1.  XX Consulting 2000 MM01 - Organizational Structure & Master Data in MM November, 2000

2.  XX Consulting 2000 Instructor YOUR FACILITATOR FOR THIS COURSE IS : Stella Ding Consultant XX Consulting

3.  XX Consulting 2000 Course Description The SAP R/3 Procurement course provides conceptual information and hands-on experience in the procurement business process in the SAP R/3 System. Participants work in teams to perform the following Procurement business processes using data from a case company:  Creating purchase requisitions  Creating purchase orders  Receiving  Processing vendor invoices

4.  XX Consulting 2000 Course Description Participants gain basic knowledge and practice using the R/3 System by focusing on core functions and processes. They are taught to use the system tools (e.g. R/3 documentation) which prepare them to learn additional functions on their own.

5.  XX Consulting 2000 Schedule & Topic Organizational Structure Vendor Master Material Master MM01 - Organizational Structure and Master Data

6.  XX Consulting 2000 Schedule & Topic Introduction to Purchasing Purchase Requisitions RFQs/Quotations Purchase Orders MM02 - Purchasing Processing

7.  XX Consulting 2000 Schedule & Topic Purchasing Information Record Conditions Source List Contract MM03 - Master Data in Purchasing and Contract

8.  XX Consulting 2000 Schedule & Topic Goods Receipt Invoice Verification Material Valuation Procurement Reporting and Analysis MM04 - Miscellaneous

9.  XX Consulting 2000 Topic One: Organization Structures Topic Two: Master Data Vendor Master Records Material Master Records Schedule

10.  XX Consulting 2000 Organizational Elements Definition In the SAP R/3 System: Organizational elements are structures that represent the legal and/or organizational views of an enterprise. You can design your company structure based on your business processes. The organizational elements form a framework that supports all business activities.

11.  XX Consulting 2000 Organizational Elements The SAP R/3 Procurement business process uses the following R/3 organizational elements: Company code Plant Storage location Purchasing organization/group Client

12.  XX Consulting 2000 Client The client is a commercial, organizational unit within the R/3 System, with its own data, master records, and set of tables. From a business perspective, the client forms a corporate group.

13.  XX Consulting 2000 Company Code A company coderepresents an independent accounting unit, for example, a company within a corporate group. The company code is the smallest organizational unit for which you can have an independent Accounting department within external Accounting.

14.  XX Consulting 2000 Plant A plant is an organizational unit within a company. A plant produces goods, renders services, or makes goods available for distribution. A plant can be one of the following types of locations: Manufacturing facility Warehouse distribution center Regional sales office Corporate headquarters Plant

15.  XX Consulting 2000 Plant Client Company code 1Company code 2 Plant 1 Plant 2 Plant 3 Plant 4

16.  XX Consulting 2000 Assigning a Plant to a Company Code Plants Client Company codes 20001000 00030004 00010002

17.  XX Consulting 2000 Storage Location Storage locationsare organizational units that allow the differentiation of material stocks within a plant. Storage Location 0001 Storage Location 0002 Storage Location 0003 Storage Location 0004

18.  XX Consulting 2000 Defining Storage Locations within a Plant Storage locations Plants 000100020003 0001 0002 Company Code 1000

19.  XX Consulting 2000 Purchasing Organization / Group A purchasing organization is an organizational unit structured to negotiate the general conditions of purchase for one or more plants or companies. It is legally responsible for completing purchasing contracts. Purchasing authorization is often established at the purchasing organization level. A purchasing group is the key for a buyer or group of buyers responsible for certain purchasing activities.

20.  XX Consulting 2000 Company codes Client Purchasing Group (Buyer) Purchasing organizations 1003 001 1001 20001000 Buyer K1 Buyer K2 Buyer S01 Buyer S02 …... Organizational Structure in Purchasing 1002

21.  XX Consulting 2000 Company codes Client Plants Purchasing organizations 1002 001 1001 00040003 20001000 00010002 1003 Organizational Structure in Purchasing - Plant

22.  XX Consulting 2000 This unit has provided an overview of the organizational structures of the R/3 System from a Procurement point of View. The main organizational levels are Company Code Plant Storage Location Purchasing organization Views on the master data in the R/3 System result from the organizational structure. You have familiarized yourself with the purchasing group which is responsible for procurement. Organization Procurement: Summary

23.  XX Consulting 2000 Exercise for Organizational Structure Now it’s time for you to do exercise: No exercise!

24.  XX Consulting 2000 Topic One: Organization Structures Topic Two: Master Data Vendor Master Records Material Master Records Schedule

25.  XX Consulting 2000 Master Data contains the records that remain in the database over an extended period of time. Master Data (e.g., Vendor Data) General Data (common across client) Purchasing Data (unique to purchasing organization) Accounting Data (unique to company) Master Data is centrally stored (shared across application modules) and processed to eliminate data redundancy. SAP R/3 Master Data

26.  XX Consulting 2000 Procurement Master Data Important master data in the Procurement process includes: Material Master Vendor Master Purchasing Information Records

27.  XX Consulting 2000 Vendor Master Record Vendor Master The vendor master includes all data necessary for processing business transactions and corresponding with vendors. Information is shared between the accounting and purchasing departments. Data is grouped into three categories: General data Accounting data Purchasing data General data Purchasing data Accounting data

28.  XX Consulting 2000 Material Master Record Thematerial mastercontains all data required to define and manage material. It integrates data from engineering, manufacturing, sales and distribution, purchasing, accounting, and other departments. The material master is used as a source of data for purchase order processing throughout the procurement cycle. Material Master General data Purchasing data Accounting data Sales data Manufacturing data (Etc.)

