sap mm

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SAP MM Configuration

2 Enterprise Structure - Definition

2.1 Define Valuation Level

Menu path Implementation Guide for R/3 Customizing (IMG) ® Enterprise Structure ®Definition ® Logistics general ® Define Valuation Level Transaction Code OX14

Configuration Description

Here we specify the level at which material stocks are valuated. We have used the Plant level since the application component Production Planning (PP) and Costing are being used.

Depending on the valuation level chosen, accounting data (in particular the valuation price) is maintained for each plant or for each company code in the material master record.

If material stocks are valuated at company code level, all plant stocks of a material are managed in a joint stock account for each company code.

If material stocks are valuated at plant level, the material stocks for each plant can be managed in different accounts. We can define a separate account determination for each plant.

2.2 Define Plant

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Enterprise Structure ®Definition ® Logistics general ® Define, copy, delete, check plant

Transaction Code SPRO

As a part of the Logistics Organizational Structure, Plants are defined in SAP. The ‘Plant’ is an operating area or a branch or a location within a company. Each 'Plant' is assigned to a single 'company code'. A 'company code' can have several 'Plants'.In case of ITZ Pvt. Ltd., the various 'Plants' are assigned to each 'company code'.

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Configuration of One Plant is depicted here, (for list of all please refer to MM KDS Document)

2.3 Maintain Storage Location

Menu path

Implementation Guide for R/3 Customizing

(IMG) ® Enterprise Structure ®Definition ® Materials Management ® Maintain Storage Location

Transaction Code OX09

A storage location is the place where stock is physically kept within a plant. There may be one or more storage locations within a plant.

A storage location has the following attributes:

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.

Configuration of Storage Locations under One Plant is depicted here, (for list of all please refer to MM KDS Document)

2.4 Maintain purchasing organization

Menu path

Implementation Guide for R/3 Customizing

(IMG) ® Enterprise Structure ®Definition ® Materials Management à Maintain Purchasing Organization

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At this node we configure the Purchasing Organization .The purchasing organization is the highest level of aggregation (after the organizational unit "client") for purchasing statistics.

In case of ITZ One single Purchase Organization is created as under :

3 Enterprise Structure Assignments

3.1 Assign Plant to Company Code

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Enterprise Structure ®Assignment ® Logistics general ® Assign Plant to Company Code

A Plant needs to be assigned to one of the Company Codes, the relation is always one to one i.e. One Plant can be assigned to only one company code

All the plants can’t be shown here(for complete list refer MM KDS document)

3.2 Assign purchasing organization to company code

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Enterprise Structure ®Assignment ® Logistics general ® Assign purchasing organization to company code

In this node we assign the Purchasing Organization to the company code under which it works.

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In case of ITZ the Purchasing Organization is Central, so it is not assigned to any Company Code

3.3 Assign purchasing organization to Plant

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Enterprise Structure ®Assignment ® Logistics general ® Assign purchasing organization to Plant

In this step we assign purchasing organizations to the plants for which they are responsible.

In case of ITZ since it operates with Centralized Purchasing Org. we have assigned the Purchasing Org. to all the plants defined as of now

3.4 Assign standard purchasing organization to plant

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Enterprise

Structure ®Assignment ® Logistics general ® Assign standard purchasing organization to plant

If several purchasing organisations procure for a certain plant, wecandefine one of them as the standard purchasingorganization for the transactions "pipeline procurement", "consignment" and "stock transfers".

In source determination for stock transfers and consignent, the system automaticallyutilizesthis standard purchasingorganization. In the case of goods issues of pipeline materials, the purchasing info records of the standard purchasingorganization are read.

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In ITZ, we have not definedthis Setting as we are using single Purchasing Organisation

4 General Logistics

4.1 Assign Fields to Fields Selection Groups

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Logistics - General àMaterial Master à Field Selectionà Assign Fields to Fields Selection Groups

Transaction Code OMSR

Assignment of Material Master Fields is required to define whether a field is hidden or displayed, or whether an entry is mandatory or optional in material master maintenance, it is always advisable to work with Standard SAP settings, but for few business requirement some assignments are changed to new field selection groups defined as per reserved name space. in case of ITZ, some of the list of changed entries is as given below:

Field Name Description Changed Field Grp

MVKE-MVGR1 Material group 1 211

4.2 Maintain Field Selection for Data Screens

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Logistics -

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Data Screens Transaction Code OMS9

In this step we define the nature of a Field belonging to a particular Field Selection Group wrt the Screen Reference of a Material Type. Steps involved are :

Selecting the field selection group.

Select the field selection option (hide, display, required entry, or Optional entry) for each field reference as required.

4.3 Maintain Company Codes for Materials Management

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Logistics -

General àMaterial Master à Basic SettingsàMaintain Company Codes for Materials Management

Transaction Code OMSY

This activity is done for making a Company Code relevant for materials Management and to define the starting posting period This is a prerequisite for creating a Material Master

4.4 Define Attributes of Material Types

Menu path Implementation Guide for R/3 Customizing (IMG) ® Logistics - General à Material Master à Basic Settingsà Material Typesà Define Attributes of Material Types

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Transaction

Code OMS2

Material type is analogous to the family of a material master; all the important

attributes of a material are governed by settings in the material type. To be precise

it governs :

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1. Number range pattern and nature (external/internal)

2.

