Pp-tscm40 1 Unit 1-2

TSCM40_I Planning / Manufacturing I SAP ERP - Production

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Instructor Handbook Course Version: 95 Course Duration: 10 Day(s) Material Number: 50099842 Owner: Frank Layer (D036000)

An SAP Compass course - use it to learn, reference it for work

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About This Handbook

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Icons in Body Text The following icons are used in this handbook. Icon

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Contents Course Overview ......................................................... vii Course Goals ...........................................................vii Course Objectives ...................................................... x

Unit 1: Course Overview ................................................. 1 Academy Overview .....................................................2

Unit 2: Overview of Master Data for Product Management and Manufacturing .............................................................. 9 Types of Data in SAP ERP .......................................... 11 Use of Organizational Data and Master Data in Production..... 20

Unit 3: Organizational Data in Supply Chain Management..... 37 Plants ................................................................... 38 Storage Locations..................................................... 45 MRP Areas............................................................. 53

Unit 4: Material Masters ................................................ 61 Overview of the Material Master .................................... 63 Creating a Material Master .......................................... 70 Classification of the Material Master ..............................102 Managing the Material Master......................................122

Unit 5: Bills of Material ................................................ 151 Overview of the Bill of Material .....................................152 Managing Bills of Material ..........................................167 BOM Reporting.......................................................195

Unit 6: Modeling the Manufacturing Process .................... 215 Modeling Manufacturing ............................................217 Basic Work Center Data and Defaults ............................224 Capacities in the Work Center .....................................245 Integrating Costing with the Work Center.........................257

Unit 7: Task Lists........................................................ 263 Overview of the Task List ...........................................265 Creating a Routing and Material Assignment ....................280 Suboperations and User-Defined Fields ..........................291 Reporting and Mass Changes......................................302

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Contents

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Unit 8: Advanced Bill of Material Functions ...................... 321 Phantom Assemblies ................................................323 Co-Products and By-Products......................................328 Discontinuation and Substitute Parts in the Bill of Material.....336 Multiple and Variant BOMS .........................................352 Mass Changes and the Product Structure Browser .............376

Unit 9: Advanced Routing Functions .............................. 387 Modeling Complex and Flexible Manufacturing Processes ....389 Modeling Alternative Manufacturing Processes..................400 Reference Operation Sets ..........................................412 Lead Time Scheduling and Material Master Updates ...........423 Time Components, Reduction Possibilities in the Routing .....432 Trigger Points in the Routing .......................................448 Scrap and Its Effects ................................................456 Production Resources/Tools........................................472

Unit 10: Alternative User Interfaces ................................ 485 Structure of the Engineering Workbench .........................487 Navigating in the Engineering Workbench .......................494 Engineering Workbench Work Areas..............................512 Introduction to the PLM Web User Interface .....................526

Unit 11: Appendix ....................................................... 549 Configuration of the Material Master ..............................551 Configuration of the Bill of Material ................................574 Configuring the Work Center ......................................590 Configuring the Routing .............................................622

Index ....................................................................... 635

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Course Overview The course TSCM40 teaches you how to work with master data (course week 1) and production planning (course week 2) in SAP ECC. The course material therefore consists of two course books: TSCM40_I and TSCM40_II. This course book TSCM40_I only deals with the content of the first week of TSCM40. The second week is covered by the course book TSCM40_II.

Target Audience This course is intended for the following audiences: •

Application consultants responsible for the implementation of planning as part of the SAP Business Suite in SAP ERP.

Course Prerequisites Required Knowledge • • • • •

SAP125 – SAP Navigation 2005 (e-learning) TERP01 – SAP ERP: Introduction (e-learning) TERP02 – SAP ERP: Introduction to SAP NetWeaver (e-learning) TERP51 – SAP ERP: Introduction to Processes in Material Planning (e-learning) TERP52 – SAP ERP: Introduction to Processes in Manufacturing Execution (e-learning)

Recommended Knowledge •

No additional knowledge required

Course Duration Details Unit 1: Course Overview Academy Overview

10 Minutes

Unit 2: Overview of Master Data for Product Management and Manufacturing 30 Minutes Types of Data in SAP ERP Use of Organizational Data and Master Data in 45 Minutes Production Unit 3: Organizational Data in Supply Chain Management 20 Minutes Plants

