Materials Management (MM) Organizational Structure EGN 5620 Enterprise Systems Configuration Fall, 2015.

Materials Management (MM) Organizational Structure EGN Enterprise Systems Configuration Fall, 2015

MM Organizational Structure SAP Implementation

MM Organizational Structure Related Topics
ECC 6.0 January 2008 MM Organizational Structure Related Topics MM Organizational data & structures Organizational relationships January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Business Process Integration
ECC 6.0 January 2008 Business Process Integration FI SD MM Transactions Org Data Master Data FI MM SD Rules FI MM SD FI In the Business Process Integration class we use the stool as a metaphor for the SAP structure. There are four basic components needed to run execute SAP. Three of these are the legs of the stool: org data, master data, and rules. These ‘hold up’ the transactions. Transactions cannot be run unless these are setup. The legs are typically configured during the implementation process. During BPI 1 we will setup the stool for Finance, Materials management and Sales and Distribution. MM SD January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

MM Organizational Data
ECC 6.0 January 2008 MM Organizational Data MM Org Data We will now create organization data for the material master. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Data A hierarchy Static data and rarely changed
ECC 6.0 January 2008 Organizational Data A hierarchy Multi level structure Organizational units at each level arranged according to tasks and functions Static data and rarely changed Master data does not change very often Org data – should not change Transaction data (application data) – changes every transaction If you setup organizational data and wish to change it, it very well may be more work than the initial setup. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Structure
ECC 6.0 January 2008 Organizational Structure Client Company Chart of Accounts Code Fiscal Year Variant Credit Control Area Controlling Area You have to assign a chart of accounts to each company code. This chart of accounts is the operating chart of accounts and is used for the daily postings in this company code. You do not have to create a company You do have to create a company code The only reason to create a company is when you have to create a consolidated financial statement January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