2. Hide/optional fields in the material master

3.

3. Valuation Control at valuation area level (ultimately used to derive G/L)

4.

4. Control on Production/Purchase

4.5 Define Number Ranges for each material types

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Logistics - General àMaterial Master à Basic Settingsà Material

Typesà Define Number Ranges for each Material Types Transaction Code MMNR

In this step, we have defined the type of number assignment and the number range intervals for material master records. When creating a material master record, system must assign it a unique number. There are two ways of doing this:

internal number assignment

In this case, a number within the number range interval allowed is assigned by the SAP system.

external number assignment

Here, the user assigns a number within the number range interval allowed. We can define the intervals for external number assignment numerically and

alphanumerically.

We have defined the number range intervals for so-called groups. We assign one or more material types to each group.

If we assign just one material type to a group, we can define both an internal and an external number range interval for the material type.

If we group together more than one material type, we can define an internal and an external number range interval here too. This allows several material types to have the same number range intervals.

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4.6 Define Attributes of system messages

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Logistics - General àMaterial Master à Basic SettingsàDefine Attributes of system messages

Transaction Code OMT4

When processing material master records, the system issues a number of system messages containing important user information. In this activity, we define how the SAP system handles these messages. We have the following options:

The message can be suppressed.

The message can be displayed as a warning.

The message can be displayed as an error message. (can’t be surpassed)

For ITZ requirement Message Numbers MM189 & 312 are changed as Error message

We are using Standard SAP Messages.

4.7 Define Material Groups

Menu path Implementation Guide for R/3 Customizing (IMG) ® Logistics -

General àMaterial Master à Settings for Key Fieldsà Define Material Groups Transaction Code OMSF

Here we define the Groups for Materials & Services, This Grouping shall be defined keeping in mind the reporting requirement of the company for analysing Purchases, Consumptions, Stocks etc,

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Setting is just a table entry, few records are shown in the screen shot, for complete list refer to the MM KDS document or the actual system node

4.8 Define External Material Groups

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Logistics - General àMaterial Master à Settings for Key Fieldsà Define External Material Groups

Here we define the Groups for giving an extra key for filtering, sorting the list of materials from a criterion other than Material grouping

In case of ITZ we have not used External Material Groups

4.9 Initialize Period

Menu path Implementation Guide for R/3 Customizing (IMG) ® Logistics - General àMaterial Master à Toolsà Initialize Period

Transaction Code MMPI

This Transaction can be used to initialize the period in materials management , i.e. it opens the already closed period (thru Txn : MMPV), but opening a period has serious implications on data consistency in SAP so as recommended by SAP Follow the instructions in Note 487381 before initialization

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5 Materials Management – Consumption based Planning

5.1 Activate MRP for MRP Areas

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àConsumption-based Planning à Master Data à MRP Areas àActivate MRP for MRP Areas

This setting is required if we want to have planning at a level other than plants i.e. either of Storage location / at Subcontractor level.

An MRP area represents an organizational unit for which we can perform material requirements planning separately.

An MRP area can include one or several storage locations of a plant or a subcontractor. We can define MRP areas in a plant.

For ITZ Ltd., we have not used MRP Areas.

5.2 Define MRP Areas

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àConsumption-based Planning à Master Data à MRP Areas àDefine MRP Areas

Transaction Code SCAL

Here we define the MRP areas for a plant for which we would like to carry out material requirements planning separately.

When creating an MRP area, we enter the number, which must have at least 5 digits to avoid any overlapping with the plant MRP area, the description and the MRP area type

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Important : If MRP area is activated Conversion of Planning file entries needs to be run in every new System Client through Report RMDBVM00 in Txn : SE38

The conversion report causes the system to create a new planning file. In addition, the system creates MRP area for the existing plants. These MRP areas do not, however, affect the way material requirements planning is carried out. The number for plant MRP areas is identical to the plant number and therefore consists of four digits.

The conversion of the current planning file (table MDVM) to the new planning file (table DBVM) is a prerequisite for carrying out material requirements planning with MRP areas.

6 Materials Management – Purchasing

6.1 Define Attributes of System Messages

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing à Environment Data à Define Attributes of System Messages

In Purchasing, certain system messages containing important information for users may be issued from time to time

In this step, we can specify whether the SAP System:

Suppresses the relevant information

Issues it as a warning message Issues it as an error message

In the case of an error message, processing cannot be continued until user input has been corrected

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For ITZ requirement, messages (as a change from standard) are configured as given below:

6.2 Define Purchasing Value Keys

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing à Material Master à Define Purchasing Value Keys

With Purchasing value key we can control following functions by using it in the material master purchasing view, purchasing value key governs:

The issue of reminders and urging letters (expediters) with respect to nearly due and overdue deliveries

The admissibility of over- and under deliveries ("overages" and "under ages")

Order acknowledgment requirements for PO items Shipping/packaging instructions

This data appears as default data in purchasing documents and is taken from the material master record (unless a purchasing info record exists, in which case it is taken from the info records).

6.3 Entry Aids for Items without a Material Master

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing à Material Master à Entry Aids for Items Without a Material Master

In this step we assign In this step, we can assign a purchasing value key and a valuation class to a material group.