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Course Overview

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Storage Locations MRP Areas Unit 4: Material Masters Overview of the Material Master Creating a Material Master Exercise 1: Creating Material Masters Classification of the Material Master Exercise 2: Material Classification Managing the Material Master Exercise 3: Managing Material Masters

30 Minutes 45 Minutes 40 Minutes 30 Minutes 15 Minutes 45 Minutes 20 Minutes

Unit 5: Bills of Material Overview of the Bill of Material Exercise 4: BOM Basics Managing Bills of Material Exercise 5: Changing Bills of Material BOM Reporting Exercise 6: Multilevel BOM Reporting

45 Minutes 20 Minutes 45 Minutes 40 Minutes 20 Minutes 15 Minutes

Unit 6: Modeling the Manufacturing Process Modeling Manufacturing Basic Work Center Data and Defaults Exercise 7: Create a Work Center Capacities in the Work Center Exercise 8: Capacities in the Work Center Integrating Costing with the Work Center

30 Minutes 30 Minutes 15 Minutes 45 Minutes 15 Minutes 20 Minutes

Unit 7: Task Lists Overview of the Task List Exercise 9: Create a Simple Routing Creating a Routing and Material Assignment Exercise 10: Material Assignment and Component Allocation Suboperations and User-Defined Fields Exercise 11: Suboperations for Material-Specific Capacity Constraints Reporting and Mass Changes Exercise 12: Task List Changes with ECM Unit 8: Advanced Bill of Material Functions Phantom Assemblies Co-Products and By-Products Exercise 13: Co-Products in Production Orders Discontinuation and Substitute Parts in the Bill of Material Exercise 14: Substitute Items in Production Orders Multiple and Variant BOMS

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20 Minutes 15 Minutes

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20 Minutes 20 Minutes 30 Minutes 15 Minutes 25 Minutes 10 Minutes 15 Minutes 20 Minutes 30 Minutes 15 Minutes 20 Minutes 30 Minutes 20 Minutes 40 Minutes

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Course Overview

Exercise 15: Multiple/Alternative Bills of Material Exercise 16: Variant BOMs Mass Changes and the Product Structure Browser Exercise 17: Mass Changes and the Product Structure Browser Unit 9: Advanced Routing Functions Modeling Complex and Flexible Manufacturing Processes Exercise 18: Creating Alternative and Parallel Sequences Modeling Alternative Manufacturing Processes Exercise 19: Creating Alternative Routings and Production Versions Reference Operation Sets Exercise 20: Reference Operation Sets Lead Time Scheduling and Material Master Updates Exercise 21: Scheduling Time Components, Reduction Possibilities in the Routing Exercise 22: Time Elements of the Operation in Scheduling Trigger Points in the Routing Scrap and Its Effects Exercise 23: Scrap in Production Production Resources/Tools Exercise 24: Creating and Assigning PRTs Unit 10: Alternative User Interfaces Structure of the Engineering Workbench Navigating in the Engineering Workbench Exercise 25: Navigating in the EWB Exercise 26: Navigating in the EWB II Engineering Workbench Work Areas Exercise 27: Create a Work Area Introduction to the PLM Web User Interface Exercise 28: Using the PLM Web User Interface Unit 11: Appendix Configuration of the Material Master Exercise 29: Material Types, Field Control and Material Status Configuration of the Bill of Material Exercise 30: Bill of Material Configuration Configuring the Work Center Exercise 31: Work Center Category and Field Selection Control, Default Work Center (Optional) Exercise 32: Optional: Work Center Formulas

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15 Minutes 20 Minutes 20 Minutes 10 Minutes

20 Minutes 20 Minutes 20 Minutes 30 Minutes 20 Minutes 20 Minutes 30 Minutes 20 Minutes 30 Minutes 30 Minutes 30 Minutes 25 Minutes 20 Minutes 20 Minutes 10 Minutes 40 Minutes 45 Minutes 30 Minutes 35 Minutes 20 Minutes 20 Minutes 30 Minutes 20 Minutes 60 Minutes 30 Minutes 30 Minutes 15 Minutes 45 Minutes 20 Minutes 30 Minutes

