What is SAP MM?
SAP MM (Materials Management), an important module of the SAP ERP Central Component, (ECC), provides organisations with material, inventory, and warehouse management capabilities. SAP MM’s primary function is to ensure that all materials are kept in the correct quantities, at the right places, and in the right order. It makes sure that there are no supply shortages or gaps in an organisation’s supply chain. It assists inventory managers, warehouse managers, and other supply chain professionals in the timely and economical purchase of raw materials.
Material management is one of the most challenging areas for organisations. SAP MM gives organisations complete control over their workforce, machines, and materials. This helps them improve their inventory, supply chain, and warehouse management. SAP MM allows organisations to streamline production, logistics, and supply chains to ensure that materials are delivered to customers quickly and economically. SAP MM is a key module in the SAP ECC’s logistic function. It integrates with other modules such as Production Planning (PP), Sales and Distribution(SD), Human Capital Management, (HCM), and Quality Management (QM).
SAP MM stands for System, Applications, and Products – Material Management. It is one of the most important modules in SAP and is used by many companies. SAP MM is responsible for the storage and procurement of materials and their effective use in businesses. SAP MM’s main goal is to increase productivity and decrease costs. This module ensures that there is always enough material and that the entire inventory system works efficiently.
SAP MM (Material Management), handles Material Valuation and Procurement Processes, Purchase orders, Master Data Management, and Invoice Verification. Master Data Management also manages accounts payable, finished goods management, raw material, cost-effectiveness, and In-time access to the material. This article will provide an overview of SAP Material Management and its components.
Benefits of SAP MM Module
- Reduce the costs of operations
- Inventory losses can be reduced by removing obsolete or unnecessary material.
- Material management and procurement activities automatically make a process more efficient and smoother.
SAP S4HANA Logistics was launched recently by SAP. It covers the entire production lifecycle of a business. SAP Material Management is an important process in SAP S4HANA Logistics. Due to its popularity and widespread use, SAP S4 HANA Logistics is a popular career option. SAP MM online training was launched after the launch of S4 HANA logistics. This is because people are looking for a job in SAP or to advance their knowledge in SAP S4 HANA logistics.
SAP MM (Materials Management), is a module within SAP ERP (Enterprise Resource Planning). Materials Management is a key supply chain function that includes capabilities for supply chain planning, execution, and management.
It is the process used by companies to determine complete specifications for materials and to communicate those specifications to procurement.
Materials Management also has the responsibility of deciding how much material is to be transported to each storage site and developing replenishment plans.
SAP Logistics includes the SAP Materials Management module (MM). It has many different areas that are connected to the movement of materials from the manufacturer to and customer.
Logistics is the process of acquiring, storing, transporting, and delivering goods throughout the supply chain. Materials Management encompasses many aspects of SAP functionality, including ordering, processing products, and inventory. Materials Management’s main goal is to ensure that the supply chain is in place, that there is enough inventory, and that there are fewer deviations between actual and planned results.
Materials Management’s objective is to ensure that customers have a continuous supply of manufacturing components in order to deliver their products on time. Materials management is responsible for releasing goods to a supply base and ensuring that goods are delivered to customers on time with the appropriate carrier.
SAP Materials Management streamlines the Procurement Process. Invoice Verification, Account Determination, Valuation, and Inventory Management. Material Requirement Planning is also possible. Master Data (Material & Vendor Masters) are all included.
In certain industries, the management of materials includes the procurement of materials and the management of a supply source. A separate purchasing department is responsible for managing the supply base and procuring materials for other companies. The variances in the purchased prices are then managed by the purchasing department.
Sub-Components for MM
The SAP S/4HANA Materials Management module (MM) is the most important of all modules within SAP. There are many components to the SAP MM module. Here are the most important ones:
- Master data
- Inventory management
- Invoicing verification
- Physical inventory
- Material valuation
- Service management
The Materials Management module contains the most extensive sub-component master data. They include purchasing and inventory management.
Master data track each transaction in the data. The MM Master Data includes vendor master, material master, and purchasing master.
Materials Management is incomplete without purchasing. MM Purchasing tasks involve external procurement of materials or services, determining possible sources of supply, monitoring supply, and paying vendors.
This module also handles all material procurement-related activities, such as purchase orders, quote requests, purchase requests, procurement requests,s and release procedures. It also includes outline agreements, contracts, and timing agreements.
This module manages inventory management activities, including inventory receipt, internal transit (material movements), and the question of inventory. This module also includes Reservations.
Verification of Invoice
This Invoice Verification Configuration area is responsible for all activities related to invoicing, such as Invoice Receipt From Vendors, Automated Invoices, and Direct Posting For Materials.
Physical inventory is the storage area. It includes activities like cycle count, post difference, inventory session, and cycle count.
The material valuation includes all activities, such as material price changes, and various types of valuation like LIFO, FIFO, and lowest value.
Service management can include activities like service master and service entry sheets.
Types of SAP MM procurements
Let’s look at two types of procurements within the SAP MM module.
Basic procurement is the process of purchasing the right materials and services at the best prices. Basic procurement includes the following steps:
Gathering information: This is the first step in the procurement process. The module contacts the relevant suppliers depending on how many products.
Contact Suppliers: The selected suppliers will fulfill the orders based on demand.
Services and products: The materials management team grades products and services on the basis of their performance. The team may contact the same suppliers to place repeat orders, or they may contact new suppliers based on the product’s rating.
Special procurement is the purchase of products that are not part of the company’s business. There are many types of unique stock and special procurement.
Consignment stocks are items that are not yet available in the store.
Third-party processing. The seller forwards the orders to the vendor, who then delivers the product to the customer.
Pipeline handling: Even after the customer places an order, the vendor keeps the material in stock at their premises. The seller receives the material from the vendor when a customer places an online order and delivers it to him.
What does the future hold for SAP S/4HANA-MM?
The SAP S/4HANA MM is the next-generation ERP that integrates all SAP modules. SAP S/4HANA’s HANA database improve the ERP’s efficiency and the Materials Management sub-components.
Materials Management customers were able to use the SAP S/4HANA product on-premise and cloud for business transactions. Many businesses and industries around the globe are moving to incorporate SAP modules into their systems.
In many ways, the SAP MM module incorporation is beneficial. It lowers inventory losses, improves product delivery, reduces material costs, and many other benefits.
APTRON Noida offers a variety of MM courses to help you gain exposure to Materials Management. In-depth SAP training will be provided and you will have access to SAP S/4HANA.
Are you looking for SAP MM Course?
Learn more about Materials Management? The best place to begin your journey in SAP MM is our SAP Materials Management Courses. Many people want to learn SAP MM Training because of the growing demand for SAP software. Although there are many SAP training centers in Delhi NCR, APTRON Noida offers the best online SAP training. They offer SAP MM course at a very affordable price.