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The assignment of a purchasing value key default values for reminder levels etc. in purchase order items without a material master record and without an info record.

The assignment of a valuation class to a material group enables the system to determine different accounts for the individual material groups.

For ITZ we have maintained Valuation Classes in the accounting view of the materials.

6.4 Create Purchasing Groups

Menu path Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing à Create Purchasing Groups

It’s a key for a buyer or group of buyers responsible for certain purchasing

activities. useful in accessing information, controlling authorizations, setting

up release strategies etc. for ITZ ‘s Requirement following groups are

configured, configuration is a simple table entry but purchasing group has a

comprehensive use in all purchasing transactions/ documents

6.5 Define Document Types (RFQ/Quotation)

Menu path Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing à RFQ/Quotation à Define Document Types Transaction Code SPRO

SAP manages RFQs and quotations as documents which are grouped into different document types., in this step we have :

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Created new document types Defined item interval

Defined admissible follow-on document types Assigned document types to a number range group Defined number range interval

Chosen

internal external Chosen

The update group determines how the data from the document header is updated in the statistics file.

Linkage determines which PR document types can be referenced for creating a particular RFQ document type

6.6 Define Text Types for Header Texts (RFQ/Quotations)

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àRFQ /Quotations à Define Text Types for Header Texts

In this step we define different Texts which appear in RFQ/Quotation

Headers, which are used to store information applicable for a particular

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RFQ document

We have standard Header Text Types.

6.7 Define copying rules for Header Texts (RFQ/Quotations)

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àRFQ /Quotations à Define copying rules for Line Texts (RFQ/Quotations)

In this step we define copying rules for different header Texts which

appear in RFQ/Quotation Line Items

Copying rules are used to determine which texts can be adapted from other objects (for example, vendor master records, contracts) to the header text of the RFQ. We link text types in the RFQ with text types in other objects. System can adopt header texts from the following objects:

RFQ / Quotation Contract

Scheduling agreement Vendor master

We can also specify whether the adopted text can be edited in the destination document or not. This type of setting is more useful in PO Header Texts

6.8 Define document types (Purchase Requisitions)

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing à Purchase Requisitions à Define document types (Purchase Requisitions)

SAP manages Purchase Requisitions as documents which are grouped into various document types., in this step we have :

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Chosen

Above linkage governs which type of PO can be created using PR of a particular type

6.9 Release Procedure with Classification (Purchase

Requisitions)

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing à Purchase Requisitions à Release

Procedure àProcedure with Classification à Set Up Procedure with Classification Transaction Code SPRO

In this step, we have set up the release procedure with classification.

Purchase Requisition release is the process in which Purchase Requisition is approved and released by HOD of concern department for request of required material or services specified in Purchase Requisition. Once the Purchase Requisition is approved and released then Purchase Order or RFQ will be created for that material or services against same Purchase Requisition.

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Configuration involves following elements in sequence: Release Group:

Specify for the release group either "overall release" or "item-wise release"

Release codes:

The Release Code is a two-character ID allowing a person to release (approve) a requisition.(analogous to approver code)

Release Indicators:

A release indicator shows the release status of a purchase requisition

Release Indicators also involve: Field selection key

via the field selection key, we can specify which fields in a purchase requisition with this release indicator can be changed or must be populated

Changes after start of release process

With the Changeability indicator, we can specify the effects of changes to a requisition. For example, certain changes may require a new release strategy to be determined for the requisition.

Via the Value change field, we can cause the release strategy to be re-started if the value of a purchase requisition item is increased by more than a certain percentage (e.g. 10%). To do so, set the Changeability indicator to "4 - Changeable, new release in case of new strategy or value change" and enter a percentage in the Value change field.

Release Strategy

The Release Strategy defines the approval process for Purchase

Requisitions. The strategy specifies the release codes which are

necessary and the sequence in which releases have to be

affected. We can define a maximum of eight release codes i.e. 8

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Levels of approval.

Release Prerequisites

indicate the sequence in which a Purchase

Requisition must be approved via the release codes. (In ITZ case

release is parallel(either / or so indicators are kept blank)

Release Status indicates the affect after the release by a particular release code

Release Values

These values need to be maintained in every client manually, this forms the basis on which release strategy is triggered for a PR.

An important prerequisite for this is to create Class & Characteristics in class type 032

Characteristics for Release Strategy

Create the Characteristics required for release strategy as master data thru transaction CT04, here the most important setting is to attach the characteristics to corresponding field of structure CEBAN

attach it to the structure

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Create the class as master data thru transaction CL02 and attach the Characteristics created earlier to the class

6.10 Define Number Ranges (Purchase Orders)

Menu path Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àPurchase order à Define Number Ranges Transaction Code OMH6

In this step we define number ranges for Purchase order document types,

(defined separately in customizing), this setting also includes number

ranges for other external purchasing documents i.e. for

Contracts/Scheduling Agreements and RFQs.

There are two ways of doing this:

internal number assignment

In this case, a number within the number range interval allowed is assigned by the SAP system.

external number assignment

Here, the user assigns a number within the number range interval allowed. We can define the intervals for external number assignment numerically and

alphanumerically.