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Course Overview

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Configuring the Routing

45 Minutes

Course Goals This course will prepare you to: • •

Understand the general handling of logistics master data in SAP ECC Understand and describe the positioning, integration, and functions of the planning area within the SAP ERP application

Course Objectives After completing this course, you will be able to: •

Use the relevant master data elements for the modelling of planning and production processes Evaluate, describe, and implement the options provided by SAP-ERP-based planning

•

SAP Software Component Information The information in this course pertains to the following SAP Software Components and releases: • •

SAP ERP Central Component 5.0 SAP ERP Central Component 6.05

Important Information It is strongly recommended to check necessary information published on the SAP Service Market Place. All information essential for course preparation like instructor guides, system setup guides, trouble shooting guides, logon information, and so on, you will find under the alias /curr-info (http://service.sap.com/curr-info). In case you cannot access this site please ask the responsible education coordinator (the sender of this document) to make the relevant information available to you.

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Unit 1 Course Overview

1

Welcome the participants to the first week of the course and introduce yourself and briefly the overall course content and objectives. Familiarize the participants with the course schedule. Ask the participants to introduce themselves.

Unit Overview The academy course TSCM40 operates exclusively within SAP ECC as far as content, demonstrations, and exercises are concerned, dealing with the master data background and production planning process in the system. The course builds on the basics contained in the according e-learning sessions. As an introduction, the course contents are outlined.

Unit Objectives After completing this unit, you will be able to: •

Give an overview of the scope of the training

Unit Contents Lesson: Academy Overview......................................................2

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Unit 1: Course Overview

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Lesson:

Academy Overview

2

Lesson Duration: 10 Minutes

Lesson Overview This lesson provides an overview of the training required for the Application Associate Planning & Manufacturing with SAP ERP 6.0.

Lesson Objectives After completing this lesson, you will be able to: •

Give an overview of the scope of the training

Provide the participants with a brief overview of the academy course. Refer to the e-learning courses that the participants should already have attended.

Business Example Basic Training The training courses TSCM40 (Planning/Manufacturing I) and TSCM42 (Planning/Manufacturing II (including case study)) provide the participants with knowledge of the business processes of planning and manufacturing in a basic training geared towards manufacturing companies. In the training course TSCM40 (Planning/Manufacturing I), you learn about the master data required for production (material masters, bills of material, work centers, routings, etc.), including master data management, as well as about the concepts and business processes of selected planning areas. The course deals with the processes of production planning using material requirements planning (ERP-PP-MRP module), as well as the different planning strategies for creating a master plan. The course also demonstrates evaluation methods for evaluating the planning results. The follow-up training course TSCM42 (Planning/Manufacturing II (including case study)) teaches you the different options for controlling production. This includes order-based production with production orders or process orders, repetitive manufacturing, and Kanban. These options provide effective support for the complete manufacturing process including the process steps of material staging, sequencing, creation of shop floor papers, confirmation, goods receipt, and settlement of production activities. The focus is set on production order management. An overview is provided of the other options named above.

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Lesson: Academy Overview

Moreover, the training course also contains a summary of capacity planning as well as a case study. The latter allows you to apply the knowledge you have acquired by configuring specified integrated business processes. The training course ends with an exam (certification C_TSCM42_65). The following diagram provides an overview of the scope of the training.

Figure 1: Consultant Profile Application Associate - Planning & Manufacturing with SAP ERP 6.0: Basic Training

Alternative project team training The training materials for the Solution Academy are predominantly based on the corresponding standard training course, but are supplemented by topics that are relevant for consultants. The following table shows the topics that were taken from the standard training course and the topics that are dealt with in addition: Note that the e-learning courses are not included in this overview.

