SAP MM & PP Course Material

Sample Training Lecture Slides

December, 2007

R/3 Org Structure Overview - MM

Financial
Company
0001

Client

Plant

Bus. Area
1000

Materials Management
Plant
0001

Bus. Area
2000
Bus. Area
3000

Company
Code

Company
0002

Plant
0002

Company
0003

Plant
0003

Sto.Loc.
0001
Sto. Loc.
0002
Sto. Loc.
0003

Purchase Org
Storage Location

Valuation Area in SAP MM

Valuation Area is either Company Code or Plant.

When stock is valuated at plant level, you can valuate a material in different
plants at different prices.
When you valuate stock at company code level, the valuation price of a material
is the same in all of a company's plants (that is, in a company code).
SAP recommends that you valuate material at plant level.
Valuation at plant level is mandatory if you want to use either of the Production
Planning or Product Cost Accounting components

Purchase Requisition (PR) Process Flow

MRP Run in SAP

Req. Created
Automatically or
Converted from
a Planned
Order in PP

Requisitions

Approval
Required?

Yes

Release
Requisition

Released
Requisitions

Convert to
PO via MRP
List

Purchase
Orders

No

Services or Materials
Required (Outside of Those
Handled by MRP)

Enter
Requisition

MRPcontrolled?

No

Purchasing

Yes

G/L Account Postings from GR

Material Price $10 a piece

Amount $100/
(10 PC * $10)
Order Price $12 a piece
Amount $120/
(10 PC * $12)
GR Diff - $2 a
piece
Amount $20
Invoice Price $11 a piece
Amount $110/
(10 PC * $11) +
Tax $11
Total Due $121

Invoice Verification Process

Purchase Order based Invoice Process
Purchase Req

Purchase
Order

Tax
Calculation

Tax is expensed at
Goods Receipt

Goods
Receipt

Invoice
Receipt

Pay to
Vendor

Tax is estimated on
PO Price

Tax
Calculation

Tax is paid or
accrued at Invoice
Receipt

CBP Vs. MRP - Key Differences

M
R
P

C
B
P

MRP is based on current and future sales. Useful for the planning of finished products and important
assemblies and components. Requirement elements are sales orders, planned independent
requirements, material reservations.
CBP is based on historical data and uses material forecasts or statistical procedures to determine future
requirements. It is not triggered by independent or dependent requirements. It is either triggered by
the available stock level falling below the reorder point or by forecast requirement calculated from
historical data.

MRP Type: Changed to Reorder Point Plan

MRP Type - Reorder
Point Plan
Matl Master - MRP 2 View

Multiple PRs are created to cover

reqd qty: 237, because order qty
is limited by fixed lot size of 60
per planned order / pur req

Matl Master - MRP 1 View

Purchase Req - creation indicator

Reservation
Material

Reqd
Qty

Reqd
Date

Golf Iron

200

12/24

Super BOM - Maintenance Screen

PC ASSY - A Configurable Item, contains another
Configurable Item, PC CASE.
Variant Items / Alternate
Items as BOM Components
One of the alternatives will be
selected based on char value
assigned during BOM config for
an order

BOM Component is a
Configurable Material.
Contains a Class Item
PC CASE - Configurable Item, contains Class Item

Class Item as BOM

Component
Will be replaced by a material
based on char value assigned
during BOM config for an order

Configurable BOM - Config Simulation

1

Simulation - Assign / Pick Char Value

Auto selection via Action

Result of Parent BOM (Level 0) - PC Assy

User selection

3 Result of Child BOM (Level 1) - PC Case

1
el
v
Le

Result of Child BOM (Level 2) - Fan & Heat Sink

Level 0
Le
ve
l2

Level 1
Level 2

Capacity Leveling in Planned Order

Capacity Evaluation - Order Qty 100
Planned order capacity situation shows
an over load of 43.2% at Work Center
WC 1 where the operation is carried
out.
Required capacity: 79.58 HR
Available capacity: 55.57 HR
Cap Load: 143.2%

No overload
during other
periods

Overload
on 1/9

Production Order Settlement Example

GR for Order (Post this Before Settlement)

Order Settlement Doc

Settlement - Sender & Receiver

Accounting Doc - Settlement Result

Controlling Doc - Settlement Result

KANBAN Execution - Example - Step 2

Employee responsible for

Supply SA sees the
container status.
A new PO 4500000096 is
automatically created,
because the
Replenishment strategy is
set to External
Procurement with Purchase
Orders
The PO is for qty 2 PC as
kanban qty is set to 2 in
control cycle. The PO will
be sent to the Vendor
3000

Employee sets status to In

Process, yellow color.