This document covers the business processes of purchasing from Delhi, which currently is
handling purchasing of:
All project related (purchases not used for manufacturing by Ahmedabad)
Capital items
Administrative items

The scope of the MM-purchasing will give only reference of inventory at site by a tracking
number. The scope excludes the complete site inventory management, as R/3 material
management does not provide this functionality unless integrated with the project system
module. The MM- purchasing implementation scope does not include project system and

hence not considered in this document.

The trigger of All project related purchases is against either Sales forecast or firm sales
order.

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For logical purpose, the business blueprint is structured to be represented in the following
approach:

Organizational Unit
Enterprise Structure
Company Code
Plants assigned to company code
Storage locations assigned to plant(s)
Purchasing organization assign to plant

LO Logistics General
LO Managing Material Master Data
Organizational Unit

Enterprises Structure:
Company code
Plants assigned to Company Code
Storage location assigned to Plant(s)
Purchasing organisation assigned to plant

LO Logistics General- LO Managing Material Master Data

MM-Material Management
MM Purchasing
MM Vendor Evaluation
MM Inventory Management
MM Invoice Verification and Material Valuation
MM Consumption-Based Planning

QM Quality Management
QM Procurement

Integration with other modules of R/3 System

Integration with FI/CO

Information System
Purchasing Information System
Inventory Controlling

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Organizational Unit

Describe the current or the planned organizational units that have one of the following roles
within the enterprises.
Financial Accounting
Reporting responsibility
Balance Sheet (Internal/external)
Profit & loss statement (Internal/external)
Costs and profits
Stock responsibility
For invested capital (assets and material stock)
For bank accounts
Responsibility for running operation

Processing incoming and outgoing payment transactions

Accounts Receivable
Dunning
Cash Management/Cash Management and Forecast

Logistics
Responsibility for inventory management
Volume of material stock
Requirements planning
Material Valuation
Planning responsibility
Sales
Production
Responsibility for procurement
Vendor selection
Control management
Responsibility for sales
Processing customer orders
Creating customer billing documents
Defining sales and transfer prices of products

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Central Functions
Mater data maintenance

Details of Enterprise Structure

Plants assigned to Company code- Enterprise Structure

The structure of the plants in R/3 is based on the structure of the company codes, since
plants must always be assigned uniquely to one company code. These assignment enables
material stock changes to be updated correctly to the G/L accounts in the G/L accounting
system.

The basic structure of the plants in R/3, which is determined by the requirements for
external accounts rendering, can be refined to ensure that the more stringent
requirements of the internal accounting or logistic systems are fulfilled.

The requirements for production planning and inventory management, in particular, must
be taken into account when the plants are defined and the business and plant location
structures of the enterprise are mapped in the R/3 architecture.

Production Planning:
One of the main requirements, from a production planning point of view, is the ability to
perform standardized, independent detailed production planning for areas of an
enterprise that have a high degree of integration from a production prospective.
An enterprises has a high degree of integration with regard to production over various
locations. Standardized detailed production planning is to be performed at a global level
for the various business locations of the enterprises. In this case, a cross-location plant
is created. In R/3, the locations within the plant are represented
o
o

As storage locations from the point of view of inventory management

As work centers from the point of view of production planning

An enterprise would like to carry out independent, detailed production and material
requirements planning for the various plant locations in a business location. In this
case, a plant can be set up in R/3 for each plant location in the business location.
General production planning can be carried out for all of the plant locations in a
business location or across all business locations.
In both cases, the effect on the logistic business processes and the strategic information
flows from the logistics to the accounting structures must be investigated. In the first
case, the compatibility of this solution with the relevant legal provisions (transport
papers etc.) must be ensured.

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Inventory management
Precise assignment of the current assets (raw materials, semi-finished and finished
products) to the strategic business units and business locations of the enterprises can
often be an essential requirement with regard to inventory management. This
assignment is a prerequisite for determining management numbers, such as return on
investment, cash flow, and so on, which are used to assess the performance of the
various strategic business units and locations of an enterprise. Issues relating to
materials planning and the availability of materials can represent additional factors that
determine plant structure design.

In order to define plant structures from the point of view of inventory management, it is
essential to determine how the materials are used in a company. In this context, the
business area specific use of materials and the cross business unit use of materials play a
crucial role.

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Purchasing Organisation- Enterprises Structure

External procurement, that is the purchase of materials from external vendors, can be
organised at four levels in R/3:

Plant oriented
Cross plant, within a company code
Cross company code
Cross system (in distributed system topologies only)

Assume that a business unit specific plant structure has been defined for the
enterprises. A separate purchasing organisation can then be created for each
plant. Furthermore, a cross-plant purchasing orgainsation can be created for
each legal entity, that is each company code. A central, cross company code
purchasing organisation is responsible for cross entity procurement.

With plant oriented procurement, one purchasing organisation is responsible for

the procurement of materials for exactly one plant. This purchasing organisation
is assigned exactly one plant for which it procures materials. Material orders for
different plants cannot be entered in a plant oriented purchasing organisation.

A cross-plant purchasing organisation within a company code receives

purchasing requisitions from different plants in a company code. Several or all
the plants in a company code are assigned to a cross plant purchasing
organisation. From a settlement perspective, all of the orders entered in a cross
plant, company code oriented purchasing organisation are processed within the
company code to which the entering purchasing organisation is assigned. A
separate plant, which is responsible for receiving the delivered materials, can be
entered for each item in the order.

A cross company code purchasing organisation is assigned plants from different

company codes. The company code assignment for an order is not derived from
the company code assignment of the purchasing organisation, within which the
order is entered, but is defined in the order itself.