SAP Org. Structure Client Company Chart of accounts Company code
ECC 6.0 January 2008 SAP Org. Structure Client Company Chart of accounts Company code Fiscal year variant Credit control area Controlling Area You are not going to create a client or company: The client and company is going to be setup for us already. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Client (review) Highest hierarchical level in an SAP environment
ECC 6.0 January 2008 Client (review) Highest hierarchical level in an SAP environment A complete database containing all the tables necessary for creating a fully integrated information system Master records are created at the client level The client may be the enterprise and you may want to share customers at the company level Client Definition A commercially, organizationally, and technically self-contained unit within an SAP System. Clients have their own master records and set of tables. The definition of the client organizational unit is obligatory. Use The client is the highest level in the SAP System hierarchy. Specifications that you make, or data that you enter at this level are valid for all company codes and for all other organizational structures. You therefore only need to make these specifications, or enter this data once. This ensures that the data is consistent. Users must enter a client key when they log on to the SAP System. This defines the client in which they wish to work. All the entries you make are saved per client. Data processing and analysis is also carried out per client. This means that you cannot include customer accounts from different clients in one dunning run. Access authorization is assigned per client. You must create a user master record for each user in the client where he or she wishes to work. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Company Consolidated financial statements are created at the company level A company can include one or more company codes All company codes must use the same chart of accounts and fiscal year Company is not required in the definition of an enterprise (optional) A company is the smallest organizational unit for which individual financial statements can be drawn up according to the relevant commercial law. A company can contain one or more company codes. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Chart of Accounts A Chart of Accounts contains a complete list of all of the accounts utilized in the General Ledger for a given company A chart of accounts must be assigned to every company code in order to create the General Ledger for that company Several company codes can use the same chart of accounts Chart of Accounts This is a list of all G/L accounts used by one or several company codes. For each G/L account, the chart of accounts contains the account number, account name, and the information that controls how an account functions and how a G/L account is created in a company code. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Company Code (review) A legally independent entity
ECC 6.0 January 2008 Company Code (review) A legally independent entity Smallest organizational unit for which accounting can be carried out Business transactions are processed at this level Accounts are managed at this level Legal financial statements, such as the balance sheet and the income statement, are generated at this level required by US SEC (Securities & Exchange Commission) The smallest organizational unit for which a complete self-contained set of accounts can be drawn up for external reporting. This involves recording all relevant transactions and generating all supporting documents for financial statements, such as balance sheets and profit and loss statements. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Fiscal Year Variant Specifies the accounting fiscal year for reporting purposes Special periods are created to aid in the quarterly or year-end adjusting process completed prior to preparing financial statements A single fiscal year variant is assigned to each company code You use fiscal year variants to define: How many posting periods there are in a fiscal year How many special periods you require How the system is to determine the period for postings you enter. K1, for example has 13 periods, 12 plus 1 special January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Credit Control Area An organizational unit or area of responsibility created to control customer credit limits A company code is assigned to one and only one credit control area Multiple company codes can be assigned to one credit control area An organizational unit that represents the area where customer credit is awarded and monitored. This organizational unit can either be a single or several company codes, if credit control is performed across several company codes. One credit control area contains credit control information for each customer. Credit and risk management takes place in the credit control area. According to your corporate requirements, you can implement credit management that is centralized, decentralized, or somewhere in between. If GM control credit at company code level dealership Sells Chevrolet - $10 million credit Things go well Applies for Buick - $10 million credit Add Pontiac, etc. Soon $50 million with GM TOO much If GM managed at company level instead of company code level. It would have stopped at $10 million January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Controlling Area An organizational unit that serves to broadly define a managerial accounting and reporting system Each company code can be assigned to one and only one controlling area Controlling areas can consist of multiple company codes thereby enabling cross-company allocations January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Controlling Area (continued)
ECC 6.0 January 2008 Controlling Area (continued) Overhead Cost Accounting Modules SD MM HR FI Cost and Revenue Accounting Profit Center Accounting Product Cost Controlling Profitability Analysis January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Cost Center Standard Hierarchy
ECC 6.0 January 2008 Cost Center Standard Hierarchy An organizational unit that serves to refine and focus a managerial accounting and reporting sub-system Each standard hierarchy is attached to the appropriate Controlling Area All cost centers (groups) of interest must be entered in the Standard Hierarchy A mapping of responsibility to individual managers and cost centers facilitate: Expense collection Expense tracking Expense reporting January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Cost Center Groups Logical groupings of cost centers in the standard hierarchy to establish accountability and responsibility for one or more cost centers Facilitates reporting, planning, and allocating costs at a more aggregated level January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Cost Centers Designation
ECC 6.0 January 2008 Cost Centers Designation Units that are distinguished, for example, by area of responsibility, location, or type of activity Copy center Security department Maintenance department One or more value-added activities are performed within each cost center Can be permanent or temporary (e.g., internal order) January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Profit Centers primary revenue collection objects in the system
ECC 6.0 Profit Centers January 2008 primary revenue collection objects in the system posted to all balance sheet postings can be attributed by cost centers assigned to a single controlling area and a single company code grouped together into a hierarchy to represent the organization structure for analysis of income versus expenditure for different parts of a organization Some organizations don’t have profit centers January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