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Unit 1: Course Overview

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Solution Academy Training

Course Content

TSCM40 (Planning/Manufacturing I)

5 days PLM114 (Basic Data) 5 days SCM240 (Production Planning (ERP))

TSCM42 (Planning/Manufacturing II (incl. Case Study))

4.5 days SCM310 (Production Orders) 0.5 days KANBAN from SCM300 (Production Overview) 1 day from SCM365 (Capacity Planning (ERP)) 1 day Repetitive Manufacturing and Process Manufacturing from SCM300 (Production Overview) 2.5 days Integrated Case Study (academy only!) 3 hours Certification Exam C_TSCM42_65

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Lesson: Academy Overview

Facilitated Discussion Optional

Discussion Questions Use the following questions to engage the participants in the discussion. Feel free to use your own additional questions.

Ask the customers who is intending to take the Certification Exam.

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Lesson Summary You should now be able to: • Give an overview of the scope of the training

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Unit Summary

Unit Summary You should now be able to: • Give an overview of the scope of the training

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Unit Summary

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Unit 2 Overview of Master Data for Product Management and Manufacturing

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This unit is designed as an introduction to the use of master data in production planning and execution in SAP ERP. Participants might have taken SCM100/SCM300 or SCM130 to have a more detailed overview of the Planning and execution functions in SAP ERP. This section is designed as a refresher for those participants and enlighten participants who have not taken the necessary prerequisites.

Unit Overview This unit introduces you to how master data will be used in supporting the SAP ERP production planning and execution process. The different master data and organizational data are discused at a summary level. Each object will be covered in more detail in following lessons.

Unit Objectives After completing this unit, you will be able to: • • • • •

Describe the types of data used in modeling and executing manufacturing in SAP ERP Identify the production planning organizational units (configuration) Identify the procurement organizational units Identify the Sales and Distribution organizational units Identify the production planning master data objects

Unit Contents Lesson: Types of Data in SAP ERP ........................................... 11 Demonstration: Configuration in SAP ERP .............................. 12 Procedure: Configuring SAP ERP ........................................ 14 Demonstration: Production Planning Master Data ...................... 15 Demonstration: Transactional Data ....................................... 16

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Lesson: Use of Organizational Data and Master Data in Production ..... 20 Demonstration: Organizational Structures in SAP ERP................ 25 Demonstration: Views and Fields in the Material Master .............. 28 Demonstration: BOMs ...................................................... 29 Demonstration: Work Centers ............................................. 31 Demonstration: Routings ................................................... 32

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Lesson: 8

Lesson: Types of Data in SAP ERP

Types of Data in SAP ERP Lesson Duration: 30 Minutes

Lesson Overview In this lesson we will discuss the different types of data that users and project team members will deal with during an implementation and after go live.

Lesson Objectives After completing this lesson, you will be able to: •

Describe the types of data used in modeling and executing manufacturing in SAP ERP

This section is designed for true beginners. If you have an experienced class, gloss over the material at high level. This will be an introduction to configuration.

Business Example Your company, Precision Pumps, has just purchased SAP ERP to efficiently run your business. As a member of the project team in a company that manufactures pumps, you are responsible for the introduction of basic data for manufacturing. The defined basic data will be used in the procurement, scheduling, manufacturing, and costing of all components and products necessary for the manufacturing of pumps. You must introduce the basic concepts of configuration in SAP ERP, as well as master data and organization data.

Data Types in SAP ERP When dealing with a software system as robust as SAP ERP, you need to have perspective on how your business will be modeled in a software environment. In SAP ERP, users will have essentially three types of data: • • •

Configuration data Master data Transactional data

Configuration Data Configuration data is often referred to as one-time data. This means that the data should not change, but if it does it will be tracked or controlled.

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Figure 2: Configuration in SAP ERP

During an implementation, the SAP ERP landscape will typically consist of three servers: DEV (development), QA (quality assurance), and PROD (production). Each server may have several clients. The DEV server is where a sandbox client will exist, as well as the golden client, where the final configuration resides. During the project, team members will try different iterations of configuration in the sandbox client and test the results. If the results meet the organizations requirements, they are configured again in the golden client. From there, the Basis team moves it to the QA server for further evaluation. The Basis team will us a tool called the Change and Transport System (CTS). This allows them to track the configuration changes from DEV to QA, and QA to PROD. Once the configuration changes are moved to the QA server, integration testing will take place within the PP module and within the other applications in SAP ERP, such as materials management (MM) and Sales and Distribution (SD), for example. Once fully tested in the QA system, the configuration will be transferred to PROD, or the production server/client.