In case of ITZ all the documents are assigned with internal number ranges with the exception for document type “Legacy Open P.O”, as it was required to retain the legacy P.O number for this case.

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6.11 Define Document types (Purchase Orders)

Menu path Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àPurchase Orders à Define document types Transaction Code SPRO

SAP manages Purchase Orders as documents which are grouped into various document types., in this step we have :

Define allowable item categories

Chosen

Above linkage governs which type of PR can be referenced created while creating a particular Contract document type

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6.12 Set Tolerance Limits for Price Variance

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àPurchase

order à Set Tolerance Limits for Price Variance Transaction Code SPRO

When processing a purchase order, the system checks whether the effective price of a PO item shows variances compared with the valuation price stored in the material master record. In addition, it checks whether the specified cash discount value is admissible.

Variances are allowed within the tolerance limits. If a variance exceeds a tolerance limit, the system issues a warning or error message. In SAP, the types of variance are represented by the tolerance keys. For each tolerance key, we can define percentage and value-dependent upper and lower limits per company code.

PE Price variance, Purchasing

Tolerance limit for system message no. 207. This message appears if the specified effective price exceeds the predefined tolerances when compared with the material price.

SE Maximum cash discount deduction, Purchasing

Tolerance limit for system message no. 231. This is a warning message, which appears when the specified cash discount percentage exceeds the predefined tolerances.

6.13 Release Procedure for Purchase Orders

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials

Management àPurchasing àPurchase Order à Release Procedure for Purchase Orders

In this step, we have set up the release procedure for Purchase Orders(this also covers the process for other external purchasing documents e.g. contracts/scheduling agreements)

Purchase Order release is the process in which PO is approved and released by HOD of concern department for request of required material or services specified in PO. Once

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the Order is approved and released then GR can be created against the PO

In case of ITZ, Release strategy is used in case of all purchases.

Configuration involves following elements in sequence:

Release Group:

Release groups are created for each type of purchasing

Release codes:

The Release Code is a two-character ID allowing a person to release (approve) a requisition.(analogous to approver code)

Release Indicators:

A release indicator shows the release status of a Purchase Order

Release Indicators also involve: Changeability Indicator

With the Changeability indicator, we can specify the effects of changes to

a POdocument. For example, certain changes may require a new release strategy to be determined for the requisition.

Via the Value change field, we can cause the release strategy to be re-started if the value of a purchase order is increased by more than a certain percentage (e.g.

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10%). To do so, set the Changeability indicator to "6 - Changeable, new release in case of new strategy or value change" and enter a percentage in the Value changefield.

Release Strategy

The Release Strategy defines the approval process for

PO

. The

strategy specifies the release codes which are necessary and the

sequence in which releases have to be affected. We can define a

maximum of eight release codes i.e. 8 Levels of approval.

Release Prerequisites

indicate the sequence in which a Purchase

Requisition must be approved via the release codes. (In ITZ case

release is by a single authority so there are no prerequisite involved)

Release Status indicates the affect after the release by a particular release code

Release Values

These values need to be maintained in every client manually, this forms the basis on which release strategy is triggered for a PO.

An important prerequisite for this is to create Class & Characteristics in class type 032 Characteristics for Release Strategy

Create the Characteristics required for release strategy as master data thru transaction CT04, here the most important setting is to attach the characteristics to corresponding field of structure CEKKO

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Class for Release Strategy

Create the class as master data thru transaction CL02 and attach the Characteristics created earlier to the class

6.14 Define Screen Layout at Document Level

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àPurchase Orders à Define Screen Layout at Document Level

In this step we define the attributes of various fields contained in a field selection key (defined for a document type) inside which various fields are grouped into fields selection groups.Steps involved in the process are :

Selecting the field selection key (defined for a document type)

Select the field selection option (hide, display, required entry, or Optional entry) for each field inside a field selection group reference as required.

Select a field selection key and set the attributes inside as shown:

get inside a field group and choose the attributes

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required

6.15 Define Text Types for Header Texts (Purchase Orders)

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àPurchase Order à Define Text Types for Header Texts

In this step we define different Texts which appear in Purchase order

header, these are used to store information applicable for a

particular PO document

6.16 Define copying rules for Header Texts (Purchase Order)

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àPurchase Orders à Define copying rules for Header Texts

In this step we define copying rules for different header Texts which

appear inPurchase Order Headers

Copying rules are used to determine which texts can be adapted from other objects (for example, vendor master records, contracts, RFQ) to the header text of the Purchase Order. We link text types in the PO with text types in other objects. System can adopt header texts from the following objects:

RFQ / Quotation Contract

Scheduling agreement Vendor master Purchase Requisition

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We can also specify whether the adopted text can be edited in the destination document or not. Currently we are not maintaining any copying rule for header texts

6.17 Define Text Types for Item Texts (Purchase Orders)

Menu path Implementation Guide for R/3 Customizing (IMG) ® Materials

Management àPurchasing àPurchase Order à Define Text Types for Item Texts Transaction Code SPRO

In this step we define different Texts which appear in Purchase order item level,

these are used to store information applicable for a particular PO document line

item

6.18 Define copying rules for Item Texts (Purchase Order)

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àPurchase Orders à Define copying rules for Item Texts

