#IFactorDigest37:??The Ultimate SAP MM Booklet

Author-

1. ?? Introduction to SAP MM

2. ??? SAP MM Organizational Structure

3. ?? Master Data in SAP MM

4. ?? Procurement Process

5. ?? Purchase Requisition

6. ??? Purchase Order

7. ?? Goods Receipt

8. ?? Invoice Verification

9. ?? Inventory Management

10. ?? Material Requirements Planning (MRP)

11. ?? Reporting and Analysis

12. ?? Configuration and Customization

13. ?? Tips and Best Practices

14. ?? Transaction Codes Reference List

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1. ?? Introduction to SAP MM        

Overview

SAP Material Management (MM) is a core module in SAP ERP that manages materials and inventory processes. It integrates various activities including procurement, inventory management, and invoice verification to streamline operations and enhance efficiency.

Importance and Benefits

- ?? Efficiency: Streamlines procurement processes.

- ?? Cost Savings: Reduces material costs through optimized procurement.

- ?? Productivity: Enhances productivity by ensuring material availability.

- ?? Transparency: Provides clear visibility into material movements and inventory levels.

Key Features

- ?? Procurement: Manages the entire procurement lifecycle.

- ?? Inventory Management: Controls material stock levels and movements.

- ?? MRP: Ensures materials are available for production needs.

- ?? Invoice Verification: Checks and verifies supplier invoices.

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2. ??? SAP MM Organizational Structure        

Enterprise Structure

Defines the organization’s hierarchy and its various units.

?? Client: The highest level in the SAP system representing an independent environment.

?? Company Code: Represents an independent accounting unit within a client, producing financial statements.

?? Plant: An operational unit where activities such as production, storage, or distribution occur.

?? Storage Location: Subdivision of a plant where materials are stored.

?? Purchasing Organization: Manages procurement activities, either centralized or specific to company codes/plants.

?? Purchasing Group: A group of buyers responsible for procurement.

3. ?? Master Data in SAP MM        

?? Material Master: Central repository for all material-related data.

Steps to Create Material Master (MM01)

1. Navigate to T-code: MM01.

2. Enter Material Type: Choose the type of material.

3. Enter Industry Sector: Specify the industry.

4. Maintain Data Views: Select views such as Basic Data, Purchasing, MRP, etc.

5. Enter Material Data: Fill in required fields (e.g., description, unit of measure).

6. Save: Confirm and save the material master.

?? Vendor Master: Stores information about suppliers.

Steps to Create Vendor Master (XK01)

1. Navigate to T-code: XK01.

2. Enter Vendor Account Group: Specify the account group.

3. Enter Company Code: Choose the relevant company code.

4. Fill Vendor Details: Input data such as name, address, and payment terms.

5. Save: Confirm and save the vendor master record.

?? Purchasing Info Record: Links material and vendor information, including pricing and delivery terms.

Steps to Create Purchasing Info Record (ME11)

1. Navigate to T-code: ME11.

2. Enter Vendor and Material: Specify the vendor and material number.

3. Maintain Purchasing Data: Enter data like price, delivery terms, and conditions.

4. Save: Confirm and save the record.

?? Source List: Lists approved vendors for a material.

Steps to Create Source List (ME01)

1. Navigate to T-code: ME01.

2. Enter Material and Plant: Specify the material number and plant.

3. List Vendors: Add approved vendors and validity periods.

4. Save: Confirm and save the source list.

??? Service Master: Contains data about services procured by the company.

Steps to Create Service Master (AC01)

1. Navigate to T-code: AC01.

2. Enter Service Data: Fill in details like service number, description, and pricing.

3. Save: Confirm and save the service master record.

4. ?? Procurement Process        

The procurement process involves acquiring materials or services from external vendors to meet business needs.

Basic Procurement

- Purchase Requisition: Internal document requesting materials.

- Purchase Order: Formal order to a vendor.

- Goods Receipt: Recording the arrival of goods.

- Invoice Verification: Checking and verifying invoices.

Special Procurement

- Consignment Stock: Vendor-owned stock stored at your location.

- Third-Party Processing: Goods delivered directly from vendor to customer.

- Subcontracting: Sending materials to a vendor for processing.