Demonstration: Configuration in SAP ERP Purpose Show New Project Team members how to Access IMG

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Lesson: Types of Data in SAP ERP

System Data System: Client: User ID: Password: Set up instructions: 1. Show students Transaction code SPRO. Do not bother to show menu path as it seems to change for every new release.

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2.

Select Reference IMG

3.

follow menu path : Production → Basic Data → Bill of Material → Control Data for Bill of Material → Define Default Parameters

4.

Explain Configuration

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Configuring SAP ERP 10

1.

Enter transaction code SPRO.

2.

Select Reference IMG.

3.

Choose Production → Basic Data → Bill of Material → Control Data for Bill of Material → Define Default Parameters.

Master Data in SAP ERP Configuration will be the foundation upon which most master data will be built. Master data is often referred to as “slowly changing” data. This means the data of a particular object does not change all the time, but often several times a year.

Figure 3: Master Data

Master data in SAP ERP is a centralized function. This means that the data is be intended to be stored once and replication is to be avoided. The master data that will be used for production planning in SAP ERP is as follows: • • • • •

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Material masters Bills of material Work centers Task lists/routings Cost centers

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Lesson: Types of Data in SAP ERP

Business users will be limited to creating, changing, or displaying data based on their role within the organization. During implementations, each business must determine how the Product Lifecycle Management (PLM) process within SAP ERP will integrate with their specific business processes. As organizations change, so must the master data to support the business; this needs to be modeled properly within the SAP ERP environment.

Demonstration: Production Planning Master Data Purpose

System Data System: Client: User ID: Password: Set up instructions: 1. Show users the menu paths they will be using over the next several days. 2.

Follow Menu path : Logistics → Production → Master Data

3.

Point out the folders for the material master, Bill of material, Work Center and Routing.

Transactional Data Every day, businesses perform tens of thousands of transactions that make the business function. Some transactions are directly related to outside events with customers or suppliers. Other events are internal to the business and affect the interaction between departments within a business or division.

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Figure 4: Transactional Data

Within SAP ERP, all transactional data is related to some form of master data or configuration data. In the world of production planning, you will be executing planning runs that will be generating replenishment suggestions, generating production execution directions, or executing production confirmations. In SAP ERP production planning, all transactional data typically revolves around the material master, bill of material, or routing. In this class you will learn how master data works; however you may be asked to analyze how it works in conjunction with day-to-day business events or transactions, such as a production order.

Demonstration: Transactional Data Purpose Demonstrate creating a production order and the need for master data

System Data System: Client: User ID: Password: Set up instructions: 1. Follow menu path: Logistics → Production → Production Control → Order → Create → With Material

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Lesson: Types of Data in SAP ERP

2.

Enter material T-F200, plant 1000, order type PP01. Select Enter

3.

Enter 10 pcs and enter a finish date of on month from today. Select Enter

4.

Show customers the Material master , Bill of Material, Routing and work centers.

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Facilitated Discussion

Discussion Questions Use the following questions to engage the participants in the discussion. Feel free to use your own additional questions.

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Lesson: Types of Data in SAP ERP

Lesson Summary You should now be able to: • Describe the types of data used in modeling and executing manufacturing in SAP ERP

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Lesson: 13

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Use of Organizational Data and Master Data in Production Lesson Duration: 45 Minutes

Lesson Overview In this lesson you will be exposed to organizational data and its potential impact on production planning in SAP ERP.

Lesson Objectives After completing this lesson, you will be able to: • • • •

Identify the production planning organizational units (configuration) Identify the procurement organizational units Identify the Sales and Distribution organizational units Identify the production planning master data objects

This lesson is designed for new customers that have never worked SAP ERP or production planning. If class participants are knowledgeable in SAP ERP use this as an overview and move through the material quickly. Note: We have included information about other application organizational levels as students will come across the objects within the PP master data. It is collateral information only. If they wish to know more about SD organizational structures suggest SCM600. If they wish to know more about MM organizational Structures suggest SCM500.