SAP MM Organizational Structure
ECC 6.0 January 2008 SAP MM Organizational Structure Plant Valuation Area Storage Locations Shipping Point Purchasing Organizations Purchasing Groups There are five organizational structures that we will define for our material management Plant Valuation area Storage locations Purchasing organizations Purchasing groups January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Plant Lowest valuation area
ECC 6.0 January 2008 Plant Lowest valuation area Organizational level where Material Requirements (MRP) runs Generally used to describe a production site, a distribution center or centralized warehouse May be a physical or logical unit Plant is a physical or logical location It may be a warehouse: PHYSICAL Vendor are in warehouse (Vendor managed inventory) Customer site (consigned inventory): LOGICAL Can do multiple plants within the same physical structure We value material at the plant level. Planning done at the plant not organizational level The plant is an operating area or branch within a company. The plant is embedded in the organizational structure as follows: The plant is assigned to a single company code. A company code can have several plants. Several storage locations in which material stocks are managed can belong to a plant. A single business area is assigned to a plant and to a division. A plant can be assigned to several combinations of sales organization and distribution channel. A plant can have several shipping points. A shipping point can be assigned to several plants. A plant can be defined as a maintenance planning plant. A plant has the following attributes: A plant has an address. A plant has a language. A plant belongs to a country. A plant has its own material master data. You can maintain data at plant level for the following views on a material master record in particular: MRP, Purchasing, Storage, Work scheduling, Production resources/tools, Forecasting, Quality management, Sales, Costing. The plant plays an important role in the following areas: material valuation If the valuation level is the plant, the material stocks are valuated at plant level. If the valuation level is the plant, you can define the material prices for each plant. Each plant can have its own account determination. inventory management The material stocks are managed within a plant. MRP Material requirements are planned for each plant. Each plant has its own MRP data. Analyses for materials planning can be made across plants. production costing In costing, valuation prices are defined only within a plant. plant maintenance If a plant performs plant maintenance planning tasks, it is defined as a maintenance planning plant. A maintenance planning plant can also carry out planning tasks for other plants (maintenance plants). January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 Valuation Area January 2008 Valuation area determines at which level a material is valuated (inventory value is established) SAP ERP allows valuation at the company code or plant level, but recommends valuation area be set at the plant level We are going to create at the plant level. System defaults to plant level. Define valuation level You define the valuation level by specifying the level at which material stocks are valuated. You can valuate material stocks at the following levels: Plant level Valuation must be at this level in the following cases: If you want to use the application component Production Planning (PP) or Costing Company code level The decision you make is valid for the whole client. You are recommended setting material valuation at plant level. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Storage Location Subdivision of a plant
ECC 6.0 January 2008 Storage Location Subdivision of a plant Where materials are managed (inventory management) Raw Materials Finished Products Semi-finished products Trading materials Miscellaneous materials Maintenance, Repair, and Other (MRO) materials May be a physical or logical unit Maintain storage location A storage location is the place where stock is physically kept within a plant. A storage location has the following attributes: There may be one or more storage locations within a plant. A storage location has a description and at least one address. It is possible to store material data specific to a storage location. Stocks are managed only on a quantity basis and not on a value basis at storage location level. Physical inventories are carried out at storage location level. A storage location can be assigned to a warehouse number in the Warehouse Management System . You can assign more than one storage location to the same warehouse number within a plant. Storage locations are always created for a plant. Could be inventory management Production floor Quality Engineering bin January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Relationship
ECC 6.0 January 2008 Organizational Relationship Plant/Storage Location Storage Location 20 - Quality 10 - Inventory Plant P001 Storage locations are assigned to a plant Do not confuse inventory locations with storage locations Storage locations equates to a warehouse Inventory location is a bin or place where individual inventory is kept We would want to create these things because we want to have them in quality until we inspect them. Could have a return: Check the return before we place it back into inventory. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Shipping Point Shipping points are independent organizational entities within which processing and monitoring of the deliveries as well as goods issue is carried out. A delivery is processed by one shipping point only. Maintain storage location A storage location is the place where stock is physically kept within a plant. A storage location has the following attributes: There may be one or more storage locations within a plant. A storage location has a description and at least one address. It is possible to store material data specific to a storage location. Stocks are managed only on a quantity basis and not on a value basis at storage location level. Physical inventories are carried out at storage location level. A storage location can be assigned to a warehouse number in the Warehouse Management System . You can assign more than one storage location to the same warehouse number within a plant. Storage locations are always created for a plant. Could be inventory management Production floor Quality Engineering bin January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

