- [Instructor] The next module we'll take a look at
is materials management or MM.
This is a logistics module that many other modules rely on
to keep the supply chain functioning.
Materials management ensures that there
are always the required materials in stock.
The key benefits of materials management are the way
it can help increase productivity and reduce costs
by handling materials efficiently.
The four major components of materials management in SAP
are material master data, purchasing, inventory management
and physical inventory.
First, we'll look at master data in materials management.
One component of MM master data are material master records.
They include a huge amount of information
about a specific material.
Next, our business partner records for suppliers.
These records document all the physical
and financial information pertaining
to the suppliers a company is working with.
Finally, we've got purchasing information records.
These act as the marriage between material information
and supplier information.
For example, a supplier's current price
of a particular material is stored
in the purchasing information record.
Let's look at a material master record in the system.
This is the basic data one screen of a material master
for material TTS five.
In our description field, we can see that this material
is a small titanium screw.
Our record also shows the base unit of measure.
In this case, our small titanium screws are sold by piece.
When we scroll down, we see the dimensions area that shows
that the net weight of each screw is 35 grams.
Across the top, where it says basic data one,
basic data two, purchasing, et cetera.
Each of these are tabs that has many fields
that allow for input.
These tabs have over 200 available fields.
There are a few required fields,
but a material master can be as detailed as a company needs.
The next MM module component we'll explore is purchasing.
This includes procurement activities,
like purchase requisitions and purchase orders.
Let's take a look at a purchase order in our system.
We're now looking at a standard purchase order
and we're in our delivery slash invoice tab.
We can see the vendor number and name.
This purchase order is for Indiana Supply Company.
And the date the order was created was March one, 2019.
The grid below shows line items of what was ordered.
It looks to be a raw material named RM20
and 500 pieces were ordered at a price of $1.23 per piece.
Inventory management and the MM module does exactly
what it says.
It manages the inventory.
Examples here include goods receipts from suppliers
and internal transfers, where we move a material
from one storage area to another.
Let's look at an inventory management report in the system.
This is an important inventory management report
that showing all the goods receipts at a particular plant.
In the first column, we have which material was received.
In the second column, we have our plant,
which is 17, 10.
In the third column, we have our storage location
within that plant.
The last three columns show us when the material
was received, how big the order was
and in what unit of measure.
Was it in pieces or eaches?
Closely tied to inventory management,
we've got physical inventory.
This is where physical inventory is documented.
Various inventory strategies can be implemented.
For example, a company may choose periodic inventory
where they count all inventory at a specified time.
Alternatively, a company may go with a process,
like cycle counts.
A cycle count is where a small sample of inventory
in one storage location is counted at a specific time.
Let's look at a physical inventory report
in our test system.
This is a report showing our physical inventory
for a specific material called small widgets.
At plant 1710 in storage location 171A,
we can see that our current stock 4,998 pieces
was last counted on June 11, 2019.
The last column shows that our inventory counts still needs
to be executed for our current period.
When used effectively, the materials management module
is a powerful tool to ensure an efficient supply chain.