29.  XX Consulting 2000 Purchasing Information Record Purchasing information recordsdescribe the supply relationship for a material and a vendor. Data includes: Material number Vendor number Vendor-specific data on deliveries, delivery tolerances, and pricing and text During purchase order entry, data can be proposed from the purchasing information record to the order. Material number Vendor number Vendor-specific data

30.  XX Consulting 2000 Topic One: Organization Structures Topic Two: Master Data Vendor Master Records Material Master Records Schedule

31.  XX Consulting 2000 Roles of the Vendor Goods receipt Bank order account ?=?= Invoice verification purchase order Invoice Material Purchasing Payment DEUTSCHE MARK DEUTSCHE MARK DEUTSCHE MARK Vendor

32.  XX Consulting 2000 Basic Organizational levels Purchasing organization data General data Company code data Company code 001

33.  XX Consulting 2000 Maintenance of Vendor Master Record Purchasing organization data General data Company code data Company code 001 The purchasing and/or the accounting departments can maintain general vendor data. Purchasing organization vendor data can be maintained separately by each purchasing organization. Accounting vendor data can be maintained separately for each company. Purchasing and accounting vendor data can be maintained separately or centrally.

34.  XX Consulting 2000 Optional Organizational levels Plant-specific data and vendor sub-ranges has been acted as optional data levelsin the vendor master to allow greater control: Plant Level: Allows plant-specific purchasing data. Plants in the same company code will share the same accounting data. Vendor sub-range : Allows the vendor master to reflect the vendor’s organization. For example, vendor ABC has three different divisions with unique pricing conditions for each one. Plant/sub-range : Allows vendor sub-ranges to be plant specific. Plant-level data and vendor sub-ranges should only be used when needed due to increased data maintenance.

35.  XX Consulting 2000 Vendor master Area of validity Purchasing data Accounting data Client Purchasing organization code -One company code General data Company -Allpurchasing - organizations Allcompany codes -Onepurchasing organization Bank details Payment transaction Account management code Company Data group Client Purchasing Data PO currency Partner roles Address Communication Purchasing organization

36.  XX Consulting 2000 Vendor Account Group Type of number assignment Number assignment interval Field selection An account group defines the control functions for vendor master record maintenance. Every vendor master is managed under an account group. Allowance of vendor sub-ranges or plant level data Partner procedure assignment Account group determines... Vendor or one-time vendor status

37.  XX Consulting 2000 Vendor Master Reconciliation Account Enter vendor invoice "Parallel" Reconciliation Account G/L Accounting Vendor A Subsidiary Ledger R/3 System The reconciliation account is the G/L account used by A/P. The reconciliation account and the vendor subsidiary ledger are updated in parallel by the posting of an invoice. Line item details are kept in the subsidiary ledger. Summary information is kept in the reconciliation account.

38.  XX Consulting 2000 Partner Functions A business partner is one who is directly involved in a business transaction with you. Business partners for purchasing are vendors; likewise, the partners for sales and distribution are customers. The following information is stored in vendor master records: Business partners Contact persons  Data on contact persons is stored in the vendor master record of the respective business partner. Partner Functions

39.  XX Consulting 2000 Partner Functions  SAP AG Partner functions (partner roles) allow the assignment of different locations or companies to a single vendor master. Partner functions address the different roles a particular vendor can have with you. For example, a vendor may have one address, contact person, and phone number for receiving orders and a different address, contact person, and phone number for receiving invoices. Partner functions keep this data organized by storing each function for the vendor in one vendor master record. Partner Functions

40.  XX Consulting 2000 Partner Functions  SAP AG Partner Functions Vendor master records: Only one vendor master record is necessary if one vendor fulfills the functions of order recipient, goods supplier, invoicing party, and payee. Multiple vendor master records are necessary if the functions are divided among different locations or companies. They are linked through partner functions. The partner functions are copied into each purchasing document from the vendor master record.