SAP (Sub)modules in MM (I)
ECC 6.0 January 2008 SAP (Sub)modules in MM (I) Purchasing Management SAP sub-module that involves the acquisition of goods and services to support the creation of goods and services in the organization Master data for the purchasing management exists in the (MM) as well as the (FI) modules It interfaces with the Production Planning (PP), and Quality Management (QM) modules Inventory Management A SAP sub-module that involves goods movement, material stock and inventory controlling, material documents, & period processing January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Purchasing Organization
ECC 6.0 Purchasing Organization January 2008 An organizational unit responsible for procuring materials or services for one or more plants and for negotiating general conditions of purchase with vendors. Legal responsible for all external purchase transactions. A purchasing organization can be assigned to more than one company code Required to a plant – PO org purchases for the plant Multiple purchasing orgs – Centralized – Does it for all plants Maintain purchasing organization From the Materials Management and Purchasing view, the purchasing organization is responsible for all purchasing activities (including the processing of requests for quotations and purchase orders, for example). The purchasing organization is integrated within the organizational structure as follows: A purchasing organization can be assigned to several company codes. (= Corporate-group-wide purchasing). A purchasing organization can be assigned to one company code. (= Company-specific purchasing). A purchasing organization can also exist without being assigned to a company code. Since each plant must be assigned to a company code, the latter can be determined via the plant at the time of each procurement transaction even if the procuring purchasing organization has not been assigned to a company code. A purchasing organization must be assigned to one or more plants. (= Plant-specific purchasing). A purchasing organization can be linked to one or more other purchasing organizations. (= reference purchasing organization) For more on this topic, refer to Assign Purchasing Organization to Reference Purchasing Organization. A purchasing organization can be divided into several purchasing groups that are responsible for different operational areas. Each purchasing organization has its own info records and conditions for pricing. Each purchasing organization has its own vendor master data. Each purchasing organization evaluates its own vendors using MM Vendor Evaluation. Authorizations for processing purchasing transactions can be assigned to each purchasing organization. All items of an external purchasing document, that is, request for quotation, purchase order, contract, or scheduling agreement, belong to a purchasing organization. The purchasing organization is the highest level of aggregation (after the organizational unit "client") for purchasing statistics. The purchasing organization serves as the selection criterion for lists of all purchasing documents. Possible organizational forms You can organize your purchasing function in the following ways: Corporate-group-wide purchasing Company-specific purchasing Plant-specific purchasing All of these forms can co-exist within a single client. Corporate-group-wide purchasing: A purchasing organization is responsible for the purchasing activities of different company codes. In this case, you do not assign a company code to the purchasing organization, but specify the company code concerned for each individual purchasing transaction. You assign plants from different company codes to the purchasing organization. Company-specific purchasing: A purchasing organization is responsible for the purchasing activities of just one company code. In this case, you assign a company code to the purchasing organization. The purchasing organization may procure only for this company code. You assign only plants of the company code concerned to the purchasing organization. Plant-specific purchasing: A purchasing organization is responsible for the purchasing activities of one plant. In this case, you assign the plant and the company code of the plant to the purchasing organization. The purchasing organization may procure for this plant only. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Structure
ECC 6.0 January 2008 Organizational Structure Purchasing Organization – P001 Company Code C001 Storage Location 20 - Quality 10 - Inventory Plant P001 Group N## We have been asked over and over to provide how it all fits together. You can’t It really DEPENDS on the organization. IT IS COMPLETELY CONFIGURABLE! In this example the purchasing organization buys for more than one plant Storage locations can be the same for every plant. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Relationships
ECC 6.0 January 2008 Organizational Relationships Plant/Purchasing Organization (1) Company code C001 Purchasing Organization – P002 Organization – P001 Plant P001 Decentralized purchasing One company code/plant – multiple purchasing organizations January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Relationships (Continued)
ECC 6.0 January 2008 Organizational Relationships (Continued) Plant/Purchasing Organization (2) Purchasing Organization – P001 Plant P001 Purchasing Organization – P002 Plant P002 Each plant has its own purchasing organization January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Relationships (Continued)
ECC 6.0 January 2008 Organizational Relationships (Continued) Plant/Purchasing Organization (3) Plant – P002 Plant – P001 Purchasing Organization – P001 Centralized purchasing One purchasing organization for multiple plants January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Relationships (continued)
ECC 6.0 January 2008 Organizational Relationships (continued) Plant/Purchasing Organization (4) Company Code C002 C001 Purchasing Organization – P001 Plant – P002 Plant – P001 Centralized We can set up the purchasing for multiple companies and the plants within them. One purchasing organization for multiple company codes January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Purchasing Group Responsible for specified purchasing activities
ECC 6.0 January 2008 Purchasing Group Responsible for specified purchasing activities Often used to identify individual buyers Used for reporting Purchasing Group Definition A purchasing group corresponds to a buyer or group of buyers who perform the following purchasing activities: Procuring certain articles or merchandise categories Acting as the contact for vendors The purchasing group is also responsible for the day-to-day planning of requirements and ordering of merchandise.This includes creating purchase orders, allocation tables and promotions. It can also send vendors requests for quotation or create purchase requisitions. Or we could have individual buyers under the purchasing group Metals Government January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Organizational Relationships
ECC 6.0 Organizational Relationships January 2008 Purchasing Organization/Purchasing Group Purchasing Organization – P001 Purchasing Group 001 Purchasing Group 002 A purchasing organization can have multiple purchasing groups. For instance, one group could specialize a one type of material procurement while another could special in another. This often take place in industrial fabrication shops that use a lot of steel. One person/group is in charge of procuring and getting delivered the steel rolls, etc. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