In this step we define copying rules for different item Texts which appear

inPurchase Order ITEM

Copying rules are used to determine which texts can be adapted from other objects (for example, vendor master records, contracts, RFQ) to the header text of the Purchase Order. We link text types in the PO with text types in other objects. System can adopt header texts from the following objects:

RFQ / Quotation Purchase Requisition Purchase Info record Contract

Material master

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document or not.

maintain the rules for a text as under

6.19 Define Document Types (Contracts)

Menu path Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àContracts à Define Document Types Transaction Code OMH6

SAP manages Contracts as documents which are grouped into various document types., in this step we have :

Define allowable item categories

Chosen

In case of ITZ, use of Contracts and Scheduling agreements is very minimal so we have retained and used standard SAP document types

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Above linkage governs which type of PR can be referenced created while creating a particular Contract document type

6.20 Define Screen Layout at Document Level (Contracts)

Menu path

Management àPurchasing àContracts à Define Screen Layout at Document Level

Transaction

Code SPRO

In this step we define the attributes of various fields contained in a field selection key (defined for a document type) inside which various fields are grouped into fields selection groups.Steps involved in the process are :

Selecting the field selection key (defined for a document type)

Select the field selection option (hide, display, required entry, or Optional entry) for each field inside a field selection group reference as required.

Select a field selection key and set the attributes inside as shown:

get inside a field group and choose the attributes

settings can be made similarly for other fields in various other groups as & when required

6.21 Define Text Types for Header Texts (Contracts)

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àContracts à Define Text Types for Header

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Texts Transaction Code SPRO

In this step we define different Texts which appear in Contract header,

these are used to store information applicable for a particular Contract

document

6.22 Define copying rules for Header Texts (Contracts)

Menu path

Management àPurchasing àContracts à Define copying rules for Header Texts

In this step we define copying rules for different header Texts which

appear inContract Headers

Copying rules are used to determine which texts can be adapted from other objects (for example, vendor master records, Contract, RFQ) to the header text of the Contract. We link text types in the PO with text types in other objects. System can adopt header texts from the following objects:

RFQ / Quotation Contract Vendor master

We can also specify whether the adopted text can be edited in the destination document or not.

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6.23 Define Text Types for Item Texts (Contracts)

Management àPurchasing àContracts à Define Text Types for Item Texts Transaction Code SPRO

In this step we define different Texts which appear in Contract item level, these

are used to store information applicable for a particular Contract document line

item

6.24 Define copying rules for Item Texts (Contract)

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àContracts à Define copying rules for Item Texts

In this step we define copying rules for different item Texts which appear

inContract Headers

Copying rules are used to determine which texts can be adapted from other objects (for example, vendor master records, contracts, RFQ) to the header text of the Contract. We link text types in the Contract with text types in other objects. System can adopt header texts from the following objects:

RFQ / Quotation Purchase Requisition Contract

Purchase Info record Material master

We can also specify here whether the adopted text can be edited in the destination document or not.

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6.25 Define External Confirmation Categories

Menu path

Management àPurchasing àConfirmations à Define External Confirmation Categories

Notification from the vendor to the recipient regarding the status of a purchase

order., In case of ITZ , CONFIRMATIONS are not being used Confirmation

categories are defined to symbolize the key for a type of confirmation

6.26 Define Internal Confirmation Categories

Menu path

Management àPurchasing àConfirmations à Define Internal Confirmation Categories

In this step, we assign an external confirmation category to each internal confirmation category.

Internal Categories are for system controls.

6.27 Set Up Confirmation Control

Management àPurchasing àConfirmations à Set Up Confirmation Control Transaction Code SPRO

In this step, we assign an external confirmation category to each internal confirmation category.

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As shown all the conformation categories are relevant for MRP, but the last one is

relevant to GR also, which means that when a GR is made against the P.O line

item it will get defaulted with qty of last conf. category

6.28 Define Access Sequence

Menu path

Management àPurchasing àConditionsà Define Price Determination Process à Define Access Sequence

Access sequence is an important element of pricing determination. It is the Order

in which the system searches through the condition tables when searching for

particular condition records. The search order goes from specific condition

records to general condition records.

A.

E.G.

Access sequence is made up of condition table (the level at which data is stored)

In the access sequence shown system will search for the record from first to last

table in sequence. (e.g. if Custom duty % for a material is maintained at all the

three levels i.e. Incoterms-plant-maerial / Plant-Material / Plant-Material Type

level , then system will take the record from 1

st

_{available level only i.e.}

Incoterms-plant-maerial in this case)

Each condition table is defined as an combination of fields for data access and is

assigned to different condition types ( In case of ITZ , we are not maintaining any

access sequence),

6.29 Define Condition Types

Menu path

Management àPurchasing àConditionsà Define Price Determination Process à Define Condition Types

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s

In this step we have defined condition types.

The condition types are used to represent pricing elements such as prices,

discounts, surcharges, taxes, or delivery costs in the SAP. These are stored in the

system in condition records.

For condition types for which we want to maintain conditions with their own

validity period we have specified an access sequence. (e.g. for all import duty

conditions

Important Settings Condition type include:

Condition Class: Defines nature of condition as Prices / surcharge / discounts

etc.