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Enterprise Structure Finalized for Delhi & Ahmedabad:

Company
Company Code= ABC
Plants assigned to Company Code
Plant
Ahm1= XXX Plant
Ahm2= XXX1 Plant
Ahm3= XXX2 Plant
Del=XXX3 Plant

Location
Guj
Guj
Guj
Delhi

Company Code
ABC
ABC
ABC
ABC

Storage Locations assigned to Plant(s)- Enterprises Structure

Storage Locations
Main=Component Store
RECV= Receiving store
PROD=Ahm1, Ahm2 Mfg. store
KANB= Kanban Store
BOND= Bonded Store
EXCS=Excess component store
OBJS=Objection Stores
REJS= Rejection Stores
DELV=Delivery Centre
Del=Delhi Store

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Assigned to plants
Ahm1, Ahm2, Ahm3
Ahm1, Ahm2, Ahm3
Ahm1, Ahm2, Ahm3
Ahm1, Ahm2, Ahm3
Ahm1, Ahm2, Ahm3
Ahm1
Ahm1, Ahm2, Ahm3
Ahm1, Ahm2, Ahm3
Ahm1, Ahm2, Ahm3
Del

Details of LO Managing Material Master Data

The material master is the companys central source for retrieving material specific
data. It is used by all the components in the SAP Logistics System.

The integration of all material data in a single database object eliminates

redundant data storage. Areas such as purchasing, inventory management,
material requirements planning (MRP), invoice verification, and so on, can all use
the same data.

In the SAP logistics system, the data contained in the material master is required,
for example, for the following functions:

In
In
In
In
In

purchasing for ordering

inventory management for goods movement postings and physical inventory
invoice verification for posting invoices
sales and distribution for sales order processing
production planning and control for material requirements planning,

scheduling, and work scheduling

Data Structure of material master

The material master has a hierachical structure resembling the organizational
structure of a company.
The SAP R/3 system can be organised flexibly to suit individual company
needs. When the system is installed, its organisation is tailored as precisely as
possible to the corporate structure.
The SAP R/3 system depicts the corporate structure using the following
organizational units:
Client:

In commercial, organizational and technical terms, a self-contained

unit in an R/3 system with separates master records and its own set

of tables.
Example: group

Company code:

The smallest organizational unit for which a complete self-contained

set of accounts can be drawn up for purposes of external reporting.

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This involves recording all relevant transactions and generating all

supporting documents for the legally required financial statements

such as balance sheets and profit and loss statements.

Examples: company, subsidiary.

Plant:

An organizational unit serving to subdivide an enterprise according

to production, procurement, maintenance and materials planning
aspects. It is a place where either materials are produced or goods
and services provided.

Examples; production site, field office, branch.

Storage location:

An organizational unit allowing the differentiation of material

stocks within a plant.

Purchasing organisation:

An organizational unit sub-divided an enterprise according to the

requirements of purchasing. It procures materials and services,
negotiates

conditions

of

purchase

with

vendors,

and

is

responsible for such transactions.

Sales organisation:

An organizational unit sub-divided an enterprise according to the

requirements of sale. It is responsible for selling materials and
services.

Warehouse number:
An alphanumeric key defined a complex warehousing system
consisting of different organizational and technical units (storage
areas).

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Storage type:

A physical or logical storage area that can be defined for a

warehouse in the warehouse management (WM) system. It
consists of one or more storage bins.

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Material Type:
Materials with the same basic attributes are grouped together and assigned to a
material type. This allows you to manage different materials in a uniform
manner in accordance with your companys requirements. Examples of
materials types are raw materials, semi-finished products and finished
products.
When creating a material master record, you must assign the material to a
material type. The material type determines certain attributes of material and
has important control functions. For example, it is a factor determining the
screen sequence and field selection in a material master record.
The material type defines:

Whether the material number can be assigned internally or externally

From which number range the material number comes
Which screens appear and in what sequence
Which departmental data you may enter

The material type also determines the materials procurement type, that is,
whether a material is manufactured in-house or procured externally, or both.
Together with the plant, the material type determines the materials inventory
management requirement, that is:
Whether changes in quantity are updated in the material master record.
Whether changes in value are also updated in the FA (i.e. financial
accounting) stock accounts
The accounts affected by a material entering or leaving the warehouse depend
on the material type.

Material Group:
Material groups allow to group together materials with the same attributes.
Material group can be used to:

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Restrict the scope of analyses

Details of LO Managing Material Master Data finalized for Gurgaon

Material Master
Material (Code) for project related, capital and Auxiliary items relevant for Delhi
The Material (code) will be internal nos.
o Decision on internal Nos. was arrived at:
The SACH No. assigned by XYZ is not completely available and hence
system will generate the material no. wherever the Sach Nos. are not
available.
Each material will be assigned to the following objects (for relevant material
type) from the Enterprise structure finalized:

Plant
Storage location
Purchasing organisation
Sales organisation
Storage type

Material Type
SAP standard material types will be used and assigned to each material.
An additional material type (AUXM) is created for auxiliary items.
The following material types will be used for ABC, Delhi purchase
For all material purchases, material type HIBE will be used.
For all services procured, material type DIEN will be used.
Material Type : HIBE Description: Bought out Material
Views relevant : Accounting
: MRP
: Purchasing
: Basic Data
: Quality Management
: Sales
: Plant stock
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: Storage location stock

Price Control : Standard

Quantity updating: Not Relevant

Value updating: Not Relevant

Numbering: Internal : 9000001 to 9999999 (7 digits)

External : A00000 (18 digits) to ZZZZ..Z(18 digits)

Numbering followed for ABC purchases will be internal, system generated, in case the
SACH number is not available.

Material type

: AUXM Description : Auxiliary Materials

: Accounting
: MRP
: Purchasing
: Basic data
: Quality Management
: Sales
: Plant stock
: Storage location stock

Price Control

: Moving Average

Quantity updating

: Not Relevant

Value updating

: Not Relevant

Numbering

: Internal: 7000001 to 7999999 (7 digits)

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: External: Not allowed

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Material type: DIEN Description : Services

Default item category: LEIS Service without delivery

View relevant

: Accounting
: MRP
: Purchasing
: Basic Data
: Sales
: Quality Management

Quantity updating

: Not Relevant

Value updating

: Not Relevant

Numbering

: Internal : 8000001 to 8999999 (7 digits)

: External : Not allowed

Numbering followed for ABC purchases will be internal system generated.

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Material type

Manufactured

Procured

in-house

Externally

Bought out(HIBE)

Yes

Services(DIEN)

Yes

Auxiliary (AUXM)

Yes

Both

Together with the plant, the material type determines the materials inventory
management requirement:
For the plant Delhi no material type will update inventory
Changes in value will update in the FA (Financial Accounting) accounts
The accounts affect by a material entering or leaving the warehouse depends on the
material type.