SAP Modules using MM Warehouse management (WM)
ECC 6.0 January 2008 SAP Modules using MM Warehouse management (WM) A SAP module that focuses on managing materials location in a warehouse No connection with its financial module The execution of purchase order is primarily done in Materials Management, but parts of the procurement process are cross-module. A/P resides in finance, and receipt quality check in Quality Management. Putaway’s from receipt can interface with the Warehouse Management module. Org structure in MM and FI Master Data in MM and FI Rule and transaction Data interface with MM, FI, PP, WW, and QM January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Warehouse Management WM is not required for purchasing functionality of SAP ERP Many functions and elements can be performed outside of the module Warehouse Management System (WMS) Purpose The SAP Warehouse Management system (WMS) provides flexible, automated support in processing all goods movements and in managing stocks in your warehouse complex. The system supports scheduled and efficient processing of all logistics processes within your warehouse. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Warehouse Management Elements
ECC 6.0 January 2008 Warehouse Management Elements Receiving, identifying and sorting goods Placing goods into storage bins Taking inventory Monitoring and inspecting goods in storage Preplanning distribution of materials Picking and accumulating orders Packaging, loading and shipping goods Storage Bin Management You map your entire storage facilities in the Warehouse Management system. In doing so, you can set up various storage facilities such as automatic warehouse, high rack storage areas, bulk storage or fixed storage bins in various storage types, according to your needs. You manage material stocks at storage bin level. You can define these storage bins according to your own requirements. Every storage bin in your warehouse is mapped in the system. This lets you monitor all warehouse movements at all times. You can follow where a certain material is in your warehouse. SAP Inventory Management and the SAP Warehouse Management system are fully integrated. With its inventory procedure and recording of stock differences, the system ensures that the inventory balance in Inventory Management always corresponds to the warehouse stock in the WMS. Goods Movements You process all goods movements that affect your warehouse via the WMS. This includes goods receipts, goods issues, stock transfers, material staging for production, automatic replenishment, managing hazardous materials, and processing stock differences in your warehouse. The WMS optimizes warehouse capacities and material flows using putaway and stock removal strategies, which you can adjust to suit your individual needs, or by using storage units. Planning and Monitoring The WMS offers you an overview of all goods issues and warehouse stocks. The system supports you in planning, monitoring, and optimizing work processes. For example, it gives you a foresighted view of the workload in the coming days or allows you to intervene in good time during critical warehouse processes, so that you can execute warehouse movements on time. Via the RF monitor, you get an up-to-date picture of all of the activities in the warehouse, which means that you can control the actual work in the warehouse using the RF monitor. Radio Frequency Connection In order to structure the work in the warehouse efficiently and cost-effectively, you control the warehouse workers’ work steps clearly and simply via mobile radio-frequency terminals. Radio frequency connection (RF connection) to mobile date entry achieves quick and flawless data transfer. The RF machines receive data directly from the SAP system and transfer data back to the system. Using barcodes, you can record information to be recorded and verify it. This means that you ensure a high standard of quality in your warehouse. Decentralized WMS You can run the WMS as a standalone decentralized warehouse management system, independent of a central enterprise resource planning system (ERP system). For more information, see Decentralized Warehouse Management. Warehouse Control WMS also has an interface to external systems (warehouse control units), so that you can integrate automatic putaway, stock removal systems or fork lift control January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Inventory Management & Warehouse Management Relationships
ECC 6.0 January 2008 Inventory Management & Warehouse Management Relationships Inventory Management (MM) Company Code Plant Storage Loc. Warehouse User definable warehouse levels Mimics the physical layout in the actual warehouse. We will be setting up the upper level (Material Management system) We will NOT be setting up the warehouse management system. Aisle Storage Rack Warehouse Management (WM) Quantity January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