Calculation type: Defines nature of condition unit i.e. Amount type /

Percentage / Qtyetc

Condition Category : e.g. Packaging, Cost , Tax, Delivery Costs(requiring

extra vendor at condition level)

Access Sequence : Allows condition records to be maintained

Header Condition : Allows usage at Header level of Purchasing document

Accruals : Makes a condition irrelevant to net price calculation i.e. excluded

from tax base

6.30 Define Calculation Schema

Menu path

Management àPurchasing àConditionsà Define Price Determination Process à Define Calculation Schema

Transaction Code M/08

In this step, we have defined the calculation schemas.

In MM area, a calculation schema is a framework of steps used to calculate

pricing in as purchasing document

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Analogous to this is referred to in the Sales and Distribution (SD) area as

a

pricing procedure.

In the calculation schema (pricing procedure), we specify which condition types

are to be taken into account in which sequence.

In the price (or cost) determination process, the SAP System automatically

determines which calculation schema is valid for a business transaction and takes

into account, one after another, the condition types it contains

.

In case of ITZ we have defined schemas all starting with Z*, these will get derived

in different types of purchasing documents as per the rule explained in Schema

determination configuration

Select one of the schema and see the control data as shown below:

Important keys in defining Schema are as under:

Step No. & Counter: For determination the sequence of conditions and to act

as a base for calculations with in condition

From- To : Base for calculation of condition value, this is only relevant for %

type of conditions

Statistical: Makes a condition non-relevant to account postings

Subtotal: Used to pass the condition value in to fields of P.O item tables and

other pricing structure

Requirement : Used for validating Condition value determination using small

ABAP written formulae

Base Type: Here a Formula for determining the condition basis as an alternative

to the standard.

Accrual key: for deriving a separate account during GR / Invoice postings

6.31 Define Schema Group

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àConditionsà Define Price Determination Process à Define Schema Group

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Every External Purchase document derives Calculation Schema from a

combination of Purchasing Organization and Vendor, to simplify data

maintenance for this process SAP works with grouping concept. So all the

purchasing org. are grouped in to a Schema group and Vendors requiring

same pricing stricture are grouped into a Schema group , now for the

combination of these , system derives the pricing schemas

Click on a row to enter :

the other part i.e. vendors are assigned with schema group in vendor

master

6.32 Define Schema Determination

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àConditionsà Define Price Determination Process à Define Schema determination

In this step we have defined the determination of Pricing schema for

different type of Purchasing documents and for Stock transport orders

For standard purchase orders

(depending on the schema group of the vendor and the purchasing

organization)

For stock transport orders

(depending on the supplying plant, the document type and the schema

group of the purchasing organization)

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select first item ,

and second item

6.33 Define Transaction Event keys

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àConditionsà Define Price Determination Process à Define Transaction Event keys

In this step, we have defined transaction/event keys for condition types

involving provisions.

This enables the system to find the relevant account for provisions (for

accrued delivery costs or miscellaneous provisions, for example),

We have assigned these transaction/event key to each condition type that

is relevant to provisions in the step Define Calculation Schema.

Select the 1

st

_row

Select second row, it displays the usage of key in schema

6.34 Maintain Condition Table

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àConditionsà Define Price Determination Process à Maintain Condition Table

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In this step, we create custom tables, these table are used to store

condition records for different condition types , for this these tables should

be a part of access sequence

With help of this we can derive prices, discounts and surcharges

dependent on almost all the fields in a purchasing document.

In a condition table, we specify the combination of fields for which we can

create condition records.

As per SAP recommendation

we should not change the condition tables

that are included in the standard version of the SAP System.

Check the extent to which we can use the condition tables that are supplied

with the standard SAP System, for our tables we can only choose names

between 501 and 999. If we make no entry, the system will automatically

assign a consecutive number.

For ITZ we have not defined any tables:

Steps:

For creating new condition tables. copy a similar condition table and proceed as follows:

Enter the name of the table we wish to create.

Note that we can only choose names between 501 and 999. If we make no entry, the system will automatically assign a consecutive number.

Specify whether we wish to create the table with or without a validity period.

Enter the type of condition table (for example, transparent table). Enter a description for the condition table.

From the list of allowed fields that are included in the field catalog and which can be extended there, choose the desired fields for the condition table.

Generate the new condition table.

IMP: All the fields that shall be used to pick up any condition value must be

part of Header/Key field in the condition table.

6.35 Define Grid for Quantity Variances

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For Purchasing information system for vendor performance the statistics is

managed on the amount of quantity variances of vendors.

The delivery quantity variance specifies in percent the variance

between the purchase order quantity and the quantity actually delivered.

This key figure is determined if an order item is completed and is updated

for the entry date of the goods receipt or for the entry date of purchase

order change.

In this step we can determine four interval limits for every purchasing

organization. Five intervals are then available to we for evaluation of

vendors

6.36 Define Grid for Delivery Date Variance

Menu path Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àStatistics àDefine Grid for Delivery date Transaction Code SPRO

Delivery date variance data is used in statistics for evaluating vendor

performance.

The delivery date variance specifies the difference in days the

difference between the statistically relevant delivery date and the date of

the goods receipt.

This key figure is updated during the goods receipt for the entry date.

In this step we can determine four interval limits for every purchasing

organization. Five intervals are then available to we for evaluation of

vendors

6.37 Define Weighing keys

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àVendor Evaluation à Define Weighing keys

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In vendor evaluation criteria are weighted according to their importance

through Weighing key.

