Oracle application.docx

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SAP Application Material Management ModuleAmara Raja Batteries Limited

IT Management Assignment

By: Harpriya Goraya (F-088)

Sec- B


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Table of Contents

Introduction to SAP Application: ..........................................................................................................3

Different Modules Used in SAP: ........................................................................................................ 4

SAP mm (Material Management) Module: ....................................................................................4

How a new item is taken into account in SAP: ................................................................................... 5

Different Terminologies that are used in SAP for input and Output ..............................................6

Procure to Pay business process associated with the SAP MM module: ........................................7

Subcomponents of the SAP Materials Management (SAP MM) Module: ....................................7

How purchase takes place through SAP ....................................................................................... 10

How money is paid to the vendors ............................................................................................... 12

How SAP MM helps in the execution of Jobs in day to day Operations in Plant Maintenance: ..... 13

Manual System & Conclusion ........................................................................................................15


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Amara Raja Batterieshas selected IBM to implement a hardware platform to support its SAP implementation.

The company said, after careful evaluation, it chose IBM System Power6 570 servers with virtualisation, DS

4700 Storage and Tivoli middleware for its server and storage requirements.

Introduction to SAP Application:SAP stands for Systems Applications and Products in Data Processing. Designed and developed by 5 IBM

engineers during the 1970s as a standards based software alternative to custom built ERP software, SAP has

come a long way. SAP has been in the forefront of ERP software ever since.

SAP develops ERP products to be used by companies to manage their enterprise. This includes managing their

day to day operations, logistics, finances, month end, quarter end and yearly activities, reporting, HR etc.

Although there are a couple of other ERP vendors who do the same, the key differentiator for SAP is the way in

which SAP integrates all these operations and makes for a seamless system that is both easy to use and at the

same time sophisticated enough to include all kinds of complex activities that are needed for any kind of

enterprise. Examples of some of these activities could, be running Material resource planning, recruiting and

managing an employees lifecycle, disbursing payrolls, recording all financial transactions and drawing balance

sheets and P/L statements of the company etc. Now imagine a single system that takes care of all these diverse

activities and still keep them well integrated.

SAP was initially designed to be run on the mainframe and was called that release was called R/2 (Release 2).

SAP quickly caught on to the client server model with a later release called R/3 and this was the most popular

version of SAP. After R/3, later versions of their core software were launched called Enterprise Central

Component (ECC).

The automation needs of an enterprise are endless. SAP soon realized that corporations needed business

intelligence to mine data from their daily operational data and extract meaningful trends that could enable

further business opportunities. SAP BW was born and morphed into BI after buying out Business Objects (BO).

After the hugely successful R/3, SAP created more and more niche software like Customer Relationship

Management (CRM), SRM, XI (now called Process Integration or PI) and once again living up to the standards

of SAP by maintaining tight integration with their core ECC software.

Through the process of developing these software components, SAP has slowly moved from standard client

server architecture to a completely web-based architecture where every transaction can be run from just a

browser. These new dimension products developed on the web standards based framework (NetWeaver) are all

under new umbrella called mySAP.
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The SAP R/3 client/server system architecture is built around several modules or applications.

Different Modules Used in SAP:

A module is a set of transactions that deal with the same area of business functionality.

The current modules of SAP R/3 include:

FIFinance COControlling MMMaterials Management HRHuman Resources PMPlant Management PPProduction Planning LOLogistics SDSales and Distribution

One of the reasons for the success of SAP R/3 is the tight integration of the business applications.

One event in one module, such as materials, automatically triggers response in the others,

such as sales, finance, and plant maintenance. For instance, when a customer places an order, a purchase order is

created, an inventory is created, appropriate documents are created, and so on. This functionality is a major

advantage compared to that offered by other vendors who simply package the business functionality in one box

with limited integration .

SAP mm (Material Management) Module: SAP MM is the materials management module of the SAP ERP

software package from SAP AG that is used for Procurement Handling and Inventory Management. The module

has two important master data - material and vendor.

SAP Materials management covers all tasks within the supply chain, including consumption-based planning,

planning, vendor evaluation and invoice verification. It also includes inventory and warehouse management to

manage stock until usage dictates the cycle should begin again. It can be divided into five major components.

There are: materials management, plant maintenance, quality management, production planning and control, and

a project management system. Each is divided into number of subcomponents. SAP MM is all about managing

the materials i.e. the resources of an organization. These resources include method, manpower and materials.


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How a new item is taken into account in SAP:

Firstly, what happens when a new spare/ product is required to be procured from outside? This is a process

where we need to first identify the product which we need to purchase, create a purchase order and then raise

quotation from outside. Identification of the product is generally done by looking into the Cross-sectional

drawings of the machine and then identifying the specific part along with its specifications (This is called part

number) .On the basis of this product part number a 12 digit SAP Code is created. This SAP code is in fact the

product identification number. This purchase requisition which is created by using SAP gets

Step 1

We need to codify each new spare that comes to store after quality checking and inspection

Step2Codification is dependent on its part number mentioned on the Bill of Materials

Step 3

Code are generally 12 digited number which is created by a creation tool mm01

Step 4

Purchase Requisition is created with a tool me51N (Authorization)

Step 5

PR is released (an information is sent to procurement) me54N


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Different Terminologies that are used in SAP for input and Output:

In SAP the input can be my product name or specification, different tools of SAP like mmbe is used for stock

overview, ie03 is used for analyzing the details of the part number as indicated in the Model no. and similarly

inputs are the modes to create a notifications against the job that are require to be performed.

Output in SAP is generally PR number, Order Number that are generated against the required notifications.

It is a perfect tool where the Output is fixed for any particular notifications or PR raised. So, it becomes very

easy to analyze about the products that were used even in many years before.

Some of the tools used in SAP are indicated in the Table Below:

MMBE Stock Overview

MB51 Material Document List

MB03 Display Material Document

MB54 Vendor consignment stocks

CO09 Material Availability

MB5C Batch Where Used Pick Up List

ME54N PR is released (an information is

sent to procurement


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Procure to Pay, business process associated with the SAP MM module:

Subcomponents of the SAP Materials Management (SAP MM) Module:

Purchasing Inventory Management Logistics Invoice Verification Physical Inventory Material Valuation Material Requirements Planning (MRP) External Services Management


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