Material Type
For Account assigned
Bought-out (HIBE)
Auxiliary (AUXM)
Services (DIEN)

Price Control
Purchase Order
S
S
S

Accounts

Account

On Receipts

On Issue

42100
Multiple
42100

Not Relevant
Not Relevant
Not Relevant

Opening/Closing stock account and updates for the closing stock balance at period
end will be provided by the account department of ABC.

Material Group
To be finalized by Delhi.

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Details of PP Materials Requirements planning finalized for Delhi

The logistics chain will start at sales and distribution and with demand
management.
In sales and distribution, the sales orders containing concrete customer
requirements will be received. The sales order will enter with the details of the
functional modules.
In order to cover the requirements of the confirmed sales order and forecast, the
reorder quantities and dates will be calculated as well as the corresponding
procurement elements. The procurement element in the planning run is the
planned order, or for external procurement, the purchase requisitions. Both
procurement elements are internal planning elements are internal planning
elements that can be changed, rescheduled or deleted at any time.
Planning Strategies
Make to stock production (10/11)
Planning without final assembly (50)
Make to order production (20)
For the materials produced in house, the system will calculate the dependent
requirements, or the quantity of components required to produce the finished
product or the assembly, by exploding the BOM (i.e. bill of material). If a
material shortage exists, planned orders will be created at every BOM level to
cover requirements.

On completion of the calculations of quantities and dates, these planned,

procurement elements will converted into exact procurement elements by the MRP
controller after making the necessary manual adjustments for scrap (buffer) over
and above the system calculated requirements including scrap consideration. The
planned orders will be converted into production orders for in house production
and into purchase orders for external procurement.

The progress of the order for materials produced in house will be controlled using
the production order. The production order will contain its own scheduling
procedures, capacity planning and status management. Cost accounting will be
also carried out via the individual production order.

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Materials that are procured externally will trigger the procedure for purchasing. In
this case, suitable vendor will be chosen or outline agreements will be drawn up.

The quantities made available by production or by external procurement will be

placed in stock and will be managed by inventory management.

Planning run
The types of planning run that will be used are:
Net change planning (NETCH)
Net change planning in the planning horizon (NETPL)
The other type which will be used at the time of going live or in the event of
exceptional cases is:
Regenerative planning (NEUPL)
The planning file will contain a list of all materials relevant to the planning run.
This means that as soon as a material master record is created with MRP data
and a valid MRP type, this material is then automatically included in the
planning file.
When starting the planning run, it is defined whether all the materials that are
in the planning file are to be planned or net change planning is to be carried
out:
In a regenerative planning run, the system will plan all the materials that
are contained in the planning run
In a net change planning run, the system will only plan materials that
have undergone a change relevant to MRP since the last planning run
For the net change planning procedure, if a material is changed in any way that
is relevant to the planning run, it will be flagged with a total change indicator in
the planning file. The indicator will set by the system as soon as the material is
changed. The changes that will be relevant to the planning run will include:
Changes to stock, if these change the stock/requirements situation of the
material

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 Creation of purchase requisitions, purchase orders, planned orders, sales

requirements,

forecast

requirements,

dependent

requirements

or

reservation
If fields are changed that are relevant to the planning run for these
receipts and issues or in the material master record
Deleting receipt or issue quantities
A planning horizon can be used to further limit the scope of the planning run.
In net change planning in the planning horizon, the system will only plan
materials that have undergone a change that is relevant to the planning run
within the period defined as the planning horizon. If a planning horizon is
specified, the system will set another indicator in the planning file if a material
is changed within the planning horizon, the net change planning indicator.
During the planning run, the system will check every entry for a material in the
planning file:
In a regenerative planning run, the system will plan all materials, which are
included in the planning file irrespective of all indicators.
In a net change planning run, the system will only plan those materials,
which are provided with the total change indicator.
In a net change planning in the planning horizon, the system will only plan
those materials provided with the net change planning indicator.
On completion of the planning run, the appropriate indicator will be
automatically deleted in the planning file.
The system will delete the total change indicator and the net change
indicator for a regenerative planning run and a net change planning run
The system will only delete the net change planning indicator for a net
change planning run in the planning horizon

Net requirements calculation for MRP:

In MRP, requirement quantities will be maintained in the system as planned
independent
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requirements,

customer

requirements,

dependent

requirements, material reservations as well as forecast requirements. The

system will check every exact requirement and every forecast requirement to
determine whether they are covered by available warehouse stock and/or
receipts (Purchase orders, fixed order proposals, production orders, and so
on). Available stock is calculated as follows:
Plant stock minus (-) Safety stock plus (+) Receipts (purchase orders, firmed
order proposals, production orders) minus (-) Requirement quantities (e.g.
independent and customer requirements, material reservations, forecast
requirements for unplanned additional requirements)= Available stock
A shortage occurs if available stock is negative, that is, the requirement
quantities are greater than expected receipts and stock. The system will
store the shortage quantity. The system will specify the date of the issue (for
example,

customer

requirement,

planned

independent

requirement,

reservation, forecast requirement) as the requirements date.

Gross requirements planning:
Gross

requirements

planning

will

initiated

by

planning

with

the

requirement type gross planned independent requirements. Planned

independent requirements, created using this requirement type, will not be
compared with warehouse stock in material requirements planning. The
system will only check the expected receipt quantity (from planned order,
purchase requisitions, and so on). This means that a mandatory master
plan will be stored in the system.
The gross requirement plan will be displayed as a separate segment in the
MRP list as well as in the stock/requirement list.
If gross requirements are to be carried out planning for a particular
material, it must be marked with the indicator for dual MRP (=gross
requirement planning) in the mixed MRP field in the material master record.
MRP List
The system creates MRP lists during the planning run depending on the
creation indicator. These lists contain the planning results for the material.
The MRP list will display the future stock/requirements situation at the
time of the last planning run and also provides a work basis for the MRP

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controller. The MRP list will be stored in the system until it is either deleted
manually or replaced by a new list from subsequent planning run.
The system will display one of the selected options:

Individual display with selection according to material number and

plant
Collective display with selection according to MRP controller, plant and
further selection criteria

Stock/requirements list
In the stock/requirement list, the most up to date development of stocks
and requirements is displayed. The layout of the list on the screen is the
same as that of the MRP list.
The main difference between the MRP list and the stock/requirements list is
that each time the stock/requirements list is called up, the system re-reads
the various MRP elements and displays the most up to date situation. As a
result the most recent availability situation for the material in the
stock/requirements list whereas the MRP list reflects the stock and
requirements situations situation at the time of the last planning run.
Changes, which have taken place after the planning date, are not included.
Calculating Basic Dates Using Backward Scheduling

For materials that are planned according to either the MRP or the
forecast based planning procedures, the requirement dates are always
known.