Business Example As a member of the project team, you must understand how organizational structures, production planning, and master data are used to develop an organizational plan to support existing and future business.

Organizational Objects in Production Planning The foundation of the SAP ERP system is the organizational structure that will be configured at the early stages of your company’s implementation of the software. All other configuration or master data will be built on top of the organizational structures.

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Lesson: Use of Organizational Data and Master Data in Production

Figure 5: Organizational Structure

To better understand the structure, you must familiarize your self with several definitions: Client The client is a unit within an SAP ERP system that is self-contained both in legal and organizational terms, and in terms of data, with separate master records and an independent set of tables. From a business viewpoint, the client represents a corporate group, for example. The client is the highest hierarchical level in the SAP ERP system. Specifications or data that you make and enter at this level apply to all company codes and all other organizational units. Therefor, you do not have to enter the specifications and data in the system at client level more than once. This ensures a uniform data status. Access authorization is assigned on a client-specific basis. A user master record must be created for every user in the client in which he or she wishes to work. If the Client field has not been prepopulated, each user must specify a client key when logging on to an SAP ERP client. The client key is uniquely defined in the system and is a three-digit number. In this way, the user specifies the client in which he or she wishes to work. All user input is stored and separated by client. The processing and evaluation of data is likewise carried out on a client-specific basis.

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Company code A company code is the smallest organizational unit of external accounting for which a complete, self-contained bookkeeping system can be replicated. This includes the entry of all events that require posting to the accounts and the creation of a complete audit trail for balance sheets and profit-and-loss statements. A company code represents an independent unit producing its own balance sheet, for example, a company within a corporate group (client). You can set up several company codes in one client in order to keep separate sets of financial books. You can use a special Customizing function to copy a company code. In the process, company-code-dependent specifications are adopted for your new company code. A company code is defined in the system by means of a four-character alphanumeric key that is unique in the client. Plant The plant is an organizational unit within logistics that subdivides an enterprise from the viewpoints of production, procurement, and materials planning. Storage Location The storage location is an organizational unit that facilitates the differentiation of stocks of materials within a plant. Inventory management on a quantity basis is carried out in the plant at storage-location level. The physical inventory is also carried out at this level. A storage location is defined by means of a four-character alphanumeric key that is unique in the plant. Organizational units are tightly linked to each other to quickly process the relevant data for a business area. For example: Plant

1000 is assigned to

company code

1000

Company code

1000 is assigned to

controlling area

1000

Therefore, whenever a transaction involving cost occurs in plant 1000, the relevant records in controlling area 1000 are automatically updated. The valuation area is the organizational level at which material quantities and values are managed. It is essential for product costing that a valuation area exists for each plant. Within each valuation level, you can differentiate between values and quantities for valuation (in-house production and external procurement) by using different valuation types. In Customizing for materials management (define valuation type), balance sheet valuation is set up at company-code or valuation-area level. Selection of valuation-area level automatically causes the creation of a valuation area for each plant. To use product costing and order costing, inventory must be valuated at plant level.

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Lesson: Use of Organizational Data and Master Data in Production

Purchasing Organization Outside of production planning, other areas of the SAP ERP system need additional configuration to support their specific functional needs. In addition to the client and company code requirements, purchasing requires an additional organizational structure.

Figure 6: Purchase Organization

A purchasing group is a key for a buyer or a group of buyers who are responsible for certain purchasing activities. Internally, the purchasing group is responsible for the procurement of a material or class of materials. Externally, it is the principal channel for an enterprise’s dealings with its vendors. Note: The purchasing group is not assigned to other units of the enterprise structure in SAP ERP. Purchasing groups are not defined in Customizing for the enterprise structure, but in Customizing by choosing Materials Management → Purchasing → Create Purchasing Groups. The purchasing organization is an organizational unit within logistics that subdivides the enterprise according to the purchasing requirements. A purchasing organization procures materials or services, negotiates conditions of purchase with vendors, and assumes responsibility for these transactions.

