MATERIALS

MANAGEMEN
 MATERIALS MANAGEMENT
DEFINITION:
Material management is concerned with
planning, organizing and controlling the flow of
materials from their initial purchase through
internal operations to the service point through
distribution. Aim
To GET
SCOPE
Emphasis on the acquisition The Right quality
aspect 5R Right quantity of supplies
At the Right time
Inventory control and stores
At the Right place
management At the Right cost
Material logistics, movement
control and Handling aspect
Purchasing, supply
, transportation , materials
 MM in SAP
The Materials management (MM) function
of SAP is part of the logistics area.
It is one of the important modules in SAP
ERP software and MM application module
supports the procurement and inventory
functions occurring in day-to-day business
operations.

The Materials Management module consists of

all master data, system configuration, and
transactions to complete the Procure to Pay
process.

This process map spans from MRP generated

procurement proposals through final invoice
receipt and verification.
 Purchasing
External procurement of materials and services
And Determination of possible sources of supply
for a requirement identified by the materials
planning and control system or arising directly
within a user department
Valuation
It includes material price Inventory
change, balance sheet management
valuation, actual costing/material
ledger It deals with Management
of material stocks on a
quantity and value basis
Foreign trade
Manage import and export Material master
processes, integrating them It information on all the materials
that a company procures or
efficiently into the supply chain produces, stores, and sells.
Logistic invoice verification MRP
It is situated at the end of the logistics supply chain It includes, Reorder point
that includes Purchasing, Inventory procedure
Management, and Invoice Verification. Forecast-based planning
Time-phased materials
planning
Service master
It provides a basic process for the
Product catalog procurement of externally performed
The materials and prices in the product services.
catalog
 ORGANIZATIONAL STRUCTURE

The organizational structures form a

framework of a company in which
business is conducted.

A hierarchy in which the organizational units in an

enterprise are arranged according to tasks and
functions

MM module is fully integrated with other modules in the SAP R/3

System such as Finance (FI), Controlling (CO), Sales and Distribution
(SD), Quality Management (QM), Plant Maintenance (PM), Production
Planning (PP), and Warehouse Management(WM).
 ORGANIZATIONAL STRUCTURE

MM
STRUCTURE
Client
Company code
Plant
Storage location
Sub Modules of MM
Purchasing •Material Planning
organization •Purchasing
Purchasing group •Inventory Management
•Vendor Valuation
•Invoice Verification
•Statutory Requirements
 Client:
Represents a grouping or combination of
legal, organizational, business and/or
administrative units with a common purpose.

Company Code:
Company Code represents an independent accounting unit within a client. Each
company code has its own balance sheet and its own profit and loss statement.
Plant:
Operational unit within a
Storage Location: company code.
This level contains the data specific to a storage
location. Stock levels are an example of the
data maintained for each storage location.

Purchasing Organization:
An organizational unit responsible for procuring materials or
services for one or more plants and for negotiating general
conditions of purchase with vendors. The purchasing organization
assumes legal responsibility for all external purchase transactions.
Purchasing Group:
The purchasing organization is further subdivided into purchasing
groups, which are responsible for day-to-day buying activities. A
purchasing group can also act for several purchasing organizations
 Determine
requirements

Invoice
verification
Source
determination

Materials
goods receipt
and inventory management
management

Vendor
selection

Order-
follow up

Order
processing
 JOB roles of SAP MM consultant

Role during implementation of the project

Understand the business requirements, Setting up organization
structure of MM and relevant configuration like Purchase
organization, valuation area plants, storage location, and warehouse
structure etc.
Finalization of material groups, purchasing groups, payment
terms, Inco terms, material master, vendor master and all purchasing
and inventory documents, Pricing Procedure, Purchase requisition
and purchase order and set up of Indian taxation structure.

Role during support project

Interaction with client through net meetings, calls & emails.
Handling Tickets & Tasks and responsible for closing the same within defined
SLAs, and troubleshooting the issues in the system and providing
support, Executing the needed changes in configuration, analysis and
resolution of production support calls
Raising Change Requests (CRs) and writing functional specifications for them
and Preparing test data for testing CRs, Testing CRs (Change Requests) and
preparing test results
 Reaching SAP
Menu Path:
implementation guide(IMG)
SAP Easy Access

Tools

Customizing

IMG

Execute Project
click on “SAP Reference IMG”
Configuration nodes related
to MM & other Modules
 Creating plant

Menu Path:

SAP IMG

Enterprise Structure

Definition

Logistics- general

Define, Copy
Delete, Check plant
 Creating storage location

Menu Path:

SAP IMG

Enterprise Structure

Definition

Materials management

Maintain
storage location
Creating purchase
order
Invoice verification
 Determine
requirements

Invoice
verification
Source
determination

Materials
goods receipt
and inventory management
management

Vendor
selection

Order-
follow up

Order
processing
 • Invoicing
Invoice Posting
Variances and Blocking Reasons
Release Blocked Invoices
Automatic Settlements - Evaluated Receipt

SYLLABU Settlement (ERS)

• Valuation and accounts assignment
Materials Price Change
• Basic overview
S SAP overview
SAP MM overview
Materials Valuation Type
Configure Automatic Account Determination
• Materials Requirements Planning (MRP)
• Procurement process in SAP MM
Planning Requirements
Master Data
Over All Procedures
Materials Master
Planning Run
Vendor Master
• Reporting in SAP MM
purchasing
Reporting at Document Level
Special stocks and special procurement types
Reporting with the Logistics Information
source determination
System
release procedures for purchasing documents
• Configuration
• Inventory management
Enterprise Structure in MM
Goods Receipt
Materials Master
Goods Issue
Purchase Requisition
Transfer Posting
• Integration of MM with various modules
Reservation
Overview of integration of MM with other
Physical Inventory
modules FICO, SD and PP
 Salary range for SAP MM
consultant
freshers

lessthan 1 year

1-4 years

5-9 years

10-15 years

15 years and more

0 2 4 6 8 10 12 14
 CONCLUSION
• SAP SD module is the one which is very interesting and important module in SAP compare
to other modules.
• This includes the material management in industry, it is responsible for all the steps during
the purchase of materials and maintaining that materials.
• MM module is integrated with other SAP modules such as controlling(CO), sales and
distribution(SD), quality management(QM), plant maintenance(PM), production
planning(PP), warehouse management(WM) and financial accounting(FI).
• This module has a great impact on every industry because every industry works on
this, so demand for this module is more compare to other modules in SAP.
• The opportunities in MM module are more, every time it has bull run demand.
• More of this module is related for MBA professionals in any specialization but it is related
to who did specialization in Marketing and finance, even for others also it is very good as
we can observe in many job portals and other sources.
• In Mm module salaries providing by companies are huge and compare to previous years
the salaries are increased 3-4 % according to payscale.com and ITJOBSWATCH.com.