SAP SD & SAP MM has similar functionality
SD Basically deal with Customer whereas MM deal
with Vendor
So it’s good to have some MM Knowledge as well
SAP MM (Material Management) 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.
MM module contains many aspects such as
purchasing, goods receiving, material storage, consumption-based planning, and
inventory. SAP 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).
It supports all phases of materials management
materials planning and control, purchasing, goods receiving, inventory
management, and invoice verification.
Procurement
in Materials Management
MM Process flow
The typical procurement cycle for a service or
material consists of the following phases:
1. Determination of
Requirements
Materials requirements are identified either in
the user departments or via materials planning and control. (This can cover
both MRP proper and the demand-based approach to inventory control. The regular
checking of stock levels of materials defined by master records, use of the
order-point method, and forecasting on the basis of past usage are important
aspects of the latter.) You can enter purchase requisitions yourself, or they
can be generated automatically by the materials planning and control system.
2. Source Determination
The Purchasing component helps you identify
potential sources of supply based on past orders and existing longer-term
purchase agreements. This speeds the process of creating requests for quotation
(RFQs), which can be sent to vendors electronically via SAP EDI, if desired.
3. Vendor Selection and
Comparison of Quotations
The system is capable of simulating pricing
scenarios, allowing you to compare a number of different quotations. Rejection
letters can be sent automatically.
4. Purchase Order
Processing
The Purchasing system adopts information from
the requisition and the quotation to help you create a purchase order. As with
purchase requisitions, you can generate Pos yourself or have the system
generate them automatically. Vendor scheduling agreements and contracts (in the
SAP System, types of longer-term purchase agreement) are also supported.
5. Purchase Order Follow-Up
The system checks the reminder periods you have
specified and - if necessary - automatically prints reminders or expediters at
the predefined intervals. It also provides you with an up-to-date status of all
purchase requisitions, quotations, and purchase orders.
6. Goods Receiving and
Inventory Management
Goods receiving personnel can confirm the
receipt of goods simply by entering the Po number. By specifying permissible
tolerances, buyers can limit over- and under deliveries of ordered goods.