MM Rules MM Rules MM ECC 6.0 January 2008
In the Business Process Integration class we use the stool as a metaphor for the SAP structure. There are four basic components needed to run execute SAP. Three of these are the legs of the stool: org data, master data, and rules. These ‘hold up’ the transactions. Transactions cannot be run unless these are setup. The legs are typically configured during the implementation process. During BPI 1 we will setup the stool for Finance, Materials management and Sales and Distribution. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Rules Rules define the parameters for Master Data and Transactions
ECC 6.0 Rules January 2008 Rules define the parameters for Master Data and Transactions Rules determine functionality for Master Data and Transactions Rules are relatively fixed Rules change, when corporate policy changes Master data does not change very often Org data – should not change Transaction data (application data) – changes every transaction Rules are relatively fixed. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Rules in Material Management
ECC 6.0 Rules in Material Management January 2008 Fiscal Periods Account Groups Material Types Plant Parameters Purc./Rec./Inv. Tolerances Automatic Account Assignment Reservations Material Group Loading Group January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Global Bike, Inc. MM Organizational Structure

GBI. Organizational Structures
Plant (DL## /MI##/SD## _) Client (330) Chart of Accounts (GL##) Company Code (US##) Fiscal Year Variant (K1) Credit Control Area (GL##) Purchasing Organization (US##) Group (N##) Controlling Area (NA##) RM## FG## Cost Center Standard Hierarchy (NA##) N10## N10## N10## N10## N10## SF## TG## MI## N11## N12## Cost center groups Work center (ASSY/INSP/PACK/MANT/SERV) NAEX10## NAEX20## NAIS10## Cost centers Shipping Point (DL##/MI##/SD##)

Exercises: (Due Date 9/5/2015)
1. Define account group 2. Copy document number range 3. Set up company for payment transaction 4. Maintain number ranges for controlling 5. Define tolerance groups for employees 6. Define retained earnings account 7. Copy general ledger accounts 8. Create standard hierarchy 9.Maintain purchasing organization 10.Assign purchasing organization 11. Assign purchasing organization to plants 12.Create purchasing group 13.Group together valuation areas

Materials Management (MM) Organizational Structure EGN 5620 Enterprise Systems Configuration Fall, 2015.

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Materials Management (MM) Organizational Structure EGN 5620 Enterprise Systems Configuration Fall, 2015.

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