SAP ERP & SAP Material Management
SAP ERP Introduction
&
SAP Material Management
SAP Material Management
SAP ERP Introduction
SAP MM Introduction
SAP MM Organizational Levels
SAP MM Organizational Relationship
SAP ERP - Introduction
What is ERP (Enterprise Resource Planning?
Think about all the core processes needed to run a company: finance, HR, manufacturing, supply chain,
services, procurement, and others. ERP integrates these processes into a single system. It provide
intelligence, visibility, analytics, and efficiency across every aspect of a business. Using the latest
technologies, ERP systems facilitate the flow of real-time information across departments and
ecosystems, so businesses can make data-driven decisions and manage performance – live.
In simple language ERP is business process management software that allow an organization to use
integrated application system to manage and automate back office functioning.
SAP ERP - Introduction
ERP
ERP, or enterprise resource planning, is a modular software system designed to integrate the main functional areas
of an organization's business processes into a unified system.
An ERP system includes core software components, often called modules, that focus on essential business areas
such as finance and accounting, HR, production and materials management, customer relationship management
(CRM), and supply chain management. Organizations decide which core modules to useful for their business
particularly.
Benefits of ERP:
Improved workflow by streamlining business processes and simplified access control.
Increases productivity, better inventory management, promotes quality, reduced material cost, effective human
resources management, reduced overheads ultimately boosts the profits.
Transparency - Provides information across departments in real time but with proper control.
Control - Role based system makes ERP transparent as well as secure.
Provides better business intelligence and customer service capabilities.
Improves supply chain management.
Strategic insight – Due to integration of data and processes, top management always have a 360-degree view.
ERP always gives the “Big Picture”
SAP ERP - Introduction
Advantages and disadvantages:
Advantages:
Saving over the long run by streamlining processes.
Reduction in IT-related expenses and end-user training cost via unified system.
Greater visibility of the business, such as inventory & finance, that are critical for meeting customer needs.
Quality data enables better reporting and planning.
Offers better compliance and data security, along with improved data, backup and the ability to control user
rights/access.
Disadvantages:
High upfront cost.
Difficultly in implementation.
Requires change management during and after implementation.
Basic, core ERP modules may be less sophisticated compared to targeted, stand-alone software. Companies may
require additional modules for more control and better management of specific areas, such as the supply chain or
customer relationship capabilities.
SAP ERP - Introduction
EPR systems can provide a number of benefits to organizations due to their ability to streamline business processes
and unify data. But EPR implementations have a number of potential pain points;
EPR Implementation:
On-Premises ERP -Solutions are installed locally on company's hardware & servers and managed by local IT
team.
Cloud ERP (also called SaaS – Software-as-a-Service);
Hybrid ERP – combination of on-premises and cloud;
SAP ERP - Introduction
Different ERP Systems available in Market;
There are many ERPs available in market;
SAP
BAAN
JDEDWARD (J.D. Orisoft)
People Soft
EXCEED
Siebel
Oracle
Ramco
Microsoft Navision
SAP, Oracle, People Soft, J.D. Edwards are big vendors in ERP.
SAP ERP - Introduction
What is SAP:
SAP is a market leader in providing ERP (Enterprise Resource and Planning) solutions and services.
SAP stand for Systems Applications and Products in Data Processing.
SAP by definition is also named of the ERP (Enterprise Resource Planning) software as well the name of the
company.
SAP Software was Founded in 1972 by five Ex-IBM engineers;
SAP system consists of a number of fully integrated modules, which covers every aspect of the business
management.
SAP has more than 140,000 installations worldwide, over 25 industry-specific business solutions and more than
75,000 customers in 120 countries.
SAP ERP - Introduction
W/O SAP ERP With SAP ERP
Suppose a client approaches sales team asking for a Different departments can continuously communicate &
particular product. The sales team contacts to inventory exchange data with each other. Success of organization
department to check the availability of the product. To lies in effective communication, and data exchange,
their surprise, sales team found out that the product is within these departments, as well as associated third
out of stock. party such as vendors, sub-contractor, and customers.
SAP ERP - Introduction
Centralized Vs De-Centralized Data management system:
Decentralized System:
Data is maintained locally at the individual departments
Departments do not have access to information or data of other departments
SAP ERP - Introduction
Centralized Vs De-Centralized Data management system:
Centralized System:
Data is maintained at a central location and is shared with various Departments
Departments have access to information or data of other Departments
Key benefits of the centralized system are:
Eliminates the duplication, discontinuity and redundancy
in data.
Provides information across departments in real time.
SAP System is Provides control over various business
processes.