In backward scheduling, the order finish date is calculated by

subtracting the goods receipt processing time from the requirements
date. The order start date is then determined by subtracting the in
house production time from the order finish date.

Finally, the opening period is subtracted from the order start date and
the result is the order opening date. The opening period represents the
time required by the MRP controller to covert the planned orders into
purchase requisitions. It is determined in customizing per plant as a
float.

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Calculating Basic Dates Using Forward Scheduling

If an order starting date which lies in the past is calculated by

backward scheduling for either the MRP or the forecast based planning
procedures, the system automatically switches to forward scheduling in
order to receive realistic scheduling data. Forward scheduling is always
carried out for reorder point planning.

In forward scheduling, the current date is entered as the order start

date. The in-house production time is added to the current date to
determine the order finish date. On this date, the material is available.

The order opening date will not exist in forward scheduling.

The following functions will also be used for material requirements
planning:

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Total planning and single item planning

Materials planning procedures (MRP

planning)
Discounted Parts
Using Alternative and substitute parts
Easy to use functions for evaluating the planning result
Exception messages and rescheduling check
Availability check
Single and Multi level pegging
Single item planning for sales orders

and

consumption

based

Details MM Material Management finalized for Delhi

Details of MM Purchasing finalized for Delhi

Purchasing Structure
Organizational levels
The structure of ABC (Ahm & Del)

Client
Currently: Test client= 400, Live client =120

Company code= ABC

Plant
o At AHM
AHM 1= PSS PLANT AHM Plant
AHM 3= HTL Plant
AHM 2= PN Plant
At DEL
DEL = Delhi Plant

Purchasing organisation
o At AHM
AHP1= Ahmedabad purchasing organisation for all plants in
Gujarat.
At Delhi
DPO1= Delhi purchasing organisation for all plants (Currently

only one plant) in New Delhi

Purchasing Group
o Each Buyer will be a purchasing group for Delhi plant
Assignment of organizational levels
o All the plants at Delhi (Currently only Delhi) are assigned to one
Purchasing Organisation.
o

A central purchasing unit with one purchasing organisation to

negotiate a comprehensive contract (having more advantages
conditions due to greater purchase volumes) with a vendor.

28 | P a g e

 Purchasing document

Purchase requisition (PR) Purchase requisitions will be generated:

o

For project materials (externally procured materials):

For requirements transferred by the sales order, PR will be
generated by MRP. For requirements transferred by the sales
order under individual purchase order, PR will be generated
entering the sales order for externally procured materials.

For all non-project items (externally procured materials):

PR will be created manually.

Request for quotation (RFQ): RFQs will be sent to all approved/listed

vendors with reference to purchase requisition.
o

Quotation: Quotations received with or without reference to RFQ

from different vendors will be entered in the system for comparison.
The details of vendors pricing and terms of delivery provided in
response to an RFQ will be entered for comparison. Quotation will be
the basis for selecting the vendor to supply the required material or
services.

Purchase Order (PO): Purchase order will contain specific details of

dates and prices.

Contract: Contract will be maintained for outline agreement, or

longer term buying arrangement. The contract will be binding
commitment to procure a certain material or service from a vendor
over a certain period of time.

Scheduling

agreement:

Another

type

of

outline

agreement,

providing for the subsequent issue of a delivery schedule specifying

purchase quantities, delivery dates, and possibly also delivery timespots.

29 | P a g e

Classification of Purchasing Documents (Document Types)

The purchasing document type appears as a default value when a

purchasing document is created.

Purchasing Document types:

PRG
QPG
QCG
POPG
POCG
POXG
CVG
CQG

:
:
:
:
:
:
:
:

Purchase Requisition from Delhi

RFQ for Project items from Delhi
RFQ for Project items from Delhi
PO for all Project items from Delhi (Local +Imports)
PO for all Capital items from Delhi (Local +Imports)
PO for all Auxiliary items from Delhi (Local +Imports)
Contract (Outline Agreement) for Value from Delhi
Contract (Outline Agreement) for Quantity from

Delhi
o

Numbering of Purchasing documents

Each document will be assigned a unique number. All the
numbers will be assigned internally by the system and then will
be assigned to different number ranges based on document
types:

PRG
QPG
QCG
POPG
POCG
POXG
CVG
CQG

:
:
:
:
:
:
:
:

2000000 to 2999999
6200000 to 6299999
6200000 to 6299999
4700000 to 4799999
4700000 to 4799999
4800000 to 4899999
4800000 to 4899999
4800000 to 4899999

Structure of Purchasing document:

Each purchasing documents will be subdivided into two main
areas: the header and individual items. Each document will
contain a header and can contain several items.
The header will contain information relevant to the whole
document. The individual items specify the materials or services
to be procured.

o
30 | P a g e

Purchasing info record:

 The purchasing info record (also referred to in abbreviate form as

the info record will be a source of information for purchasing. It
contains information on a specific material and a vendor
supplying the material. For example, the vendors current pricing
is stored in the info record.
The info record allows buyers to quickly determine:

Which materials have been previously offered or supplied by

a specific vendor

Which vendors have offered or supplied a specific material

Contents of an info record

The info record contains data such as:

o
o
o
o

Current prices and pricing conditions

The number of the last purchase order
Tolerance limits for over deliveries and under deliveries
The planned deliver time (lead time required by the

o
o

vendor to deliver the material)

Vendor evaluation data
An indicator as to whether the vendor counts as the

o
o

regular vendor for the material.

