UNIT -01 SAP OVERVIEW

What is ERP?

• “ERP comprises of a commercial software package that promises the seamless

integration of all the information flowing through the company such as financial,
accounting, human resources, supply chain and customer information.” [T.J.
Davenport, Harvard Business Review, July Aug,. 1998

How ERP helps

•All data is available in central database

•Eliminates data redundancy

•Data is updated and available real-time

•Single point of entry for one type of data

•Best business practices inbuilt

•Modular system

–Can implement only required functions

–Others can be easily integrated later

•Transparency and Control to extent required

Managers can utilize their time in analysis and spend less time in coordination
effort

There are 3 layers in SAP Architecture:

1. Presentation Layer
2. Application Layer
3. Database Layer

There are 3 SAP Conceptual Areas:

1. Application Area
2. Basis Area
3. Development Area

There are 3 SAP systems:

1. Development System
2. Quality System
3. Production System

Change and Transport Management

•SAP Transport Management is used to organize, perform and monitor transports

between SAP Systems. The Transport Management System provides the following
functions:

–Configuring transport routes using a graphical editor

–Displaying import queues for all SAP systems in transport domain

–Importing all requests in import queues

–Importing all requests in a project

–Importing individual requests

–TMS Quality Assurance

–Transport Workflow

Client is defined as an “independent accountable business unit within an R/3

system”.

UNIT -02 ENTERPRISE STRUCTURE AND MASTER DATA

An enterprise / organizational structure is mapped to SAP applications using

organizational units. Organizational units handle specific business functions.

Organizational units may be assigned to a single application (such as a sales

organization assigned to Sales and Distribution, or to several applications (e.g.
plant assigned to Materials Management and Production Planning).

In any given Organization, Corporate Group as the top most level. In SAP this is
known as Client.

Below this group we a Company which forms a independent unit and is the base for
balance sheet & profit and loss statement.

In SAP this is called as Company Code.

One level below we have the actual factory building where goods are manufactured.

This can be more the none. i.e. it is the operational unit within a Company.

We called it as Plant in SAP system

There is an organizational unit which is responsible for procuring materials for

these plant/s and is called as Purchase department. In SAP its termed as Purchase
Organization.

General stores, commonly known as storage location is assigned to a plant.

The following guidelines should be adhered to when creating the Enterprise

Structure in SAP :

Standardization : Create uniform structures and standards across business units

Simplicity : Represent the business with a structure which is simple. Adding

unnecessary complexity will drive maintenance issues, user error, etc.

Flexibility : The structure should have the ability to handle future growth such as
new products, new warehouses or even acquisition of new businesses

Optimization : Ensure that the structure will allow for simplified transaction
flow.

SALES AND DISTRIBUTION:

1. Pre sales activities--> 2.Sales processing --> 3.Inventory Sourcing -->
4.Shipping --> 5.Billing --> 6.Payment

2,3,4 come under sales and distribution.

Sales processing steps: Inquiry, Quotation, Sales order.

Methodology of SAP projects:

1. Project Planning --> 2. Blue Print --> 3. Realization --> 4. Final Preparation
--> 5. Go live support

ORGANIZATION STRUCTURE:
1. Client --> 2. Company Code(Company, Subsidiary)--> 3.Plant &
StorageLocation(Factory & General stores)--> 4. Sales Org (Dept, division, business
area)

SALES AREA is a combination of sales org, dist. channel, division.

Customer master record contains data for processing business transactions

•System proposes master data for business transactions involving customers

•A Customer Master record has the following details:

–General data : Data is stored at client level [KNA1 - TABLE]

–Company code data : data relevant for financial accounting[KNB1 -TABLE]

–Sales area data : data is different for different customers, depends on sales area
[KNVV - TABLE]

•Transaction code to create customer : XD01 / VD01

•Change Customer master : XD02 / VD02

•Display Customer master : XD03 / VD03

•Flag for deleting Customer master : VD05

•Block Customer : VD06

Examples of Partner functions: Customer Master Account Groups

Sold to Party (SP) 0001: Contains sales data like price list and sales office

Ship to Party (SH) 0002: Contains shipping data like goods receiving hours and
unloading point

Bill to Party (BP) 0004: Contains document pricing and communications information

Payer (PY) 0003: Contains bank details, billing schedules etc.,

A single customer can be a sold to party as well as a ship to party and a bill to
party if it assumes all the partner functions.

In this case a single customer master record is created as a sold to party and all
relevant partner functions data are entered
Material Master:

Create: MM01
Change: MM02
Display: MM03

Company level [MARA -TABLE]

Plant level [MARC - TABLE]
Storage Location level [MARD - TABLE]

•Definition :

–Grouping of materials with similar basic attributes under a single material type.

–Helps in classification of various materials into known types like

–Raw Materials, Semi-finished Products, Finished Products etc.,

.•Material Type + Plant

–This combination is helpful in determination of inventory management postings.

•Changes in quantity to be updated in Material Master Record.

•Changes in value also to be updated in financial accounting (Stock Accounts).

CUSTOMER MATERIAL INFORMATION RECORD [CMIR]:

Create: vd51
Change: vd52
Display: vd53

Customer --> Material --> CMIR

Customer-Material information record special data for a combination of certain

customers and materials e.g. Special name given by the customer to a material

•It is created if a customer specially manages a sale-able material differently

•This data has the priority over the customer master and the material master

•Customer Material Info Record also stores Texts

•Customer’s material description can be printed on various outputs, e.g. delivery

note and invoice

UNIT -03 SALES O2C CYCLE

Inquiry: (IN) VA11/VA12/VA13

Inquiry is a request to the company to provide a quotation or sales information
without obligation

Total quantity (Inquiry) = Schedule lines in different amounts + delivery dates

Quotation: (QT) VA21/VA22/VA23

Quotation provides the customer legal binding offer for delivering
products/services with fixed condition over a fixed time period
Sales Order VA01/VA02/VA03
Sales order is a legal agreement for the supply of services or products for a
specified quantity in certain period. Signed between sales organization and a
customer. A single quotation could have many sales orders

Sales Document Structure

Sales document is grouped into header, item and schedule line

• Header: Sales document header has the data which is valid for the entire document
like customer related data

•Item: Sales document item has the data which is valid for a single line like
material and quantity ordered

•Schedule lines: Schedule lines are uniquely identified for an item in sales
document and contains data of delivered quantity and delivery date.

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Sales Order Functions:

Availability Check:

‒Availability check determines whether the requested delivery quantity be available

for shipping in order to meet the customer’s requested delivery date. This is
carried out at plant level and results in material availability date‒Basic elements
of availability check are: checking group, checking rule, schedule line category,
delivery item category, requirement class and requirement type.

Types of Sales document type:

Cash Sales

Rush order

Free of charge delivery

Returns

Consignment fill-up

Credit/debit demo request

Standard order

Sales Document Type Configuration

•Sales Document Type controls the functioning of Sales Document

•Some of the Sales Document and corresponding Sales Document Type are given below:

‒Standard Order: OR

‒Rush Order: RO

‒Cash Sale: CS
‒Return Order: RE

‒Inquiry: IN

‒Quotation: QT

Unit -04 Sales Part -02