Increases productivity, better inventory management,
promotes quality, reduced material cost, effective HR
management, reduced overheads boosts profits.
Better customer interaction & improves customer service
Centralized enterprise management system is required.
SAP Software is a centralized enterprise management
system also known as Enterprise Resource Planning.
SAP ERP - Introduction
Client/Server Architecture:
The SAP R/3 architecture is based on a 3-tier client/server principle. (GUI - Graphical user interface)
Presentation Server – Specialized in interacting with end-users from Presentation Layer.
Application Server - Specialized in processing business application from the Application Layer.
Database Server - Specialized in management, storage and retrieval of data from the Database Layer.
Presentation / Internet PCs on the LAN / WAN / Internet (CLIENTS)
Application server Application server
Application
Central / Distributed servers
Database server
Database
SAP ERP - Introduction
SAP - Net Weaver:
NetWeaver is a combination of the SAP Kernel and any SAP software tool for business enablement. SAP
NetWeaver describes all the software and services used for 'Business Enablement'.
The SAP Business suite, such as ECC or SRM, contains the software components for that specific business
solution.
------------------------------------------------------------------------------------------------------------------------------------------
SAP landscape: Development –> Quality –> Production
Development system has two clients. 100 – Golden client and 110 – Test client. Golden client is meant only for
configurations. Test client is meant for testing by consultants/core team to test changes before import in Quality
system.
Quality system has two clients. 200 – Test client and 210 – User testing. Test client is for core team testing. User
testing client used by users to perform testing of new changes and client development reports.
Production system
Production system has one client where we book business transaction of day-to-day activities.
SAP ERP - Introduction
SAP Modular Structure:
SAP ERP - Introduction
SAP Logon:
SAP logon is used to create icons to logon to SAP R/3. The SAP logon pad is available once the SAP GUI is
installed at the workstation.
SAP Logon Icon: SAP Logon Pad:
The SAP logon menu is similar to one-stop shopping store, where end-users can choose from logon icons, logon
groups, or create new logon icons. Logon icons will log a user onto one specific application server. A logon group
will log onto one of several applications servers depending on which one has the best performance statistics.
SAP ERP - Introduction
First Time SAP Login: During the first logon to the
system with your ID, system will be prompt to
change your initial password.
Creating New Password: To change password, click on
“New Password” button and set the password.
Select a new password and then confirm it by typing
it again.
Click on the icon once you are satisfied with your
password selection.
SAP ERP - Introduction
First SAP Login: During the first logon to the
system with your ID, system will be prompt to
change your initial password.
Logging Off from SAP:
Click on System (from Menu Bar) and choose “Logoff”.
SAP ERP - Introduction
Single User Multiple Logon on – Warning:
SAP ERP - Introduction
Screen Elements and Maintaining own user data:
Menu Bar
Screen
Title Bar Banner Screen
Header
Application Tool Bar Standard Tool Bar
Screen Body
Insert / Over Type Indicator
SAP System ID Server ID
Status Bar
SAP ERP - Introduction
Mandatory Fields:
This symbol means mandatory field
SAP ERP - Introduction
Creating Favourite Menu:
Create Tree structure by adding folders in
“Favorite” menu option. You can add folders
by placing cursor on Favorite folder and then
right click
Drag and drop the frequently used
transaction from SAP Menu
SAP ERP - Introduction
Display Technical Names:
To know the transaction code we need to enable
the technical names in Extras Settings
SAP ERP - Introduction
Transaction and Command Field:
Entering the transaction code in the command field the
path can be directly reached without going through the
tree
Transaction code hence displayed along with
name, in the tree
SAP ERP - Introduction
Various Navigation Option:
SAP ERP - Introduction
Commonly Used Icons:
ENTER. To be clicked on by the mouse. Or, press ENTER on Key Board.
Facilitates dialogue with the System while maintaining transactions.
SAVE . To be clicked on by the mouse after maintaining the required
entries & after the necessary System dialogues. If not used, the
transactions will not be saved. Alternately, use “ CTRL + S”
BACK . To be clicked on by the mouse to go to the previous record.
Alternately, use “ F3 “.
EXIT . To be clicked on by the mouse if you want to exit to the main Screen
after you log in. Alternately, use “ SHIFT+F3”
CANCEL . To be clicked on by the mouse , if you do not wish to save/ to exit
the current Screen. Alternately, use “ F 12”
SAP ERP - Introduction
Commonly Used Icons:
To create a new Session (Max of 6 sessions allowed). Else, the menu path is
System-> Create Session.