The vendor sub-range to which the material belongs
The availability period during which the vendor can

supply the material

The info record will

contain

quotation

(wherever

available) and ordering data. The data is the info record

(prices fro example) is also used as default data for
purchase orders.
The current and future quotation conditions (discounts,
fixed costs etc.) will be stored in the info record, in order
to be able to copy them into POs. The vendors conditions
will also be maintained directly in the info record.
o

31 | P a g e

Type of info record

 Info records with a material master record (e.g. for

stock material)
This type of info record represents the relationship
between a material or service (for which a master
record exists) and a vendor.
Info records without a material master record (e.g. for
consumable materials)
Purchasing info records will be created as follows:
Manually
Info record for a purchasing organization or for a plant

Automatically
Through

setting

the

info

update

indicator

when

maintaining a quotation, a purchase order, or an outline

agreement. The purchase order data will be updated
automatically in an info record.

Release (Approval) procedure:

The release strategy defines the approval process for
purchase

requisition

item

or

external

purchasing

documents. The strategy specifies the release codes

necessary and the sequence in which release have to be
effected maximum of eight release codes can be defined.

The assignment of the release strategy to a requisition

item or a purchasing document is based on the release
conditions.

The release code (denoting a release point) is a twocharacter ID allowing a person to release (clear, or
approve) a requisite item or an external purchasing
document. Who may work with which release codes is
basically controlled via a system of authorizations.

The approval procedure for purchase requisitions in an

enterprise may be set up in such a way that a department
manager must approve a requisition item before the next

32 | P a g e

level of authority (e.g. the cost center manager). In this

case,

approval

by

the

department

manager

is

prerequisite for approval by the cost center manager.

Calculation Schema (Pricing Procedure)

The R/3 system determines the effective price in purchase

orders through the condition techniques. They serve as a
central repository of pricing for purchase orders. They are
automatically included in the price calculation in the
purchase order if the PO references a contract or an info
record, or if it meets certain criteria defined in the extended
conditions.

The type conditions (relevant) are:

Conditions in contracts- Conditions in a contract apply

to all release orders issued against the contract.

Conditions in info records- Conditions in the info record
apply to orders that specify the material and vendor
contained in the info record.

Condition technique
The condition technique is used to determine prices across
applications. The goal of the condition technique is to
calculate the effective price in a purchase order.
The condition technique consists of four main elements:

33 | P a g e

Condition types
Condition tables
Access sequences
Calculation schema (pricing procedure)

Condition type- A condition type is a representation of a

pricing element. Condition types exist for discounts,
surcharges, and freight costs, for example. You use
condition types to enter prices in purchasing documents.
You learned how to specify condition type when entering
prices in quotations and purchase orders, for example.

Condition table- A condition table defines the combination

of fields (the key) that identifies an individual condition
record. The system stores the condition data you enter in
the form of a condition record.
For example, when you enter a vendors price in a
purchasing info record with reference to a material master
record, the key of the condition table includes the vendor
number and the material number.
The actual pricing information- such as the gross price and
any discounts is stored in a condition record under this key.

Access sequence
An access sequence is a search strategy that the system
uses to find condition records for a particular condition
type.
The access sequence determines the sequence in which the
system searches condition records for a valid price.

Calculation schema (pricing procedure)

A calculation schema (also known as a pricing procedure,
but the same mechanism can also be used to calculate tax
amounts, period end rebates, or costs, for example) is a
group of condition types, defined in a particular sequence.
It enables the system to determine that a particular set of
condition types, in a specified sequence, apply in given
circumstances.
For example, the price calculation schema determines
which condition type apply to the gross price. The

34 | P a g e

calculation schema also determines that the condition type

for discounts automatically included in the calculation of
the effective price.

Conditions can be maintained in the following ways:

Prices
Maintain the conditions that determine the net price in a
single info record or contract.

Discounts and surcharges

Discounts or surcharges that apply to all info records or
contracts meeting the pricing criteria

Other condition types

If the company has defined its own condition types,
access sequences, and condition tables, conditions will
maintained for these pricing elements.

35 | P a g e

Other Acceptance/Fulfillment Confirmations

Order acceptance/fulfillment confirmations (referred to in abbreviated form as
confirmations) will be maintained for purchase orders or delivery schedules
issued under scheduling agreements where confirmation will be received from
vendors in the form of:

Acknowledgments
Confirmations: General procedure

Subsequent to the release of the confirmed purchase order/scheduling

agreement the following confirmation and the promise or confirmed dates
will be captured through:
Vendors order acknowledgment

Influence of confirmation on Material Planning

MRP initially will assume that delivery will be in accordance with the
data in the delivery schedule.

The vendors order acknowledgment will cause MRP to change the

delivery date.

The confirmation will be through:

Manual maintenance of confirmations in purchase orders and scheduling
agreement delivery schedules

Monitoring of confirmation dates with the aid of reports and analyses

All types of confirmation will be entered manually with reference to the

purchase order items. The system will provide the list of all items and
they can be marked as confirmed.

Updating of the PO when several order acknowledgements are received:

If a vendor initially sends an order acknowledgment relating to only
two schedule lines of an item with four schedule lines, there will be
multiple acknowledgments.

36 | P a g e

 As soon as another confirmation is received, all the old data from the
preceding confirmation will be deleted and replaced by the data of the
current confirmation.

37 | P a g e

Purchasing & Goods Receipt Process Flow Diagram-Finalized for implementation

in SAP R/3

C1

38 | P a g e

Details of MM Vendor Evaluation finalised for Delhi

The vendor evaluation component has been completely integrated into MM

purchasing information such as delivery dates, prices and quantities can be
taken from purchase orders. Vendor evaluation also uses data from quality
management, such as the results of incoming inspections or quality audits.

It also access basic data in Material Management, such as goods receipt data
from inventory management.
The vendor evaluation system supports the optimization of procurement
processes in the case of both materials and services.