For example, the overall evaluation of a vendor is calculated from the

scores awarded for the main evaluation criteria "price," "quality," and

"delivery." The latter comprises "on-time delivery performance" and

"quantity reliability."

If we consider a vendor's price to be more important than quality, and

quality to be more important than delivery, we can assign weights to the

criteria in a ratio of three for price, two for quality, and one for delivery. This

ratio is recorded in a weighting key.

6.38 Define Criterion (Vendor Evaluation)

Menu path Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àVendor Evaluation à Define Criterion Transaction Code SPRO

Here we have defined the criteria by which the system computes scores for

vendors and specify whether the scores for the subcriteria are computed

manually, semi-automatically, or automatically.

Select One of the criterion and drilldown to sub criterion

6.39 Define Scope of List (Vendor Evaluation)

Menu path Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àVendor Evaluation à Define Scope of List Transaction Code SPRO

In this step we define various types of list, each representing different main criteria or the same main criteria in a different order.

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supplied as an example:

The parameter Standard provides the user with a ranking list of vendors by overall score. The main criteria are arranged in the order "Price", "Quality", "Delivery", "General service/support” and "Externally performed service/work".

The parameter Version 1 yields a ranking list of vendors sorted according to the score for the main criterion "Price". Then follow the overall evaluation and the main criteria "General service/support", "Quality", "Delivery", and "Externally performed service/work".

check the details of list inside

6.40 Maintain Purchasing Organization data

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àVendor Evaluation à Maintain Purchasing Organization data

Select a row and displays criterion for Purchasing Organization

Sub criterions for main criterion

Weighing for a Purchasing Org.

We have provided Equal Weighting to the Criteria as we have different

weighing parameters for ITZ

Point scores for a Purchasing Org.

6.41 Define Permissible Partner Roles per Account Group

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àPurchasing àPartner Determination à Partner Rolesà Define Permissible Partner Roles per Account Group

Here we can specify for each account group of the vendor which roles the vendor may assume. Example we can specify that certain vendors may only serve as an ordering address, not as an invoicing party.

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6.42 Define Partner Schemas (Vendor Master)

Menu path

Management àPurchasing àPartner Determination à Partner settings in Vendor Master recordsà Define Partner Schemas

Partner schemas allow us to group various partner roles. We can specify

that certain roles in a schema are mandatory, i.e. cannot be changed after

entry.

For ITZ, Schema groups Z1 is defined

select a schema to detail the allowed partner functions

6.43 Assign Partner Schemas to Account Groups

Menu path

Management àPurchasing àPartner Determination à Partner settings in Vendor Master recordsà Assign Partner Schemas to account groups

Here we assign the already defined schema groups to vendor account

groups

6.44 Define Partner Schemas (Purchasing Documents)

Menu path

Management àPurchasing àPartner Determination à Partner settings in Purchasing documentsà Define Partner Schemas

Partner schemas allow us to group various purchasing documents for

partner determination. We can specify that certain roles in a schema are

mandatory, i.e. cannot be changed after entry.

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Select a Schema to detail the partner function allowed

6.45 Assign Partner Schemas to Document Types

Menu path

Management àPurchasing àPartner Determination à Partner settings in Purchasing documentsà Assign Partner Schemas to document types

In this step, we have assigned the partner schemas to the various types of

purchasing document.

As a result, only the roles of the schema in question can be maintained in

documents of the relevant types.

7 Materials Management – External Services

Management

7.1 Define Service Category

Menu path

Management àExternal Services Managementà Service Master à Define Service Category

In this step, we define the service category.

The service category is the most important criterion for structuring Service master records. It provides a default value for the valuation

A. Classes. Service master records can be assigned to number ranges on the basis of the service category.

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7.2 Define Number Ranges

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management àExternal Services Managementà Service

Master à Define Number Ranges Transaction Code SPRO

In this step, we define NumberRanges for each service category.

7.3 Define Number Range for Service Entry Sheets

Menu path

In this step, we define the service category.

The service category is the most important criterion for structuring Service master records. It provides a default value for the valuation

A. Classes. Service master records can be assigned to number ranges on the basis of the service category.

7.4 Define Attributes of System messages

Menu path

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In External Services Management, a number of system messages containing important information for users may be issued. Users can process this information further.

In this step, we can define whether the SAP System Suppresses this information

Issues it in the form of a warning Issues it in the form of an error message

For ITZ requirement, additional messages no. SE 346 / 347 / 361 is activated asError along with other additional Standard SAP Messages

8 Materials Management – Inventory Mgmt. & Physical

Inventory

8.1 Plant Parameters

Management ® Inventory Management and Physical Inventory ®Plant Parameters Transaction

Code SPRO

In this step, we make the general plant settings for ‘Inventory Management’. All settings are also contained in the individual steps of the Implementation Guide for Inventory

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If we have created a plant in the enterprise structure using the Copy plant function, we do not need to make any settings.

If we have created a plant manually, we have to create a new entry for the plant parameters.

8.2 Define Number Assignment for Accounting Documents

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management ® Inventory Management and Physical Inventory ® Number

Assignment ®Define Number Assignment for Accounting Documents Transaction

Code OMBA

In this step, we set the number ranges for the accounting documents which are created when goods movements or inventory differences are posted.