41.  XX Consulting 2000 Partner functions (partner roles) Order Recipient Supplier of Goods Invoicing Party Payee The vendor is the only mandatory partner function. A contact person may be specified for each partner role. Vendor

42.  XX Consulting 2000 Vendor Master Summary The vendor master can be maintained centrally or on a decentralized basis General data is managed at the client level,purchasing data at the purchasing organization level, and accounting data at company code level Vendor master records are assigned to an account group. The account group determines the control functions for maintenance ( field selection, number assignment, partner determination schema, etc. Vendor postings require a control account ( G/L account ) If the business partner does not utilize all of the vendor’s roles, several vendor master records have to be created and are managed via partner roles

43.  XX Consulting 2000 Exercise for Vendor Master Now it’s time for you to do: MM01 - Exercise 1 20 minutes

44.  XX Consulting 2000 Topic One: Organization Structures Topic Two: Master Data Vendor Master Records Material Master Records Schedule

45.  XX Consulting 2000 General Concepts The material master contains information about the materials an enterprise buys, produces, stores, and sells. Information is stored in a database that is used as a central repository for material data. Material data is used throughout the R/3 System. Applications related to Procurement include: Purchasing Inventory Management Invoice Verification MRP Material Master Data

46.  XX Consulting 2000 Organizational Levels in Material Master General data Material number Description Units of measure Technical data Plant-specific data MRP data Purchasing data Storage location data Stock quantities Client Plant Storage Location The Material master has a hierarchical structure, which covers the following organizational levels: Client plant storage location Organizing materials hierarchically allows easy management of information and prevents redundant storage of material data.

47.  XX Consulting 2000 Primary Views Material master record Material planning St t Purchasing Sales and distribution Storage Quality management Stocks in plant-warehouse A B Warehouse management Classification Forecast Accounting Each user department has its own view of the material master containing department-specific data.

48.  XX Consulting 2000 Material Master View Selection Screen The R/3 System allows selection and maintenance of the data that is relevant to a particular department To create a view, the view must be selected on this screen before material data is entered Users are responsible for creating and maintaining the view(s) of the material that are relevant to their department(s) Changes are recorded in history

49.  XX Consulting 2000 Levels in material master maintenance Material Initial level Purchasing St t Engineering MRPSalesForecast Accounting department Main work level Units of measure Additional data level Texts Management data Consumption Additional data level

50.  XX Consulting 2000 Material Types and Industry Sectors Semi-finished products Raw materials Semi-finished products Finished products Others Mechanical engineering Chemical industry Material master records are grouped according to industry sectormaterial Industry sector information determines the industry- specific data that will appear on the material master record. Material type information determines what departmental views are maintained and how inventory will be handled (quantity and value updates).

51.  XX Consulting 2000 Industry Sector Industry sector determines the type of industry to which the material will be assigned. Industry sector information determines: which screens will appear and in what sequence. what industry-specific data will appear.

52.  XX Consulting 2000 Material Type Material types group materials with the same basic attributes. Material type information determines: Which departmental views are maintained. Whether changes in material quantities are updated. Whether internal or external procurement is allowed. Which general ledger accounts are updated (e.g., inventory account).

53.  XX Consulting 2000 Material Type - default parameters Account assignment Can material be configured? Quantity / value update Price control Variances per plant Material A Material type  Data views / screen sequence  Number range / assignment  Description  Field reference  Item category group  Price control  Internal / external purchase orders  Valuation / account assignment

54.  XX Consulting 2000 Material master record - data areas General data Material number Description Units of measure Technical data Plant-specific data MRP/type Planned delivery time Purchasing group Batch indicator Valuation Valuation price Valuation procedure Valuation quantity Sales-specific data Delivering plant Sales texts Unit of measure Palleting instruction Storage location- specific data Storage time Stock fields Forecast data Consumption data Warehouse Manage- ment system data

55.  XX Consulting 2000 Units of measure Base unit: Piece (ea) Box (unit of issue) Crate (order unit) Pallet (sales unit) 49616

56.  XX Consulting 2000 Material creation - Accounting... MART Allowed values ROH 3000 3010 HALB 7920 HIBE 3000... Mat. stock account 300000 300100 790000 300000 Valuation class

57.  XX Consulting 2000 Material creation - Accounting Price control Standard price control: Valuation at standard price from the material master record Moving average price control: Landed price (e.g. order price) influences the valuation price ? ? S S V V

58.  XX Consulting 2000 Display options for material data Display Stock overviewList of materials Data for this material Material List of selected material Stocks per plant/ storage location

59.  XX Consulting 2000 Additional functions Change Flag for deletion Change document Material

60.  XX Consulting 2000 Changing / extending the material Material master record Purchasing Sales and distribution Stocks in plant-warehouse A B Engineering Accounting Requirements planning St t Classification Data view to be “created”

61.  XX Consulting 2000 Material Master Summary A material has different organizational levels Material processing is controlled by the material type, the industry sector and the material status The data in a material master record is divided between different views ( departments ) In addition to data pertaining to the organizational levels, a view usually contains data for more general organizational levels The material master record can be maintained centrally or can be maintained on a decentralized basis according to the organizational levels and views

62.  XX Consulting 2000 Exercise for Material Master Now it’s time for you to do: MM01 - Exercise 2 30 minutes

63.  XX Consulting 2000 Congratulations !