Procurement of Materials: It provides accurate information on

Prices
Terms of payment
Delivery
Procurement of services:
It informs whether the vendors perform the services within the specified
timeframes and appraise the quality of the work carried out.

Scores and Criteria

The SAP standard system offers a scoring range from 1 to 100 points,
which is used to measure the performance of vendors on the basis of five

main criteria.
The main criteria available in the standard system are:
Price
Quality
Delivery
General service/support
These four main criteria serve as a basis for the evaluation of vendors
from whom materials are procured.
External Service
This main criterion serves as a basis for the evaluation of vendors
employed as external service providers.

39 | P a g e

Any other main criteria, as required

Currently no other criteria are relevant for AHM.

Different weights to the individual criteria will be provided. The

vendors overall score is computed taking into account the weighted
scores awarded for each of the main criteria.

Analyses
The results of vendor evaluation are displayed in the form of analyses.
Ranking lists of the best vendors according to overall score of ranking
lists for specific materials will be displayed by the system.

40 | P a g e

Details of MM Inventory Management Finalized for ABC-Delhi

SAPs Inventory Management system will allow to
Manage stocks on a quantity and value basis
Plan, enter and check any goods movements
Carry out physical inventory
Managing Stocks by Quantity
Managing stocks by value
The stock value for inventory management
The account assignment for cost accounting
The corresponding G/L accounts for financial accounting via automatic
account assignment
Both the quantity and the value are updated automatically when entering a
good movement.

Planning, Entry and Proof of Goods Movements

Goods movements include both external movements (good receipts from
external procurement, goods issues for sales orders) internal movements
(good receipts from production, withdrawals of material for internal
purposes, stock transfers, and transfer postings).

For each goods movement a document will create which is used by the
system to update quantities and values and serves as proof of goods
movements.

Physical Inventory
Different physical inventory methods:
Periodic inventory
Inventory sampling
Cycle counting
Inventory management
Inventory management manages the stocks by quantity and value.
Goods Movement
A good movement (also called a material movement or stock movement) will
be an event that will cause a change in stock.
41 | P a g e

Type of goods movement:

Good receipt:

A good receipt (GR) is a good movement with which the receipt of goods
form a vendor or from production will be posted. A good receipt will lead to
an increase in warehouse stock.

Good Issue:

A good issue (GI) is a goods movement with which a material withdrawal

or material issue, a material consumption, or a shipment of goods to a
customer will be posted. A good issue will lead to a reduction in warehouse
stock.

Stock Transfer:

A stock transfer will be the removal of material from one storage location
and its transfer to another storage location.

Transfer Posting:

A transfer posting will be a general term for stock transfers and changes in
stock type or stock category of a material.

Document concept
Accounting principle
Even in a computer supported inventory management system, the accepted
accounting principle of posting only with a document applies. According to the
document principle, a document will be generated and stored in the system for
every transaction/event that causes a change in stock.
Against each posting of a good movement in the SAP System, the following
documents will be created:

Material document
Accounting document

42 | P a g e

Document Numbers
A document numbers and the material document year will identify a material
document. The company code, the document number, and the fiscal year will
identify an accounting document. The material document number and the
accounting document number will be different.

A movement type will be a three digit SAP standard identification key for a
goods movement. The following table contains examples of movement types.

Good Movement
Good receipt for a purchase order
Release from quality inspection

Movement Type
102
342

stock

Control functions of the Movement Type

The movement type will play an important role in:

Updating of quantity fields

Updating of stock and consumption accounts
Determining which fields are displayed during entry of a document in the
system

Results of a Goods Movement in the System

A material document will be generated, which will be used as proof of the
movement and as a source of information for any other applications

involved.
The movement relevant for financial accounting, one or more accounting

documents will be generated.

The stock quantities of the material will be updated.
The stock values in the material master record will be updated.

43 | P a g e

Details of MM Invoice Verification and Material Valuation Finalized for

Delhi
Invoice Verification Finalized for Delhi

The

invoice

verification

component

will

be

part

of

the

Materials

Management (MM) system. It will provide the link between the Materials
Management component and the Financial Accounting, Controlling and
Asset Accounting components.

Invoice verification in material management will serve the following

purposes:
o

It will complete the materials procurement process which start with the
purchase requisition, continues with purchasing and goods receipt and
end with the invoice receipt.

It will allow invoices that do not originate in materials procurement (for

example, services, expenses, course cost etc.) to be processed.

It will allow credit memos to be processed, either as invoice

cancellations or discounts.

Invoice verification will not handle the payment or the analysis of invoices.
The information required for these processes will be passed on to other
departments.

Invoice Verification tasks include:

Entering invoices and credit memos that have been received
Checking the accuracy of invoices with respect to contents, prices and

arithmetic
Executing the account posting resulting from an invoice
Updating certain data in the SAP system, for example, open items and

material prices
Checking invoices that were blocked because they varied too greatly
from the purchase order

The high degree of integration in the SAP system will allow these tasks to be
carried out smoothly and efficiently.
44 | P a g e

Material Valuation
The SAP system consists of various components that are linked, allowing
different departments within a company to work together.

Material valuation will be part of MM material management module. This

module will include the following application areas:
Purchasing
Inventory Management
Invoice Verification

Material valuation will not be an independent application area, since

most material valuation functions take place automatically in the SAP
system. Depending on how a company is structured, tasks that have to
be carried out manually belong to either inventory management or
invoice verification.

Material valuation will respect a link between material management and

financial accounting, since it will update the G/L accounts in financial
accounting.

Material Valuation Tasks

The central task of Material Valuation will be to determine and record the
stock value of a material. The stock value will be calculated using the
following simple formula:
Stock value= stock quantity * material price

Thus, if the stock quantity or the material price changes, the stock value
changes.

In

Control of material valuation

Material valuation will be controlled by

45 | P a g e

addition, material valuation has the following tasks:

Adjusting material prices to market prices
Performing revaluations
Carrying out physical inventories
Carrying out valuation of stocks for balance sheet purposes

o
o

System settings
Material master records

System Settings
By customizing the SAP system, material valuation will be adapted to
the requirements of company.
o
o
o

Level at which the materials will be valuated

Types of goods movement, which will be relevant for valuation
Accounts which will be posted during a transaction

Material Master Records

Material master record will be created for ever material in the SAP
system. The information contained in this record will include
valuation data for the material. The following decisions will be made
when maintaining the material master record:
o
o
o
o

Material relevant for valuation or not

Sub-stock of a material to be valuated differently or not
Price control is a standard price or moving average price
G/L account in which the stock value of a material be managed

The stock quantity and value of a material and the material price will
also recorded in the material master record.