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You can incorporate purchasing into the company structure by assigning the purchasing organization to a company code and to plants. This means that you can take into account whether purchasing is organized on a centralized or decentralized basis in your company. You can have a combination of these two organizational forms. You can assign several purchasing organizations to one company code. However, a certain purchasing organization can only belong to one company code. You can decide not to assign the purchasing organization to a company code (cross-company-code purchasing). There is an m:n relationship between purchasing organizations and plants. In other words, you can assign several plants to one purchasing organization, and one plant to several purchasing organizations.

Sales Organization Similar to the purchasing side of an organization, the group responsible for sales has additional unique business requirements.

Figure 7: Sales Organization

The sales organization is responsible for selling and distributing goods and services. It is liable for the products sold and responsible for a customer’s rights of recourse. The sales organization can be used to represent a regional, national, or international subdivision of a marketplace in which products are sold. A sales organization is uniquely assigned to a company code, however a company code may have more than one sales organization assigned to it. If the Sales and Distribution module is used, at least one sales organization must be defined. The sales organization is the highest summation level in sales statistics. Customer master data will be created for each sales organization. Documents created throughout the Sales and Distribution process (order, delivery, and billing document) will belong to a sales organization.

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Lesson: Use of Organizational Data and Master Data in Production

A distribution channel is a means through which saleable materials or services reach the customer. A distribution channel is assigned to a sales organization. A sales organization may have more than one distribution channel assigned to it. If the Sales and Distribution module is used, at least one distribution channel must be defined and assigned to a sales organization. A distribution channel allows customers to be treated differently depending on the channel they are assigned to. For example, a customer assigned to a wholesale distribution channel may receive preferred pricing compared to a retail distribution channel customer. A sales organization can have several divisions assigned to it, but must have at least one division. A division is used to group materials and services. A division can represent a product group or product line, which allows: • •

Restricted price agreements to a certain division Statistical analysis by division

A sales area is a unique and allowable combination of a sales organization, distribution channel, and division. Each Sales and Distribution document is assigned to exactly one sales area. This assignment cannot be changed. A sales area can belong to only one company code. This relationship is created by the assignment of the sales organization to the company code in Customizing. The shipping point is the organizational element that manages your shipping activities. Each outbound delivery is processed at a shipping point. A shipping point can be a physical location, for example, a loading dock, a mail room, or a railroad depot. It can also be a logical location, for example, a group of employees responsible for processing next-day deliveries or less-than-truckload orders. Shipping points are assigned to plants. A shipping point should have physical proximity to the plant to which it is assigned. More than one shipping point can be assigned to a plant. Several plants can also have a shared shipping point assigned to them, for example, several plants in same physical proximity sharing the same railroad depot.

Demonstration: Organizational Structures in SAP ERP Purpose Show participants how org structures are assigned.

System Data System: Client: User ID:

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Unit 2: Overview of Master Data for Product Management and Manufacturing

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Password: Set up instructions: 1. Follow Menu Path: SPRO → Enterprise Structure → Assignment → Logistics-General → Assign Plant to Company Code → 2.

Assign Business Area to Plant/Valuation Area...

3.

SPRO → Enterprise Structure → Assignment → Sales and Distribution → Assign Sales Org to Company Code...

4.

SPRO → Enterprise Structure → Assignment → Materials Management → Assign Purchasing Org to Company Code...

Master Data Objects in Production Planning Once your company has established an organization structure, the different business areas can proceed with developing the application-specific master data to activate the necessary functionality required to run the day-to-day activities of your business.

Figure 8: Master Data for Production Planning

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Lesson: Use of Organizational Data and Master Data in Production

Within the PP application, several pieces of master data are required to carry out planning and execution functionality. The following master data objects are required to initiate planning and execution functions in SAP ERP: • • • •

Material master Bill of material Work center Routing/task list

Material Masters Material Master Record: Definition The material master contains information on the materials that a company constructs, procures, manufactures, stores, and sells. The information is stored in a database that is a central source of data on materials. The material master record integrates data from different areas of a company.

Figure 9: Material Masters in SAP ERP

For the company, the material master record represents the central source for data on materials. The material master is used by various SAP logistics applications. The material can be a finished product (product or article), a semi-finished product (subassembly), or a raw material (purchased part).