5. ?? Purchase Requisition (Indent)        

Creating Purchase Requisition (ME51N)

1. Navigate to T-code: ME51N.

2. Enter Header Data: Fill in document type and other relevant details.

3. Enter Item Data: Specify material, quantity, delivery date, and plant.

4. Check and Save: Review the details and save the purchase requisition.

Releasing Purchase Requisition T-code: ME54N

- Steps: Select the requisition, execute release strategy, and save.

Workflow

Automates the approval process for purchase requisitions, ensuring timely approvals and order processing.

6. ??? Purchase Order        

Creating Purchase Order (ME21N)

1. Navigate to T-code: ME21N.

2. Enter Vendor and PO Type: Specify the vendor and purchase order type.

3. Enter Item Details: Fill in material, quantity, price, and delivery date.

4. Check and Save: Review and save the purchase order.

Types of Purchase Orders

- Standard PO: Regular orders for materials/services.

- Subcontracting PO: Orders for vendor processing.

- Stock Transport Order: Orders for internal transfers between plants.

Approval Process

T-code: ME28/ME29N

Steps: Select the purchase order, execute release strategy, and save.

7. ?? Goods Receipt        

Posting Goods Receipt (MIGO)

1. Navigate to T-code: MIGO.

2. Select Document Type: Choose 'Goods Receipt'.

3. Enter Reference: Specify the purchase order number.

4. Check Items: Verify the received quantities and materials.

5. Post: Save the goods receipt.

Movement Types

- 101: Goods receipt for purchase order.

- 102: Reversal of goods receipt.

- 122: Return delivery to vendor.

8. ?? Invoice Verification        

Invoice Posting (MIRO)

1. Navigate to T-code: MIRO.

2. Enter Invoice Details: Fill in the vendor, invoice date, and amount.

3. Enter PO Reference: Link to the corresponding purchase order.

4. Check and Post: Verify the details and save the invoice.

Handling Discrepancies

- Discrepancy Types: Quantity and price differences.

- Resolution: Adjust quantities, update prices, or return goods.

9. ?? Inventory Management        

Stock Overview (MMBE)

1. Navigate to T-code: MMBE.

2. Enter Material and Plant: Specify the material number and plant.

3. View Stock Levels: Review the available, reserved, and ordered quantities.

Goods Issue (MB1A)

1. Navigate to T-code: MB1A.

2. Enter Movement Type: Specify the movement type (e.g., 201 for cost center).

3. Enter Material Data: Fill in material number, quantity, and storage location.

4. Post: Save the goods issue.

Transfer Posting (MB1B)

1. Navigate to T-code: MB1B.

2. Enter Movement Type: Specify the movement type (e.g., 301 for plant to plant).

3. Enter Material Data: Fill in material number, quantity, and storage locations.

4. Post: Save the transfer posting.

Physical Inventory Process

- Create Physical Inventory Document (MI01): Specify materials and storage locations.

- Enter Count Results (MI04): Record the physical count.

- Post Differences (MI07): Adjust stock levels based on count results.

10. ?? Material Requirements Planning (MRP)        

Running MRP (MD01)

1. Navigate to T-code: MD01.

2. Enter Planning Scope: Specify plant and MRP controller.

3. Set Parameters: Choose processing keys and planning modes.

4. Execute: Run the MRP process and review the generated proposals.

MRP Process and Output

- Process: Calculates material requirements based on demand.

- Output: Generates purchase requisitions and planned orders.

11. ?? Reporting and Analysis        

Standard Reports (MB52, ME2L)

- Stock Overview (MB52): Displays material stocks.

- Purchase Orders by Vendor (ME2L): Lists purchase orders for a vendor.

12. ?? Configuration and Customization        

The Implementation Guide (IMG) is used for configuring SAP settings according to business requirements.

Key Configuration Steps

- Define Company Code: Set up company code parameters.

- Configure Plant: Establish plant settings.

- Set Up Material Types: Define material type attributes and views.?

13. ?? Tips and Best Practices        

Efficient Use of T-codes

- Favorites: Add frequently used T-codes to favorites for quick access.

- Shortcuts: Use keyboard shortcuts for navigation and execution.

Common Issues and Troubleshooting

- Stock Discrepancies: Regularly reconcile physical and system stock.

- Invoice Mismatches: Verify vendor and PO data before posting invoices.

Best Practices

- Regular Training: Ensure users are well-trained on SAP MM processes.

- Data Accuracy: Maintain accurate master data for reliable operations.

14. ?? Transaction Codes Reference List        

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