46 | P a g e

Details MM Consumption Based Planning finalized for Delhi

Consumption based planning procedures are straightforward materials
planning procedures to achieve set targets with relatively little effort. These
planning procedures will be used for planning both B and C parts and
operating supplies.
The following procedures will be used in consumption based planning for
Ahmedabad:

Reorder Point Planning:

o

In the reorder point planning procedure, the system will compare

available warehouse stock with the reorder level. If available stock
falls below the reorder level, an order proposal will be generated.

The reorder level (also known as the reorder point) will be made up of
the sum of the safety stock plus the expected average material
consumption within the replenishment lead time.

Safety stock must be set at a level, which covers both excess material
consumption within the replenishment lead time and the additional
requirements, which may occur during delivery delays.

The reorder level and safety stock level are central control parameters
within reorder point planning. They can be determined automatically
by the system or manually by the MRP controller. Depending on this
manual or automatic selection, following two procedures will be used:
Manual Reorder Point Planning
Automatic Reorder Point Planning

47 | P a g e

QM Quality Management procedures finalized for ABC Delhi

QM in Procurement
Inspection Lot:

During the inspection process, the inspection lot will become the central

control record that will document the current status of the inspection. It
will be the repository for all inspection data, including the inspection
specifications, inspection results and usage decision.
Inspection Results:

Quality inspections will fulfill a variety of goals. These goals set the
parameters for the type and scope of expected inspection results. These
goals will include:

Determining

whether

products

adhere

to

predefined

quality

requirements (acceptance inspection)

Determining whether a product can be used (usage decision)

o Supporting or triggering decisions (vendor evaluation, complaints
processing)

Providing records needed for later evaluations (required verification)

o Determining and documenting the quality of products, assets, or
o

process (audit)
Determining the capability of processes, machines or production
resources (capability check)

QM Procurement
The QM module will be involved in the following decision making phases
of the procurement process: inquiry, vendor selection, purchase order,
goods receipt, incoming inspection and release of goods receipt quantity.
Vendor Selection:
The material management (MM) module will inform the purchasing
agent of the vendors delivery reliability and price behavior. The QM
module will provide information on the quality of the previously
delivered goods and the vendors quality management system. For

48 | P a g e

this purpose, the system will maintain summarized quality scores

that will be automatically updated for the vendor evaluation.

Purchase Order:
When the purchase order is issued, the vendor must have been
released by the quality department to deliver the material in
question (if this requirement has been specified). The release of the
supply relationship may be limited to a specific period of time and a
specified quantity. With the purchase order, the vendor will
automatically receive information about the latest technical delivery
terms and the currently valid quality assurance agreement, as well
as the vendors obligation to include a quality certificate with the
delivery.

Inspection at the Vendors Premises

Inspections carried out at the vendors premises will replace a
goods receipt inspection. In such case, the system will permit the
user to monitor the scheduled delivery dates and create inspection
lots in time for the receiving dates.

Goods Receipt
If a certificate is required for a material, it must be available no later
than when the goods are received. A certificate may be required for

each individual purchase other item, batch or goods receipt.

Normally, the quantity of goods received will be posted to inspection
stock for the duration of the goods receipt inspection. This stock
will classified as not available. It will be managed solely within the
scope of inspection lot processing and cannot be posted separately
using the functions of materials management. The duration of the
goods receipt inspection will be also taken into consideration by the
material requirements planning (MRP) department.

Inspection and Releasing the Goods Receipt Lot

Inspection lot processing will be automatically triggered upon goods
receipt. In addition to the goods receipt document, the system will
also create an inspection lot record. Furthermore, it will select an

49 | P a g e

appropriate inspection plan and determine the sample size for all
inspection characteristics based on the quality level. The inspection
can now be initiated and the necessary documents, such as the
sample drawing instructions and inspection instructions, can be
printed out.

Quality inspection
When an inspection lot has been processed in the QM module, the
inspector must take a usage decision for the inspected goods. Under
special circumstances, the inspection lot quantity can be withdrawn
from the inspection stock in advance, providing the user has the
proper authorization to make the withdrawal. Normally, however,
the stock posting will take place after inspection completion in
conjunction with the usage decision.

Usage Decision
After the inspection has been completed, the accepted inspection lot
quantity will be posted to unrestricted use stock. A special posting is
possible for rejected quantities. When the goods receipt quantity has
been released, the QM module no longer has the responsibility for
managing the stock.

With the usage decision, the system will update the quality level and
make the inspection lot quality score available for the vendor
evaluation. It will also update all data in the quality information
record relating to material and vendor. For example, the status of the
supply relationship can be changed from prototype delivery to
production delivery, once the inspection lot has been accepted.

Follow-up Actions
After the usage decision has been made, the system may trigger an
additional series of individually programmed follow-up actions. For
example, if defective goods were received, a letter of complaint or a
system-supported quality notification can notify the vendor of this.

50 | P a g e

Status of Supply Relationships

The QM module will monitor how the supply relationships are

released. The user can define certain statuses such as prototype,

preliminary series or production series. These statuses represent the
stages a vendors material delivery must sequentially pass through.
The system will then create inspection lots with an inspection lot type
that matches the status of the supply relationship and automatically
update the statuses, based on the usage decision.

Vendor Master
The vendor master will contain information about the vendors that a

company uses. The information will be contained in individual

vendor master records. In addition to the name and address of a
vendor, the vendor master record will also contain the vendor
number and information about the currency and terms of payment
that apply to the vendor.