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Unit 2: Overview of Master Data for Product Management and Manufacturing

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Demonstration: Views and Fields in the Material Master Purpose Demonstrate the material master

System Data System: Client: 8## User ID: Password: Set up instructions: P-100 in plant 1000 1. Show material P-100 in plant 1000. Follow menu Path: Logistics → Production → Master Data → Material Master → Material → Change → Immediately

Bills of Material A bill of material (BOM) is a complete, formally structured list of the components that make up a product or assembly. The list contains a description and object number for each component, together with the quantity and unit of measure. Bills of material can exist at the plant and/or client level. The header and components all contain validity dates that can be affected using Engineering Change Management.

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Lesson: Use of Organizational Data and Master Data in Production

Figure 10: Bills of Material In SAP ERP

Bills of material will be integrated with the material master and can be used in conjunction with routing to schedule a more precise usage point. These BOMs are used in material requirements planning, production, procurement, and product costing. A BOM consists of header material and BOM items (components). The base quantity in the header material specifies the finished production quantity on which the component quantities are based. BOM items indicate individual parts and assemblies, which are identified by their material numbers. BOMs are single level. A BOM item can also contain components, so that multi-level production can be described by the single-level BOMs from the finished product, assemblies, or assemblies of the assemblies (and so on). In addition to stock items, which flow into the finished product, a BOM can also contain documents or text items.

Demonstration: BOMs Purpose In the BOM P-100 show the BOM header and the components with their item categories.

System Data System: Client: User ID:

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Password: Set up instructions: 1. In the BOM P-100 show the BOM header and the components with their item categories. Show material P-100 in plant 1000. Follow menu Path: Logistics → Production → Master Data → Bills of Material → Bill of Material → Material BOM → Change

Work Centers A work center is a location that defines when and where production resources are required according to order requirements. In different companies, work centers are also called machine, labor, or capacity centers.

Figure 11: Work Centers in SAP ERP

Work centers can be defined as individual or multiple machines, people, tools, and so on. Work centers are used in routings (routings, standard networks, inspection plans, maintenance task lists, and rough-cut planning profiles) and in orders.

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Lesson: Use of Organizational Data and Master Data in Production

Demonstration: Work Centers Purpose Where to find work centers.

System Data System: Client: 8## User ID: Password: Set up instructions: 1. Show Work Center 1310 in plant 1000. Follow menu Path: Logistics → Production → Master Data → Work Center → Work Center → Change

Task Lists and Routings A routing defines operations and the sequence in which they are carried out. The following is also defined in the routing: • • • •

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Where the work is to be done How long the work should take What materials are needed for each operation What tools and fixtures are required

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Figure 12: Routings in SAP ERP

A routing shows operations in a sequence and acts as a template for production orders. Each step defines the work center in which specific work will be accomplished. The planned time for each operation is stored in the routing as a standard value. These standard values are the basis for: • • •

Lead time scheduling Product costing Capacity planning

Demonstration: Routings Purpose

System Data System: Client: User ID: Password: Set up instructions:

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Lesson: Use of Organizational Data and Master Data in Production

1.

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Show Routing P-100 in plant 1000. Follow menu Path: Logistics → Production → Master Data → Routings → Routings→ Standard Routing → Change

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Unit 2: Overview of Master Data for Product Management and Manufacturing

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Facilitated Discussion Perform overview of lesson.

Discussion Questions Use the following questions to engage the participants in the discussion. Feel free to use your own additional questions. • •

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What are the PP-relevant organizational elements? Describe how master data objects are dependant on one another.

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Lesson: Use of Organizational Data and Master Data in Production

Lesson Summary You should now be able to: • Identify the production planning organizational units (configuration) • Identify the procurement organizational units • Identify the Sales and Distribution organizational units • Identify the production planning master data objects

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Unit Summary

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Unit Summary You should now be able to: • Describe the types of data used in modeling and executing manufacturing in SAP ERP • Identify the production planning organizational units (configuration) • Identify the procurement organizational units • Identify the Sales and Distribution organizational units • Identify the production planning master data objects

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