For accounting-relevant goods movements, the system creates two different documents: material document

accounting document

Both the material documents and the accounting documents have their own document numbers. When inventory differences are posted, the system also creates an accounting document for the physical inventory document.

In this step, we only maintain the number assignment for accounting documents.

Accounting documents are split into document types to allow differentiated document number assignment, which is the basis for distinguishing between the various accounting operations. A number range is assigned to each document type. In a company code, we

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have to define number intervals for each number range and fiscal year. In inventory management, the transaction determines which document type is used.

Goods Issue Document Type

TCode Transaction text Type Description

MB05 _A. _{Subseq. Adjustmt: Act.Ingredient} Mat

WE Goods receipt

MB11 Goods Movement WA Goods issue

MB1A Goods Withdrawal WA Goods issue

MB1B Transfer Posting WA Goods issue

MB26 Picking list WA Goods issue

MBSU Place in Stor.for Mat.Doc: Init.Scrn

MIGO_GI Goods Movement WA Goods issue

MIGO_TR Transfer Posting WA Goods issue

Goods Receipt Document Type

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MB01 Post Goods Receipt for PO WE Goods receipt

MB04 _A. _{Subsequ.Adj.of}

"Mat.Provided"Consmp.

WE Goods receipt

MB0A Post Goods Receipt for PO WE Goods receipt

MB1C Other Goods Receipts WA Goods issue

MB31 Goods Receipt for Production Order WE Goods receipt

MBNL Subsequent Delivery f. Material Doc.

MBRL Return Delivery for Matl Document

MBSF Release Blocked Stock via Mat. Doc. WE Goods receipt

MBSL Copy Material Document

MBST Cancel Material Document

MIGO_GO Goods Movement WE Goods receipt

MIGO_GR Goods Movement WE Goods receipt

MIGO_GS

A. Subseq. Adjust. of Material Provided

WE Goods receipt

Automatic Movements Document Type

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BMBC Batch Information Cockpit WA Goods issue

BORGR GR Automotive WE Goods receipt

BORGR_B GR Automotive: Posting WE Goods receipt

BORGR_C GR Automotive: Clearing WE Goods receipt

CAT5 Data Transfer CATS -> PS WA Goods issue

CAT9 Data Transfer CATS -> PM/CS WA Goods issue

CIP2 CC2: Update PDC messages WA Goods issue

CIPV Posting PDC records WA Goods issue

Physical Inventory Document Type

TCode Transaction text Type Description

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MI08 Create List of Differences with Doc. WI Inventory document

MI10 Create List of Differences w/o Doc. WI Inventory document

8.3 Define Number Assignment for Material and Physical

Inventory Documents

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management ® Inventory Management and Physical Inventory ® Number Assignment ®Define Number Assignment for Material and Phys.Inv Documents

Transaction

Code OMBT

In this step, we maintain the number assignment for the following documents: material documents

physical inventory documents

The number assignment for these documents is not to be confused with the number assignment for accounting documents which we completed in the step Define number assignment for accounting documents. The number assignment for accounting documents depends on the document type which is allocated to the transaction.

The number assignment for material documents and physical inventory documents depends on the transaction/event type which is also allocated to each transaction in Inventory Management. The transaction/event types are divided into groups of number ranges. A number range interval has to be defined for each group.

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No From no. To number Status Ext 01 0100000000 0199999999 0 02 4900000000 4999999999 4900002419 03 5000000000 5999999999 5000000219 04 0200000000 0299999999 0 Note

We cannot change the transaction/event types. However, we can change the number range intervals or we can allocate transaction/event types to new groups.

SPRO-> IMG-> Materials Management-> Inventory Management and Physical Inventory-> Number Assignment-> Define Number Assignment for Material and Phys. Inv. Docs Her you ned to maintain the number ranges for the group attched to the key.

If you want to maintain new number range intervals for an existing group: a) Choose Group -> Maintain.

b) Select a group and choose Interval -> Maintain. c) Choose Edit -> Insert year.

d) Maintain the number interval for the new fiscal year.

8.4 Define Number Assignment for Reservations

Menu path

Implementation Guide for R/3 Customizing (IMG) ® Materials Management ® Inventory Management and Physical Inventory ® Number Assignment ®Define Number Assignment for Reservations

(51)

Transaction

Code OMJK

In this step, we set up number assignment for reservations. The number assignment applies to all plants in the client.

Note

If we create reservations with method CreateFromData1 (function module BAPI_RESERVATION_CREATE1), we can use the number range RB for an external number assignment.

8.5 Field Selection for Goods Movement/Initial Header Screens

Menu path

Management ® Inventory Management and Physical Inventory ®Field Selection for Goods Movement/Header Screens

Transaction

Code OMJN

In this step, we define the field selection for goods movements initial and header screens. Note that the field selection for the item screens depends on the movement type and is configured in separate steps.

In this step, we specify whether the fields are input, mandatory, display or hidden.

8.6 Field Selection for MIGO

Menu path

Management ® Inventory Management and Physical Inventory ® Settings for Enjoy Transactions ® Settings for Goods Movements ®Field Selection for MIGO