In certain, the procurement of goods from a certain vendor is to be

blocked (for example, if he delivers poor-quality products), it can be
done in:
In the vendor master record
The vendor block applies to all materials and plants

For procurement and purchasing functions, the system will first check
the vendor master record to determine if the vendor is blocked from
these functions. If the vendor is not blocked, the system will check the
parameters in the Q-info record, if necessary. The settings in the Qinfo record are only checked if a vendor release or quality assurance
agreement is specified in the material master record via the control
key for QM in procurement.

51 | P a g e

 Integration with other modules of R/3 system

Integration with FI/Co

MM
purchasing

transactions

will

update

the

following

G.L.

Accounts/objects:
All purchase orders will be account assigned, to a Cost Center or Sales Order or to an
Asset
MM Transaction

When requirements are

When requirements are

generated from Sales

generated manually

Receipt of Project items

Order
Dr. Sales Order (P/L)

Dr. Cost In- Cost Centre (B/S)

against-

Cr. Provision (B/S)

Cr. Provisions (B/S)

Not applicable

Dr. G/L Asset

Account

Assigned P.O.
Receipt of Capital Items
against-

Account

Assigned P.O.
Receipt of Auxiliary items
against-

w/o

against

P.O.-

Not applicable

Not applicable

Not applicable

Not applicable

Not applicable

Not applicable

No accounting entry

Not applicable

Not applicable

Not applicable

Not applicable

Not applicable

Account

Assigned P.O.
Issue of Project
against

Cr. Provisions (B/S)

w/o

Account Assigned P.O.

Receipt of Auxiliary items
w/o-

Dr. Expenses Cost Centre (P/L)

Account

Assigned P.O.
Receipt of Capital Items

against

Not applicable

Account

Assigned P.O.
Receipt of Project Items
against-

Cr. Provision

items

Account

Assigned P.O.
Issue of Project

items

against w/o Account

Assigned P.O.
Issue of Auxiliary items
against

w/o

assigned P.O.
52 | P a g e

Account

Down

payment

Dr. Vendor (B/S)

Dr. Vendor (B/S)

P.O.

Cr. Cash/Bank (B/S)

Cr. Cash/Bank (B/S)

Receipt

Shadow: Expenses (P/L)

Dr. Provision (B/S)

Shadow: Expenses (P/L)

Dr. Provision (B/S)

Cr. Vendor (B/S)

Cr. Vendor (B/S)

Dr. Vendor (B/S)

Dr. Vendor (B/S)

Cr. Vendor (B/S)

Not applicable

Cr. Vendor (B/S)

Dr. Provision (B/S)

of

against

Vendors

invoice Retention

Receipt

of

Vendors

invoice for Capital items

Cr. Vendor (B/S)

Retention

Dr. Vendor (B/S)

Cr. Vendor (B/S)

53 | P a g e

 Information System
Purchasing Information System:
In the standard system, the following information structures are available in
the Purchasing information system:
o

S011 Purchasing Group

This information structure forms the data basis for the purchasing group
analysis.

S012 Purchasing
This information structure forms the data basis for the material groups,
vendors and material analysis.
The analyses for long-term planning are based on planning data, which is
updated to a separate planning version of the information structure S012
from long term planning.

S013 Vendor evaluation

This information structure provides the data basis for the standard
analysis of vendor evaluation. The information structure is updated when
the events goods receipt and purchase order take place.

S015 Subsequent settlement

This information structure forms the data basis for the standard analyses
of subsequent settlement. The information structure S015 is updated
when the events invoice receipt for a purchase order (vendor business
volume) or subsequent settlements of an arrangement (income) by credit
memo/billing document take place.

Inventory Controlling:

54 | P a g e

 In the standard system, the following information structures are available in

inventory controlling:
o

S031 Movement:
All key figures relating to material movements involving current valuated
stock and vendor consignment stock are updated to this information
structure. In the standard system, the period unit in this information
structure is month. You can define your own period unit for the updating
of this information structure.

S032 Stocks:
The current valuated and vendor consignment stocks are updated to this
information structure when a goods movement takes place. The stock
values are also updated to this info structure when a goods movement
and invoice verification/revaluation take place. This information structure
does not contain a period unit.

S033 Movements (Individual records):

In order to gain specific results from your analysis, such as determining
the date of last consumption, displaying informative receipts/issues
diagrams, or obtaining reliable mean stock values, updating of the
statistical data must take place on a daily basis. The stock values,
updating of the statistical data must take place on a daily basis. The
information structure S033 satisfies this requirement, as it is supplied
with data every day.
Structurally,
information

the

information

structure

S031,

structure
yet

also

S033

is

includes

identical
the

to

the

characteristic

document number. Updating is carried out on a daily basis at document

level. The period unit for the updating of this information structure
cannot be changed in customization.

S034 Movement (Batches)

The key figures relating to material movements at plant, storage location,
material and batch levels are updated to this information structure.

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S035 Stocks (Batches)

The current valuated and vendor consignment stock are updated to this
information structure when a goods movement takes place. This
information structure does not refer to ant period and is set up in the
same way as the information structure S032, yet also contains the
additional characteristic batch.

S039 Planning
This information structure includes all of the key figures that are
available in inventory controlling, including all of the extra key figures
(range of coverage, inventory turnovers, key figures that are calculated
using the mean value). No actual data is written to this information
structure. This information structure provides the basis for flexible
planning.
If you wish to fill the information structure S039 with actual data, then
you can use the report RMCBS039. It is always advisable to fill the
information structure with actual data if you want to access actual data
for the forecast during planning, or if you want use the flexible analyses
to evaluate the extra key figures from inventory controlling.

S094 Stock/Requirements Analysis

The information structure S094 includes all of the key figures relating to
the current stock and requirements situation and forms the data basis for
the

standard

analyses

of

stock/requirements.

Data

relating

to

requirements and stock situation flows into this information structure

from MRP (data basis for the standard analysis of the current
stock/requirements situation), while at the same time data from longterm planning flows into a separate planning version (data basis for the
standard analysis long-term planning). Future stock levels are derived
from the requirements and future receipts.
Updating of this information structure does not take place on a continual
basis for reasons of performance. It can be initialized via a a report.

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List of ABAP/4 programs

The following ABAP/4 programs will be developed for:
Print layout for external documents which are to be presented in a
mandatory format:
Purchase order
Request for Quotation
Rejection Note

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