HELP . To know the usage of a filed/message, place the cursor on the field &
click on this icon / else click on “ F1”
MAINTAIN OVERVIEW . To be clicked on by the mouse to see the records
already created/maintained
CREATE : To create a new record. Else, use “ F5”. If previous records exist,
maintains history
CHANGE . Else, use “ F6”. Only for corrections.
SAP ERP - Introduction
Commonly Used Icons:
DISPLAY . Else, use “ F7 “. To see the contents of an Infotype
COPY. (SHIFT + F9). Used to create a new record by copying an earlier record
and where only a few field values are to be changed
DELETE . To delete an erroneous record
Icons to move up & down. Equivalent to “Page up”, “Page down “ keys in
the Key board.
LOCK and UNLOCK . To temporarily block record and release record
SAP ERP - Introduction
Creating a new Sessions:
A new session can be created, keeping the
existing session running, either by
following System Create Session or
clicking the icon above
SAP ERP - Introduction
Created New Session:
Systems detail below indicates the second
Created New Session
SAP ERP - Introduction
End Session:
A session can be ended either by following
System End Session or clicking the icon
above or with transaction code ‘/n’
SAP Material Management
SAP ERP Introduction
SAP MM Introduction
SAP MM Organizational Levels
SAP MM Organizational Relationship
SAP MM - Introduction
SAP MM is know as SAP Material Management system, it is one of the module of SAP that deals with
material management and inventory management.
Material Management process ensures that there is never a shortage of materials or any gaps in the
supply chain process of the organization. SAP MM speeds up the procurement and material
management activities making the business run smoother with complete time and cost efficiency.
It deals with managing the materials (products and or services) resources of an organization with the
aim of accelerating productivity, reducing costs and increase improvement and at a similar time be
versatile to accommodate changes in day to day life.
It deals with the Procurement Process, Master Data (Material & Vendor Master), Account
Determination & Valuation of Material, Inventory Management, Invoice Verification, Material
Requirement Planning etc.
SAP MM - Introduction
MM controls purchasing, inventory management and reporting and
supports the following processes:
MM Material/Service Requirement
Materials
Mgmt. Vendor selection
Purchasing
Receipt of material
Incoming quality control
Settlement of bills
Inventory control, transfer of stocks
Stock accounting and valuation
SAP Material Management
SAP ERP Introduction
SAP MM Introduction
SAP MM Organizational Levels
SAP MM Organizational Relationship
SAP MM – Organizational Levels
Organizational Elements in Material Management:
SAP MM – Organizational Levels
Client:
SAP MM – Organizational Levels
Company Code:
SAP MM – Organizational Levels
Plant:
SAP MM – Organizational Levels
Storage Location:
SAP MM – Organizational Levels
Purchasing Organization:
SAP MM – Organizational Levels
Purchasing Group:
A purchasing organization is further subdivided into purchasing groups (buyer groups), which are
responsible for day-to-day buying activities of a material or a class of materials.
A purchasing group is the key for a buyer or group of buyers responsible for certain purchasing
activities.
Externally, the purchasing group is the principle channel for an enterprise’s dealings with its vendors
on a day-to-day basis.
SAP MM – Organizational Levels
Reference Purchasing Organization:
Reference purchasing organization to facilitate cross-purchasing-
organization procurement transactions.
Agree on more advantageous conditions, and use centrally
agreed contracts based on larger purchase quantities.
Other purchase organizations can use the conditions of reference
purchasing organization for price determination purpose
Standard Purchasing Organization:
• If several purchasing organizations procure for a certain plant,
then one of them can be designated as the standard purchasing
organization for the transactions pipeline procurement,
consignment, and stock transfer.
SAP Material Management
SAP ERP Introduction
SAP MM Introduction
SAP MM Organizational Levels
SAP MM Organizational Relationship
SAP MM – Organizational Relationships
Organizational Relationships:
A plant must always be assigned to one company code. However, a company code can assign to
several plants.
A storage location is always assigned to just one plant. And it is unique within plant.
Purchasing organizations can be responsible for one or more plants. However, a number of purchasing
organizations can be assigned to a plant. For example:
A local purchasing organization,
A cross-plant purchasing organization and
A cross-company-code purchasing organization.
Purchasing organizations can be assigned to a company code.
However, you can also work with purchasing organizations that are not assigned to any company
code (for example, centralized purchasing).
In contrast, sales organizations are always assigned to one company code.
Purchasing Group is an floating elements of organizational structure, it is neither assigned to plant nor
purchasing organization.
SAP MM – Organizational Relationships
Relationship between the Various Organizational Levels:
SAP MM – Organizational Levels
Organizational Levels fields length and type:
